Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 1 of 32 Page ID #:1 1 JOHN H. DONBOLI (SBN: 205218) jdonboli@delmarlawgroup.com 2 JL SEAN SLATTERY (SBN: 210965) sslattery@delmarlawgroup.com 3 DEL MAR LAW GROUP, LLP 12250 El Camino Real, Suite 120 4 San Diego, CA 92130 Telephone: 858-793-6244 5 Facsimile: 858-793-6005 6 CHARLES J. LADUCA charles@cuneolaw.com 7 CUNEO GILBERT & LADUCA, LLP Woodmont Avenue, Suite 810 8 8120 Bethesda, MD 20814 9 Telephone: 202-789-3960 Facsimile: 202-589-1813 10 Attorneys for Plaintiff Chris Howe, an individual, and on behalf 11 of all others similarly situated 12 [Additional Counsel Listed on Next Page] 13 14 UNITED STATES DISTRICT COURT 15 CENTRAL DISTRICT OF CALIFORNIA – EASTERN DIVISION 16 17 CHRIS HOWE, on behalf of himself and 18 all others similarly situated, CLASS ACTION Plaintiff, 19 20 Case No. COMPLAINT FOR: VIOLATIONS OF CALIFORNIA’S UNFAIR COMPETITION LAW, FALSE ADVERTISING LAW AND CONSUMERS LEGAL REMEDIES ACT; BREACH OF EXPRESS WARRANTY AND UNJUST ENRICHMENT v. 21 MCDONALD’S CORPORATION, a Delaware Corporation; and DOES 1 22 through 100, inclusive, 23 24 Defendant. 25 Jury Trial Demanded 26 27 28 1 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 2 of 32 Page ID #:2 1 BENJAMIN D. ELGA belga@cuneolaw.com 2 TAYLOR ASEN tasen@cuneolaw.com 3 CUNEO GILBERT & LADUCA, LLP 16 Court Street, Suite 1012 4 Brooklyn, NY 11241 Telephone: 202-789-3960 5 Facsimile: 202-589-1813 6 7 8 9 10 11 12 13 AMY BOYLE boyle@halunenlaw.com MELISSA W. WOLCHANSKY wolchansky@halunenlaw.com HALUNEN LAW 1650 IDS Center 80 South Eighth Street Minneapolis, MN 55402 Telephone: 612-605-4098 Facsimile: 612-605-4099 Attorneys for Plaintiff Chris Howe, an individual, and on behalf of all others similarly situated 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 3 of 32 Page ID #:3 1 2 3 4 Plaintiff Chris Howe (“Plaintiff”) alleges the following against McDonald’s Corporation (“McDonald’s” or “Defendant”) upon personal knowledge as to his own transactions and upon information and belief as to all other matters. 5 PRELIMINARY STATEMENT 6 7 8 9 10 11 12 1. In the middle of 2015, McDonald’s began selling a product it styled as “Mozzarella Sticks” (the “Sticks” or “McDonald’s Mozzarella Cheese Sticks”) in its Wisconsin restaurants. Recently, McDonald’s began selling the Sticks nationwide, including in California. 2. In addition to suggesting that these products contain mozzarella by 13 14 labeling them “mozzarella sticks,” McDonald’s advertises them as being made 15 with “pure mozzarella,” “real mozzarella,” and “100% real cheese.” 16 17 18 19 3. In fact, McDonald’s “Mozzarella” Cheese Sticks are adulterated and misbranded. The Sticks are filled with a substance that is composed (in part) of starch, in violation of the federal standards of identity for “mozzarella” cheese, and 20 21 contrary to reasonable consumers’ expectations regarding the meaning of the term 22 “mozzarella.” 23 24 25 26 27 28 4. Rather than solely containing cheese, the Sticks contain an admixture of various substances. In particular, McDonald’s has used starch as a cheap substitute and filler. Due to starch’s ability to hold moisture, a small amount can be introduced into a mixture to add bulk and weight at a fraction of the cost of real 3 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 4 of 32 Page ID #:4 1 2 3 4 5 cheese. Upon information and belief, McDonald’s has been able to cut costs of production by limiting its reliance on actual dairy products necessary to make mozzarella, contrary to what the law requires for products labeled as “mozzarella.” 5. Labels matter. Relying on McDonald’s representations about the 6 7 8 9 10 11 12 Sticks, and the self-evident proposition that a product called “mozzarella” will be mozzarella cheese, consumers have been misled en masse into purchasing the Sticks. 6. In other words, by adding starch to its Sticks, McDonald’s fraudulently, misleadingly, and deceptively adulterated the supposed “mozzarella” 13 14 of its product. Its reasons for doing so are self-evident: inserting filler in its Sticks 15 allows McDonald’s to save money and increase its profit. 16 17 18 19 7. Defendant’s labeling and advertising is misleading, deceptive, unfair, and fraudulent. It also violates, among other laws, California’s Unfair Competition Law (“UCL”), California’s False Advertising Law (“FAL”), and California’s 20 21 Consumers Legal Remedies Act (“CLRA”). 22 PARTIES 23 24 25 26 27 8. Plaintiff Chris Howe resides in Riverside County, California. On December 24, 2015 he purchased and consumed an order of McDonald’s Mozzarella Sticks from a McDonald’s located at 34101 Monterey Avenue, Rancho 28 4 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 5 of 32 Page ID #:5 1 2 3 4 5 Mirage, California. He would not have purchased the Sticks if he had known they were misbranded and adulterated. 