Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_18-cv-02499/USCOURTS-cand-3_18-cv-02499-2/pdf.json

Nature of Suit Code: 360
Nature of Suit: Other Personal Injury
Cause of Action: 28:1346 Tort Claim

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

BRADLEY COLGATE, et al.,

Plaintiffs,

v.

JUUL LABS, INC.,

Defendant.

Case No. 18-cv-02499-WHO 

ORDER PARTIALLY GRANTING 

MOTION TO DISMISS AND DENYING 

MOTION TO STRIKE

Re: Dkt. Nos. 40, 41

Plaintiffs are adults and minors from seven states bring class claims against defendant 

JUUL Labs, Inc. (“JUUL”), a market leader in the burgeoning electronic cigarette industry, for 

various state law violations related to JUUL’s advertising and labelling of its electronic cigarettes. 

JUUL argues that the Tobacco Control Act, 21 U.S.C. § 387 et seq. (“TCA”) preempts plaintiffs’ 

claims. It is partially correct concerning its product labelling, because the TCA is very detailed 

about what must appear on the label. But claims that JUUL misrepresents the amount of nicotine 

in its product are not preempted. JUUL also moves to dismiss plaintiff’s First Amended 

Complaint (FAC), because it fails to meet Federal Rule of Civil Procedure 9(b)’s heightened 

pleading requirements, to state a claim, and to identify applicable state laws. As discussed below, 

I grant in part and deny in part JUUL’s motion to dismiss, with leave to amend. JUUL’s motion to 

strike plaintiffs’ nationwide class allegations pursuant to Federal Rules of Civil Procedure 12(f), 

23(c)(1)(A), and 23(d)(1)(D) is not ripe and is denied. 

BACKGROUND

Plaintiffs are thirteen individuals from seven states: California, New Jersey, Washington, 

Pennsylvania, New York, Michigan, and Massachusetts. First Amended Complaint (“FAC") [Dkt. 

No. 24] ¶¶ 12-52. Plaintiffs fall into two categories, (1) adults who use JUUL’s electronic nicotine 

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delivery systems (“ENDS”) and (2) minors who use JUUL’s ENDS. Plaintiffs Bradley Colgate, 

Kaytlin McKnight, Anthony Smith, Corey Smith, Kacie Ann Lagun, Tommy Benham, and David 

Langan fall into the first group. (“Adult Plaintiffs”) Id. Except for McKnight, the adult plaintiffs 

smoked cigarettes prior to using JUUL’s ENDS. The second group consists of M.H. and her 

mother and natural Guardian Jennifer Hellman, A.U. and her mother and natural guardian 

Commitante, and Jill Nelson, who appears to bring claims on behalf of her daughter L.B. (“Minor 

Plaintiffs”) Id.

JUUL is a Delaware corporation with its principal place of business in San Francisco, 

California. Id. ¶ 53. PAX Labs, Inc. (“PAX”) is also a Delaware corporation with its principal 

place of business in San Francisco, California. Id. ¶ 54. JUUL originally operated under the name 

PAX Labs, Inc. Id. ¶ 53. In 2017, it was renamed JUUL Labs, Inc. and a new company was spun 

out as Pax Labs, Inc. Id. 

I. JUUL’S PRODUCTS

JUUL manufactures an ENDS about the size and shape of a pack of chewing gum. Id. ¶ 

67. The ENDS consists primarily of a rechargeable battery and heating element. Id. Consumers 

purchase disposable pre-filled pods of JUUL’s patented nicotine solution (“pods”) which attach to 

the ENDS. Id. JUUL’s ENDS and pods are proprietary and do not work with other ENDS 

systems. Id. A user “vapes” from the ENDS by inhaling through it, triggering a sensor that 

activates the heating element, converting the liquid nicotine contained in the pod to an inhalable 

vapor. Id. ¶ 68. Pods are sold in packs of four and in a variety of flavors, including mango, cool 

cucumber, fruit medley, cool mint, and crème brulee. Id. ¶ 70.

The formulation in JUUL’s pods combines benzoic acids with nicotine to produce nicotine 

salts. Id. ¶ 80. Plaintiffs allege that nicotine salts are absorbed into a user’s body faster and create 

a more pronounced effect than the nicotine in traditional cigarettes. Id. ¶¶ 79-82. They cite a 

study by James F. Pankow (“Pankow Study”) finding that JUUL’s pods contain 6.2% nicotine salt, 

rather than the 5% nicotine advertised. Id. ¶ 83. They also cite the same study to claim that JUUL 

uses a higher level of benzoic acid in their retail pods than was tested when JUUL applied for 

patent No. 9,215,895 (“the ‘895 patent”). Id. They quote JUUL’s website that “JUULpod is 

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designed to contain approximately 0.7mL with 5% nicotine by weight at time of manufacture 

which is approximately equivalent to 1 pack of cigarettes or 200 puffs.” Id. ¶ 89.

Plaintiffs allege that JUUL’s packaging has changed multiple times since 2015. Id. ¶ 77. 

The packaging bears a California Proposition 65 nicotine warning indicating that the product 

contains a substance known to cause cancer, and a warning to keep pods away from children and 

pets. Id. There is no nicotine warning on the ENDS or pods themselves. Id. The product 

labeling does not contain any information about the known effects, or unknown long-term effects, 

of vaping/inhaling nicotine salts. Id.

II. JUUL’S ADVERTISING 

In June 2015, JUUL launched its multimillion-dollar “Vaporized” advertising campaign to 

promote its new product. Id. ¶ 98. JUUL advertised on a 12-panel display over Times Square in 

New York City, as well as in the front spread of Vice magazine’s cover issue. Id. The 

advertisements featured young men and women using JUUL’s ENDS. Id. JUUL also launched a 

number of “pop-up JUUL bars” in Los Angeles, New York City, and the Hamptons. Id. Plaintiffs 

allege that JUUL’s ads utilize the same themes that tobacco companies used to advertise to young 

people, including “independence, adventurousness, sophistication, glamour, . . . social inclusion, 

sexual attractiveness, thinness, popularity, rebelliousness, and being ‘cool’”. Id. ¶ 99. They state 

that to the extent that the “Vaporized” advertisements disclosed that JUUL products contained 

nicotine, the warnings were in small print against low-contrast backgrounds. Id. ¶ 103.

