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Maeda v. Pinnacle Foods Inc.

United States District Court, D. Hawaii

May 9, 2019

MCHAEL MAEDA and ILIANA SANCHEZ, individually and on behalf of all others similarly situated, Plaintiffs,
v.
PINNACLE FOODS INC.; DOES 1 THROUGH 50, Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT PINNACLE FOODS INC.'S MOTION TO DISMISS PLAINTIFFS' CLASS ACTION COMPLAINT

          Jill A. Otake, Judge

         This putative consumer class action arises out of the sale and marketing of Defendant Pinnacle Food Inc.'s (“Defendant”) Hawaiian brand snacks, including:

         Hawaiian Kettle Style Potato Chips, Original; Hawaiian Kettle Style Potato Chips, Luau BBQ; Hawaiian Kettle Style Potato Chips, Sweet Maui Onion; Hawaiian Kettle Style Potato Chips, Ginger Wasabi; Hawaiian Kettle Style Potato Chips, Hulapeno; Hawaiian Kettle Style Potato Chips, Mango Habanero; Hawaiian Luau Barbeque Rings; and Hawaiian Sweet Maui Onion Rings (collectively “Hawaiian Snacks”). Plaintiffs allege that they purchased these snacks due to false and deceptive labeling, packaging, and advertising, which misled them into believing that the snacks are made in Hawai‘i from local ingredients.

         Defendant moves to dismiss this action for lack of personal jurisdiction, lack of actionable misrepresentation as to the consumer protection claims, failure to state a claim, and lack of standing. For the reasons articulated below, the Court GRANTS IN PART AND DENIES IN PART Defendant's Motion to Dismiss Plaintiffs' Class Action Complaint. ECF No. 11.

         BACKGROUND

         Plaintiffs commenced this action on October 12, 2018 in the Circuit Court of the First Circuit, State of Hawai‘i. Defendant removed the action on November 23, 2018. Plaintiffs allege that although the Hawaiian Snacks are manufactured in Algona, Washington, Defendant markets them in such a manner as to mislead consumers into believing that they were manufactured in Hawai‘i.

         Plaintiffs assert the following claims: (1) violation of Hawai‘i's made in Hawai‘i statute (Haw. Rev. Stat. § 486-119); (2) violation of Hawai‘i's Uniform Deceptive Trade Practices Act (Haw. Rev. Stat. Chapter 480); (3) violation of Hawai‘i's false advertising law (Haw. Rev. Stat. § 708-871); (4) violation of California's Consumers Legal Remedies Act (Cal. Civil Code § 1750); (5) violation of California's unfair competition law (Cal. Business & Professions Code § 17200); (6) violation of California's false advertising law (Cal. Business & Professions Code § 17500); (7) breach of express warranty; (8) breach of implied warranty; (9) common law fraud; (10) intentional misrepresentation; (11) negligent misrepresentation; and (12) quasi-contract/unjust enrichment/restitution.

         The three proposed classes identified by Plaintiffs are as follows:

Hawaii Class: All persons, who, within the relevant statute of limitations period, purchased any of the Hawaiian Snacks, in the State of Hawai‘i.
California Class: All persons, who, within the relevant statute of limitations period, purchased any of the Hawaiian Snacks, in the State of California.
California Consumer Subclass: All persons, who, within the relevant statute of limitations period, purchased any of the Hawaiian Snacks for personal, family, or household purpose, in the State of California.

Compl. at ¶ 51.

         In their prayer for relief, Plaintiffs request a declaration that Defendant's conduct violates the law; restitution; damages; punitive damages; attorneys' fees and costs; and pre and post judgment interest. Id. at 31-32.