9. Defendant McDonald’s Corporation is a citizen of Delaware with its corporate offices and principal place of business located at One McDonald’s Plaza, 6 7 8 9 10 Oak Brook, Illinois 60523. 10. Defendant sells its Sticks through its retail locations and franchise locations throughout the United States, including in California. JURISDICTION AND VENUE 11 12 11. This Court has jurisdiction over this action under 28 U.S.C. § 1332(d), 13 14 because this is a class action in which: (1) the matter in controversy exceeds the 15 sum or value of $5,000,000, exclusive of interest and costs; (2) members of the 16 17 18 19 proposed class are citizens of a State different from McDonald’s principal place of business and place of incorporation; and (3) the number of members of the class is greater than 100. 20 21 22 12. Because a substantial portion of the wrongdoing alleged herein occurred in California, this Court has personal jurisdiction over Defendant. 23 24 25 26 27 28 Defendant also has sufficient minimum contacts with California and has otherwise intentionally availed itself of the markets in California through the promotion, marketing, and sale of products sufficient to render the exercise of jurisdiction by this Court permissible under traditional notions of fair play and substantial justice. 5 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 6 of 32 Page ID #:6 1 2 3 13. Venue is proper in this District under 28 U.S.C. § 1391(b)(2) and (3), because: (1) a substantial part of the events or omissions giving rise to these claims 4 occurred in this District; (2) a substantial part of the property that is the subject of 5 this action is situated in this District; and (3) Defendant is subject to the Court’s 6 7 8 personal jurisdiction with respect to this action. THE REGULATIONS CONCERNING COMPOSITION AND 9 LABELING OF MOZZARELLA 10 11 12 14. The definition of “food” under the Federal Food, Drug, and Cosmetic Act (“FDCA”), includes “articles used for food or drink.” 21 U.S.C. § 321(f). The 13 14 FDCA strictly prohibits the “adulteration or misbranding” of food. 21 U.S.C. 15 § 331. A food is misbranded if it has a label that is false and misleading in any 16 17 18 19 particular. 21 U.S.C. § 343. By contrast, a food is adulterated, among other things: (1) If any valuable constituent has been in whole or in part omitted or abstracted therefrom; or (2) if any substance has been 20 21 substituted wholly or in part therefor; or (3) if damage or 22 inferiority has been concealed in any manner; or (4) if any 23 24 25 26 27 28 substance has been added thereto or mixed or packed therewith so as to increase its bulk or weight, or reduce its quality or strength, or make it appear better or of greater value than it is. 21 U.S.C. § 342(b). 6 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 7 of 32 Page ID #:7 1 2 3 15. Federal regulations provide “standards of identity” for various foods. A food that “purports to be or is represented as” a food with a standard of identity, 4 but which in fact does not conform to such a standard, is illegally misbranded. 21 5 CFR § 343(g). 6 16. 7 8 9 10 11 12 Under federal law—and by incorporation, California law—“a food does not conform to the definition and standard of identity if it contains an ingredient for which no provision is made in such definition and standard, unless such ingredient is an incidental additive introduced at a nonfunctional and insignificant level . . . .” 21 CFR § 130.8. 13 17. 14 15 Mozzarella, like other, valuable dairy products, has a federal standard of identity. See 21 CFR § 133.155. The regulation defining “mozzarella cheese and 16 17 18 19 scamorza cheese” sets forth in detail the manner in which cheese labeled as “mozzarella” must be made.1 It also permits mozzarella cheese to contain the following “optional ingredients”: 20 21 (1) Dairy Ingredients. Cow’s milk, nonfat milk, or cream, 22 as defined in Section 133.3, or the corresponding products 23 of water buffalo origin, except that cow’s milk products are 24 25 not combined with water buffalo products. 26 27 28 1 Plaintiff reserves the right to amend these allegations to include violations of the manufacturing regulations, subject to discovery. 7 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 8 of 32 Page ID #:8 1 (2) Clotting Enzymes. Rennet and/or other clotting 2 enzymes of animal, plant or microbial origin. 3 (3) Other optional ingredients. 4 5 (i) Vinegar. 6 (ii) Coloring to mask any natural yellow. 7 8 (iii) Salt. 9 (iv) Antimycotics, the cumulative levels of which 10 shall not exceed current good manufacturing 11 12 practice, may be added to the cheese during the 13 14 kneading and stretching process and/or applied to 15 the surface of the cheese. 16 17 18 19 21 CFR § 133.155(b). 