Shavonda Hawkins v. the Kroger Co.

906 F.3d 763
Court of Appeals for the Ninth Circuit·Decided October 4, 2018·No. 16-55532·Published·Cited by 46 cases

Opinion

FOR PUBLICATION

UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

SHAVONDA HAWKINS, on No. 16-55532 behalf of herself and all others similarly situated, D.C. No. Plaintiff-Appellant, 3:15-cv-02320-JM-BLM

v. OPINION THE KROGER COMPANY, Defendant-Appellee.

Appeal from the United States District Court for the Southern District of California Jeffrey T. Miller, Senior District Judge, Presiding

Argued and Submitted December 7, 2017 Pasadena, California

Filed October 4, 2018

Before: Marsha S. Berzon and Jacqueline H. Nguyen, Circuit Judges, and Frederic Block,* District Judge.

Opinion by Judge Block

* The Honorable Frederic Block, United States Senior District Judge for the Eastern District of New York, sitting by designation. 2 HAWKINS V. THE KROGER COMPANY

SUMMARY**

Preemption / Standing / Product Labels

The panel reversed the district court’s Fed. R. Civ. P. 12(b)(6) dismissal of plaintiff’s putative consumer class action alleging that The Kroger Company sold Kroger Bread Crumbs that included misleading labels in violation of California law.

Plaintiff alleged that she purchased the bread crumbs by relying on information contained on the face of the label that the product contained “0g Trans Fat per serving.” Plaintiff further alleged that contrary to the claim on the label, the bread crumbs “contained artificial trans fats, and caused heart disease, diabetes, cancer, and death.”

Concerning plaintiff’s claim under California law of reliance on misleading labels, the panel held that plaintiff had standing because she adequately alleged that she relied on the label’s misrepresentations and would not have purchased the product without those misrepresentations. The panel also held that the label statement “0g Trans Fat per serving” was not preempted by federal regulations. Specifically, the panel noted that the federal Food and Drug Administration (“FDA”) regulations at issue involved two categories: rules contained in 21 C.F.R. § 101.9 governing what must be stated within the Nutrition Facts Panel; and rules governing “nutrient content claims.” The panel applied the holding in Reid v. Johnson & Johnson, 780 F.3d 952, 960 (9th Cir. 2015)

** This summary constitutes no part of the opinion of the court. It has been prepared by court staff for the convenience of the reader. HAWKINS V. THE KROGER COMPANY 3

(holding that the statement “No Trans Fat” was not allowed outside the Nutrition Facts Panel since the product did contain trans fat, notwithstanding that the Panel reported it contained 0g trans fat), and held that a consumer reading the label in this case could be misled, similarly, into believing that the product was free of trans fat. The panel further held that the federal regulations also bolstered their conclusion in this case. The panel concluded that because the FDA regulations did not authorize the contested statement, plaintiff’s labeling claims were not preempted.

Concerning plaintiff’s “use claims” under California law – that it was illegal to include trans fat in products since it was not for human consumption and an unlawful food additive – the panel held that plaintiff had statutory standing for the same reason she had statutory standing to bring her labeling claims. The panel further held that the issue of whether the claim was federally preempted by a Food and Drug Administration 2015 Final Determination on the subject was not addressed by the district court and not fully briefed on appeal. The panel declined to exercise its discretion to consider the issue, and remanded to the district court to decide in the first instance to what extent, if at all, the state law use claims were federally preempted.

COUNSEL

Gregory S. Weston (argued) and David Elliot, The Weston Firm, San Diego, California, for Plaintiff-Appellant.

Jacob M. Harper (argued) and Nicole S. Phillis, Davis Wright Tremaine LLP, Los Angeles, California, for Defendant- Appellee. 4 HAWKINS V. THE KROGER COMPANY

OPINION

BLOCK, District Judge:

Trans fat has become increasingly recognized as a dangerous substance and a leading cause of numerous serious ailments, including heart disease and diabetes. Food and Drug Administration (“FDA”) regulations govern the information reported within a food product’s Nutrition Facts Panel on the product’s label.1 As for trans fat, FDA regulations provided, at all relevant times, that if the product contained “less than 0.5 gram” trans fat, as it did in this case, it was required to tell the consumer on the Nutrition Facts Panel that it contained 0 grams trans fat, even though it contained this dangerous food additive.

We are asked to determine, inter alia, whether these FDA trans fat regulations governing the contents of the Nutrition Facts Panel preempt California’s unfair competition laws proscribing false or misleading advertising elsewhere on a food product’s label. We hold that they do not; accordingly, the plaintiff can challenge the legitimacy of defendant’s product advertising on the face of the label that it contains “0g Trans Fat per serving.” In doing so, we take the occasion to reinforce and apply our holding in Reid v. Johnson & Johnson that “a requirement to state certain facts in the

1 Somewhat confusingly, the FDA regulations refer to the ubiquitous box that contains nutritional facts as “nutrition labeling,” 21 C.F.R. § 101.9, while also referring to the rest of the product’s exterior as labeling. For clarity, and consistent with other decisions of this Court, this decision uses “Nutrition Facts Panel” to refer to the “nutrition labeling,” see, e.g., Lilly v. ConAgra Foods, Inc., 743 F.3d 662, 664 (9th Cir. 2014), and all other references to labels to refer to information outside the Nutrition Facts Panel. HAWKINS V. THE KROGER COMPANY 5

nutrition label is not a license to make that statement elsewhere on the product.” 780 F.3d 952, 960 (9th Cir. 2015) (emphasis added).

I

Hawkins’ complaint alleges the following:2 The Kroger Company (“Kroger”) sells Kroger Bread Crumbs (“KBCs”) in stores in California, including the supermarket chain Ralph’s. Hawkins regularly purchased KBCs at several Ralph’s locations between 2000 and 2015. In making the purchases, she relied on the information contained on the face of the label that the product contained “0g Trans Fat per serving.” In August 2015, she discovered that, contrary to the claim on the label, KBCs “contained artificial trans fat, and caused heart disease, diabetes, cancer, and death.”3

2 We must “accept the complaint’s well-pleaded factual allegations as true, and construe all inferences in the plaintiff’s favor for the purposes of evaluating a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6).” Ariz. Students’ Ass’n v. Ariz. Bd. of Regents, 824 F.3d 858, 864 (9th Cir. 2016).

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Shavonda Hawkins v. the Kroger Co., 906 F.3d 763 (9th Cir. 2018).

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