Argueta v. Walgreens Company

District Court, E.D. California·Decided December 20, 2024·No. 1:24-cv-00072·Unknown

Opinion

JESSICA ARGUETA, individually Case No. 1:24-cv-00072-JLT-CDB and on behalf of all others similarly situated, ORDER GRANTING DEFENDANT’S MOTION TO DISMISS WITHOUT LEAVE Plaintiff, TO AMEND

v. (Doc. 16)

Defendant. Pending before the Court is the motion of Defendant Walgreens Company (“Defendant”) to dismiss the class action complaint of Plaintiff Jessica Argueta (“Plaintiff”) and request therein for judicial notice, filed on April 19, 2024. (Doc. 16). On May 15, 2024, Plaintiff filed an opposition to the motion to dismiss and Defendant filed a rely on May 24, 2024. (Docs. 18, 19).1 For the reasons set forth herein, the Court will grant Defendant’s motion to dismiss and dismiss Plaintiff’s complaint without leave to amend. On January 17, 2024, Plaintiff Jessica Argueta (“Plaintiff”) initiated this action with the filing of a complaint, asserting claims on behalf of herself and a putative class against Defendant Walgreens Company (“Defendant” or “Walgreens”). (Id. ¶¶ 6, 41-44).2 Plaintiff alleges 1 On July 25, 2024, in light of the parties’ stipulation to consent to the jurisdiction of a United States Magistrate Judge for the limited purpose of ruling on Defendant’s pending motion to dismiss (Doc. 20), the Honorable District Judge Jennifer L. Thurston referred the pending motion to dismiss to the undersigned for final disposition. (Doc. 21). Defendant sells the drug Phenazopyridine Hydrochloride (“PhenAzo”)—marketed as a finished, over-the-counter (“OTC”) product called “Urinary Pain Relief” (the “Product” or “Products”) to treat symptoms of a urinary tract infection (“UTI”)—“even though it is unsafe, ineffective, and unlawful to sell.” This allegation serves as the basis for claims she asserts against Defendant for breach of express warranty, breach of implied warranty of merchantability, and violation of California’s Unfair Competition Law (“UCL”), Cal. Bus. & Prof. Code §§ 1700, et seq. (Id. at 1, ¶¶ 2-4). Plaintiff alleges that on or about August 17, 2023, she purchased the Product from one of Defendant’s stores, Walgreens, for use in treating a UTI. (Id. ¶ 37). Plaintiff alleges that she, as “a reasonable consumer [who] understands that there is some sort of approval process that drugs must be subjected to before they can be legally sold to consumers . . . . also understands that if Walgreens—a trusted local pharmacy—is selling a drug, marketed as a finished product, that such drug is approved for lawful sale.” (Id. ¶¶ 39-40). Plaintiff believed that Defendant could lawfully sell the Products at issue. (Id. ¶ 40). Plaintiff asserts claims on behalf of herself and a putative class and seeks certification of the following class: “All persons in the United States who purchased the Products from Walgreens within the four years prior to the filing of this Complaint” (“putative class”). (Id. ¶ 41). In the alternative, Plaintiff seeks certification of a putative California class. (Id. ¶ 42). In claim I, Plaintiff alleges that Defendant’s “very sale of the Products is an express warranty that the Products are lawful to sell.” (Id. ¶ 54). Such “affirmations of fact and promises” by selling the Products “became part of the basis of the bargain between Defendant and [the] Plaintiff[/]Class, thereby creating an express warranty that the Product[s] . . .were legal to sell.” (Id. ¶ 55). Plaintiff alleges the Products, however, are in fact not legal to sell as they are not FDA approved and are not “marketed under an established OTC drug monograph.” (Id. ¶ 56). Plaintiff alleges that she and members of the putative class suffered economic injury as a direct and proximate result of Defendant’s breach of warranty as “they would not have purchased the Product on the same terms if they had known that the Product was illegal to sell.” (Id. ¶ 57). Thus, Plaintiff alleges that she and the putative class suffer damages “either in the full amount of the purchase price of the Products or in the difference in value between the Products as warranted and the Products as sold.” (Id. ¶ 58). In claim II, Plaintiff alleges Defendant is a “merchant” within the meaning of the Uniform Commercial Code (“UCC”) and that the Products it sold and marketed are also “goods” under the UCC. (Id. ¶ 60). Thus, Defendant impliedly warranted that the Products are merchantable, including that the Products are finished drug products that are legal to sell. (Id.). Plaintiff alleges that “this implied warranty was false with respect to the [Products] sold to Plaintiff and [the putative class]” as the Products did not conform to the representations on the Products’ containers or labels that the drugs are capable of being lawfully sold. (Id. ¶¶ 61-62). Plaintiff alleges that “Defendant knew the Products would be purchased and used by Plaintiff and [the putative class] and that the Products are not FDA[-]approved” and are they not “marketed under an established OTC drug monograph.” (Id. ¶ 65). Thus, Plaintiff alleges Defendant breached its implied warranty of merchantability, resulting in injury to Plaintiff and the putative class. (Id. ¶¶ 66-68). In claim III, Plaintiff alleges violation of the California Unfair Competition Law (“UCL”), California Business Professions Code §§ 17200 et seq., which prohibits acts of “unfair competition,” including any “unlawful, unfair or fraudulent business act or practice” as well as “unfair, deceptive, untrue or misleading advertising.” (Id. ¶ 70); see Cal. Bus. & Prof. Code § 17200. Plaintiff alleges that members of the public, i.e., reasonable consumers, are likely to be deceived by Defendant’s conduct in selling the Products as lawful, finished-drug products when the Products are not lawful to sell such that the conduct is “fraudulent” within the meaning of the UCL. (Id. ¶ 73). Plaintiff alleges that such conduct is also “unfair” under the UCL for Defendant having realized profits from the sale. (Id. ¶ 74). Plaintiff alleges that Defendant’s unlawful sale in violation of, generally, “the laws and regulations surrounding the drug approval process[,]” can serve as a predicate for a Section 17200 “unlawful” violation, and Defendant has done so here. (Id. ¶¶ 75-77). Plaintiff seeks on behalf of herself, and the putative class, restitution and disgorgement of injunctive relief including, but not limited to, putting a stop to the unlawful sale of the Products. (Id. ¶¶ 79-80). Plaintiff prays for an order certifying the class action and the award of damages as appropriate. (Id. at 19-20). A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) asks a court to dismiss a plaintiff’s complaint for failing “to state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). A motion to dismiss under Rule 12(b)(6) tests the complaint’s sufficiency. N. Star Int’l v. Ariz. Corp. Comm’n., 720 F.2d 578, 581 (9th Cir. 1983) (citing Peck v. Hoff, 660 F.2d 371, 374 (8th Cir. 1981)). A complaint may be dismissed as a matter of law either for lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory. Balistreri v. Pacifica Police Dep’t., 901 F.2d 696, 699 (9th Cir. 1990) (citing Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 533-34 (9th

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