Trazo v. Nestlé USA, Inc.

113 F. Supp. 3d 1047, 2015 WL 4196973
District Court, N.D. California·Decided July 10, 2015·No. Case No. 5:12-cv-02272-PSG·Published·Cited by 7 cases

Opinion

ORDER GRANTING MOTION FOR RECONSIDERATION

PAUL S. GREWAL, United States Magistrate Judge

Plaintiff Jude Trazo, individually and on behalf of similarly situated Plaintiffs, moves for reconsideration of his unjust enrichment/quasi-contract claim. Because the Ninth Circuit recently decided that the duplicative nature of an unjust enrichment/quasi-contract claim is not a valid reason to dismiss it, the court GRANTS Trazo’s motion.1

I.

“Reconsideration is appropriate if the district court (1) is presented with newly discovered evidence, (2) committed clear error or the initial decision was manifestly unjust, or (3) if there is an intervening change in controlling law. There may also be other, highly unusual, circumstances warranting reconsideration.”2

In August 2013, the court dismissed Plaintiffs’ claim for restitution based on unjust enrichment/quasi-contract.3 The court specifically held that because “Plaintiffs’ quasi-contract theory rests on the same allegations already covered by their other claims, which also provide for restitution as a remedy, the claim is ‘merely duplicative of statutory or tort claims’ and must be dismissed.”4

Trazo requests reconsideration on the grounds that Astiana “requires that [he] be allowed to pursue a claim for unjust enrichment.”5

II.

This court has subject matter jurisdiction pursuant to 28 U.S.C. § 1367. The parties further consented to the jurisdiction of the undersigned magistrate judge under 28 U.S.C. § 636(c) and Fed.R.Civ.P. 72(a).6

As a preliminary matter, while Nestlé may be right that Trazo was dilatory in bringing this motion, its contention that Trazo “relinquished and waived” his unjust enrichment claim is insufficient.7 This court has broad discretion to reconsider and revise its prior orders.8

Nestlé also argues that Trazo’s motion should be denied because “the ‘unjust enrichment’ claim [he is] trying to assert is not for restitution” but only for nonrestitu-[1049] tionary disgorgement9 — an entirely new claim. Since Astiana denied dismissal of a claim for restitution but did not discuss nonrestitutionary disgorgement, Nestlé asserts that the Ninth Circuit’s decision is “entirely beside the point of what [Trazo] seek[s] in [his] motion[] for reconsideration.”10 Nestlé’s argument is unfounded. Trazo explicitly requests reconsideration of his original unjust enrichmenVquasi-con-tract claim before he discusses nonrestitm tionary disgorgement as a remedy.11 Tra-zo’s claim for restitution is appropriately before the court in a request for reconsideration.

HI.

The Ninth Circuit’s decision in Astiana is “an intervening change in controlling law” and therefore presents a valid basis for reconsideration.12

First, Astiana settled the long-standing question of whether a court may dismiss a claim for unjust enrichment as merély du-plicative of other statutory ortort claims.13 Astiana involved a putative class action suit in which Plaintiffs alleged that Defendant falsely labeled its cosmetic products as “All Natural.”14 Plaintiffs claimed that such false labeling deceived customers into buying those products and unjustly enriched Defendant as a result.15 The complaint sought damages under-California’s Unfair Competition Law and False Advertising Law and under a quasi-contract theory.16 Before the class-certification stage, the district court dismissed the quasi-contract claim, “concluding that restitution ‘[was] not a standalone-cause'of action in California and [that the claim was] nonsensical as pled in any event.’ ”17 The Ninth Circuit agreed that unjust enrichment did not constitute a standalone cause of action in California.18 However, it confirmed that “[w]hen a plaintiff alleges unjust enrichment, a court may' ‘construe the cause of action as a quasi-contract claim seeking restitution.’ ”19 Accordingly, the court found that Plaintiffs’ allegations were “sufficient to state a quasi-contract cause of action.”20 The court then ‘held that “[t]o the extent the district court concluded that the [claim] was nonsensical because it was duplicative of or superfluous to [Plaintiffs’] other claims, this [was] not grounds for dismissal.”21

The unambiguous holding' in Astiana requires'this court to side with Trazo and reinstate his claim for restitution based on unjust enrichmenVquasi-contract.22 Trazo’s amended complaint alleged that “Defendant sold Misbranded Food Products to Plaintiffs” and that “[a]s a result of Defendant’s fraudulent and misleading labeling ... Defendant was enriched at the expense of Plaintiffs and the [1050] class.”23 This allegation .is sufficient to state a quasi-contract cause, of action. “That the claim may be duplicative of Plaintiffs statutory claims under the UCL, FAL, and [California Consumer Legal Remedies Act] is not a proper ground for dismissal at this stage of the litigation, particularly as Plaintiff seeks to represent a nationwide, class on [his] claim for quasi-contract.” 24

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Trazo v. Nestlé USA, Inc., 113 F. Supp. 3d 1047, 2015 WL 4196973 (N.D. Cal. 2015).

113 F. Supp. 3d 1047 (Trazo v. Nestlé USA, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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