JUUL also advertised on a number of social media platforms including Twitter, Instagram, 

and Facebook. Id. ¶ 114. Plaintiffs cite a study that found that JUUL grew nearly 700% despite 

spending “no recorded money” on major advertising channels and only $20,000 on business to 

business advertising. Id. ¶ 116. The study concluded that JUUL was taking advantage of the 

reach and accessibility of social media “because there are no restrictions” on social media 

advertising. Id. ¶ 121.

III. JUUL’S SALES 

Plaintiffs allege that JUUL’s products are primarily sold out of gas stations. Id. ¶ 111. 

They claim that JUUL’s retail locations do not provide signs, warnings, or other indicators 

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concerning the existence, danger, or amount of nicotine in JUUL products. Id. ¶ 112. A pack of 

four JUUL pods cost approximately $13. Id. ¶ 108. JUUL offers a 15% discount to purchasers 

who refer others to purchase JUUL’s ENDS or pods. Id. ¶ 109. 

JUUL also owns and operates www. juullabs.com and www.juulvapor.com. Id. ¶ 123. 

Customers may purchase the ENDS or pods from JUUL’s websites. Id. ¶ 124. Plaintiffs allege 

that although JUUL represents that it uses state-of-the-art age verification for website purchases, it 

has been improperly implemented and numerous minors have been able to purchase products or 

obtain warranty service. Id. ¶ 127.

JUUL also offers a 15% discount to purchasers who join their pod subscription service. Id.

¶ 110. It asserts states that consumers may cancel their subscription at any time. Id. ¶ 129.

Minor Plaintiffs allege that they were able to obtain JUUL’s products, despite the 

prohibition on the sale of ENDS to those under the age of 18. M.H., L.B. and A.U. state that they 

have purchased pods at nearby stores which readily sell JUUL’s products to minors. Id. ¶¶ 23, 30, 

47. M.H. also asserts that pods are sold in her school by older students. Id. ¶ 23. L.B. claims that, 

at the age of 14, she was able to obtain a warranty replacement through JUUL’s website in 

November 2017. Id. ¶ 29.

LEGAL STANDARD

I. MOTION TO DISMISS

Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss if a claim 

fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to 

dismiss, the claimant must allege “enough facts to state a claim to relief that is plausible on its 

face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible when 

the plaintiff pleads facts that “allow the court to draw the reasonable inference that the defendant 

is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation 

omitted). There must be “more than a sheer possibility that a defendant has acted unlawfully.” Id. 

While courts do not require “heightened fact pleading of specifics,” a claim must be supported by 

facts sufficient to “raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555, 

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570.

Under Federal Rule of Civil Procedure 9(b), a party must “state with particularity the 

circumstances constituting fraud or mistake,” including “the who, what, when, where, and how of 

the misconduct charged.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) 

(internal quotation marks omitted). However, “Rule 9(b) requires only that the circumstances of 

fraud be stated with particularity; other facts may be pleaded generally, or in accordance with Rule 

8.” United States ex rel. Lee v. Corinthian Colls., 655 F.3d 984, 992 (9th Cir. 2011).

In deciding a motion to dismiss for failure to state a claim, the court accepts all of the 

factual allegations as true and draws all reasonable inferences in favor of the plaintiff. Usher v. 

City of Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987). But the court is not required to accept as 

true “allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable 

inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008).

II. MOTION TO STRIKE

Federal Rule of Civil Procedure 12(f) authorizes a court to “strike from a pleading an 

insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed. R. 

Civ. P. 12(f). The function of a motion to strike “is to avoid the expenditure of time and money 

that must arise from litigating spurious issues by dispensing with those issues prior to trial.” 

Sidney–Vinstein v. A.H. Robins Co., 697 F.2d 880, 885 (9th Cir. 1983). Motions to strike are 

generally disfavored and “should not be granted unless the matter to be stricken clearly could have 

no possible bearing on the subject of the litigation.” Platte Anchor Bolt, Inc. v. IHI, Inc., 352 F. 

Supp. 2d 1048, 1057 (N.D. Cal. 2004). In addition, courts often require some showing of 

prejudice by the moving party before granting a motion to strike. Hernandez v. Dutch Goose, Inc., 

No. C 13-03537 LB, 2013 WL 5781476, at *5 (N.D. Cal. Oct. 25, 2013).

“If the court is in doubt as to whether the challenged matter may raise an issue of fact or 

law, the motion to strike should be denied, leaving an assessment of the sufficiency of the 

allegations for adjudication on the merits.” Carolina Cas. Ins. Co. v. Oahu Air Conditioning 

Serv., Inc., 994 F. Supp. 2d 1082, 1090-91 (E.D. Cal. 2014). In resolving a motion to strike, I 

view the pleadings in a light most favorable to the nonmoving party. Platte Anchor Bolt, 352 F. 

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Supp. 2d at 1057.

DISCUSSION

Plaintiffs bring 11 causes of action: (1) False Advertising; (2) Violation of Consumers 

Legal Remedies Act, California Civil Code §§ 1750, et seq., and similar laws of other states; (3) 

Fraud; (4) Unfair, Unlawful and Deceptive Trade Practices, Business and Professions Code § 

17200 and similar laws of other states; (5) Unjust Enrichment, (6) Strict Liability – Failure to 

Warn; (7) Strict Product Liability – Design Defect; (8) Strict Liability – Manufacturing Defect; (9) 

Breach of Implied Warranty of Merchantability; (10) Breach of Express Warranty; and (11) 

Negligent Misrepresentation. They propose to define the class as “[a]ll persons who purchased, 

in the United States, a JUUL e-cigarette and/or JUULpods.” Id. ¶ 162. They also allege a 

subclass consisting of “[a]ll class member[s] who at the time of their purchase were under the age 

of 18. Id. ¶ 163.

