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MEMORANDUM OF LAW IN SUPPORT

OF DEFENDANT’S MOTION TO DISMISS

Case No. 5:17-cv-00603-EJD

PATTERSON BELKNAP WEBB & TYLER LLP

Steven A. Zalesin (pro hac vice)

Michelle W. Cohen (pro hac vice)

1133 Avenue of the Americas

New York, NY 10036-6710

Telephone: (212) 336-2000

Facsimile: (212) 336-2222

SHOOK HARDY & BACON LLP

Tammy B. Webb

One Montgomery Tower, Suite 2700

San Francisco, CA 94104

Telephone: 415-544-1904

Facsimile: 415-391-0281

tbwebb@shb.com

Attorneys for Defendant

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

JACKIE FITZHENRY-RUSSELL, ON BEHALF

OF HERSELF AND ALL OTHERS SIMILARLY

SITUATED

Plaintiff,

vs.

THE COCA-COLA COMPANY

Defendant.

Case No. 5:17-cv-00603-EJD

NOTICE OF MOTION AND

MOTION; MEMORANDUM OF LAW

IN SUPPORT OF DEFENDANT’S

MOTION TO DISMISS

Case Removed: February 6, 2017

Hearing Date: May 25, 2017

Time: 9:00 a.m.

Courtroom: 4

Judge: Honorable Edward J. Davila

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ii MEMORANDUM OF LAW IN SUPPORT

OF DEFENDANT’S MOTION TO DISMISS

Case No. 5:17-cv-00603-EJD

TO THE PLAINTIFFS AND THEIR ATTORNEYS OF RECORD IN THE ABOVECAPTIONED MATTER:

PLEASE TAKE NOTICE that on Thursday, May 25, 2017, at 9:00 a.m. or as soon

thereafter as the matter may be heard, in Courtroom 4 before the Honorable Edward J. Davila of the

Northern District of California, Defendant The Coca-Cola Company will and hereby does move the

Court to dismiss Plaintiff Jackie Fitzhenry-Russell’s Class Action Complaint against it, in which

Plaintiff alleges violations of the California Consumers Legal Remedies Act (“CLRA”), Cal. Civ.

Code § 1750, et seq., the False Advertising Law (“FAL”), Cal. Bus. & Prof. Code § 17500, et seq.,

and the Unfair Competition Law, Id. § 17200, et seq., as well as common law claims for fraud,

deceit and misrepresentation.

Defendant moves for dismissal under Federal Rule of Civil Procedure 12(b)(6) as to each

cause of action on the grounds set forth in the accompanying Memorandum of Law in Support of

Defendant’s Motion to Dismiss.

Dated: March 13, 2017

Respectfully submitted,

/s/ Steven A. Zalesin

Steven A. Zalesin (pro hac vice)

Michelle W. Cohen (pro hac vice)

PATTERSON BELKNAP WEBB & TYLER LLP

1133 Avenue of the Americas

New York, NY 10036-6710

Telephone: 212-336-2000

Facsimile: 212-336-2222

sazalesin@pbwt.com

mcohen@pbwt.com

Tammy B. Webb

SHOOK HARDY & BACON LLP

One Montgomery Tower, Suite 2700

San Francisco, CA 94104

Telephone: 415-544-1904

Facsimile: 415-391-0281

tbwebb@shb.com

Attorneys for Defendant The Coca-Cola Company

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iii MEMORANDUM OF LAW IN SUPPORT

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Case No. 5:17-cv-00603-EJD

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ............................................................................................................... iv

STATEMENT OF ISSUES ................................................................................................................ vii

PRELIMINARY STATEMENT ...........................................................................................................1

STATEMENT OF FACTS ....................................................................................................................1

ARGUMENT.........................................................................................................................................3

I. PLAINTIFF’S CLAIMS MUST BE DISMISSED BECAUSE SHE HAS NOT

ALLEGED ANY FALSE OR MISLEADING STATEMENT.................................................4

A. Plaintiff Cannot State A Claim Under California’s Consumer-Protection

Statutes Because She Has Not Alleged Any Statement That Is Misleading To

Reasonable Consumers ..................................................................................................4

B. Plaintiff’s Failure to Allege A False Statement Is Also Fatal To Her Fraud

Claim..............................................................................................................................9

C. Plaintiff Cannot Salvage Her Claim By Citing Irrelevant Regulations .......................10

II. PLAINTIFF FAILS TO PLEAD RELIANCE ON ANY REPRESENTATIONS

OTHER THAN THOSE ON THE PRODUCT LABELING..................................................11

III. PLAINTIFF’S CLASS CLAIMS SHOULD BE DISMISSED...............................................12

CONCLUSION....................................................................................................................................13

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iv MEMORANDUM OF LAW IN SUPPORT

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TABLE OF AUTHORITIES

Page

Cases

Ashcroft v. Iqbal,

556 U.S. 662 (2009).........................................................................................................................3

Bell Atl. Corp. v. Twombly,

550 U.S. 544 (2007)...................................................................................................................3, 10