18. Ingredients which are not listed as optional or necessary under a standard of identity are not permitted to be included in products purporting to have 20 21 that identity. By way of illustration, on December 18, 2002, the FDA sent a letter 22 to Kraft discussing the illegality of misbranding/adulterating cheese based on the 23 24 25 26 27 28 introduction of a non-permitted ingredient. Kraft had been using milk protein concentrate (“MPC”) as an ingredient in certain of their products they labeled as cheese. Among other things, that letter clearly announced that the introduction of MPC was illegal—and constituted illicit misbranding—because “MPC is not listed 8 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 9 of 32 Page ID #:9 1 2 3 4 as an optional dairy ingredient in any of the standardized cheese products governed by a standard of identity, and therefore standardized cheese products are not permitted to contain MPC as an ingredient.” 5 19. Starch is not a permitted ingredient of mozzarella under the legal 6 7 8 9 10 11 definition of that product. Nor would a reasonable consumer believe that a product purporting to contain “mozzarella” would include starch. The inclusion of starch in a product purporting to be “mozzarella” therefore constitutes a violation of federal food labeling law. 12 20. California’s Sherman Law expressly adopted the federal labeling 13 14 requirements as its own, stating “[a]ll food labeling requirements and any 15 amendments to those regulations adopted pursuant to the federal act . . . shall be 16 17 18 19 the food regulations of this state.” Cal. Health & Safety Code § 110100. See also Cal. Health & Safety Code §§ 110660, 110665 and 110670 (prohibiting misbranded food); Cal. Health & Safety Code § 110620 (prohibiting adulterated 20 21 food). 22 /// 23 24 25 26 27 28 /// /// /// /// 9 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 10 of 32 Page ID #:10 1 2 3 FACTUAL ALLEGATIONS A. 21. 4 5 The “Mozzarella” Sticks Mozzarella sticks are battered or breaded mozzarella that has been deep fried. Often served with a condiment, mozzarella sticks are a ubiquitous and 6 7 popular appetizer at American restaurants. 8 9 10 11 22. There is no impediment to using real mozzarella in mozzarella sticks, and in fact, reasonable consumers believe that items labeled mozzarella sticks are nothing more than real mozzarella with breaded coating. 12 23. In the summer of 2015, McDonald’s began selling “Mozzarella” 13 14 Sticks in McDonald’s restaurants located in the state of Wisconsin, and shortly 15 thereafter began selling them nationwide. 16 24. 17 18 19 McDonald’s advertising highlights the “real,” “pure” or “100% real” nature of the cheese contained in the Sticks. Under any reasonable interpretation of the below advertisements, consumers would be led to believe that the Sticks 20 21 contained mozzarella cheese that comports with their understanding of what 22 mozzarella is, and that conforms to relevant federal and state law. 23 24 25 26 27 28 /// /// /// /// 10 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 11 of 32 Page ID #:11 1 2 3 25. Across the country, McDonald’s has begun advertising the Sticks as containing real mozzarella cheese. Below is an example of the campaign: 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 26. 22 23 In addition to calling the product “Mozzarella” Sticks—and thereby intimating that the product contains mozzarella cheese—the container in which the 24 25 26 27 28 Sticks are served states that the product is “made with real mozzarella”: /// /// 11 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 12 of 32 Page ID #:12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 27. These representations are part and parcel of a larger strategy on 18 19 20 21 22 23 24 McDonald’s part to rebrand as healthier. Key to this effort has been a campaign to introduce more “real” food products to the menu. Ironically, McDonald’s website contains the claim that: “In September 2013, McDonald’s Corporation partnered with the Clinton Foundation and the Alliance for a Healthier Generation to announce a global commitment that includes McDonald’s top 20 markets. Through 25 26 that commitment, we will use our size and scale to help educate, empower and 27 28 12 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 13 of 32 Page ID #:13 1 2 3 4 5 encourage our customers to make informed, nutrition minded choices by the year 2020.” 28. McDonald’s efforts to “educate, empower and encourage [their] customers to make informed . . . choices” have, by design or otherwise, in fact 6 7 8 9 10 11 12 resulted in deceptive, misleading business practices, like peddling a misbranded/adulterated dairy product: the Sticks. 29. McDonald’s charges approximately $1.29 for three “Mozzarella” Sticks, which together weigh approximately 2.3 ounces. 