         LEGAL STANDARD

         A. Rule 12(b)(1)

         Under Federal Rule of Procedure (“FRCP”) 12(b)(1), a district court must dismiss a complaint if it lacks subject matter jurisdiction to hear the claims alleged in the complaint. Fed.R.Civ.P. 12(b)(1). “Standing is a threshold matter central to our subject matter jurisdiction.” Bates v. United Parcel Serv., Inc., 511 F.3d 974, 985 (9th Cir. 2007). “[L]ack of Article III standing requires dismissal for lack of subject matter jurisdiction under [FRCP] 12(b)(1).” Maya v. Centex Corp., 658 F.3d 1060, 1067 (9th Cir. 2011) (citations omitted). In determining constitutional standing, the trial court has the authority to “to allow or to require the plaintiff to supply, by amendment to the complaint or by affidavits, further particularized allegations of fact deemed supportive of plaintiff's standing.” Id. (citation and quotations omitted). The court “must accept as true all material allegations of the complaint, and must construe the complaint in favor of the complaining party” when “ruling on a motion to dismiss for want of standing.” Warth v. Seldin, 422 U.S. 490, 501 (1975).

         B. Rule 12(b)(2)

         Under FRCP 12(b)(2), a defendant may seek dismissal of an action, or of particular claims, for lack of personal jurisdiction. Fed.R.Civ.P. 12(b)(2). In determining whether personal jurisdiction exists, courts may consider evidence presented in affidavits and declarations. Doe v. Unocal Corp., 248 F.3d 915, 922 (9th Cir. 2001) abrogated on other grounds by Daimler AG v. Bauman, 571 U.S. 117 (2014). Plaintiffs bear the burden of showing that courts have personal jurisdiction over defendants. See Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1154 (9th Cir. 2006). Absent formal discovery or an evidentiary hearing, “this demonstration requires that the plaintiff make only a prima facie showing of jurisdictional facts to withstand the motion to dismiss.” Id. (quotations omitted).

         To make this prima facie showing, a plaintiff can rely on the allegations in its complaint to the extent that the moving party does not controvert those allegations. See Doe, 248 F.3d at 922.

         C. Rule 12(b)(6)

         FRCP 12(b)(6) authorizes dismissal of a complaint that fails “to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). On a Rule 12(b)(6) motion to dismiss, “‘the court accepts the facts alleged in the complaint as true,' and ‘[d]ismissal can be based on the lack of a cognizable legal theory or the absence of sufficient facts alleged.'” UMG Recordings, Inc. v. Shelter Capital Partners LLC, 718 F.3d 1006, 1014 (9th Cir. 2013) (quoting Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988)) (alteration in original). However, conclusory allegations of law, unwarranted deductions of fact, and unreasonable inferences are insufficient to defeat a motion to dismiss. Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001); Nat'l Ass'n for the Advancement of Psychoanalysis v. Cal. Bd. of Psychology, 228 F.3d 1043, 1049 (9th Cir. 2000). Furthermore, the court need not accept as true allegations that contradict matters properly subject to judicial notice. Sprewell, 266 F.3d at 988.

         “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Facial plausibility exists “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556). The tenet that the court must accept as true all of the allegations contained in the complaint does not apply to legal conclusions. Id. As such, “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. (citing Twombly, 550 U.S. at 555). “[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not ‘show[n]'-‘that the pleader is entitled to relief.'” Id. at 679 (citing Fed.R.Civ.P. 8(a)(2)) (some alterations in original). If dismissal is ordered, the plaintiff should be granted leave to amend unless it is clear that the claims could not be saved by amendment. Swartz v. KPMG LLP, 476 F.3d 756, 760 (9th Cir. 2007).

         DISCUSSION

         Defendant seeks dismissal of the Complaint with prejudice on the following grounds: (1) the Court lacks personal jurisdiction over the claims asserted by Plaintiff Iliana Sanchez; (2) Plaintiffs' consumer protection claims fail because Plaintiffs have not alleged an actionable misrepresentation; (3) Plaintiffs' common law claims fail as a matter of law; and (4) Plaintiffs lack standing to seek prospective injunctive relief. The Court addresses each of Defendant's arguments in turn.

         A. Personal Jurisdiction Over Nonresident Plaintiff Iliana Sanchez and Unnamed Nonresident Class Members

         Defendant contends that the Court lacks personal jurisdiction over the claims asserted by Plaintiff Iliana Sanchez, as well as the unnamed nonresident class members.

