Case 5:21-cv-01202-EJD Document 33 Filed 12/20/21 Page 1 of 14
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`SAN JOSE DIVISION
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`ANKUSH PURI,
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`Plaintiff,
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`v.
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`COSTCO WHOLESALE CORPORATION,
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`Defendant.
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`Case No. 5:21-cv-01202-EJD
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`ORDER GRANTING MOTION TO
`DISMISS AMENDED COMPLAINT
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`Re: Dkt. No. 23
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`Plaintiff Ankush Puri brings this putative false advertising class action against Defendant
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`Costco Wholesale Corporation (“Costco”) related to Costco’s sale of ice cream bars. Before the
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`Court is Costco’s motion to dismiss Puri’s amended complaint under Federal Rules of Civil
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`Procedure 12(b)(6) and 9(b). Def. Costco Wholesale Corp.’s Notice of Mot. and Mem. in Supp.
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`of Def.’s Mot. to Dismiss Pl.’s First Am. Compl. (“Mot.”), Dkt. No. 23. The Court finds the
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`motion appropriate for decision without oral argument pursuant to Civil Local Rule 7-1(b).
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`Having considered the parties’ written submissions, the Court GRANTS the motion with leave to
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`amend.
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`I.
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`BACKGROUND
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`Defendant Costco is a Washington corporation with its principal place of business in
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`Issaquah, Washington. First Am. Class Action Compl. (“FAC”), Dkt. No. 18 ¶ 87. Costco
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`operates approximately 600 stores in the United States, including a significant number in
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`California. Id. ¶¶ 88-89. Costco offers under its Kirkland Signature brand “Chocolate Almond
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`Dipped Vanilla Ice Cream Bars” (“the Product”), which are sold in packages of 18 bars in
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`Case No.: 5:21-cv-01202-EJD
`ORDER GRANTING MOT. TO DISMISS. AM. COMPL.
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`Case 5:21-cv-01202-EJD Document 33 Filed 12/20/21 Page 2 of 14
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`Costco’s retail stores. Id. ¶¶ 1-3.
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`The Product’s packaging includes the aforementioned name of the Product as well as
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`pictures of the Product, two pieces of chocolate, three vanilla beans, a vanilla flower, and two
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`almonds. Id. ¶ 3. The packaging also includes an ingredient list, which provides that the
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`Product’s “Milk Chocolate Flavored Coating With Almonds” consists of “Coating (Sugar,
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`Coconut Oil, Nonfat Dry Milk, Unsweetened Chocolate, Soybean Oil, Unsweetened Chocolate
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`Processed With Alkali, Soy Lecithin), Roasted Almonds (Almonds, Cottonseed Oil).” Id. ¶ 39.
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`Plaintiff Puri is a resident of Santa Clara, California and has been a Costco member for
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`many years. Id. ¶¶ 86, 94. Puri purchased the Product several times in the last two years. Id. ¶¶
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`97-98. Based on the Product’s packaging and name, he “expected the Product’s chocolate coating
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`would be made from chocolate from cacao beans.” Id. ¶¶ 63-70. This is because, according to
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`Puri, chocolate is defined by the Food and Drug Administration (“FDA”) and under California law
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`as “prepared from ground roasted cacao bean,” and it must be “made chiefly from cacao beans
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`with a small amount of optional ingredients.” Id. ¶¶ 3, 7-8. Based on this definition, he says the
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`pictures and terminology on the packaging are misleading because the “Milk Chocolate Flavored
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`Coating With Almonds” actually contains mostly vegetable oils and only “de minimis” or
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`“negligible” amounts of ingredients derived from cacao beans. Id. ¶¶ 39-78. Therefore, Puri
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`alleges, “the Product is not chocolate, or even mostly chocolate, because it is mainly made from
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`vegetable oils.” Id. ¶ 71. He says that he would not have purchased the Product had he known of
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`the amount of vegetable oils present in the Product. Id. ¶¶ 67-75.