30. In fact, the substance within the breading is not mozzarella at all: it is 13 14 an adulterated cheese, containing both permitted dairy products and filler or 15 adulterated substances, including starch. 16 17 18 19 31. By removing each end of the Sticks, and taking a sample from their cores, it is possible to test only the central filling—the area advertised and purporting to be “Mozzarella.” An illustration of the procedure by which the 20 21 samples were obtained is shown below: 22 23 24 25 26 Sample area, avoiding contamination by coating 27 28 13 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 14 of 32 Page ID #:14 1 2 3 32. Testing the core “mozzarella” cheese of the Sticks reveals that the substance contained within their breading is not mozzarella cheese at all. It 4 contains non-permitted substances which render it outside the standard of identity 5 of mozzarella cheese, inter alia, starch. 6 7 8 9 10 11 12 33. The samples taken from within the Sticks contain 3.76% percent starch by weight. Because of starch’s moisture-holding properties, the total percentage of permitted mozzarella ingredients by weight is thereby reduced substantially. In other words, the starch becomes a cheap substitute for permitted ingredients, and a vehicle for an even cheaper ingredient: water. 13 14 15 34. Plaintiff’s investigation has confirmed that starch in the center of the Sticks could not have migrated from the coating of the Sticks, and was present in 16 17 18 19 the “cheese” portion of the Sticks. 35. This renders the overall substance misbranded and adulterated, in contravention of federal regulations and California law. The entire contents of the 20 21 22 Sticks cannot, under applicable law, be considered mozzarella. 36. Additionally, the admixture of ingredients which McDonald’s 23 24 25 26 27 advertises as “real” or “pure” mozzarella is, in fact, composed of elements which are not permitted, and thus consumers are denied the reasonably expected amount of cheese per Stick. 28 14 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 15 of 32 Page ID #:15 1 2 3 37. Relying on representations about the contents of the Sticks, consumers have been misled en masse into purchasing an inferior, misbranded, adulterated, 4 and under-filled product, containing cheap substitutes to give the appearance of 5 bulk and real cheese. 6 7 8 9 10 11 12 38. Such acts of misbranding result in consumers suffering a pecuniary loss by paying more for a product than they otherwise would have, or by purchasing a product they would not have absent the false, misleading, and deceptive advertising/labeling. At minimum, consumers purchased the Sticks believing their entire contents (within the breading) to be cheese. To the extent that 13 14 McDonald’s has used starch to increase the perceived amount of cheese in each 15 Stick, consumers have suffered a pecuniary loss in the amount of displaced cheese 16 17 18 19 that would be required to fill the Sticks. 39. These acts also harm competitors, and the dairy industry, by marketing an inferior, adulterated/misbranded product, in place of actual 20 21 mozzarella cheese. 22 CLASS ACTION ALLEGATIONS 23 24 25 26 27 28 40. Plaintiff brings this action as a class action pursuant to Federal Rule of Civil Procedure 23(b)(2) and 23(b)(3) on behalf of the following class: All persons in California who purchased McDonald’s Mozzarella Cheese Sticks (the “California Class”). 15 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 16 of 32 Page ID #:16 1 2 3 4 5 41. Additionally, Plaintiff seeks to certify a class pursuant to Federal Rule of Civil Procedure 23(b)(2) & 23(b)(3) on behalf of the following class: All consumers residing in the United States (the “Nationwide Class”). 42. Additionally, Plaintiff seeks to certify a class pursuant to Federal Rule 6 7 of Civil Procedure 23(b)(2) and 23(b)(3) on behalf of the following class: 8 All consumers who purchased McDonald’s Mozzarella Cheese 9 Sticks in Alaska, Arizona, Arkansas, California, Colorado, 10 Connecticut, Delaware, District of Columbia, Georgia, Hawaii, 11 12 Idaho, Illinois, Indiana, Kansas, Kentucky, Maine, 13 14 Massachusetts, Minnesota, Mississippi, Missouri, Montana, 15 Nebraska, Nevada, New Hampshire, New Mexico, New York, 16 North Carolina, North Dakota, Ohio, Oklahoma, Oregon, 17 18 Pennsylvania, Rhode Island, South Carolina, South Dakota, 19 Tennessee, Texas, Utah, Vermont, Virginia, Washington, West 20 21 Virginia, or Wyoming during the applicable liability period (the 22 “Multi-State Class”). 23 24 25 26 27 28 43. The following persons are expressly excluded from the Classes: (i) Defendant and its subsidiaries and affiliates, (ii) all persons who make a timely election to be excluded from the proposed Class, (iii) governmental entities, and (iv) the Court to which this case is assigned and its staff. 