Bronson v. Johnson & Johnson, Inc.,

No. 12-04184 CRB, 2013 U.S. Dist. LEXIS 54029 (N.D. Cal. Apr. 16, 2013)............................11

Carrea v. Dreyer’s Ice Cream,

475 F. App’x 113 (9th Cir. 2012) ........................................................................................5, 7, 8, 9

Churchill Village, LLC v. General Electric Co.,

169 F. Supp. 2d 1119 (N.D. Cal. 2000) .........................................................................................12

Dvora v. General Mills, Inc.,

No. 11-1074-GW, 2011 U.S. Dist. LEXIS 55513 (C.D. Cal. May 16, 2011) ...............................11

Figy v. Frito-Lay N. Am.,

67 F. Supp. 3d 1075, 1087 (N.D. Cal. 2014) ...........................................................................12, 13

Fitzhenry-Russell v. Dr. Pepper Snapple Group, Inc.,

5:17-cv-00564-NC (N.D. Cal.) ........................................................................................................3

Gershman v. Bayer HealthCare LLC,

No. 14-05332-HSG, 2015 U.S. Dist. LEXIS 60835 (N.D. Cal. May 8, 2015)..............................12

Henderson v. Gruma Corp.

No. 10-04173 AHM, 2011 U.S. Dist. LEXIS 41077 (C.D. Cal. Apr. 11, 2011).............................8

Kwikset Corp. v. Superior Court,

51 Cal. 4th 310 (2011) ...................................................................................................................11

Leonhart v. Nature’s Path Foods Inc.,

No. 13-0492 EJD, 2014 U.S. Dist. LEXIS 46413 (N.D. Cal. Mar. 31, 2014)...............................10

Morgan v. AT&T Wireless Servs., Inc.,

177 Cal. App. 4th 1235 (Cal. App. 2009)........................................................................................9

People for the Ethical Treatment of Animals v. Whole Food Market, Inc.,

No. 15-04301 NC, 2016 U.S. Dist. LEXIS 55601 (N.D. Cal. Apr. 26, 2016) ................................5

Rahman v. Mott’s, LLP,

No. 13-3482 SI, 2014 U.S. Dist. LEXIS 11767 (N.D. Cal. Jan. 29, 2014) .....................................8

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v MEMORANDUM OF LAW IN SUPPORT

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Red v. Kraft Foods, Inc.,

No. CV 10-1028-GW(AGR), 2012 U.S. Dist. LEXIS 164461 (C.D. Cal. Oct. 25,

2012) ....................................................................................................................................5, 7, 8, 9

Semegen v. Weidner,

780 F.2d 727 (9th Cir. 1985) .....................................................................................................4, 12

Sugawara v. Pepsico, Inc.,

No. 08-01335-MCE-JFM, 2009 U.S. Dist. LEXIS 43127 (E.D. Cal. May 21,

2009) ................................................................................................................................................8

Sullivan v. Oracle Corp.,

51 Cal. 4th 1191 (2011) .................................................................................................................12

Swartz v. KPMG LLP,

476 F.3d 756 (9th Cir. 2007) .....................................................................................................4, 12

In re Tobacco II Cases,

46 Cal. 4th 298 (2009) ...............................................................................................................9, 11

Vess v. Ciba-Geigy Corp.,

317 F.3d 1097 (9th Cir. 2003) .........................................................................................................3

Von Koenig v. Snapple Bev. Corp.,

713 F. Supp. 2d 1066 (E.D. Cal. 2010)............................................................................................6

Werbel v. Pepsico, Inc.,

2010 U.S. Dist. LEXIS 76289 (N.D. Cal. July 2, 2010)..............................................................4, 8

Williams v. Gerber Prods. Co.,

552 F.3d 934 (9th Cir. 2008) ...........................................................................................................4

Wilson v. Frito-Lay North America, Inc.,

961 F. Supp. 2d 1134 (N.D. Cal. 2013) ...................................................................................10, 12

Workman v. Plum, Inc.,

141 F. Supp. 3d 1032, 1035–36 (N.D. Cal. 2015) ...........................................................................8

Statutes

21 U.S.C. § 343-1 ..................................................................................................................................9

Cal. Health & Safety Code § 110665...................................................................................................10

Cal. Health & Safety Code § 110740...................................................................................................10

California Consumers Legal Remedies Act, Cal. Civ. Code § 1750, et seq................................3, 4, 12

False Advertising Law, Cal. Bus. & Prof. Code § 17500, et seq.................................................3, 4, 12

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vi MEMORANDUM OF LAW IN SUPPORT

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Other Authorities

21 C.F.R. § 101.3(a)-(b).........................................................................................................................9

21 C.F.R. §§ 101.13-101.14.................................................................................................................10

21 C.F.R. § 101.22(h)(1)........................................................................................................................6

Fed. R. Civ. P. 8(a)(2)............................................................................................................................3

Fed. R. Civ. P. 9(b) ......................................................................................................................3, 4, 12

Fed. R. Civ. P. 12(b)(6)....................................................................................................................3, 12

Fed. R. Evid. 201 ...................................................................................................................................6

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vii MEMORANDUM OF LAW IN SUPPORT

OF DEFENDANT’S MOTION TO DISMISS

Case No. 5:17-cv-00603-EJD

STATEMENT OF ISSUES

1. Has Plaintiff stated a claim under the California consumer-protection statutes, or for

common-law fraud, where she has challenged the use of the statement “Made With Real Ginger” on

the label of Seagram’s® Ginger Ale, but has not plausibly alleged that that statement is false or

misleading to a reasonable consumer?