         1. The Court Lacks Personal Jurisdiction Over Plaintiff Sanchez's Claims

         Defendant successfully challenges Plaintiff Sanchez's satisfaction of personal jurisdiction requirements. Although they bear the burden of establishing that jurisdiction is proper, Boschetto v. Hansing, 539 F.2d 1011, 1015 (9th Cir. 2008), Plaintiffs have not demonstrated that the Court has personal jurisdiction over Plaintiff Sanchez's claims, nor even addressed the specific jurisdiction test. It is well established that in a class action, personal jurisdiction requirements “must be satisfied for each and every named plaintiff for the suit to go forward.” AM Tr. v. UBS AG, 78 F.Supp.3d 977, 987 (N.D. Cal. 2015) (quoting Abrams Shell v. Shell Oil Co., 165 F.Supp.2d 1096, 1107 n.5 (C.D. Cal. 2001)) (citation and quotations omitted); Action Embroidery Corp. v. Atl. Embroidery, Inc., 368 F.3d 1174, 1180 (9th Cir. 2004) (“Personal jurisdiction must exist for each claim asserted against a defendant.”).

         Hawai‘i's long-arm statute, Hawaii Revised Statutes (“HRS”) § 634-35, Authorizes the exercise of personal jurisdiction to the extent permitted by the Due Process clause of the Fourteenth Amendment. Barranco v. 3D Sys. Corp., 6 F.Supp.3d 1068, 1077 (D. Haw. 2014) (citing Cowan v. First Ins. Co. of Haw., 61 Haw. 644, 649, 608 P.2d 394, 399 (1980)). Due Process requires that a defendant have “minimum contacts with [the forum state] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Int'l Shoe Co. v. State of Wash., Office of Unemployment Comp. & Placement, 326 U.S. 310, 316 (1945) (citations omitted) (internal quotations omitted).

         There are two types of personal jurisdiction: “‘general' (sometimes called ‘all-purpose') jurisdiction and ‘specific' (sometimes called ‘case-linked') jurisdiction.” Bristol-Myers Squibb Co. v. Superior Ct. of Cal., San Francisco Cty., __ U.S. __, 137 S.Ct. 1773, 1779-80 (2017). A corporate defendant's place of incorporation and principal place of business are “paradig[m] . . . .bases for general jurisdiction.” Daimler, 571 U.S. at 137 (citation omitted) (alteration in original). When a court has general jurisdiction, it “may hear any claim against that defendant, even if all the incidents underlying the claim occurred in a different State.” Bristol-Myers, __ U.S. at __, 137 S.Ct. at 1780 (citation omitted). That said, “‘only a limited set of affiliations with a forum will render a defendant amenable to' general jurisdiction in that State.” Id. (citation omitted). It is undisputed that the Court lacks general jurisdiction over Defendant.

         A court has specific jurisdiction over a nonresident defendant when it “purposefully avails itself of the privilege of conducting activities within the forum State, ” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985), and “the suit ‘aris[es] out of or relate[s] to the defendant's contacts with the forum.'” Daimler, 571 U.S. at 127 (citation omitted); Bristol-Myers, __ U.S. at __, 137 S.Ct. at 1781 (alteration in original) (“In order for a court to exercise specific jurisdiction over a claim, there must be an ‘affiliation between the forum and the underlying controversy, principally, [an] activity or an occurrence that takes place in the forum State.'”). Although courts must consider a variety of interests in determining whether personal jurisdiction is present, including those of the forum State and the plaintiff's forum of choice, the “primary concern” is “the burden on the defendant.” Bristol-Myers, __ U.S. at __, 137 S.Ct. at 1780 (citations omitted) (internal quotations omitted).

         The Ninth Circuit employs a three-part test to determine whether a court may exercise specific jurisdiction over a nonresident defendant:

(1) the defendant must either purposefully direct his activities toward the forum or purposefully avail himself of the privileges of conducting activities in the forum; (2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e., it must be reasonable.

