In Re Laundress Marketing and Product Liability Litigation

District Court, S.D. New York·Decided November 13, 2024·No. 1:22-cv-10667·Unknown

Opinion

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------------- X : IN RE LAUNDRESS MARKETING AND PRODUCT : LIABILITY LITIGATION : : : : 22-CV-10667 (JMF) : This Document Relates To: : OPINION AND ORDER Safran v. The Laundress, LLC, No. 24-CV-865 (JMF) : Nixon v. The Laundress, LLC, No. 24-CV-1630 (JMF) : Macha v. The Laundress, LLC, No. 24-CV-2108 (JMF) : : ---------------------------------------------------------------------- X JESSE M. FURMAN, United States District Judge: In 2022, The Laundress, LLC, a manufacturer and distributor of luxury cleaning and laundry products, recalled approximately eight million units of its products, citing potential contamination with harmful bacteria. Several lawsuits against The Laundress, since consolidated, followed, including a putative class action brought by Lori Ostenfeld, Judy Stilwill, Deborah Geschwind, and Margaret Murphy (the “Class Action”), see ECF Nos. 16, 19; and a case brought by Ashley Sites and Gabriel Yibale (the “Sites Action”), see ECF Nos. 46, 47. In an Opinion and Order entered March 5, 2024, this Court granted in part and denied in part The Laundress’s motions to dismiss the claims in those cases. See Ostenfeld v. Laundress, LLC, No. 22-CV-10667 (JMF), 2024 WL 967124 (S.D.N.Y. Mar. 5, 2024) (ECF No. 86) (“Laundress I”). Now pending are The Laundress’s motions to dismiss, pursuant to Rules 9(b) and 12(b) of the Federal Rules of Civil Procedure, three other consolidated cases: one brought by Plaintiff David Safran, see 24-CV-865 (the “Safran Action”); the second brought by Plaintiff Stephanie Michelle Nixon, see 24-CV-1630 (the “Nixon Action”); and the third brought by Plaintiffs Olga Macha and Lauris Macs (collectively, the “Macha Plaintiffs”) on behalf of their minor child, A.S., see 24-CV-2108 (the “Macha Action”). See ECF Nos. 104, 106, 137.1 The Court assumes familiarity with the background and its prior Opinion and Order. For the reasons that follow, the Court GRANTS in part and DENIES in part all three motions to dismiss. DISCUSSION

As noted, The Laundress moves to dismiss pursuant to Rules 9(b) and 12(b)(6). The latter requires a court to determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible “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). When ruling on a Rule 12(b)(6) motion, a court must accept the factual allegations set forth in the complaint as true and draw all reasonable inferences in favor of the plaintiff. See, e.g., Holmes v. Grubman, 568 F.3d 329, 335 (2d Cir. 2009). A complaint that offers only “labels and conclusions” or a “formulaic recitation of the elements of a cause of action will not do.”

Twombly, 550 U.S. at 555. Further, if the plaintiff has not “nudged [its] claims across the line from conceivable to plausible, [those claims] must be dismissed.” Id. at 570. With respect to Plaintiffs’ claims sounding in fraud, Rule 9(b) imposes a heightened pleading standard. See, e.g., Cohen v. Avanade, Inc., 874 F. Supp. 2d 315, 320 (S.D.N.Y. 2012). Specifically, such claims must “state with particularity the circumstances constituting fraud . . . .” Fed. R. Civ. P. 9(b). To satisfy that standard, a complaint must “allege facts that give rise to a strong inference of fraudulent intent.” Acito v. IMCERA Grp., Inc., 47 F.3d 47, 52 (2d Cir.

1 As discussed below, the Nixon Action is brought against The Laundress and its parent company, Conopco, Inc. (“Unilever”), which joins in the motion to dismiss. 1995). That is, “the complaint must: (1) specify the statements that the plaintiff contends were fraudulent, (2) identify the speaker, (3) state where and when the statements were made, and (4) explain why the statements were fraudulent.” Lerner v. Fleet Bank, N.A., 459 F.3d 273, 290 (2d Cir. 2006) (internal quotation marks omitted). Failure to satisfy Rule 9(b) is grounds for

dismissal. See, e.g., id. at 293; Slayton v. Am. Exp. Co., 604 F.3d 758, 766 (2d Cir. 2010). Mindful of these standards, the Court will address each argument in turn. As the parties agree, Illinois law governs Safran’s claims, see ECF No. 105, at 4 (“Safran Def.’s Mem.”); ECF No. 124 (“Safran Opp’n”), at 8; Maryland law governs Nixon’s claims, see ECF No. 107 (“Nixon Def.’s Mem.”), at 4; ECF No. 117 (“Nixon Opp’n”), at 7; and Florida law governs Macha’s and Macs’ claims, see ECF No. 138 (“Macha Def.’s Mem.”), at 4; ECF No. 140 (“Macha Opp’n”), at 6. See In re AXA Equitable Life Ins. Co. COI Litig., 595 F. Supp. 3d 196, 238 (S.D.N.Y. 2022) (discussing New York case law regarding choice of law in tort cases). A. Claims Against Unilever As a threshold matter, Unilever is easily dismissed as a Defendant in the Nixon Action.

Nixon fails to “distinguish [Unilever’s] conduct . . . to give adequate notice . . . as to what [it] did wrong,” Appalachian Enters., Inc. v. Epayment Sols. Ltd., No. 01-CV-11502 (GBD), 2004 WL 2813121, at *6 (S.D.N.Y. 2004), beyond making broad and conclusory allegation that Unilever “manufactures, markets, designs, promotes, and/or distributes The Laundress Products” since acquiring the company in 2019, see 24-CV-1630, ECF No. 1 (“Nixon Compl.”), ¶ 10.2 Furthermore, under Maryland law, it is well established that a parent corporation is generally not

2 That dooms Nixon’s claims against Unilever, but it does not follow, as The Laundress suggests, that Nixon’s Complaint should be dismissed in its entirety on account of group pleading. See Nixon Def.’s Mem. 5. As Defendants themselves argue, the problem with the Nixon Complaint is that it fails to make allegations that are specific to Unilever, not The Laundress. See id. liable for the actions of its subsidiary unless certain narrow exceptions are met. See Dixon v. Process Corp., 38 Md. App. 644, 654 (1978) (“[T]he [subsidiary’s] corporate entity will be disregarded only when necessary to prevent fraud or to enforce a paramount equity.”); Dolan v. Kent Rsch. & Mfg. Co., 63 Md. App. 55, 67 (1985) (declining to hold the parent company liable

because “[n]either situation” identified in Dixon applied, and the parent company did not “exercise[] sufficient control to render [the subsidiary] a mere instrumentality”). Here, Nixon makes no allegations from which the Court can draw “the reasonable inference” that The Laundress was a “mere instrumentality” of Unilever. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (first quotation). Accordingly, the claims against Unilever must be and are dismissed in the Nixon Action. That leaves The Laundress as the sole Defendant in all three actions. B. Strict Liability and Negligence Next, The Laundress raises various arguments — some recycled from its earlier motion to dismiss and some new — to dismiss the strict liability and negligence claims in all three actions. As an initial matter, one of The Laundress’s arguments for dismissing the Macha

Plaintiffs’ strict liability and negligence claims for manufacturing defect and design defect is easily rejected.

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