2. Has Plaintiff stated a consumer-protection or fraud claim arising out of the

statement’s appearance on advertising materials other than the product label, where she has not

alleged that she read or relied on any such materials?

3. Can Plaintiff bring consumer-protection claims under California state law on behalf

of non-California residents who never purchased the product at issue in California?

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1 MEMORANDUM OF LAW IN SUPPORT

OF DEFENDANT’S MOTION TO DISMISS

Case No. 5:17-cv-00603-EJD

PRELIMINARY STATEMENT

Plaintiff’s claims in this putative class action arise entirely from the statement, on the label of

Seagram’s Ginger Ale, that the product is “Made With Real Ginger.” Like most food-labeling

complaints, Plaintiff’s complaint includes allegations that she was “attracted to” the product in part

because of that representation, that she paid a price premium as a result of it, and that she is entitled

to damages. Also like many food-labeling cases, it is not the only one of its kind: the same day that

Plaintiff filed this complaint, she filed a virtually identical one against another soft-drink company.

Less typical, however, is Plaintiff’s utter failure to allege that the statement at issue is false.

The complaint acknowledges that the flavoring for Seagram’s Ginger Ale is formulated with real

ginger, i.e., that the product is, in fact, “Made With Real Ginger.” That acknowledgment is fatal to

her claims: the sine qua non of any consumer-protection or fraud claim is an allegation of a false or

misleading statement. Because the complaint makes no such allegation, it must be dismissed.

Plaintiff attempts to compensate for this deficiency by asserting, implausibly, that a

reasonable consumer would interpret the phrase “Made With Real Ginger” to mean something other

than what it says. She claims that the statement would lead a reasonable consumer to expect a wide

array of “health benefits” from the product, and/ or a quantity of ginger that, Plaintiff speculates,

Seagram’s Ginger Ale may not contain. But these dubious conjectures, which have no basis in fact,

cannot salvage Plaintiff’s claim. Courts in this Circuit have routinely dismissed consumerprotection complaints based on facially incredible interpretations of advertising claims, and this

Court should do the same here.

Plaintiff’s complaint also suffers from other defects: she alludes to the use of the same

phrase in “advertising materials,” but does not allege reliance on any such materials; and she

purports to assert claims on behalf of ginger-ale purchasers nationwide, in contravention of

California’s presumption against extraterritorial application of its laws.

For all of these reasons, the complaint should be dismissed.

STATEMENT OF FACTS

The Coca-Cola Company is a global beverage producer whose portfolio of soft drinks

includes Seagram’s Ginger Ale. (Compl. ¶ 19) Seagram’s Ginger Ale specifies on its packaging

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2 MEMORANDUM OF LAW IN SUPPORT

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Case No. 5:17-cv-00603-EJD

that it is “Made With Real Ginger.” (See Compl. ¶ 41 & Exh. B) That statement is true: Coca-Cola

uses ginger root, the edible portion of the ginger plant, to give the beverage its distinctive ginger

flavor. (Compl. ¶ 26)

Plaintiff, a California resident, alleges that she has purchased several cases of Seagram’s

Ginger Ale over the past few years. She claims that she was “attracted to” the product partly

because of the statement “Made With Real Ginger”1 —which, she alleges, appears both on product

labels and on “advertising materials,” though she claims to have read only the former. (Compl. ¶¶ 5,

56) Crucially, Plaintiff concedes that the flavor for Seagram’s Ginger Ale is, in fact, formulated

with real ginger root. (Compl. ¶ 26) She claims, however, that the statement “Made With Real

Ginger” is misleading because (1) it implies that Seagram’s Ginger Ale offers certain “health

benefits” associated with ginger—including anti-carcinogenic and anti-inflammatory effects—when

in fact it does not; and (2) it suggests that ginger root is a predominant ingredient in the product,

when in fact, she speculates, it is merely distilled to its “essentials oils or essences” and “combined .

. . with any number of other extractions from other plants and animals to create a flavoring substance

that tastes like ginger.” (Compl. ¶ 26)

Based on these allegations, Plaintiff seeks damages and injunctive relief on behalf of a

putative nationwide class of consumers who purportedly purchased Seagram’s Ginger Ale believing

that it contains “ginger root” and would confer wide-ranging “health benefits” as a result. (Compl. ¶

21, 33)

Plaintiff pleads no facts to support her conclusion that the phrase “Made With Real Ginger”

would cause a reasonable consumer to associate a carbonated soft drink with “health benefits.”