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`In support of his contention that the Product is mostly vegetable oils and not ingredients
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`derived from cacao beans, Puri relies on the Product’s ingredient list, which identifies the
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`ingredients in order of predominance by weight in accordance with 21 C.F.R. § 101.4(a)(1). Id. ¶¶
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`39-48. He assigns weights to the ingredients based on their placement in the ingredient list,
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`ultimately concluding that the total amount of vegetable oils (the coconut oil and soybean oil) “are
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`present in an amount greater than cacao bean ingredients” (presumably, the unsweetened
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`chocolate and unsweetened chocolate processed with alkali). Id. ¶¶ 48. Furthermore, Puri says
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`Case No.: 5:21-cv-01202-EJD
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`Case 5:21-cv-01202-EJD Document 33 Filed 12/20/21 Page 3 of 14
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`that the Product contains even less chocolate than his weighting analysis suggests, because the
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`ingredient list improperly uses the term “unsweetened chocolate processed with alkali.” Id. ¶¶ 49-
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`56. He alleges that “unsweetened chocolate processed with alkali” is a misnomer, because only
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`cocoa powder is processed with alkali, not chocolate. Id.
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`In addition to his main theory that the Product’s labeling is misleading because it contains
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`more vegetable oils than cacao bean ingredients, Puri offers two other categories of reasons why
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`the Product’s packaging is deceptive: (1) the Product does not have the same taste or “mouthfeel”
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`as “real” chocolate, and (2) “real” chocolate is a natural ingredient that has health and nutrition
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`benefits and satiety value that synthetic vegetable oils do not. Id. ¶¶ 21-38.
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`On February 18, 2021, Puri filed the instant action alleging the following claims: (1)
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`unlawful, unfair, and fraudulent conduct in violation of California’s Unfair Competition Law
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`(“UCL”), Cal. Bus. & Prof. Code §§ 17200 et seq.; (2) violation of the California False
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`Advertising Law (“FAL”), Cal. Bus. & Prof. Code §§ 17500 et seq.; and (3) violation of the
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`California Consumers Legal Remedies Act (“CLRA”), Cal. Civ. Code §§ 1750 et seq. Id. ¶¶ 113-
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`151. On June 14, 2021, Costco filed the motion to dismiss now before the Court. Dkt. No. 23.
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`II.
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`LEGAL STANDARD
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`A.
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`Rule 12(b)(6)
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`Federal Rule of Civil Procedure 8(a) requires a plaintiff to plead each claim with enough
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`specificity to “give the defendant fair notice of what the . . . claim is and the grounds upon which
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`it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotations omitted). A
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`complaint which falls short of the Rule 8(a) standard may therefore be dismissed if it fails to state
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`a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). “Dismissal under Rule
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`12(b)(6) is appropriate only where the complaint lacks a cognizable legal theory or sufficient facts
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`to support a cognizable legal theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097,
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`1104 (9th Cir. 2008). When deciding whether to grant a motion to dismiss, the Court must accept
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`as true all “well pleaded factual allegations” and determine whether the allegations “plausibly give
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`rise to an entitlement to relief.” Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). The Court must also
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`Case No.: 5:21-cv-01202-EJD
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`Case 5:21-cv-01202-EJD Document 33 Filed 12/20/21 Page 4 of 14
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`construe the alleged facts in the light most favorable to the plaintiff. Love v. United States, 915
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`F.2d 1242, 1245 (9th Cir. 1989). While a complaint need not contain detailed factual allegations,
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`it “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is
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`plausible on its face.’” Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp., 550 U.S. at 570).
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`A court generally may not consider any material beyond the pleadings when ruling on a
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`Rule 12(b)(6) motion. If matters outside the pleadings are considered, “the motion must be treated
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`as one for summary judgment under Rule 56.” Fed. R. Civ. P. 12(d). However, documents
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`appended to the complaint, incorporated by reference in the complaint, or which properly are the
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`subject of judicial notice may be considered along with the complaint when deciding a Rule
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`12(b)(6) motion. Khoja v. Orexigen Therapeutics, 899 F.3d 988, 998 (9th Cir. 2018); see also Hal
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`Roach Studios, Inc. v. Richard Feiner & Co., Inc., 896 F.2d 1542, 1555 n.19 (9th Cir. 1990).
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`Likewise, a court may consider matters that are “capable of accurate and ready determination by
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`resort to sources whose accuracy cannot reasonably be questioned.” Roca v. Wells Fargo Bank,
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`N.A., No. 15-cv-02147-KAW, 2016 WL 368153, at *3 (N.D. Cal. Feb. 1, 2016) (quoting Fed. R.
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`Evid. 201(b)).
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`B.