16 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 17 of 32 Page ID #:17 1 2 3 44. Numerosity. The Class comprises thousands of consumers throughout California and the nation. The Classes is so numerous that joinder of all members 4 is impracticable. 5 45. Commonality and Predominance. Common questions of law and 6 7 8 9 10 fact exist as to Plaintiff and the Classes and predominate over any questions that affect only individual Classes members. These common questions of law and fact include, without limitation: (a) 11 12 Whether the Mozzarella Cheese Sticks contain “mozzarella,” as that term is defined by federal law; 13 (b) 14 15 Whether labeling and advertising the Mozzarella Cheese Sticks as “mozzarella” violated California law; 16 (c) 17 18 Whether consumers of Mozzarella Cheese Sticks suffered a pecuniary harm; and, 19 (d) Whether Defendant was unjustly enriched by its 20 deceptive practices. 21 22 46. Typicality. Plaintiff’s claims are typical of the claims of Classes 23 24 25 26 27 28 members. Plaintiff and the Classes sustained damages arising out of Defendant’s common course of conduct in violation of law, as described herein. The damages of each Class member were caused directly by Defendant’s unlawful and deceptive conduct. 17 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 18 of 32 Page ID #:18 1 2 3 47. Adequacy. Plaintiff will fairly and adequately protect the interests of the Classes because they share common injuries as a result of Defendant’s conduct 4 that is common to all Class members. Plaintiff has no interests adverse to the 5 interests of absent Class members. Plaintiff has retained counsel with substantial 6 7 8 9 10 11 12 experience and success in the prosecution of complex class action and consumer protection litigation. Plaintiff and his counsel are committed to prosecuting this action vigorously on behalf of the Classes, and have the financial resources to do so. 48. Superiority. A class action is superior to other methods of fairly and 13 14 efficiently adjudicating this litigation. While not inconsequential, the damages as 15 to any individual litigant are such that individual litigation is not feasible. 16 17 18 19 Furthermore, many Class members may not even be aware that they have a claim. Accordingly, for Class members, a class action is the only mechanism by which they could reasonably expect to vindicate their rights. 20 21 22 49. The prosecution of separate actions by individual Class members would create a risk of inconsistent and varying adjudications concerning the 23 24 25 26 27 subject of this action. 50. Class treatment of predominating common questions of law and fact is superior to multiple individual actions because it would conserve the resources of 28 18 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 19 of 32 Page ID #:19 1 2 3 4 5 the courts and the litigants, and further the efficient adjudication of Class member claims. 51. Plaintiff knows of no difficulty to be encountered in the management of this action that would preclude its maintenance as a class action. 6 7 8 9 10 52. Defendant has acted, or refused to act, in a manner that applies generally to the Classes, such that final injunctive relief is appropriate as to the Classes as a whole. CAUSES OF ACTION 11 12 13 14 15 COUNT I California’s Unfair Competition Law: Violation of the “Unlawful” Prong Cal. Bus. & Prof. Code § 17200 (on behalf of the California Class) 16 53. Plaintiff repeats and re-alleges each of the above allegations. 17 54. California’s Unfair Competition Law prohibits any “unlawful, unfair, 18 19 or fraudulent” business practice. Cal. Bus. & Prof. Code § 17200. Defendant’s 20 misrepresentations listed herein are “unlawful” under California law. 21 22 23 24 55. A business practice is “unlawful” under the UCL if it violates any other law or regulation. 56. As explained herein, because the Sticks contain filler, in the form of 25 26 non-permitted ingredients for mozzarella cheese, the Sticks are misbranded in 27 violation of the law. 21 U.S.C. § 331; 21 C.F.R. § 101.9(g)(5). By extension, 28 19 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 20 of 32 Page ID #:20 1 2 3 4 5 Defendant’s conduct runs afoul of California’s Sherman Law. See Cal. Health & Safety Code § 110100. 57. Defendant’s conduct also violates various provisions of California’s Consumers Legal Remedies Act, including Civil Code § 1770(a)(5), Civil Code 6 7 8 9 10 11 12 § 1770(a)(7), and (3) Civil Code § 1770(a)(9). 58. As a result of the conduct described above, Defendant has been, and will continue to be, unjustly enriched at the expense of Plaintiff and the other California Class members. Specifically, Defendant has been unjustly enriched by obtaining revenues and profits it would not otherwise have obtained absent its 13 14 15 false, misleading, and deceptive practices. 