Moreover, although she does not challenge Coca-Cola’s decision to designate the product as a

“ginger ale,” she does not account for the fact that any consumer who has those expectations based

on the phrase “Made With Real Ginger” would likely have similar expectations based on the word

“ginger” in the name of the product. Nor does she specify what quantity or form of ginger would

satisfy a reasonable consumer’s expectations based on the challenged phrase. Nevertheless, she

1

Though Plaintiff’s complaint makes several references to the phrase “Made From Real Ginger”

(emphasis added), that appears to be an error. See Compl. ¶¶ 2-4, 19-20.

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3 MEMORANDUM OF LAW IN SUPPORT

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claims that if she had known that the product did not meet these amorphous expectations, she would

not have purchased the product, or would have refused to pay the same price for it. (Compl. ¶¶ 26,

56–58) She also references a laundry list of regulatory provisions that, she claims, Seagram’s

Ginger Ale has violated, though she provides no facts to support that legal conclusion. (Compl. ¶¶

34-36)

Plaintiff filed her complaint on December 28, 2016, in Santa Cruz Superior Court, asserting

claims under the California Consumers Legal Remedies Act (“CLRA”), Cal. Civ. Code § 1750, et

seq., the False Advertising Law (“FAL”), Cal. Bus. & Prof. Code § 17500, et seq., and the Unfair

Competition Law, Id. § 17200, et seq. (“UCL”), as well as a claim for common-law fraud. (Compl.

¶¶ 71–78, 79–89, 98–110) The same day, Plaintiff, represented by the same counsel, filed a nearlyidentical complaint against Dr. Pepper Snapple Group for its use of the phrase “Made From Real

Ginger” on Canada Dry Ginger Ale. See Fitzhenry-Russell v. Dr. Pepper Snapple Group, Inc., 5:17-

cv-00564-NC (N.D. Cal.) (Dkt. No. 1, Ex. A). Coca-Cola timely removed this action on February 6,

2017. (Dkt. No. 1)

ARGUMENT

The Federal Rules of Civil Procedure require dismissal of a complaint that fails to state a

claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). To withstand dismissal, “a

complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is

plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007)). Although the court must accept all well-pleaded factual

allegations in the complaint, the court is “not bound to accept as true a legal conclusion couched as a

factual allegation.” Id. (quoting Twombly, 550 U.S. at 555. “[W]here the well-pleaded facts do not

permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—

but it has not ‘show[n]’—‘that the pleader is entitled to relief.’” Iqbal, 556 U.S. at 679 (citing Fed.

R. Civ. P. 8(a)(2)).

Consumer-protection claims that sound in fraud, as Plaintiff’s do, are also subject to the

heightened pleading requirements of Fed. R. Civ. P. 9(b). Vess v. Ciba-Geigy Corp., 317 F.3d 1097,

1103-04 (9th Cir. 2003) (Where a claim is . . . “grounded in fraud or to sound in fraud, the pleading

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of that claim as a whole must satisfy the particularity requirements of Rule 9(b).”). Those

requirements provide that “a party must state with particularity the circumstances constituting fraud

or mistake,” Fed. R. Civ. P. 9(b), and must be “specific enough to give defendants notice of the

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

the charge.” Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir. 1985). Therefore, allegations

sounding in fraud must contain “an account of the time, place, and specific content of the false

representations as well as the identities of the parties to the misrepresentations.” Swartz v. KPMG

LLP, 476 F.3d 756, 764 (9th Cir. 2007).

Plaintiff’s complaint is deficient, first and foremost, because it fails to allege any false or

misleading statement, which is essential to a claim for violation of any of the California consumerprotection statutes or for common-law fraud. Plaintiff’s attempts to compensate for this deficiency

by attributing implausible meanings to the statement, and by invoking a laundry list of irrelevant

regulations, are unavailing. In addition, Plaintiff fails to plead reliance on any materials other than

the product label, and improperly purports to bring claims on behalf of a nationwide class. The

complaint should be dismissed.

I. PLAINTIFF’S CLAIMS MUST BE DISMISSED BECAUSE SHE HAS NOT

ALLEGED ANY FALSE OR MISLEADING STATEMENT

A. Plaintiff Cannot State A Claim Under California’s Consumer-Protection

Statutes Because She Has Not Alleged Any Statement That Is Misleading

To Reasonable Consumers

To state a claim under the UCL, FAL, or CLRA, a plaintiff must plausibly identify a

marketing or advertising statement that is “either actually misleading or . . . has a capacity,

likelihood or tendency to deceive or confuse the public.” Williams v. Gerber Prods. Co., 552 F.3d

934, 938 (9th Cir. 2008) (internal quotation marks omitted). Claims under these statutes are

“governed by the ‘reasonable consumer’ test,” and a plaintiff’s allegations must be sufficient to

“show that members of the public are likely to be deceived.” Id. When the court “can conclude as a

matter of law that members of the public are not likely to be deceived by the product packaging,” a

complaint under these statutes must be dismissed. Werbel v. Pepsico, Inc., No. 09-04456 SBA, 2010

U.S. Dist. LEXIS 76289 at *8-9 (N.D. Cal. July 2, 2010).