Axiom Foods, Inc. v. Acerchem Int'l, Inc., 874 F.3d 1064, 1068 (9th Cir. 2017) (internal citations and quotations omitted). The plaintiff bears the burden of establishing the first two prongs. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th Cir. 2004). If either prong is not satisfied, “personal jurisdiction is not established in the forum state.” Id. If the plaintiff satisfies the first two prongs, “the burden then shifts to the defendant to ‘present a compelling case' that the exercise of jurisdiction would not be reasonable.” Id.

         The specific jurisdiction inquiry focuses on the relationship between the nonresident defendant, the forum, and the litigation. Walden v. Fiore, 571 U.S. 277, 284 (2014). “For a State to exercise jurisdiction consistent with due process, the defendant's suit-related conduct must create a substantial connection with the forum State.” Id. This requires the relationship to “arise out of contracts that the ‘defendant himself' creates with the forum state” and “looks to the defendant's contacts with the forum State itself, not the defendant's contacts with persons who reside there.” Id. at 284-85.

         Before applying the specific jurisdiction test, the Court addresses the parties' dispute concerning the extension of Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco County to this case.[1] In its briefing, Defendant contends that the Court should apply Bristol-Myers to dismiss the unnamed non-resident class members for lack of personal jurisdiction. At the hearing, however, defense counsel conceded that the personal jurisdiction inquiry before the Court can be resolved without reliance on Bristol-Myers. While a number of district courts have weighed in on whether Bristol-Myers should apply to federal courts and/or class actions, the Court finds it unnecessary to resolve this issue because well-established jurisprudence governs the present jurisdictional inquiry. Indeed, Bristol-Myers involved the “straightforward application . . . of settled principles of personal jurisdiction, ” Bristol-Myers, __ U.S. __, 137 S.Ct. at 1783; see also Id. at 1781 (“Our settled principles regarding specific jurisdiction control this case.”). Accordingly, the Court declines to speculate as to the applicability of Bristol-Myers in this particular context. Id. at __, 137 S.Ct. at 1783-84 (“[S]ince our decision concerns the due process limits on the exercise of specific jurisdiction by a State, we leave open the question whether the Fifth Amendment imposes the same restrictions on the exercise of personal jurisdiction by a federal court.”). Any reference to Bristol-Myers is limited to the longstanding personal jurisdiction principles therein.

         Turning to the specific jurisdiction test, Plaintiff Sanchez has made no effort to establish either of the first two prongs, nor has she cited the relevant test or explained how this Court has specific jurisdiction over her claims, which concern Defendant's purported conduct in California and do not arise out of any of Defendant's contacts with Hawai‘i.

         a. Prong One: Purposeful Direction

         When cases sound in tort, courts employ the purposeful direction test, also known as the “effects” test. Axiom Foods, 874 F.3d at 1069. Under this test, which derives from Calder v. Jones, 465 U.S. 783 (1984), “[t]he defendant must have ‘(1) committed an intentional act, (2) expressly aimed at the forum state, (3) causing harm that the defendant knows is likely to be suffered in the forum state.'” Id. (citation omitted). Purposeful direction “usually consists of evidence of the defendant's actions outside the forum state that are directed at the forum, such as the distribution in the forum state of goods originating elsewhere.” Schwarzenegger, 374 F.3d at 803.

         i. Intentional Act

         An intentional act is “an external manifestation of the actor's intent to perform an actual, physical act in the real world.” Washington Shoe Co. v. A-Z Sporting Goods, Inc., 704 F.3d 668, 674 (9th Cir. 2012), abrogated as recognized in Axiom Foods, 874 F.3d at 1069-70; Schwarzenegger, 374 F.3d at 806. In the Complaint, Plaintiffs allege that Defendant deceptively labeled the Hawaiian Snacks to create impression that they are made in Hawai‘i and that it sells the snacks at multiple retail locations throughout Hawai‘i and California. Defendant's conduct constitutes an intentional act.