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`Rule 9(b)
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`Consumer protection claims that sound in fraud are subject to the heightened pleading
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`requirements of Federal Rule of Civil Procedure 9(b). See Vess v. Ciba-Geigy Corp. USA, 317
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`F.3d 1097, 1102 (9th Cir. 2003); San Miguel v. HP Inc., 317 F. Supp. 3d 1075, 1084 (N.D. Cal.
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`2018). Rule 9(b) requires that “a party must state with particularity the circumstances constituting
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`fraud.” Fed. R. Civ. P. 9(b). The circumstances constituting the fraud must be “specific enough to
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`give defendants notice of the particular misconduct which is alleged to constitute the fraud
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`charged so that they can defend against the charge and not just deny that they have done anything
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`wrong.” Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir. 1985). Therefore, a party alleging
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`fraud must set forth “the who, what, when, where, and how” of the misconduct. Vess, 317 F.3d at
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`1106 (quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997)). “[I]n a case where fraud is
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`not an essential element of a claim, only allegations . . . of fraudulent conduct must satisfy the
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`Case 5:21-cv-01202-EJD Document 33 Filed 12/20/21 Page 5 of 14
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`heightened pleading requirements of Rule 9(b)” while “[a]llegations of non-fraudulent conduct
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`need satisfy only the ordinary notice pleading standards of Rule 8(a).” Id. at 1104–05.
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`With respect to omissions-based fraud claims, “the pleading standard is lowered on
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`account of the reduced ability in an omission suit ‘to specify the time, place, and specific content,
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`relative to a claim involving affirmative misrepresentations.’” Barrett v. Apple Inc., No. 5:20-CV-
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`04812-EJD, 2021 WL 827235, at *7 (N.D. Cal. Mar. 4, 2021) (quoting In re Apple & AT & TM
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`Antitrust Litig., 596 F. Supp. 2d 1288, 1310 (N.D. Cal. 2008)); see also Falk v. Gen. Motors
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`Corp., 496 F. Supp. 2d 1088, 1099 (N.D. Cal. 2007).
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`III. DISCUSSION
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`Costco now moves to dismiss all claims on the grounds that Puri fails to state any claim
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`because the Product is not misleading, Puri’s claims are preempted, Puri lacks standing to seek
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`injunctive relief, and Puri has failed to comply with the requirements of the CLRA for seeking
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`money damages. Mot. at 4–21.
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`A.
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`Preemption
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`The Supremacy Clause grants Congress the power to preempt state law. U.S. Const. art.
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`VI, cl. 2; Crosby v. Nat’l Foreign Trade Council, 530 U.S. 363, 372 (2000). The Supreme Court
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`has identified two cornerstones of its preemption jurisprudence: first, “the purpose of Congress is
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`the ultimate touchstone in every preemption case,” and second, “[i]n all pre-emption cases, and
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`particularly in those in which Congress has legislated in a field which the States have traditionally
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`occupied, we start with the assumption that the historic police powers of the States were not to be
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`superseded by the Federal Act unless that was the clear and manifest purpose of Congress.”
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`Wyeth v. Levine, 555 U.S. 555, 565 (2009) (citation and internal marks omitted). Where there is a
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`“plausible alternative reading,” courts “accept the reading that disfavors pre-emption.” Bates v.
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`Dow Agrosciences LLC, 544 U.S. 431, 449 (2005).
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`The Food Drug and Cosmetics Act (“FDCA”) established a comprehensive federal scheme
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`of food regulation to ensure food safety and proper labeling in an effort to avoid misleading
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`consumers. 21 U.S.C. § 341 et seq. Congress amended the FDCA by enacting the Nutrition
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`Case No.: 5:21-cv-01202-EJD
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`Labeling and Education Act of 1990 (“NLEA”). The FDCA, as amended by the NLEA, expressly
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`preempts state laws to the extent they differ from federal law, providing that “no State . . . may
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`directly or indirectly establish . . . any requirement for the labeling of food . . . that is not identical
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`to” the FDCA’s requirements. 21 U.S.C. § 343-1(a)(3). A state regulation is “not identical to” a
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`federal regulation if it imposes any obligation that differs from those specifically imposed by or
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`contained in the applicable provision, including any implementing regulation. 21 C.F.R. §
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`100.1(c)(4)(ii). Under the NLEA, state consumer protection laws are preempted when they are
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`used to impose requirements that contravene or are inconsistent with the FDCA’s requirements.
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`Durnford v. MusclePharm Corp., 907 F.3d 595, 601–03 (9th Cir. 2018); Hadley v. Kellogg Sales
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`Co., 273 F. Supp. 3d 1052, 1071–72 (N.D. Cal. 2017).
