Ashley Franz v. Beiersdorf, Inc.

• Court: Court of Appeals for the Ninth Circuit
• Decided: December 11, 2018
• Docket: 17-55646
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS DEC 11 2018 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

ASHLEY FRANZ, On behalf of herself and No. 17-55646 all others similarly situated, D.C. No. Plaintiff-Appellant, 3:14-cv-02241-LAB-AGS

v. MEMORANDUM* BEIERSDORF, INC., a Delaware corporation,

Defendant-Appellee.

Appeal from the United States District Court for the Southern District of California Larry A. Burns, District Judge, Presiding

Argued and Submitted November 13, 2018 Pasadena, California

Before: GOULD and MURGUIA, Circuit Judges, and AMON,** District Judge.

The district court dismissed Plaintiff-Appellant Ashley Franz’s claim on the

grounds that she failed to adequately plead that the amount in controversy exceeds

the jurisdictional minimum and that she lacks standing. Plaintiff timely appealed

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The Honorable Carol Bagley Amon, United States District Judge for the Eastern District of New York, sitting by designation. that decision. We have jurisdiction under 28 U.S.C. § 1291. We reverse and

remand for further proceedings.

1. Plaintiff has adequately pled that the amount in controversy exceeds

$5,000,000—the jurisdictional minimum under the Class Action Fairness Act

(“CAFA”). 28 U.S.C. § 1332(d)(2). We need not decide which version of

Plaintiff’s complaint we should look to in determining jurisdiction, because we

conclude that Plaintiff has adequately pled the requisite amount in controversy

under each iteration. In her Second Amended Complaint, which proposes the most

restrictive class definition, Plaintiff alleges that the proposed class includes all

California consumers who purchased NIVEA Skin Firming Hydration Body Lotion

with CoQ10 Plus formulated with Co-Enzyme Q10 and Hydra-IQ (“Nivea

CoQ10”) “within the applicable statute of limitations period.” Nivea CoQ10

retails for approximately $10. During the applicable class period, Defendant-

Appellee Beiersdorf, Inc. allegedly sold Nivea CoQ10 “online and in virtually

every major food, drug, and mass retail outlet.” It is easily conceivable that

Defendant sold the product 500,000 times in a state the size of California over a

multi-year period. Defendant does not dispute that the amount in controversy

exceeds $5,000,000. We cannot say “to a legal certainty that the claim is really for

less than the jurisdictional amount.” St. Paul Mercury Indem. Co. v. Red Cab Co.,

303 U.S. 283, 289 (1938); accord Naffe v. Frey, 789 F.3d 1030, 1039 (9th Cir.

2 2015); Lowdermilk v. U.S. Bank Nat’l Ass’n, 479 F.3d 994, 998 (9th Cir. 2007),

overruling on other grounds recognized by Rodriguez v. AT & T Mobility Servs.

LLC, 728 F.3d 975, 981 (9th Cir. 2013). The district court erred by sua sponte

dismissing Plaintiff’s claim on the ground that Plaintiff did not adequately allege

that the amount in controversy exceeds the jurisdictional minimum.

2. Plaintiff has standing under California’s Unfair Competition Law

(“UCL”). Plaintiff alleges that Defendant sold a “drug”—Nivea CoQ10—without

FDA approval. Plaintiff contends that doing so violates the Food, Drug, and

Cosmetic Act (“FDCA”), see 21 U.S.C. §§ 331(d), 355(a), and California’s

Sherman Law, see Cal. Health & Safety Code § 111550. Plaintiff alleges that, as a

result, she spent money on a product that should not have been on the market.

Those allegations are sufficient to establish standing under the UCL. See Medrazo

v. Honda of N. Hollywood, 205 Cal. App. 4th 1, 11–13 (2012), modified on denial

of reh’g (Apr. 16, 2012). Plaintiff need not plead reliance because neither the

alleged FDCA violation nor the alleged Sherman Law violation requires

allegations of fraud or deception. See id. at 12 (explaining that claims based on a

theory of fraud require a plaintiff to demonstrate reliance to establish standing

because “reliance is the causal mechanism of fraud.” (quoting In re Tobacco II

Cases, 46 Cal. 4th 298, 326 (2009))). In response, Defendant relies on Demeter v.

Taxi Computer Services, 21 Cal. App. 5th 903 (2018), and Medina v. Safe-Guard

3 Products, 164 Cal. App. 4th 105 (2008), to contend that Plaintiff lacks standing

under the UCL. Because those cases concerned voidable service contracts,

Demeter, 21 Cal. App. 5th at 913; Medina, 164 Cal. App. 4th at 112, whereas

Medrazo and the present case concern goods that a defendant was allegedly not

legally allowed to sell in the form being offered, we believe Medrazo to be more

directly on point. We therefore hold, consistent with Medrazo, that Plaintiff has

sufficiently demonstrated standing under the UCL.

3. Plaintiff likewise has standing under Article III of the United States

Constitution. Plaintiff alleged injury in fact—she spent money on Nivea CoQ10.

Defendant’s allegedly illegal conduct caused that injury, insofar as Defendant

allegedly sold a product in commerce that it should not have sold. And the injury

is redressable—in restitution—by a favorable court decision. Spokeo, Inc. v.

Robbins, 136 S. Ct. 1540, 1547 (2016). The district court erred by dismissing

Plaintiff’s claim on the ground that she lacked standing.

4. As an alternative ground for affirmance, Defendant urges us to hold

that Plaintiff has failed to state a claim. The district court did not reach this issue.

Although we may affirm on “any ground supported by the record,” Canyon Cty. v.

Syngenta Seeds, Inc., 519 F.3d 969, 975 (9th Cir. 2008), we decline to decide

whether Plaintiff has “state[d] a claim to relief that is plausible on its face,”

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly,

4 550 U.S. 544, 570 (2007)), in the first instance. The district court should consider

Defendant’s contentions on remand in the first instance.

REVERSED and REMANDED for further proceedings.