59. Plaintiff seeks to enjoin further unlawful, unfair, and/or fraudulent 16 17 18 19 acts or practices by Defendant, to obtain restitutionary disgorgement of all monies and revenues generated as a result of such practices, and to obtain all other relief allowed under California Business & Professions Code § 17200. 20 21 22 23 24 25 26 27 28 COUNT II Violation of California’s Unfair Competition Law: Violation of the “Unfair” Prong Cal. Bus. & Prof. Code § 17200 (on behalf of the California Class) 60. Plaintiff repeats and re-alleges each of the above allegations. 61. California’s UCL prohibits any “unlawful, unfair, or fraudulent” business practice. Cal. Bus. & Prof. Code. § 17200. Defendant’s 20 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 21 of 32 Page ID #:21 1 2 3 misrepresentations on the boxes, in stores, and in advertising of the Sticks are “unfair” under California law. 62. 4 5 A business practice is “unfair” under the UCL if the gravity of the harm to the victim outweighs the utility of the defendant’s conduct. 6 63. 7 8 9 10 the UCL by misrepresenting the quality, kind, and amount of cheese contained in the Sticks. 64. 11 12 Defendant has violated, and continues to violate, the “unfair” prong of The gravity of the harm to Plaintiff and the other California Class members resulting from these unfair acts and practices outweighs any conceivable 13 14 utility of Defendant’s conduct. 15 65. As a result of the conduct described above, Defendant has been, and 16 17 18 19 will continue to be, unjustly enriched at the expense of Plaintiff and the other California Class members. Specifically, Defendant has been unjustly enriched by obtaining revenues and profits it would not otherwise have obtained absent its 20 21 false, misleading, and deceptive practices. 22 66. Plaintiff seeks to enjoin further unlawful, unfair, and/or fraudulent 23 24 25 26 27 28 acts or practices by Defendant, to obtain restitutionary disgorgement of all monies and revenues generated as a result of such practices, and to obtain all other relief allowed under California Business & Professions Code § 17200. /// 21 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 22 of 32 Page ID #:22 1 4 COUNT III Violation of California’s Unfair Competition Law: Violation of the “Fraudulent” Prong Cal. Bus. & Prof. Code § 17200 (on behalf of the California Class) 5 67. Plaintiff repeats and re-alleges each of the above allegations. 68. California’s UCL prohibits any “unlawful, unfair, or fraudulent” 2 3 6 7 8 9 10 11 12 business practice. Cal. Bus. & Prof. Code. § 17200. Defendant’s misrepresentations and omissions on the boxes, in stores, and in advertising of on the labels of the Sticks listed herein are “fraudulent” under California law. 69. A fraudulent business practice is one in which members of the public 13 14 15 are likely to be deceived. 70. Defendant has violated, and continues to violate, the “fraudulent” 16 17 18 19 prong of the UCL by misrepresenting the Sticks as containing only real mozzarella cheese, when in fact they contain an adulterated/misbranded substance, or at minimum, less mozzarella cheese than Defendant represents. In so doing, 20 21 Defendant deceives its customers into buying products they believe contain a 22 quality, kind, and quantity of mozzarella cheese which they do not. 23 24 25 26 27 71. As a result of the conduct described above, Defendant has been, and will continue to be, unjustly enriched at the expense of Plaintiff and the other California Class members. Specifically, Defendant has been unjustly enriched by 28 22 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 23 of 32 Page ID #:23 1 2 3 4 5 obtaining revenues and profits it would not otherwise have obtained absent its false, misleading, and deceptive practices. 72. Plaintiff seeks to enjoin further unlawful, unfair, and/or fraudulent acts or practices by Defendant, to obtain restitutionary disgorgement of all monies 6 7 8 and revenues generated as a result of such practices, and to obtain all other relief allowed under California Business & Professions Code § 17200. 9 COUNT IV Violation of California’s False Adverting Law (on behalf of the California Class) 10 11 12 73. Plaintiff repeats and re-alleges each of the above allegations. 74. This cause of action is brought under California’s False Advertising 13 14 15 Law, California Business & Professions Code § 17500, et seq. 16 17 18 19 75. The FAL prohibits the dissemination of any advertising which is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading. Cal. Bus. & Prof. Code § 17500. 20 21 22 76. Defendant engaged in a scheme of offering the Sticks for sale to Plaintiff and the members of the California Class by way of product packaging and 23 24 25 26 27 28 labeling, and other promotional materials. These materials misrepresented the true contents and nature of Defendant’s Sticks. 