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In accordance with these principles, a consumer-protection claim cannot stand on the premise

that consumers “will read a true statement in a package . . . and assume things about the products

other than what the statement actually says.” Red v. Kraft Foods, Inc., No. CV 10-1028-GW(AGR),

2012 U.S. Dist. LEXIS 164461, at *9 (C.D. Cal. Oct. 25, 2012); see also Carrea v. Dreyer’s Ice

Cream, 475 F. App’x 113, 115 (9th Cir. 2012) (affirming dismissal of consumer-protection

complaint where the plaintiff’s claimed interpretation of a marketing statement “strain[ed]

credulity.”). Rather, such a claim must be rooted in plausible allegations that the defendant

advertised a product as having “characteristics, benefits, uses, qualities, sponsorships, approvals or

certifications that [it did] not have.” People for the Ethical Treatment of Animals v. Whole Food

Market, Inc., No. 15-04301 NC, 2016 U.S. Dist. LEXIS 55601, at *6 (N.D. Cal. Apr. 26, 2016).

Plaintiff’s claims arise entirely out of Coca-Cola’s description of the product as “Made With

Real Ginger.” But she fails to allege that the product is not so made. On the contrary, she allows

that “[it] may be that ginger root is used in the creation” of the product, in order to give the soft drink

its distinctive ginger flavor. (Compl. ¶ 26) In other words, Plaintiff acknowledges the reality that

the product is, in fact, “made with real ginger,” and has been throughout the putative class period.

That is the end of her case.

In an effort to get around this fatal flaw in her pleading, Plaintiff makes two assertions as to

why the representation is, nonetheless, misleading to reasonable consumers. First, she claims that

the statement leads consumers to believe that they will “receive the health benefits associated with

consuming real ginger root”—an expectation that, under Plaintiff’s theory, is triggered by the use of

the phrase “Made With Real Ginger” but not by the use of the word “ginger” in the name of the

product. (Compl. ¶¶ 2, 49) Referring to unidentified “scientific studies,” Plaintiff sets forth a litany

of these purported health benefits: that ginger has “anti-inflammatory effects and aids in relaxing

muscles, is effective in alleviating symptoms of nausea and vomiting, has anti-carcinogenic

qualities, and appears to . . . decrease the risk of cardiovascular disease and diabetes.” (Compl. ¶ 24)

According to Plaintiff, the inclusion of the phrase “Made With Real Ginger” on the product’s label

thus leads reasonable consumers to believe that the beverage, a carbonated soft drink, confers this

array of health benefits. (Compl. ¶¶ 2, 24, 49)

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Second, Plaintiff asserts that the statement communicates to consumers that ginger is present

in a certain quantity or form, which, she speculates, it may not be in Seagram’s Ginger Ale. Though

she acknowledges that ginger root is used “in the creation of the natural flavor” for Seagram’s

Ginger Ale, she hypothesizes that the flavor may have been formulated from “isolated proteins” or

“extracted oils and essences” from the ginger root. (Compl. ¶ 26) She then theorizes that these

isolated compounds “may not actually taste like ginger,” and accordingly may have been “combined

. . . with any number of other extractions from other plants and animals to create a flavoring

substance that tastes like ginger.” (Compl. ¶ 26 (emphasis added)) Plaintiff finally asserts, in

conclusory fashion, that a ginger flavor formulated in this manner “is not ginger as a reasonable

consumer would understand it.” (Compl. ¶ 26) Nowhere does Plaintiff explain what method of

incorporating ginger would, in her view, satisfy a reasonable consumer’s expectations—particularly

given the reality, obvious to any consumer, that a piece of ginger root must be distilled or processed

in some way in order to be incorporated into a soft drink.

Notably, Plaintiff’s theories about how ginger is incorporated into the product are entirely

speculative. They appear to be based on the fact that, on an outdated version of the product label,

“ginger” was declared under the heading “natural flavors,” rather than called out specifically as an

ingredient. But the Food, Drug and Cosmetic Act (“FDCA”) and its implementing regulations

expressly authorize that approach to the labeling of natural flavors such as ginger—irrespective of

the amount of flavor present in the product. See 21 C.F.R. § 101.22(h)(1). That Coca-Cola formerly

took this approach to the labeling of ginger provides no basis for Plaintiff’s suppositions about how,

or in what quantity, ginger is incorporated into the product. The current version of the product

packaging—which has been in the marketplace since mid-2016—declares ginger as an individual

ingredient.2

In any event, Plaintiff’s assertion that reasonable consumers interpret the phrase “Made With

Real Ginger” to mean something other than what it says are insufficient to save her complaint from

2 The Court may take judicial notice of the current Seagram’s Ginger Ale label pursuant to Fed. R.

Evid. 201, because it is referenced throughout Plaintiff’s complaint. See Von Koenig v. Snapple Bev.

