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Loeb v. Champion Petfoods USA Inc.

United States District Court, E.D. Wisconsin

June 7, 2018

KELLIE LOEB, Plaintiff,
v.
CHAMPION PETFOODS USA INC. and CHAMPION PETFOODS LP, Defendants.

          ORDER

          J. P. Stadtmueller, U.S. District Judge.

         1. INTRODUCTION

         Plaintiff filed this class action on March 28, 2018. (Docket #1). She alleges that she and her fellow class members purchased Defendants' dog foods because Defendants advertise them as high-quality products which contain ingredients fit for human consumption. This latter assertion is, of course, merely an advertising ploy-people are not expected to eat the dog food. Nevertheless, Plaintiff maintains that Defendants' representations of quality are false, because the dog food contains high levels of poisonous heavy metals. Defendants moved to dismiss Plaintiff's complaint on April 13, 2018, for failure to state any viable claims for relief and lack of constitutional standing on Plaintiff's part. (Docket #8). The motion is now fully briefed, and for the reasons stated below, it must be granted in part and denied in part.[1]

         2. STANDARD OF REVIEW

         Defendants have moved to dismiss Plaintiff's complaint pursuant to Federal Rules of Civil Procedure (“FRCP”) 12(b)(1) and (6). FRCP 12(b)(1) allows for dismissal of actions over which the Court lacks subject-matter jurisdiction. Fed.R.Civ.P. 12(b)(1). This includes cases in which the plaintiff lacks standing. Am. Civil Liberties Union of Ill. v. Alvarez, 679 F.3d 583, 588, 590-91 (7th Cir. 2012). FRCP 12(b)(6) provides for dismissal of complaints which fail to state a viable claim for relief. Fed.R.Civ.P. 12(b)(6).

         In reviewing Plaintiff's complaint, the Court is required to “accept as true all of the well-pleaded facts in the complaint and draw all reasonable inferences in [her] favor[.]” Kubiak v. City of Chicago, 810 F.3d 476, 480-81 (7th Cir. 2016) (citation omitted). To state a viable claim, a complaint must provide “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). In other words, the complaint must give “fair notice of what the . . . claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citation omitted). The allegations must “plausibly suggest that the plaintiff has a right to relief, raising that possibility above a speculative level[.]” Kubiak, 810 F.3d at 480 (quotation omitted). Ultimately, dismissal is only appropriate “if it appears beyond doubt that the plaintiff could prove no set of facts in support of [her] claim that would entitle [her] to the relief requested.” Enger v. Chicago Carriage Cab Corp., 812 F.3d 565, 568 (7th Cir. 2016).

         3. RELEVANT FACTS

         Accepting the truth of Plaintiff's well-pleaded allegations and drawing all reasonable inferences in her favor, the relevant facts are as follows. Defendants sell dog food under the Orijen and Acana brand names throughout the United States. (Docket #1 at 3). Plaintiff has purchased Orijen repeatedly for her dogs and did so as recently as March 2018. Id. at 2. Both brands are far more expensive than other kinds of dog food, but Plaintiff bought Orijen in reliance on its advertised quality. Id. at 1-3.

         The packaging for both products offers representations of their high quality. Id. at 3-4. Defendants claim that they provide “The World's Best Petfood.” Id. at 3. Orijen is touted as “the fullest expression of our biologically appropriate and fresh regional ingredients commitment, ” containing “unmatched inclusions of free-run poultry, wild-caught fish and whole nest-laid eggs-sustainably farmed or fished in our region and delivered daily, fresh or raw and preservative-free.” Id. Orijen further claims that it “features fresh, raw or dehydrated ingredients from minimally processed poultry, fish and eggs that are deemed fit for human consumption prior to inclusion in our foods.” Id. Similarly, Acana is “bursting with richly nourishing meat and protein from free-run chicken, whole, nest-laid eggs and wild-caught flounder-all delivered fresh from our region so they're loaded with goodness and taste.” Id. at 4. As with Orijen, Acana is made “from poultry, fish and eggs passed fit for human consumption.” Id.

         Plaintiff asserts that, contrary to Defendants' representations, the products are not of high quality. Id. Rather, they contain “excessive” and “dangerous” levels of arsenic, lead, cadmium, and mercury, rendering them unfit for human consumption. Id. at 4-5. Plaintiff claims that these heavy metals can cause severe health problems for dogs. Id. at 5. Further, because “[h]eavy metals tend to accumulate in dogs and other animals, . . . long-term exposure to even small quantities of heavy metals can cause deleterious health effects.” Id.

