Consumer fraud and breach of warranty case

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A recent decision by the United District Court for the Central District of Illinois is an important reminder to Plaintiffs’ counsel of the significant and continuing shift in judicial attitudes toward speculative class action claims for consumer fraud and breach of warranty. In this case, the Court’s decision is a warning to those who make their living by endlessly sifting through legal claims to ensure that all the essential elements of their clients’ claims are sufficiently proven.

Reinitz v. Kellogg Sales Co., No. 21-cv-1239-JES-JEH, 2022 WL 1813891 (CD Ill. June 2, 2022) putative class of consumer v. Kellogg Sales Co . launched an action against the breakfast brand. “Kellogg”) after discovering that, despite the product’s name and brand, Kellogg’s Frosted Chocolate Fudge flavored Pop Tarts lacked the common ingredients that typically make up fudge. Specifically, the Plaintiffs alleged that Kellogg was duplicitous by falsely and misleadingly advertising that chocolate fudge-flavored Pop-Tarts were included, and that Kellogg subsequently charged a higher price for the product when it unfairly substituted regular ingredients. — butter and milk (“milk butter”) — contains low-quality and inexpensive vegetable oil and whey. Plaintiffs further argued that Kellogg’s was deliberately misled by the product name and the image of a large piece of fudge on the product box, so that Kellogg would not have purchased certain Pop-Tarts and/or paid the higher price offered if it had disclosed this. its “fudge” version does not contain milk fat.

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Accordingly, Plaintiffs invoke the Illinois, Iowa, and Arkansas Consumer Fraud Acts, the Magnuson Moss Warranty Act, 15 USC §§ 2301 et seq. filed complaints, including violation. sec., and express and implied warranties, including claims for violation of various state laws, negligent misrepresentation, common law fraud and unjust enrichment. The plaintiffs sought disgorgement, restitution, punitive damages, and an end to Kellogg’s marketing practices and representations related to the sale of this particular product.

In response, Kellogg moved to dismiss Plaintiffs’ claims for consumer fraud, arguing that: (1) several fudge recipes are known, although the fudge is often made with buttermilk. no milk fat in the chocolate industry; (2) the term and meaning of “fudge” is not so specific that a reasonable consumer would be misled into purchasing a dairy-free fudge; and (3) the term “fudge” is a description of Pop-Tart flavor and therefore does not refer to specific Pop-Tart ingredients. Although the Court noted Plaintiffs’ references to chocolate industry experts that milk fat is a major component of fondant, the Court noted that Plaintiffs failed to adequately demonstrate that the average consumer would infer a product containing fondant. contains milk fat; and breakfast chocolate bars made with vegetable oil and whey may mislead a reasonable consumer into thinking that the product does not resemble fudge. As a result, the court dismissed the consumer fraud claims (without damages) because Kellogg’s marketing and branding of its chocolate fudge-flavored Pop-Tarts was not misleading as a matter of law.

The Court held that Plaintiffs could not sustain state law breach of express and implied warranty claims because Kellogg’s labeling of its chocolate fudge-flavored Pop-Tarts would not lead a reasonable consumer to believe that the product contained special milk fat. Absent a violation of state law with a valid warranty claim or existence, Plaintiffs could not state a claim under the Magnuson-Moss warranty deed. Similarly, plaintiff’s common law claim for negligent misrepresentation was dismissed under the “economic loss doctrine,” which bars recovery of purely economic losses arising from tort claims. Plaintiffs’ common law fraud claim was no different because the Complaint failed to sufficiently allege an essential element of fraud—scienter; this in turn negated any possibility of an unjust enrichment claim because Plaintiff failed to effectively allege that Kellogg had engaged in any illegal or wrongful conduct.

Finally, due to the absence of any wrongful conduct against Kellogg, Plaintiffs’ motion to injunctive relief is dismissed. Because no misrepresentation, fraud, fraudulent activity, or continuing violation of federal law has been established, the Court has no jurisdiction to issue and enforce the order; even if it did, the Court noted that Plaintiffs failed to plead the risk of future injury—an essential element of a claim for injunctive relief. The Court found that Plaintiffs lacked standing to review their claims for injunctive relief, based on Plaintiffs’ failure to establish that Kellogg had any wrongful conduct implicating any liability for Plaintiffs’ alleged damages.

PICK UP: Courts hold consumer class action plaintiffs’ feet to the fire when it comes to pleading standards. The age-old tactic of a major consumer goods corporation hoping to turn a profit before exposing deceptive and/or deceptive practices is now under intense scrutiny at the start of a class action lawsuit. . At first glance, a claim of deceptive trade practices or consumer fraud may seem as obvious as a corporate defendant’s marketing and labeling of a product to include something it doesn’t. However, the burden remains on plaintiffs to satisfy the Fed. R. Civ. P. 8(a)—which contains all the essential elements of every asserted claim—they quickly read the § 12(b)(6) dismissal order and scratch their heads and say, “what the hell?!?”