Corp., 713 F. Supp. 2d 1066, 1073 (E.D. Cal. 2010) (taking judicial notice of labels affixed to the

defendant’s drink products “because these labels form the basis of the relevant causes of action”).

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dismissal. Coca-Cola has never made any representation about the quantity of ginger in the product,

the manner in which it is processed, or the extent to which it is or is not “combined . . . with other

extractions from other plants and animals.” (Compl. ¶ 26) It has also never touted any health

benefits—let alone such dramatic ones as the prevention of cancer or heart disease—in connection

with Seagram’s Ginger Ale. Plaintiff’s rank speculation that consumers will nonetheless interpret

the “Made With Real Ginger” statement to communicate some or all of these messages is facially

implausible.

Courts in this Circuit routinely dismiss consumer-protection complaints based on similarly

farfetched interpretations of product packaging claims. In Carrea v. Dreyer’s Grand Ice Cream,

Inc., 475 F. App’x 113, 115 (9th Cir. Apr. 5, 2012), for example, the Ninth Circuit affirmed the

district court’s dismissal of a consumer-protection complaint based on a claim that “a reasonable

consumer would interpret ‘Original Sundae Cone,’ ‘Original Vanilla,’ and ‘Classic,’ to imply that

[the advertised ice cream product] is more wholesome or nutritious than competing products.” The

court noted that the mere words “‘original’ or ‘classic’ . . . d[id] not plausibly imply that a product

[was] more nutritious than other desserts,” and held that a reasonable consumer was particularly

unlikely to take that message away given the nature of the product: “[I]t strains credulity to claim

that a reasonable consumer would be misled to think that an ice cream dessert, with ‘chocolate

coating topped with nuts,’ is healthier than its competitors simply by virtue of these ‘Original’ and

‘Classic’ descriptors.” Id. at 115.

Similarly, in Red v. Kraft Foods, the court dismissed a plaintiff’s consumer-protection claims

after rejecting her assertion that the statement “Made With Real Vegetables,” when affixed to a box

of crackers, would lead a reasonable consumer to believe that “the product is healthy and contains a

significant amount of vegetables.” 2012 U.S. Dist. LEXIS 164461, at *5, 10 (emphasis in original).

The court noted that “a reasonable consumer will be familiar with the fact of life that a cracker is not

composed of primarily fresh vegetables,” and that “it strains credulity to imagine that a reasonable

consumer will be deceived into thinking a box of crackers is healthful or contains huge amounts of

vegetables simply because there are pictures of vegetables and the true phrase ‘Made with Real

Vegetables’ on the box.” Id. at *11-12.

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Many other courts have likewise declined to attribute implausible meanings to challenged

claims on product packaging. See Workman v. Plum, Inc., 141 F. Supp. 3d 1032, 1035–36 (N.D.

Cal. 2015) (dismissing consumer-protection challenge to the use of images of certain ingredients on

the product panel, where the product “contain[ed] no affirmative misrepresentations,” the pictured

ingredients were “actually present in the product,” and “a reasonable consumer would simply not

view pictures on the packaging . . . and assume that the size of the items pictured directly correlated

with their predominance in the blend”); Henderson v. Gruma Corp. No. 10-04173 AHM, 2011 U.S.

Dist. LEXIS 41077, at *33 (C.D. Cal. Apr. 11, 2011) (concluding that the label “With Garden

Vegetables” on a package of dip was not actionable where the product was made with “avocado

powder, dehydrated onion, garlic powder, and bell pepper,” and thus “in fact contain[ed] vegetables

that can be grown in a garden”); Sugawara v. Pepsico, Inc., No. 08-01335-MCE-JFM, 2009 U.S.

Dist. LEXIS 43127, at *8–9 (E.D. Cal. May 21, 2009) (dismissing consumer-protection claim based

on assertion that the use of the word “berries” on a cereal package would lead a reasonable consumer

to conclude that the product was “particularly nutritious or . . . designed specifically to meet the

nutritional needs of toddlers or children”); Werbel v. Pepsico, Inc., 2010 U.S. Dist. LEXIS 76289, at

*9-10 (dismissing as “[n]onsense” a similar consumer-protection claim based on the same cereal’s

product packaging, and noting that “no reasonable consumer would believe that [the cereal] derives

any nutritional value from berries”); Rahman v. Mott’s, LLP, No. 13-3482 SI, 2014 U.S. Dist.

LEXIS 11767, at *27-28 (N.D. Cal. Jan. 29, 2014) (dismissing consumer-protection claim based on

a theory that the claim “No Sugar Added” on a package of applesauce was “likely to mislead the

consuming public into believing that the [products were] healthier and contain[ed] less sugar than

comparable products.”).