         Plaintiff discovered the heavy metal levels in the products by reference to a white paper published by Defendants themselves (the “White Paper”). Id. at 4; (Docket #10). A “white paper” is a marketing tool used to promote a product or service, usually founded on some empirical data. Defendants' White Paper, essentially a four-page pamphlet, sets forth the results of some third-party studies conducted on the heavy metal levels in Orijen and Acana. Id. The White Paper discloses the arsenic, lead, cadmium, and mercury concentrations found in the dog foods and explains how those are well below dangerous levels. Id.

         Plaintiff cites the FDA's “Total Diet Study, ” published in April 2014 and revised in April 2017, in an effort to contradict the White Paper's conclusions (the “Study”). According to the Study, poultry, fish, and eggs meant for human consumption have on average far lower levels of heavy metals than those found in Defendants' products. (Docket #1 at 4-5). This is important for Orijen and Acana because both are primarily composed of allegedly contaminated meat and eggs. Id. at 4.

         4. ANALYSIS

         Plaintiff generally alleges that Defendants' marketing is both false and misleading, and that she and the class members acted in reliance on Defendants' representations in paying a premium for the dog food. She brings specific claims in five counts. Count One is for violation of the Wisconsin Deceptive Trade Practices Act (“WDTPA”). (Docket #1 at 8). As the name implies, the WDTPA prohibits untrue or deceptive advertisements. Wis.Stat. § 100.18(1). Count Two is nearly identical, contending that Defendants' false statements violate Wisconsin Administrative Code § ATCP 90.02, which governs consumer product packaging. (Docket #1 at 8-9). If true, this would entitle Plaintiff to damages under the Wisconsin Unfair Trade Practices Act (“WUTPA”). Wis.Stat. § 100.20(5). Counts Three and Four are for breach of express and implied warranties. (Docket #1 at 9-11). Count Five asserts that Defendants have been unjustly enriched by their deceptive marketing scheme. Id. at 12.

         The Court's first concern is with the material by which Defendants' motion, and Plaintiff's complaint, should be assessed. Normally, this would be only the allegations of the complaint. E.E.O.C. v. Concentra Health Servs., Inc., 496 F.3d 773, 776 (7th Cir. 2007). However, Defendants assert that the White Paper demonstrates the implausibility of Plaintiff's allegations, and thus the propriety of dismissing this action. See, e.g., (Docket #9 at 11-15). When a defendant offers arguments in support of a motion to dismiss which go beyond the complaint's allegations, a court has two options: 1) ignore the outside materials; or 2) if it wants to consider the documents in deciding the motion, the court must convert the motion to one for summary judgment and allow the plaintiff adequate time to conduct discovery to prepare a response. Fed.R.Civ.P. 12(d).

         Defendants maintain that the Court need not convert their motion to a summary judgment posture in light of an exception to FRCP 12(d)'s otherwise clear command. The Seventh Circuit has long held that “[d]ocuments that a defendant attaches to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to her claim.” Venture Assoc. Corp. v. Zenith Data Sys. Corp., 987 F.2d 429, 431 (7th Cir. 1993). The White Paper is indeed referenced by Plaintiff's complaint and, at least at this stage, appears to be central to her claims.

         Defendants fail to account, however, for the final requirement of this doctrine. The document in question must be “concededly authentic” and “prove[] that [Plaintiff's] claim ha[s] no merit.” Tierney v. Vahle, 304 F.3d 734, 738 (7th Cir. 2002); Bogie v. Rosenberg, 705 F.3d 603, 609 (7th Cir. 2013) (“When an exhibit incontrovertibly contradicts the allegations in the complaint, the exhibit ordinarily controls, even when considering a motion to dismiss.”) (emphasis added). Defendants, heedless of this rule, rest their position on the assumption that the White Paper not only conflicts with, but indisputably proves the meritlessness of Plaintiff's allegations. For example, in their opening brief, Defendants argue:

[A]s explained in detail in the White Paper and set forth more fully below, Champion's products are anything but dangerous. In the White Paper, Champion disclosed that its products contain arsenic, cadmium, lead, and mercury, which are all from natural sources. In fact, as discussed in the White Paper, any pet food made from natural sources will have some levels of heavy metals such as arsenic, cadmium, lead, and mercury because these metals are naturally present ...

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