JUUL moves to dismiss for three reasons. First, they argue that plaintiffs’ claims are 

preempted by the Federal Food, Drug, and Cosmetic Act (“FDCA”) as amended by the TCA, 

which provides the Food and Drug Administration (“FDA”) with exclusive authority to 

promulgate regulations on ENDS labeling. Second, they contend plaintiffs’ fraud claim fails to 

satisfy Federal Rule of Civil Procedure 9(b)’s heightened pleading requirements. Third, they 

assert that plaintiffs’ failed to allege sufficient facts to plausibly satisfy the elements of any of their 

claims.

I. EXPRESS PREEMPTION

JUUL argues that plaintiffs’ false advertising claim must be dismissed because it is 

expressly preempted by the FDCA as amended by the TCA and the relating implementing 

regulations. Motion to Dismiss (“Mot. to Dismiss”) [Dkt. No. 40] at 9-13. JUUL contends that 

under the TCA’s preemption provision, 21 U.S.C. § 387p(2)(A), the labelling requirements for 

ENDS are prescribed solely by 81 Fed. Reg. at 28988. Id.

A. Relevant Statutes and Regulations 

The FDCA was enacted in 1938 and prohibits the misbranding of food. 21 U.S.C. § 301 et 

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seq. In 2009, Congress enacted the TCA to grant the FDA authority to regulate tobacco products 

under the FDCA. See 21 U.S.C. § 387a(a). In enacting the TCA, Congress found that nicotine is 

an addictive drug and that it was in “the public interest for Congress to adopt legislation to address 

the public health crisis created by actions of the tobacco industry[.]” Pub. L. 111-31, Div. A, § 2 

(codified at 21 U.S.C. § 387a)(2009)). 

On May 10, 2016, the FDA issued a final rule titled “Deeming Tobacco Products To Be 

Subject to the Federal Food, Drug, and Cosmetic Act, as Amended by the Family Smoking 

Prevention and Tobacco Control Act; Restrictions on the Sale and Distribution of Tobacco 

Products and Required Warning Statements for Tobacco Products.” (“FDA Rule”) 81 Fed. Reg. § 

28974 (May 10, 2016) (codified at 21 C.F.R. pts. 1100, 1140, 1143). The FDA Rule found that 

ENDS were deemed “covered tobacco products” and fell under the FDA’s regulatory authority. 

81 Fed. Reg. §§ 28974, 28976. Covered tobacco products, such as ENDS, may not be sold to 

individuals under the age of 18. 81 Fed. Reg. § 28974. 

B. Preemption Under the TCA

Express preemption occurs when there is “language in the federal statute that reveals an 

explicit congressional intent to pre-empt state law.” Barnett Bank of Marion Cnty., N.A. v. 

Nelson, 517 U.S. 25, 31 (1996). When presented with the task of interpreting a statutory provision 

that expressly preempts state law, courts must “start with the assumption that the historic police 

powers of the States were not to be superseded by the Federal Act unless that was the clear and 

manifest purpose of Congress.” Medtronic, Inc. v. Lohr, 518 U.S. 470, 485 (1996) (internal 

citations omitted). “The purpose of Congress is the ultimate touchstone in every pre-emption case 

and any understanding of the scope of a pre-emption statute must rest primarily on a fair 

understanding of congressional purpose.” Id. at 485-86 (internal quotation marks and citations 

omitted). Courts must look primarily to the “language of the pre-emption statute and the statutory 

framework surrounding it” . . . as well as the “structure and purpose of the statute as a whole” and 

how the “surrounding regulatory scheme [affects] business, consumers, and the law.” Id. at 486. 

The TCA contains an explicit preemption provision:

No State or political subdivision of a State may establish or continue in effect with 

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respect to a tobacco product any requirement which is different from, or in addition 

to, any requirement under the provisions of this subchapter relating to tobacco 

product standards, premarket review, adulteration, misbranding, labelling, 

registration, good manufacturing standards, or modified risk tobacco products.

21 U.S.C.A. § 387p(2)(A). Labelling is defined by the FDCA as “all labels and other written,

printed, or graphic matter (1) upon any article or any of its containers or wrappers, or (2) 

accompanying such article.” 21 U.S.C. § 321(m). A label is defined as a “display of written, 

printed, or graphic matter upon the immediate container of an article[.]” 21 U.S.C. § 321(k). 

The FDA Rule requires precise language and placement of warnings labels on covered 

tobacco products, such as ENDS. The FDA Rule states that packaging for ENDS must display a 

warning that states: “WARNING: This product contains nicotine. Nicotine is an additive 

chemical.” 81 Fed. Reg. § 28988; 21 C.F.R. § 1143.3(a)(1). The FDA Rule contains strict 

requirements for how the warning is displayed, including, among other things, that it “must appear 

directly on the package, be clearly visible underneath any cellophane or other clear wrapping; . . . 

be located in a conspicuous and prominent place on the two principal display panels of the 

package and the warning area must comprise at least 30 percent of each of the principal display 

panels; and . . . must be in at least 12-point font size [with] the required warning statement 

[occupying] the greatest possible proportion of the warning area set aside for the required text.” 