         ii. Express Aiming

         The second element requires Defendant to have “expressly aimed” its intentional act at the forum state: Hawai‘i. Schwarzenegger, 374 F.3d at 806. As noted above, Plaintiffs allege that the deceptively labeled Hawaiian Snacks were and are sold throughout Hawai‘i. Accepting Plaintiffs' allegations as true, Defendant expressly aimed its conduct at Hawai‘i, but only as to Plaintiff Maeda and the Hawai‘i class. See Calder, 465 U.S. at 789 (“In sum, California is the focal point both of the story and of the harm suffered. Jurisdiction over petitioners is therefore proper in California based on the ‘effects' of their Florida conduct in California.”). The same cannot be said of Plaintiff Sanchez, who claims to have suffered harm in California based on Defendant's deceptive labeling and advertising of the Hawaiian Snacks in California. Therefore, Plaintiff Sanchez fails to meet the second element of the purposeful direction test.

         iii. Foreseeable Harm

         The third and final element of the purposeful direction test is satisfied if Defendant's actions had “foreseeable effects” in the forum state. Brayton Purcell LLP v. Recordon & Recordon, 606 F.3d 1124, 1131 (9th Cir. 2010), abrogated on other grounds by Axiom Foods, 874 F.3d at 1069. Although it was foreseeable that Plaintiff Maeda would suffer harm in Hawai‘i, it was not foreseeable that Defendant's actions in Hawai‘i (the advertising and sale of its products) would cause harm to Plaintiff Sanchez in California. Accordingly, Plaintiff Sanchez has not satisfied the elements of the purposeful direction test and has correspondingly failed to establish the first prong of the specific jurisdiction test.

         b. Prong Two: Claims Arising Out of Defendant's Forum-Related Activities

         The second prong of the specific jurisdiction test requires Plaintiff Sanchez's claims to arise out of or relate to Defendant's forum-related activities. Axiom Foods, 874 F.3d at 1068. Plaintiff Sanchez has not argued, nor could she, that her claims involving Defendant's conduct in California arise out of Defendant's activities in Hawai‘i. Thus, even though Defendant directed certain actions to Hawai‘i, said conduct has no bearing on the harm allegedly suffered in California.

         Because Plaintiff Sanchez has not met her burden as to the first and second prongs, the Court finds that specific jurisdiction is lacking over Plaintiff Sanchez's claims against Defendant, and it is unnecessary to address the reasonableness prong of the specific jurisdiction test.

         2. The Court Cannot Exercise Pendent Jurisdiction Over Plaintiff Sanchez's Claims

         In an effort to save Plaintiff Sanchez's claims, Plaintiffs posit that the Court can and should exercise pendent personal jurisdiction because her claims arise out of the same nucleus of operative facts as those asserted by Plaintiff Maeda.

         “Pendent jurisdiction exists where there is a sufficiently substantial federal claim to confer federal jurisdiction, and a common nucleus of operative fact between the state and federal claims.” Gilder v. PGA Tour, Inc., 936 F.2d 417, 421 (9th Cir. 1991) (emphasis added) (citing In re Nucorp Energy Sec. Litig., 772 F.2d 1486, 1490 (9th Cir. 1985)); United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 725 (1966) (“Pendent jurisdiction, in the sense of judicial power, exists whenever there is a claim ‘arising under (the) Constitution, the Laws of the United States, and Treaties made'. . . and the relationship between that claim and the state claim permits the conclusion that the entire action before the court comprises but one constitutional ‘case.'”); Action Embroidery, 368 F.3d at 1180-81 (“Pendent personal jurisdiction is typically found where one or more federal claims for which there is nationwide personal jurisdiction are combined in the same suit with one or more state or federal claims for which there is not nationwide personal jurisdiction.”).[2]

         It is within the district court's discretion to exercise personal pendent jurisdiction. Action Embroidery, 368 F.3d at 1181. Pendent claims may be dismissed “where considerations of judicial economy, convenience and fairness to ...


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