77. As is explained herein, Defendant advertised, and continues to advertise, its products in a manner that was, and is, untrue and misleading. 23 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 24 of 32 Page ID #:24 1 2 3 78. are misleading or likely to mislead for the reasons set forth above. 79. 4 5 Defendant knew or should have known that its advertisements were and Defendant’s advertisements and inducements were made within California and come within the definition of advertising as contained in Business 6 7 8 9 10 11 12 and Professions Code §17500, et seq. in that such product packaging and labeling, and promotional materials were intended as inducements to purchase Defendant’s Sticks and are statements disseminated by Defendant to Plaintiff and the members of the California Class that were intended to reach the members of the California Class. 13 14 15 80. Plaintiff suffered injuries in fact and losses of money or property as a result of Defendant’s acts and practices, which violate § 17500, et seq. 16 17 18 19 COUNT V Violation of the California Consumers Legal Remedies Act: Deceptive Advertising (on behalf of the California Class) 20 21 81. Plaintiff repeats and re-alleges each of the above allegations. 22 82. This cause of action is brought under the Consumers Legal Remedies 23 24 25 26 27 Act, California Civil Code § 1750, et seq. 83. Plaintiff, as well as each member of the Class, constitutes a “consumer” within the meaning of Civil Code § 1761(d). 28 24 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 25 of 32 Page ID #:25 1 2 3 4 84. Defendant’s sale of the Sticks constitutes “transactions” within the meaning of Civil Code § 1761(e). The merchandise purchased by Plaintiff and the Class members constitutes “goods” under Civil Code § 1761(a). 5 85. Defendant’s representations to Plaintiff and other members of the 6 7 8 9 10 11 12 Class that they were receiving merchandise containing mozzarella cheese were false, in violation of the CLRA. Specifically, Defendants’ conduct violated, among others, (1) Civil Code § 1770(a)(7), which prohibits “[r]epresenting that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another” and, (2) Civil Code § 1770(a)(9), 13 14 which prohibits “[a]dvertising goods or services with intent not to sell them as 15 advertised.” 16 86. 17 18 19 Under Civil Code § 1780(a)(2), Plaintiff, on behalf of himself and the Class, requests that this Court enjoin Defendant from continuing to engage in these unlawful and deceptive practices. 20 87. 21 22 Plaintiff also reserves the right to amend this Complaint to include a request for damages under the CLRA after complying with Civil Code § 1782(a) 23 24 25 26 27 28 within thirty days after the commencement of this cause of action for injunctive relief. /// /// 25 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 26 of 32 Page ID #:26 1 COUNT VI Breach of Express Warranty (on behalf of the Multi-State Class) 2 3 4 88. Plaintiff repeats and realleges each of the above allegations as if fully 5 set forth herein. 6 7 8 9 10 11 12 89. Defendant, as the designer, manufacturer, marketer, distributor, or seller of the Sticks expressly warranted that the Sticks were “mozzarella” and “real mozzarella.” 90. Plaintiff and the Classes were the intended targets of such representations. 13 14 91. Plaintiff and the Classes reasonably relied on Defendant’s 15 representations. 16 17 18 19 92. Defendant’s affirmations of fact and/or promises relating to their Sticks created express written warranties that the products would conform to Defendant’s affirmations of fact and/or promises. 20 21 22 93. Alternatively, Defendant’s descriptions of its Sticks became part of the bases of the bargains, creating express written warranties that the products 23 24 25 26 27 28 purchased by Plaintiff and the other Class members would conform to Defendant’s descriptions and specifications. 94. In fact, the Sticks purchased by Plaintiff and the Classes did not so conform. 26 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 27 of 32 Page ID #:27 1 2 3 95. Defendant breached express warranties because the Sticks do not contain “mozzarella” or “real mozzarella.” Defendant breached the following state 4 warranty laws: 5 A. Alaska Stat. section 45.02.313; B. A.R.S. section 47-2313; C. A.C.A. section 4-2-313; D. Cal. Comm. Code section 2313; E. Colo. Rev. Stat. section 4-2-313; F. Conn. Gen. Stat. section 42a-2-313; 14 G. 6 Del. C. section 2-313; 15 H. D.C. Code section 28:2-313; I. O.C.G.A. section 11-2-313; J. HRS section 490:2-313; K. Idaho Code section 28-2-313; 21 L. 810 ILCS 5/2-313; 22 M. Ind. Code section 26-1-2-313; N. K.S.A. section 84-2-313; O. KRS section 355.2-313; P. 11 M.R.S. section 2-313; Q. Mass. Gen. Laws Ann. ch. 106 section 2-313; 6 7 8 9 10 11 12 13 