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`The parties disagree on whether Puri seeks to impose requirements that differ from the
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`FDCA’s and thus whether his claims are preempted. Costco argues that Puri’s claims are
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`preempted because the Product “fully complies with federal food regulations.” Mot. at 17. Puri
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`also argues that preemption is improper because there is a presumption against preemption in food
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`regulation and the FAC does not impose additional requirements. Mem. of Points and Authorities
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`in Opp’n to Def.’s Mot. to Dismiss (“Opp’n”), Dkt. No. 24, at 4–7. While it is true that there is a
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`presumption against preemption of laws within a state’s police powers, “[c]onsumer protection
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`laws, such as the UCL, FAL, and [CLRA], are nonetheless preempted if they seek to impose
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`requirements that contravene the requirements set forth by federal law.” Peviani v. Hostess
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`Brands, Inc., 750 F. Supp. 2d 1111, 1118 (C.D. Cal. 2010) (citing Wyeth, 555 U.S. 555).
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`The primary thrust of Puri’s allegations is that Costco’s use of the word “chocolate” and a
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`picture of chocolate on the Product’s packaging is misleading because the Product’s coating is
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`“mostly vegetable oils” instead of ingredients derived from cacao beans. FAC ¶¶ 21, 39; see
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`Opp’n at 2–3, 5–6. Similarly, Puri says that the phrase “Milk Chocolate Flavored Coating With
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`Almonds” from the Product’s ingredient list is misleading because it does not mention that the
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`coating is mostly vegetable oils. FAC ¶¶ 57-59. According to Puri, the basis for this theory of
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`liability is the Sherman Law and FDCA’s definition of “chocolate” as “made chiefly from cacao
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`Case 5:21-cv-01202-EJD Document 33 Filed 12/20/21 Page 7 of 14
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`beans with a small amount of optional ingredients” as described in 21 C.F.R. § 163.13(a). Opp’n
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`at 5 (citing FAC ¶ 7). Puri also relies on FDA regulations that “limit the representation of a food
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`as ‘chocolate’ where it contains a de minimis amount of cacao bean ingredients and is mostly
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`vegetable oils,” asserting that 21 C.F.R. § 163.155(c) requires Costco to label “[s]uch a food . . . as
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`‘milk chocolate and palm oil coating.’”1 Id. (citing FAC ¶ 20).
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`The problem here is that neither of Puri’s cited regulations support a viable theory of
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`liability. The Court is unable to locate 21 C.F.R. § 163.13, and it appears that no such regulation
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`exists. Title 21, Chapter I, Subchapter B, Part 163 of the Code of Federal Regulations concerns
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`“Cacao Products,” but none of its sections contain the general definition of “chocolate” that Puri
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`cites. While Part 163’s title, “Cacao Products,” provides some support for Puri’s claim that a
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`chocolate product must be made from cacao beans, it does not support his claim that it must be
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`“chiefly” so. Opp’n at 5 (citing FAC ¶ 7).
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`As to 21 C.F.R. § 163.155, that subsection reads in relevant part:
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`(a) Description. Milk chocolate and vegetable fat coating is the food
`that conforms to the standard of identity, and is subject to the
`requirements for label declaration of ingredients for milk chocolate
`§ 163.130 . . . , except that one or more optional ingredients
`specified in paragraph (b) of this section are used. . . .
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`(b) Optional ingredients.
`(1) Safe and suitable vegetable derived oils, fats, and stearins
`other than cacao fat [and] . . .
`(2) Safe and suitable dairy-derived ingredients . . .
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`(c) Nomenclature. The name of the food is “milk chocolate and
`vegetable fat coating” or “skim milk chocolate and vegetable
`fat coating”, as appropriate. Alternatively, the common or usual
`name of the vegetable derived fat ingredient may be used in
`the name of the food, e.g., “milk chocolate and _______ oil
`coating”, the blank being filled in with the common or usual name
`of the specific vegetable fat used.
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`21 C.F.R. § 163.155. First, this regulation says nothing about the relative amounts of cacao bean
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`1 Puri’s opposition brief and Paragraph 20 of the FAC refer to “palm oil.” Opp’n at 5; FAC ¶ 20.
`The Product does not contain palm oil. FAC ¶ 39. Elsewhere, the FAC refers to “milk chocolate
`and vegetable oil coating.” See, e.g., id. ¶ 59. The Court uses this latter term.