21 C.F.R. § 1143.3(a)(2).

The FDA has unambiguously put forth the required language and placement of the nicotine 

warning label, down to the font and placement of the label. Considering the statutory and 

regulatory scheme in its entirety, I find that the FDA, through its authority under the TCA has 

prescribed the precise language and placement of warning labels on covered tobacco products 

such as ENDS under 21 C.F.R. §§ 1143.3(a)(1)(2). The specificity of the labelling requirements 

strongly supports such an interpretation of the statutory scheme. I also find that under the TCA’s 

preemption provision, states and political subdivisions of states may not enact labeling 

requirements or warnings contrary or in addition to those prescribed under 21 C.F.R. §§ 

1143.3(a)(1)(2). See also In re Fontem US, Inc., No. SACV 15-01026, 2016 WL 6520142, at *3 

(C.D. Cal. Nov. 1, 2016).

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C. Plaintiffs’ Claims Relating to More Thorough Warnings as Compared to Claims 

Relating to Nicotine Percentage Based on Product Labelling

Plaintiffs’ labelling claims essentially relate to two alleged misrepresentations by JUUL. 

First, plaintiffs allege that that JUUL should have warned consumers that the pharmacokinetics of 

JUUL’s nicotine formulation contained in JUUL’s pods utilizes benzoic acid to create nicotine 

salts, delivering an exceptionally potent dose of nicotine compared to traditional cigarettes. FAC 

¶¶ 78-92. Second, plaintiffs allege that JUUL mislabels the dosage of nicotine on its pods at 5% 

when, in actuality, the dosage of nicotine is higher than 5%. Id. ¶ 83.

I find that Congress has intended to expressly preempt labeling requirements on ENDS 

packaging as shown by the preemption clause in the TCA and the specificity of the FDA Rule on 

labeling. 21 U.S.C.A. § 387p(2)(A); 21 C.F.R. §§ 1143.3(a)(1)(2). Plaintiffs believe that JUUL 

should be required to warn consumers of the pharmacokinetics, i.e. greater potency its benzoic 

acid and nicotine salt formulation delivers. If plaintiffs’ claims were allowed to go forward in this 

respect, it would constitute a usurpation of the power vested in the FDA by Congress to regulate 

the content of the warnings on covered tobacco products. Plaintiffs’ labelling claims are 

preempted to the extent that they are related to JUUL’s failure to warn consumers that 

pharmacokinetics of their formulation, even at a similar percentage of nicotine, is more potent than 

it would be in a traditional cigarette due to its chemical makeup. JUUL may only be required to 

comply with the labeling requirements as articulated by 21 C.F.R. §§ 1143.3(a)(1)(2). To the 

extent that plaintiffs’ claims are based on the product label failing to disclose the greater potency 

and addictiveness of JUUL’s benzoic acid and nicotine salt formulation, JUUL’s motion to 

dismiss is granted. These claims are necessarily dismissed with prejudice.

To the extent that plaintiffs’ causes of action are based on the allegation that JUUL 

mislabels the dosage of nicotine on its pods at 5% when the dosage of nicotine is higher than 5%, 

these causes of action are not preempted by the TCA and FDA Rule. Plaintiffs allege that the 

actual percentage of nicotine contained in JUUL’s pods is 6.2%. Id. ¶ 83. This difference would 

constitute over 20% more nicotine than JUUL claims its products deliver. Using JUUL’s 

representation that each pod contains an amount of nicotine “about” equal to a pack of cigarettes, a 

20% increase in nicotine would be the equivalent of a pack of cigarettes containing 24 cigarettes 

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instead of 20. This difference, if proved, would be significant. An individual who believes they 

might wean themselves off of traditional cigarettes by using JUUL’s products may, in fact, be 

consuming the equivalent of four more cigarettes per pod.

JUUL argues that plaintiffs misread JUUL’s ‘895 patent and the Pankow Study. 

Opposition [Dkt. No. 55] at 17. At the motion to dismiss stage, I must accept all the factual 

allegations as true and draw all reasonable inferences in favor of the plaintiffs. Usher, 828 F.2d at 

561. For the purposes of this motion, I accept plaintiffs’ factual allegation that JUUL’s pods 

contain 6.2% nicotine, rather than the 5% JUUL represents on the packaging. To the extent that 

plaintiffs’ labelling claims are based on JUUL’s alleged mislabeling of the strength of nicotine in 

their pods, JUUL’s motion to dismiss is denied.

D. Retroactivity of the FDA RULE

One court has already addressed whether the FDA Rule preempts plaintiffs’ claims arising 

before and after the promulgation of the rule on August 8, 2016. Order Granting in Part and 

Denying in Part Plaintiffs’ Motion for Clarification, Reconsideration, Entry of Judgment, or 

Certification for Interlocutory Appeal, In Re Fontem US, Inc. Consumer Class Action Litig., 15-

CV-01026 (C.D. Cal. March 8, 2017), Dkt. No. 110. In that case, Judge Selna found that the 

preemption clause of the TCA contained clear congressional intent favoring retroactivity. Id. at 5-

10. The TCA states that “[n]o State or political subdivision of a State may establish or continue in 

effect with respect to a tobacco product any requirement which is different from, or in addition to, 

any requirement . . .relating to tobacco product . . . labeling[.]” 21 U.S.C. § 387p(a)(2)(A). To 

allow plaintiffs to pursue claims on conduct preempted by the TCA and FDA Rule which took 

place before August 8, 2016, would continue in effect policies preempted by federal law. Id.

(citing Ileto v. Glock, Inc., 565 F.3d 1126, 1138 (9th Cir. 2009)). I agree with Judge Selna. 

Plaintiffs may not pursue their claims for conduct preempted under the TCA which took place 

before August 8, 2016.

E. What Claims Survive Preemption?

Plaintiffs’ claims are essentially based on either JUUL’s labelling and advertising. As 

discussed above, I find that only claims based on the allegation that the product labelling fails to 

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warn consumers that JUUL’s nicotine formulation is more addictive than other methods of

nicotine ingestion are expressly preempted. Any claims based on the mislabeling of the 

percentage of nicotine per pod are not preempted. 