16 17 18 19 20 23 24 25 26 27 28 27 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 28 of 32 Page ID #:28 1 R. Minn. Stat. section 336.2-313; S. Miss. Code Ann. section 75-2-313; 4 T. R.S. Mo. section 400.2-313; 5 U. Mont. Code Anno. section 30-2-313; V. Neb. Rev. Stat. section 2-313; W. Nev. Rev. Stat. Ann. section 104.2313; X. RSA 382-A:2-313; Y. N.J. Stat. Ann. section 12A:2-313; Z. N.M. Stat. Ann. section 55-2-313; 2 3 6 7 8 9 10 11 12 13 14 AA. N.Y. U.C.C. Law section 2-313; 15 AB. N.C. Gen. Stat. section 25-2-313; 16 17 18 19 AC. N.D. Cent. Code section 41-02-30; AD. ORC Ann. section 1302.26; AE. 12A Okl. St. section 2-313; 20 21 AF. Or. Rev. Stat. section 72-3130; 22 AG. 13 Pa.C.S. section 2313; 23 24 25 26 27 28 AH. R.I. Gen. Laws section 6A-2-313; AI. S.C. Code Ann. section 36-2-313; AJ. S.D. Codified Laws section 57A-2-313; AK. Tenn. Code Ann. section 47-2-313; 28 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 29 of 32 Page ID #:29 1 2 3 AL. Tex. Bus. & Com. Code section 2.313; AM. Utah Code Ann. section 70A-2-313; 4 AN. 9A V.S.A. section 2-313; 5 AO. Va. Code Ann. section 59.1-504.2; 6 7 8 9 10 11 12 AP. Wash. Rev. Code Ann. section 62A.2-313; AQ. W. Va. Code section 46-2-313; and AR. Wyo. Stat. section 34.1-2-313. 96. As a result of the foregoing, Plaintiff and the other Class members have suffered damages in that (1) the Sticks were not as warranted by Defendant, 13 14 and (2) the Sticks were adulterated, and therefore contained less cheese than was 15 warranted by Defendant. 16 17 18 19 97. Within a reasonable time after they knew or should have known of such breaches, Plaintiff, on behalf of himself and the other Multi-State Class members, placed Defendant on notice thereof. 20 COUNT VII Unjust Enrichment (on behalf of the Nationwide Classes) 21 22 23 24 25 26 27 28 98. As a result of Defendant’s unlawful and deceptive actions described above, a benefit was conferred on Defendant at the expense of Plaintiff and the Classes. 99. Defendant appreciated and knew of this benefit. 29 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 30 of 32 Page ID #:30 1 2 3 4 5 100. Under the circumstances, it would be against equity and good conscience to permit Defendant to retain the ill-gotten benefits that it received from Plaintiff and the Classes. 101. Because Defendant’s retention of the non-gratuitous benefit conferred 6 7 8 9 10 on it by Plaintiff and all Class members is unjust and inequitable, Defendant must pay restitution to Plaintiff and the Class members for its unjust enrichment, as ordered by the Court. PRAYER FOR RELIEF 11 12 Plaintiff, individually and on behalf of the Class, prays for judgment and 13 14 15 relief against Defendant as follows: A. For an order certifying this case as a class action and appointing Plaintiff and Plaintiff’s counsel to represent the Classes; B. For an order awarding, as appropriate, damages to Plaintiff and the Classes, including all monetary relief to which Plaintiff and the Classes are entitled under California law. C. For an order awarding restitutionary disgorgement to Plaintiff and the Classes; D. For an order awarding non-restitutionary disgorgement to Plaintiff and the Classes; E. For an order requiring Defendant to immediately cease and desist from selling its Sticks in violation of law; enjoining Defendant from continuing to manufacture, deliver, offer to deliver, market, advertise, distribute, and sell its Sticks in the unlawful manner described herein; and ordering Defendant to engage in corrective action; 16 17 18 19 20 21 22 23 24 25 26 27 28 30 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 31 of 32 Page ID #:31 1 F. For an order awarding attorneys’ fees and costs pursuant to, inter alia, California Code of Civil Procedure § 1021.5; G. For an order awarding pre-judgment and post-judgment interest as permitted by law; and H. For an order providing such further relief as this Court deems just and proper. 2 3 4 5 6 7 8 9 10 JURY DEMAND Plaintiff demands a trial by jury on all issues so triable. 11 12 Dated: January 29, 2016 Respectfully submitted, 13 14 15 16 17 18 19 20 21 22 By: /s/ John H. Donboli John H. Donboli JL Sean Slattery DEL MAR LAW GROUP, LLP 12250 El Camino Real, Suite 120 San Diego, CA 92130 Attorneys for Chris Howe Charles J. LaDuca CUNEO GILBERT & LADUCA, LLP 8120 Woodmont Avenue, Suite 810 Bethesda, MD 20814 Attorneys for Chris Howe 23 24 25 26 27 28 Benjamin D. Elga Taylor Asen CUNEO GILBERT & LADUCA, LLP 16 Court Street, Suite 1012 Brooklyn, NY 11241 Attorneys for Chris Howe Amy Boyle 31 COMPLAINT Case 5:16-cv-00176-JGB-DTB Document 1 Filed 01/29/16 Page 32 of 32 Page ID #:32 1 2 3 4 5 Melissa W. Wolchansky HALUNEN LAW 1650 IDS Center 80 South Eighth Street Minneapolis, MN 55402 Attorneys for Chris Howe 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 32 COMPLAINT