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`ingredients versus vegetable oils. Section 163.155(a) refers to § 163.130, which in turn states that
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`milk chocolate “contains not less than 10 percent by weight of chocolate liquor” as calculated
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`according to a specific formula. 21 C.F.R. § 163.130(a)(2). However, even assuming that less
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`than 10% chocolate liquor is considered a “de minimis amount,” Puri does not adequately allege
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`that the Product contains only a de minimis amount of cacao bean ingredients or even that the
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`Product is “mostly vegetable oils.” See infra Section III.B.
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`Second, § 163.155(c) does not contain any language mandating labeling of the Product as
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`“milk chocolate and vegetable oil coating” under these circumstances. Rather, § 163.155 is a
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`permissive standard of identity regulation. A violation of a standard of identity occurs if the food
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`“purports to be or is represented as a food for which a definition and standard of identity has been
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`prescribed” unless it conforms to that standard and is labeled as such. 21 U.S.C. § 343(g). When
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`no such representation has been made, the standard of identity is not implicated. See 62 Cases,
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`More or Less, Each Containing Six Jars of Jam v. United States, 340 U.S. 593, 599–600 (1951)
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`(products “not meeting the defined specifications” but labeled accurately are not misleading).
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`Accordingly, the Court finds that to the extent Puri’s claims seek to require Costco to label
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`the Product as “milk chocolate and vegetable oil coating” or “milk chocolate and vegetable oil
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`almond dipped ice cream bars,” those claims as currently pled are preempted because they seek to
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`impose requirements different from or in addition to the FDCA’s requirements. The Court does
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`not reach the question of whether Puri’s claims are preempted because Costco in fact complied
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`with FDA regulations and policy guidance—the Court makes no such findings here. Mot. at 7–9
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`(citing 21 C.F.R. §§ 163.135 and 163.155, and FDA Compliance Policy Guide § 515.800). Nor
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`does the Court reach Costco’s argument concerning the use of “chocolate” as a flavor designator.2
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`2 Although the FAC contains specific statements regarding flavor, Puri expressly disclaims any
`theory of liability based on flavor, asserting that his claims relate only to “the use of chocolate as a
`nutritive ingredient, not a flavor.” Compare FAC ¶¶ 28-31, 67-68 (discussing the flavor and taste
`of chocolate and the Product) with Opp’n at 6 (“The FAC is unambiguous that the representations
`are misleading with respect to the use of chocolate as a nutritive ingredient, not a flavor.”). The
`Court therefore reads the FAC as not asserting any consumer deception claims based on the
`Product’s flavor or taste. At any rate, the Court observes that other courts in this District have
`ruled that whether a flavor designator is proper under 21 C.F.R. § 101.22(i) (and thus whether a
`Case No.: 5:21-cv-01202-EJD
`ORDER GRANTING MOT. TO DISMISS. AM. COMPL.
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`Northern District of California
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`United States District Court
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`Case 5:21-cv-01202-EJD Document 33 Filed 12/20/21 Page 9 of 14
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`Id. at 4–14.
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`B.
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`Reasonable Consumer Standard
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`Even if Puri’s claims are not preempted, he fails to state a deceptive labeling claim.
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`California’s UCL defines “unfair competition” as “any unlawful, unfair or fraudulent
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`business act or practice and unfair, deceptive, untrue or misleading advertising.” Cal. Bus. & Prof.
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`Code § 17200. Puri brings consumer deception claims under all three prongs. FAC ¶¶ 113-132.
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`The FAL similarly prohibits “untrue or misleading” advertising “which is known, or which by the
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`exercise of reasonable care should be known, to be untrue or misleading,” Cal. Bus. & Prof. Code
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`§ 17500, and the CLRA prohibits “‘unfair methods of competition and unfair or deceptive acts or
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`practices’ in transactions for the sale or lease of goods to consumers.” Daugherty v. Am. Honda
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`Motor Co., 144 Cal. App. 4th 824, 833 (2006) (quoting Cal. Civ. Code § 1770(a)). Consumer
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`deception claims under the UCL, FAL, and CLRA must satisfy the “reasonable consumer”
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`standard to survive a motion to dismiss pursuant to Rule 12(b)(6). Moore v. Trader Joe’s, 4 F.4th
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`874, 881 (9th Cir. 2021); Williams v. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008) (citing
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`Freeman v. Time, Inc., 68 F.3d 285, 289 (9th Cir. 1995)).