Further, I find that this distinction does not extend to advertisements. The TCA contains a 

subsection titled “EXCEPTION” which states:

[The preemption clause] does not apply to requirements relating to the sale,

distribution, possession, information reporting to the State, exposure to, access to, 

the advertising and promotion of, or use of, tobacco products by individuals of 

any age, or relating to fire safety standards for tobacco products.

21 U.S.C.A. § 387p(2)(B). The exception clause expressly excepts advertisements from 

preemption and no aspect of plaintiffs’ claims based on an allegedly misleading or fraudulent 

advertising is preempted by the TCA, including the issue of warning consumers about the potency 

and addictiveness of JUUL’s benzoic acid and nicotine salt formulation. Resolving all inferences

in favor of the non-moving party, this would apply to any plaintiffs who may have seen an 

advertisement but failed to closely read the label. Ries v. Arizona Beverages USA LLC, 287 

F.R.D. 523, 531 (N.D. Cal. 2012).

Plaintiffs’ causes of action based on advertisements or the mislabeling of the amount of 

nicotine contained in each pod are not preempted by the TCA. 

II. RULE 9(b)’S HEIGHTENED PLEADING STANDARD

Plaintiffs’ claims based on labelling meet’s Rule 9(b)’s particularity requirements. I now 

turn to whether plaintiffs’ allegations based on JUUL’s advertisements meet Rule 9(b). 

Under Federal Rule of Civil Procedure 9(b), a party must “state with particularity the 

circumstances constituting fraud or mistake,” including “the who, what, when, where, and how of 

the misconduct charged.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) 

(internal quotation marks omitted). However, “Rule 9(b) requires only that the circumstances of 

fraud be stated with particularity; other facts may be pleaded generally, or in accordance with Rule 

8.” United States ex rel. Lee v. Corinthian Colls., 655 F.3d 984, 992 (9th Cir. 2011). The purpose 

of Rule 9(b)'s heightened specificity requirement is “to give defendants notice of the particular 

misconduct which is alleged to constitute the fraud charged so that they can defend against the 

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charge and not just deny that they have done anything wrong.” Swartz v. KPMG LLP, 476 F.3d 

756, 764 (9th Cir. 2007) (citation omitted). In order to meet the Rule 9(b) standard “a plaintiff 

must identify 'the time, place, and content of [the] alleged misrepresentation[s],' as well as the 

'circumstances indicating falseness' or 'manner in which the representations at issue were false and 

misleading.”' Frenzel v. AliphCom, 76 F. Supp. 3d 999, 1005 (N.D. Cal. 2014) (quoting In re 

GlenFed, Inc. Sec. Litig., 42 F.3d 1541, 1547–48 (9th Cir.1994)). 

 JUUL argues that plaintiffs have failed to meet the heightened pleading requirement for 

claims sounding in fraud under Federal Rule of Civil Procedure 9(b) because they failed to 

identify what particular advertisements they saw; as a result, they cannot allege with specificity 

how those advertisements were false or misleading. Id. at 14-15. It asserts that plaintiffs have 

also failed to state when they saw the advertisements, where they saw them, or how they were 

influenced by them. Id.

Plaintiffs contend that they have sufficiently alleged that they saw the package labelling 

when they purchased JUUL’s products, but labelling is not at issue here. Oppo. 17. They also cite 

In re Tobacco Cases II, 46 Cal.4th 298, 327-28 (2009) to argue that they do not need to identify 

specific advertisements in their complaint. Oppo. 15. But In re Tobacco Cases II was a 

California state law case not subject to Rule 9(b)’s heightened pleading requirements. Plaintiffs 

further argue, without support, that it is sufficient to state that all of JUUL’s advertisements during 

the class period were misleading. Id. at 18. If I were to accept this argument, it would eviscerate 

Rule 9(b)’s particularity requirement.

Plaintiffs have failed to specifically identify what the advertisements they saw and, as a

result, neither I nor JUUL can determine precisely what statements were allegedly false, 

misleading, or unfair. They have also failed to state where, other than on social media, they saw 

JUUL’s advertisements.

Plaintiffs cite a number of cases to argue that they are not required to state exactly when 

they saw the advertisements, only that they saw the advertisements during the class period. Oppo. 

16-17 (see e.g. Bruton v. Gerber Prod. Co., No. 12-CV-02412-LHK, 2014 WL 172111, at *13 

(N.D. Cal. Jan. 15, 2014)). I agree. Plaintiffs have sufficiently alleged that they saw JUUL’s 

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advertisements during the class period for the purposes of surviving JUUL’s motion to dismiss. 

Nevertheless, because plaintiffs have not identified which advertisements they saw during the 

class period, or where they saw them (outside of social media), I grant JUUL’s motion to dismiss 

plaintiffs false advertising, CLRA and laws of similar states, fraud, and UCL and laws of similar 

states claims. These claims are dismissed with leave to amend insofar as they relate to claims 

based on JUUL’s advertisements.

III. FAILURE TO STATE A CLAIM UNDER STATE CONSUMER PROTECTION 

STATUTES

JUUL seeks dismissal of plaintiffs’ claims for violation of the Consumer Legal Remedies 

Act of California and Similar Laws of other states as well as for violations of the Unfair, Unlawful 

and Deceptive Trade Practices, Business and Professions Code § 17200. Massachusetts Consumer 

Protection Act, Mass. Gen. Laws Ann. Ch. 93A, §§ 1, et seq.; Michigan Consumer Protection Act, 

Mich. Comp. Laws Ann. §§ 445.903, et seq.; New Jersey Consumer Protection Act, N.J. Stat. 

Ann. § 56:8-1, et seq.; Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 Pa. 

Cons. Stat. §§ 201-2 & 201-3, et seq., New York General Business Law, N.Y. Gen. Bus. Law §§ 

349, et seq., Washington Consumer Protection Act, Wash. Rev. Code Ann. §§ 19.86.020, et seq., 

and the laws of all other states and the District of Columbia.