Plaintiff’s complaint must be dismissed for the same reasons. The challenged claim

communicates only that the product “in fact contains” real ginger, as indeed it does. Plaintiff’s

suggestion that a reasonable consumer will interpret this straightforward factual statement to mean

that Seagram’s Ginger Ale is “healthy” or contains a “significant amount” of ginger is contrary to

fact and reason. Red, 2012 U.S. Dist. LEXIS 164461, at *9. And as in Carrea, this assertion is

especially implausible in view of the nature of the product: it “strains credulity” to posit that a

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reasonable consumer would assume that a sugared soft drink has large quantities of unprocessed,

fresh ginger, or has medicinal properties, based solely on the statement that it is “made with” an

unspecified amount of real ginger. Id. at *11; see also Carrea, 475 F. App’x at 115. Indeed,

Plaintiff does not even allege that she personally had these idiosyncratic expectations, other than a

vague belief that the product would have a “stomach calming” effect. (Compl. ¶ 56-58)

Plaintiff’s attempts to attribute these interpretations to Coca-Cola’s reference to “real ginger”

are particularly unavailing given that, absent the challenged claim, the word “ginger” would still

appear prominently on the product label. The FDCA and its implementing regulations require that

the “principal display panel” of any food contain a “statement of identity,” consisting of either “[t]he

common or usual name of the food” or “[a]n appropriately descriptive term.” 21 C.F.R. § 101.3(a)-

(b). In accordance with these regulations, Coca-Cola identifies the product as “ginger ale”—the

name that is commonly understood by consumers to describe a ginger-flavored, carbonated soft

drink. Plaintiff does not allege that the name of the product is deceptive, and the preemptive force of

the FDCA and its regulations preclude her from doing so. See 21 U.S.C. § 343-1. But the absence

of any challenge to the name of the product belies her allegations that the phrase “Made With Real

Ginger” would cause reasonable consumers to impute any special characteristics to Seagram’s

Ginger Ale. A consumer who labors under the impression that a soft drink “Made With Real

Ginger” is formulated exclusively or primarily with that ingredient—or has cancer-curing

properties—is likely to attribute the same benefits to any product identified as a “ginger ale.”

Because Plaintiff has failed to allege a statement likely to mislead reasonable consumers—a

critical element of all her statutory claims—her complaint must be dismissed.

B. Plaintiff’s Failure to Allege A False Statement Is Also Fatal To Her Fraud

Claim

Plaintiff’s failure to allege that Coca-Cola made any false statement is also fatal to her claim

for common-law fraud. Unlike the California consumer-protection statutes, which prohibit

“misleading” statements likely to deceive a reasonable consumer, “[a] [common law] fraudulent

deception must be actually false [and] known to be false by the perpetrator.” In re Tobacco II

Cases, 46 Cal. 4th 298, 312 (2009) (emphasis added); see also Morgan v. AT&T Wireless Servs.,

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Inc., 177 Cal. App. 4th 1235, 1256 (Cal. App. 2009) (noting that common-law fraud claim, unlike

UCL claim, requires allegations of “actual falsity.”). Because Plaintiff has not alleged (and cannot

allege) that the product she purchased was not, in fact, “made with real ginger,” her claim for fraud

must also be dismissed.

C. Plaintiff Cannot Salvage Her Claim By Citing Irrelevant Regulations

Lacking any plausible allegation that the “Made With Real Ginger” statement is false or

misleading, Plaintiff attempts to shore up her claim with a laundry list of technical food-labeling

requirements, originating in the FDCA and thereafter incorporated into California law, that the

packaging for Seagram’s Ginger Ale has purportedly violated. (Compl. ¶¶ 35-36) But these

regulations have nothing to do with Plaintiff’s factual allegations regarding the “Made With Real

Ginger” claim, and Plaintiff alleges no additional facts to support the conclusion that the labeling for

Seagram’s Ginger Ale has ever violated any of them.

For example, Plaintiff invokes the provisions that require food labels to bear certain

information on the “Nutrition Facts” panel, Cal. Health & Safety Code § 110665; to disclose the

presence of any artificial flavoring, artificial colors, or chemical preservatives, Cal. Health & Safety

Code § 110740; and to have adequate substantiation for certain express claims regarding nutrient

content or health benefits, 21 C.F.R. §§ 101.13-101.14. (Compl. ¶¶ 35-36) But her citation to these

provisions is a non sequitur: nowhere does she allege that Seagram’s Ginger Ale omitted required

information from its nutrition facts panel, failed to disclose the presence of artificial flavors, colors,

or preservatives, or made any of the nutrient or health claims addressed by the regulations. The

Court is not required to accept her threadbare “legal conclusion” that these provisions were violated

in the absence of any supporting facts. Twombly, 550 U.S. at 555.

In any event, even if Plaintiff could allege that the Seagram’s Ginger Ale packaging ran afoul

of a regulatory requirement, courts have consistently rejected consumer-protection claims based on

“alleged violation of labeling laws alone, separate from any alleged fraud or deception connected

with Plaintiffs’ reliance or injury.” Wilson v. Frito-Lay North America, Inc., 961 F. Supp. 2d 1134,

1145 (N.D. Cal. 2013); Leonhart v. Nature’s Path Foods Inc., No. 13-0492 EJD, 2014 U.S. Dist.