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`The reasonable consumer standard requires that “members of the public are likely to be
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`deceived” by the pertinent advertising. See Ebner v. Fresh, Inc., 838 F.3d 958, 965 (9th Cir.
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`2016) (internal quotation marks omitted). This standard is “not a negligible burden,” and it
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`“requires more than a mere possibility” that the statement at issue “might conceivably be
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`misunderstood by some few consumers viewing it in an unreasonable manner.” Moore, 4 F.4th at
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`881 (quoting Ebner, 838 F.3d at 965 (internal quotation marks omitted)). “Rather, the reasonable
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`consumer standard requires a probability ‘that a significant portion of the general consuming
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`public or of targeted consumers, acting reasonably in the circumstances, could be misled.’”
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`Ebner, 838 F.3d at 965 (quoting Lavie v. Procter & Gamble Co., 165 Cal. App. 4th 496, 508
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`plaintiff’s claims are preempted) cannot be decided at the pleading stage as a matter of law. See,
`e.g., Tucker v. Post Consumer Brands, LLC, No. 19-cv-03993-YGR, 2020 WL 1929368, at *3–4
`(N.D. Cal. Apr. 21, 2020) (citing cases).
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`Case No.: 5:21-cv-01202-EJD
`ORDER GRANTING MOT. TO DISMISS. AM. COMPL.
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`(2003)). California district and state courts have recognized that whether a reasonable consumer
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`would be misled is generally a question of fact not amenable to determination on a motion to
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`dismiss but that the factual allegations may fail as a matter of law. See Williams, 552 F.3d at 938–
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`39; Robie v. Trader Joe’s Co., No. 20-cv-07355-JSW, 2021 WL 2548960, at *5 (N.D. Cal. June
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`14, 2021); Shaeffer v. Califia Farms, LLC, 44 Cal. App. 5th 1125, 1140 (2020).
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`Here, Puri has not alleged facts from which it may be plausibly inferred that the Product’s
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`packaging would mislead a reasonable consumer. The FAC suffers from numerous defects.
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`First, there are no facts to support the FAC’s fundamental theory that to qualify as
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`“chocolate,” a food must be chiefly made from ingredients derived from cacao beans. As
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`described above, the purported legal basis for Puri’s alleged FDA definition of chocolate, “21
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`C.F.R. § 163.13(a),” does not exist. See supra Section III.A. The Merriam-Webster dictionary
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`definition that Puri quotes does not require that a food be made chiefly from cacao bean
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`ingredients to be called “chocolate.” FAC ¶¶ 4-8.
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`Second, the FAC is chock full of internal contradictions. For example, Puri acknowledges
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`that the coating ingredients include “unsweetened chocolate” and “unsweetened chocolate
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`processed with alkali,” which he repeatedly describes as “cacao bean ingredients.” See id. ¶¶ 42-
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`44, 48-50. If those ingredients come from cacao beans as he states, then his entire theory that the
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`Product is misleading because it does not contain ingredients derived from cacao beans is
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`defeated. Even accepting Puri’s allegations that the Product’s packaging incorrectly uses the term
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`“unsweetened chocolate processed with alkali” instead of “unsweetened cocoa powder processed
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`with alkali,” “cocoa powder” nonetheless still comes from cacao beans. See 21 C.F.R. § 163.113
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`(standard of identity for “cocoa,” referencing “breakfast cocoa” as described in 21 C.F.R. §
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`163.112); 21 C.F.R. § 163.112 (“Breakfast cocoa is the food prepared by pulverizing the material
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`remaining after part of the cacao fat has been removed from ground cacao nibs.”); 21 C.F.R. §
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`163.110 (“Cacao nibs is the food prepared by removing the shell from cured, cleaned, dried, and
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`cracked cacao beans.”). Additionally, Puri’s allegation that “[l]isting the ingredient as ‘Milk
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`Chocolate Flavored Coating With Almonds’ does not tell consumers that the coating is mostly
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`Case No.: 5:21-cv-01202-EJD
`ORDER GRANTING MOT. TO DISMISS. AM. COMPL.