First, JUUL argues that dismissal of plaintiffs’ claims based on unidentified consumer 

protection statutes is justified because plaintiffs have failed to identify the subsections of the 

various states’ (besides California’s) consumer protection laws they are seeking to invoke. Mot. 

to Dismiss 19-20. I agree. Plaintiffs’ second cause of action only identifies the relevant laws of 

Massachusetts, Michigan, New Jersey, Pennsylvania, New York, and Washington for the 

definition of “persons.” FAC ¶ 188. It is not my role to search for unidentified state statutes and 

their relevant subdivisions. Plaintiffs have only identified California’s Consumer Legal Remedies 

Act with specificity. Plaintiffs’ claims under the laws of other states are dismissed with leave to 

amend. Should plaintiffs choose to amend their claim, they must identify the state laws they seek 

to invoke.

Second, JUUL seeks dismissal of the identified state consumer protection statutes in 

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plaintiffs second and fourth causes of action for: (1) failure to plead causation or reliance by not 

alleging exposure to misleading representations (2) failure to plead reasonable reliance or a 

likelihood of deception. Mot. to Dismiss 20-26. JUUL argues that plaintiffs have not identified a 

particular misrepresentation or that any JUUL’s representations would not deceive reasonable 

consumers.

With regards to JUUL’s product labelling, JUUL is incorrect on both counts and its motion 

is denied. Plaintiffs have sufficiently alleged that at least Plaintiff Colgate relied on JUUL’s 

representation that the pods contained a formulation of 5% nicotine when plaintiffs have 

sufficiently alleged that the pods contain a formulation of 6.2% nicotine. FAC ¶ 13. I find that 

Colgate’s reliance on JUUL’s representation of the amount of nicotine in each pod to be 

approximately equivalent to the amount of nicotine in a pack of cigarettes was reasonable. 

JUUL’s motion to dismiss plaintiffs’ identified consumer protection statutes in plaintiffs’ 

second and fourth causes of action based on JUUL’s product labelling is denied.

As applied to JUUL’s advertisements, plaintiffs have not specifically identified what 

advertisements they saw and what statements in the advertisements were allegedly false, 

misleading, or unfair. This lack of specificity is insufficient to state a claim under the identified 

state consumer protection statutes. JUUL’s motion to dismiss plaintiffs’ identified consumer 

protection statutes in plaintiffs’ second and fourth causes of action based on JUUL’s 

advertisements is granted with leave to amend.

IV. FAILURE TO STATE A CLAIM FOR UNJUST ENRICHMENT

JUUL argues that plaintiffs’ claim for unjust enrichment fails because plaintiffs cannot 

allege any wrongdoing on JUUL’s part, such that JUUL’s retention of any benefit would be 

considered unjust. Mot. to Dismiss. 27-28. It contends that because plaintiffs’ other claims fail, 

the unjust enrichment claim would be duplicative and must necessarily fail.

As I have found that several plaintiffs’ claims survive JUUL’s motion to dismiss, 

plaintiffs’ unjust enrichment claim is not duplicative. JUUL’s motion to dismiss plaintiffs’ fifth 

cause of action for unjust enrichment is denied.

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V. FAILURE TO STATE A CLAIM FOR DESIGN DEFECT

Pursuant to California law, a design defect may be established under either of two 

alternative tests: (1) the consumer expectation test or (2) the risk-benefit test. See Barker v. Lull 

Eng'g Co., 20 Cal. 3d 413, 432 (1978). Under the consumer expectation test, “a product may be 

found defective in design if the plaintiff establishes that the product failed to perform as safely as 

an ordinary consumer would expect when used in an intended or reasonably foreseeable manner.” 

Id. Alternatively, under the risk-benefit test, a product may be found “defective in design if the 

plaintiff demonstrates that the product's design proximately caused his injury and the defendant 

fails to establish, in light of the relevant factors, that, on balance, the benefits of the challenged 

design outweigh the risk of danger inherent in such design.” Id. “In a products liability case, a 

plaintiff has met his burden if he establishes that there was a defect in the manufacture or design of 

the product and that such defect was a proximate cause of the injury.” Dimond v. Caterpillar 

Tractor Co., 65 Cal. App. 3d 173, 177 (Ct. App. 1976).

JUUL argues that plaintiffs have not plausibly alleged a design defect claim because they 

have stated only conclusory allegations and that their ENDS operates as intended, as a device to 

ingest nicotine and other aerosolized constituents of JUUL’s nicotine solution. Mot. to Dismiss at 

29-30. However, I find that under the consumer expectation test, plaintiffs have stated a claim for 

design defect based on the allegation that JUUL’s pods contain 6.2% nicotine salt, rather than the 

5% nicotine advertised. FAC ¶ 83. Plaintiffs have sufficiently alleged that JUUL’s pods do not 

perform as safely as an ordinary consumer would expect because each inhalation would deliver 

20% more nicotine than they would reasonably expect from JUUL’s representations.

JUUL argues that since the pods contains nicotine, a known addictive substance, there 

cannot possibly be a product defect any more than vodka is defective because it contains alcohol. 

While this may be true in a general sense, the alleged design defect is not that JUUL’s products 

contain nicotine, it is that they contain more nicotine than users expect. JUUL’s motion to dismiss 

plaintiffs’ design defect claim is denied.

VI. FAILURE TO STATE A CLAIM FOR MANUFACTURING DEFECT

Under the “manufacturing defect” theory, generally a “manufacturing or production defect 

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is readily identifiable because a defective product is one that differs from the manufacturer's 

intended result or from other ostensibly identical units of the same product line.” Barker v. Lull 

Engineering Co., 20 Cal.3d 413, 430 (1978). The “manufacturing defect” theory posits that “a 

suitable design is in place, but that the manufacturing process has in some way deviated from that 

design.” In re Coordinated Latex Glove Litigation, 99 Cal.App.4th 594, 605 (2002).

JUUL argues that plaintiffs have failed to state a claim for manufacturing defect because 

they have not alleged any variations among JUUL’s ENDS or pods. Plaintiffs allege that JUUL 

routinely added more nicotine salt and benzoic acid to their pods than represented. FAC ¶¶ 250-

251. While plaintiffs may not have alleged that a particular pod differs from identical ones from 

JUUL, plaintiffs have plausibly alleged that these pods differ from the product that JUUL intended 

to sell, i.e. pods with 5% nicotine. See Johnson v. Nissan N. Am., Inc., 272 F. Supp. 3d 1168, 

1177 (N.D. Cal. 2017). This could be due to a defect in manufacturing rather than a design defect. 

See In re Toyota Motor Corp. Unintended Acceleration Mktg., Sales Practices, & Prod. Liab. 

Litig., 754 F. Supp. 2d 1145, 1181 (C.D. Cal. 2010); see also Marshall v. Hyundai Motor Am., 51 

F. Supp. 3d 451, 467 (S.D.N.Y. 2014) (“Whether the[ ] alleged defects arose from a faulty design, 

faulty materials or faulty workmanship cannot be ascertained absent discovery, since any 

information concerning the true origin of the alleged defect is within the sole possession of the 

defendant.”) (citations omitted). 

 It is too early to dismiss this theory. Plaintiffs allege a defect that could be attributed to 

either a design or manufacturing defect. As a result, they have pleaded facts sufficient to state a

claim for manufacturing defect. Accordingly, I deny JUUL’s motion to dismiss plaintiffs’ 

manufacturing defect claim.

VII. FAILURE TO STATE A CLAIM FOR BREACH OF IMPLIED WARRANTY OF 

MERCHANTIBILITY

JUUL argues that plaintiffs have failed to state a claim for breach of implied warranty 

because the implied warranty of merchantability does not impose a general requirement that goods 

precisely fulfill the expectation of the buyer. Mot. to Dismiss at 32-33. Rather, the implied 

warranty provides only for a minimum level of quality. Id. JUUL contends that plaintiffs have 

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not plausibly alleged facts showing a breach, and that they have only pleaded conclusory 

allegations that JUUL’s products were not fit for their intended purpose. Id.

“Unless excluded or modified [ ], a warranty that goods shall be merchantable is implied in 

a contract for their sale if the seller is a merchant with respect to goods of that kind.” Cal. Comm. 

Code § 2314(1). Unlike express warranties, “liability for an implied warranty does not depend 

upon any specific conduct or promise on [the defendant's] part, but instead turns upon whether 

the[ ] product is merchantable under the code.” Hauter v. Zogarts, 534 P.2d 377 (1975). The 

Commercial Code does not “impose a general requirement that goods precisely fulfill the 

expectation of the buyer. Instead, it provides for a minimum level of quality.” Id. A plaintiff who 

claims a breach of the implied warranty of merchantability must show that the product “did not 

possess even the most basic degree of fitness for ordinary use.” Mocek v. Alfa Leisure, Inc., 114 

Cal.App. 4th 402, 406 (2003) (citing Cal. Comm. Code § 2314(2)). A product may also be 

unmerchantable if it fails to “conform[ ] to the promises or affirmations of fact made on the 

container or label,” a product may be unmerchantable based on a showing that the facts about the 

product did not match the representations on the container or label. See Hauter, 534 P.2d at 384-

87.

JUUL argues that its alleged misrepresentation of the percentage of nicotine contained in 

its pods does not render their products unmerchantable for failure to conform to the promises or 

affirmations made on their containers because plaintiffs have misread the ‘895 patent and Pankow 

Study. Reply 19. But at the motion to dismiss stage, I must accept all of the factual allegations as 

true and draw all reasonable inferences in favor of the plaintiffs. Usher, 828 F.2d at 561. For the 

purposes of this motion, I accept plaintiffs’ factual allegation that JUUL’s pods contain 6.2% 

nicotine, rather than the 5% JUUL represents on the packaging. I find that plaintiffs have 

successfully stated a claim for implied warranty of merchantability based on the allegation that the 

percentage of nicotine in JUUL’s pods does not match the represented amount of nicotine on 

JUUL’s containers. JUUL’s motion to dismiss plaintiffs’ implied warranty of merchantability 

claim is denied.

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VIII. FAILURE TO STATE A CLEAIM FOR BREACH OF EXPRESS WARRANTY

California Commercial Code section 2313 applies a three-step inquiry for a breach of 

express warranty claim: “First, the court determines whether the seller's statement amounts to ‘an 

affirmation of fact or promise’ relating to the goods sold. Second, the court determines if the 

affirmation or promise was ‘part of the basis of the bargain.’ Finally, if the seller made a promise 

relating to the goods and that promise was part of the basis of the bargain, the court must 

determine if the seller breached the warranty.” McDonnell Douglas Corp. v. Thiokol Corp., 124 

F.3d 1173, 1176 (9th Cir. 1997) (citations omitted); see also Elias v. Hewlett–Packard Co., 903 

F.Supp.2d 843, 849 (N.D. Cal. 2012); Weinstat v. Dentsply Intern., Inc., 103 Cal.Rptr.3d 614, 626 

(Ct. App. 2010).

JUUL argues that plaintiffs cannot state a claim for breach of express warranty based on 

advertising and other descriptions of the product, rather than breach of a written contractual 

warranty, without alleging the exact terms of the warranty. Mot. to Dismiss 31-32. It also 

contends that the provisions of its express Limited Warranty necessarily bar plaintiffs’ breach of 

warranty claim as it only provides a limited one-year warranty.