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`Northern District of California
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`United States District Court
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`

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`lower quality chocolate substitutes – vegetable oils” contradicts his earlier allegation that the
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`Product’s ingredient list identifies the ingredients in order of predominance by weight. Compare
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`FAC ¶¶ 39-43 with id. ¶ 58. It is clear from the face of the ingredients list that there is more
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`coconut oil than unsweetened chocolate or unsweetened chocolate/cocoa processed with alkali.
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`Third, in support of his claims, Puri attempts to use the Product’s ingredient list to engage
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`in a purported analysis in which he assigns weight amounts in decreasing order according to each
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`ingredient’s predominance. Id. ¶¶ 39-48. Based on this analysis, Puri “confirms” that vegetable
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`oils are present in greater amounts than cacao bean ingredients. Id. ¶ 48. These allegations are
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`completely speculative, and the weight amounts Puri assigns each ingredient appear to be entirely
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`arbitrary without firm basis in fact. It could very well be that one could assign different weight
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`amounts to each ingredient that would result in the amount of cacao bean ingredients equaling (or
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`possibly even exceeding) the amount of vegetable oils. “[A] plaintiff’s unreasonable assumptions
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`about a product’s label will not suffice” to satisfy the reasonable consumer standard. Moore, 4
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`F.4th at 882. Even if the Court were to accept this unsubstantiated analysis, Puri himself
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`concludes that there are “15 grams” of total vegetable oils compared to “12 grams” of total cacao
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`bean ingredients—hardly support for a claim that the Product is “mostly vegetable oils” with a “de
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`minimis” amount of chocolate. FAC ¶ 48.
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`Fourth, a reasonable consumer would know that chocolate must be mixed with some
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`significant amount of fat or oil to create a coating that would solidify around an ice cream bar.3
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`Even if a consumer were concerned that the Product’s coating is not purely chocolate made from
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`primarily cacao bean ingredients, any “potential ambiguity could be resolved by the back panel of
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`the products,” as any “reasonable shopper” would know. Workman v. Plum Inc., 141 F. Supp. 3d
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`1032, 1035 (N.D. Cal. 2015). Workman is a particularly instructive case: there, the plaintiff
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`alleged that puree pouches and fruit bars whose labels included large images of pumpkin,
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`3 The FAC includes various comments from individuals in the chocolate confectionery industry
`about the use of vegetable oils in solid chocolate candy, not ice cream coating. See FAC ¶¶ 10-15,
`30 (discussing a “bar” of chocolate in Paragraph 14).
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`Case No.: 5:21-cv-01202-EJD
`ORDER GRANTING MOT. TO DISMISS. AM. COMPL.
`11
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`Northern District of California
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`United States District Court
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`

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`pomegranate, quinoa, and yogurt were misleading because the pictured foods were not the “most
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`prominent” ingredients. Id. at 1033–34. The Workman plaintiff argued that the labeling was
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`misleading because “it did not display pictures of applesauce (the primary ingredient in many of
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`the products).” Id. at 1037. Puri makes strikingly similar claims here: in addition to alleging that
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`the chocolate image on the Product’s packaging is deceptive because it is not the primary
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`ingredient in the Product’s coating, Puri also says that he “did not observe pictures of vegetable
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`oils on the front label,” implying that failing to do so was misleading. FAC ¶ 65. The Workman
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`court dismissed the action on the grounds that “a reasonable consumer would simply not view
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`pictures on the packaging of a puree pouch or box of fruit bars and assume that the size of the
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`items pictured directly correlated with their predominance in the blend.” 141 F. Supp. 3d at 1035.
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`The same reasoning applies here. The representations of chocolate and the absence of
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`representations of vegetable oils would not deceive a reasonable consumer, who can always
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`consult the ingredients list for “more detailed information about the product that confirms other
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`representations on the packaging.” Williams, 552 F.3d at 939. This is especially true when one of
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`the allegedly misleading representations is itself listed in the ingredients, where any concerns
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`about the presence or absence of vegetable oils can be addressed by reading the next two lines.
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`See FAC ¶ 39.
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`Puri relies on Williams in arguing that the ingredients list cannot cure deception caused by
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`the front label. Opp’n at 11 (citing Williams, 552 F.3d at 938). However, Puri’s reliance is
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`misplaced, as “Williams stands for the proposition that if the defendant commits an act of
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`deception, the presence of fine print revealing the truth is insufficient to dispel that deception.”
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`Ebner, 838 F.3d at 966 (emphasis original). As discussed, there is no deception to be cured—
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`Costco makes no representations, implied or otherwise, that would deceiv