Plaintiffs allege that “Defendants’ foregoing affirmations of fact and promises made in the 

marketing of JUUL e-cigarettes became part of the basis of the bargain between Defendant and 

plaintiffs’ and all Class members, thereby creating express warranties that these products would 

conform to Defendants’ affirmation of fact, representations, promises, and descriptions.” FAC ¶ 

264. But they have not “allege[d] the exact terms of the warranty” that the JUUL breached. 

Without “pleading exact terms as required by California law,” they have “not met the pleading 

requirement” under Rule 8. Biennis v. Hewlett–Packard Co., No. C 07–00333–JF, 2008 WL 

818526, at *2 (N.D. Cal. March 25, 2008).

JUUL’s motion to dismiss plaintiffs’ breach of express warranty claim is granted. 

Plaintiffs’ breach of express warranty claim is dismissed with leave to amend.

IX. FAILURE TO STATE A CLAIM FOR NEGLIGENT MISREPRESENTATION

To state a claim for negligent misrepresentation, a plaintiff must allege: “(1) a 

misrepresentation of a past or existing material fact, (2) without reasonable grounds for believing 

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it to be true, (3) with intent to induce another's reliance on the fact misrepresented, (4) ignorance 

of the truth and justifiable reliance thereon by the party to whom the misrepresentation was 

directed, and (5) damages.” Fox v. Pollack, 181 Cal. App. 3d 954, 962 (Ct. App. 1986). Tarmann 

v. State Farm Mut. Auto. Ins. Co., makes clear that a negligent misrepresentation claim must be 

based on a misrepresentation of past or existing material facts and not on a promise or prediction 

as to future events. 2 Cal. Rptr. 2d 861, 864 (Cal. Ct. App. 1991); see also Stockton Mortgage, 

Inc. v. Tope, 233 Cal. App. 4th 437, 458 (2014) (“Although a false promise to perform in the 

future can support an intentional misrepresentation claim, it does not support a claim for negligent 

misrepresentation.”).

JUUL argues that plaintiffs’ negligent misrepresentation claim fails because plaintiffs have 

not proved reasonable or justifiable actual reliance. Mot. to Dismiss 27. Plaintiffs have alleged 

that JUUL misrepresented the pharmacokinetics of their ENDS, the nicotine content of their pods, 

and the role of benzoic acid in the nicotine formulation. As stated above, allegations relating to 

the pharmacokinetics and role of benzoic acid are preempted by the TCA and FDA Rule. For the 

purposes of deciding this motion to dismiss, I accept as true that JUUL has misrepresented the 

amount of nicotine in each pod. The question here is whether plaintiffs have shown that they 

reasonably or justifiably relied on JUUL’s representation that the pods contained a formulation of 

5% nicotine when they alleged that the pods contain a formulation of 6.2% nicotine. Plaintiff 

Colgate asserts that he relied on JUUL’s representation that a JUUL pod had an equivalent amount 

of nicotine as a pack of cigarettes when he purchased JUUL’s ENDS and pods in an effort to 

curtail his nicotine addiction and quit smoking. FAC ¶ 13. Because Colgate has sufficiently 

pleaded reliance on JUUL’s representation on the amount of nicotine in the pods, JUUL’s motion 

to dismiss plaintiffs’ negligent misrepresentation claim is denied.

X. DISMISSAL OF MINOR PLAINTIFFS’ CLAIMS ARGUMENT RAISED IN THE 

REPLY

JUUL asked that I dismiss the Minor Plaintiffs’ claims in its reply brief. Reply 20. It is 

improper to raise a new argument in a reply brief. Zamani v. Carnes, 491 F.3d 990, 997 (9th Cir. 

2007); In re Capacitors Antitrust Litig., No. 14-CV-03264-JD, 2017 WL 897340, at *1 (N.D. Cal. 

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Mar. 7, 2017). I will not consider JUUL’s motion to dismiss the Minor Plaintiffs’ claims at this 

time.

XI. THE MOTION TO STRIKE

JUUL moves to strike plaintiffs’ nationwide class allegations pursuant to Federal Rules of 

Civil Procedure 12(f), 23(c)(1)(A), and 23(d)(1)(D). JUUL argues that a nationwide class would 

be inappropriate because material variations among the laws of the many states would require 

detailed inquiries into the legal elements, recognized defenses, and remedies applicable under each 

state’s laws, overwhelming common issues and precluding predominance. 

This motion is premature. For one thing, the pleadings are not settled and plaintiffs 

indicated at oral argument that they will amend with sufficient specificity to allow all of their 

claims to proceed. Second, the Hon. Richard Seeborg’s observation Morris v. SolarCity Corp., 

No. 15-cv-05107-RS, 2016 WL 1359378, *3 (N.D. Cal. Apr. 6, 2016) is apt: “While class 

allegations may be stricken at the pleading stage in the appropriate case, doing so is not warranted 

here.... [as defendant] has not presented any argument that would completely preclude class 

certification.” JUUL’s motion to strike plaintiffs’ nationwide class allegations is denied.

CONCLUSION

For the reasons outlined above, JUUL’s motion to dismiss is granted in part and denied in 

part. Insofar as plaintiffs’ claims are based on misrepresenting the pharmacokinetics of JUUL’s 

nicotine formulation on the product labelling, they are preempted and dismissed with prejudice. 

Plaintiffs’ claims based on JUUL’s alleged misrepresentation of the percentage of nicotine on the 

labelling of JUUL’s pods are not preempted.

Plaintiffs’ claims based on JUUL’s advertising which sound in fraud fail to meet the 

heightened pleading requirements of Rule 9(b) and are dismissed with prejudice.

To the extent that plaintiffs’ remaining claims are based on mislabeled nicotine percentage 

on the packaging for JUUL’s pods, JUUL’s motion to dismiss is granted only as to the breach of 

express warranty claim and the unidentified state law consumer protection statutes claim. These 

claims are dismissed with leave to amend.

JUUL’s motion to strike plaintiffs’ nationwide class allegations is denied as it is not ripe at 

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this stage of the litigation.

IT IS SO ORDERED.

Dated: October 30, 2018

William H. Orrick

United States District Judge

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