LEXIS 46413, at *26 (N.D. Cal. Mar. 31, 2014) (plaintiff cannot make out a consumer-protection

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claim “by simply pointing to a regulation or code provision that was violated” on the challenged

label). Accordingly, even if the labeling for Seagram’s Ginger Ale violated a regulation—a

conclusion that Plaintiff has proffered no facts to support—that would not be sufficient to save her

consumer-protection claims in the absence of an actionably misleading statement.

II. PLAINTIFF FAILS TO PLEAD RELIANCE ON ANY REPRESENTATIONS

OTHER THAN THOSE ON THE PRODUCT LABELING

Plaintiff purports to base her claim on the “Made With Real Ginger” statement not only on

the product label, but also on unspecified “advertising and marketing materials” that, she claims,

also contained the challenged statement. But she does not allege that she ever relied on, or even

saw, any of these materials. (Compl. ¶ 40) As a result, even laying aside her failure to allege a

misleading statement, her consumer-protection and fraud claims arising out of any statement other

than those on the product packaging must be dismissed.

“[A] plaintiff proceeding on a claim of misrepresentation as the basis of his or her UCL

action must demonstrate actual reliance on the allegedly deceptive or misleading statements.”

Kwikset Corp. v. Superior Court, 51 Cal. 4th 310, 326 (2011). Thus, “[a] plaintiff is not permitted to

support a claim alleging misleading product packaging with statements that he never read or relied

upon when making his purchase,” or to plead a claim of reliance with “vague reference[s]” to a

general marketing campaign. Bronson v. Johnson & Johnson, Inc., No. 12-04184 CRB, 2013 U.S.

Dist. LEXIS 54029, at *8 (N.D. Cal. Apr. 16, 2013); see also Dvora v. General Mills, Inc., No. 11-

1074-GW, 2011 U.S. Dist. LEXIS 55513, at *21–22 (C.D. Cal. May 16, 2011) (plaintiff must

specifically allege that he read and relied on all challenged statements). The same reliance

requirement applies to claims of common-law fraud. Kwikset, 51 Cal. 4th at 325-26; see also In re

Tobacco II Cases, 46 Cal. 4th 298, 312-13 (2009) (to support claim of fraud, the fraudulent

representation must be “reasonably relied upon by a victim who incurs damages.”).

Here, Plaintiff claims that the “Made With Real Ginger” statement appeared not only on

product packaging, but also in unidentified “advertising and marketing materials,” “advertising

campaign[s],” and “posters, signs, end cap displays etc.” distributed to Coca-Cola’s “marketing

partners.” (Compl. ¶¶ 40-42) But she does not allege that she read or relied on any such materials;

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to the contrary, she claims only that she read the statement on the “product labels.” (Compl. ¶¶ 55-

56)3 Accordingly, she has not pleaded reliance on any “marketing materials” other than the labels

themselves.

III. PLAINTIFF’S CLASS CLAIMS SHOULD BE DISMISSED

Plaintiff’s state-law claims on behalf of “all persons” who purchased Seagram’s Ginger Ale

in the putative class period must be dismissed for the additional reason that they encompass sales

outside of California to non-California consumers. “California law embodies a presumption against

the extraterritorial application of its statutes,” Churchill Village, LLC v. General Electric Co., 169 F.

Supp. 2d 1119, 1126 (N.D. Cal. 2000), and the California Supreme Court has held that this

“presumption against extraterritoriality applies to the UCL in full force.” Sullivan v. Oracle Corp.,

51 Cal. 4th 1191, 1207 (2011).

Courts in this Circuit have therefore dismissed, under Rule 12(b)(6), putative class claims

that arise under California law but are “based on activity occurring in other states.” Wilson v. FritoLay N. Am., 961 F. Supp. 2d 1134, 1147 (N.D. Cal. 2013); Figy v. Frito-Lay N. Am., 67 F. Supp. 3d

1075, 1087 (N.D. Cal. 2014) (dismissing class claims “under the UCL, CLRA, and FAL by nonCalifornia residents for purchases made outside California”); Gershman v. Bayer HealthCare LLC,

No. 14-05332-HSG, 2015 U.S. Dist. LEXIS 60835, at *19 (N.D. Cal. May 8, 2015) (“The Court

finds that Plaintiffs’ UCL claim on behalf of a putative multi-state class cannot proceed based on the

allegations in the FAC.”).

Here, Plaintiff has pleaded her claims on behalf of a putative class of consumers consisting of

“[a]ll persons”—without geographic limitation—who purchased the Product between December 23,

2012 and the present. (Compl. ¶ 63.) Because her putative class would plainly encompass claims

“under the UCL, CLRA, and FAL by non-California residents for purchases made outside

3

Plaintiff’s vague references to “advertising and marketing materials” also fail to satisfy the

heightened standards of Rule 9(b), which require allegations “specific enough to give defendants

notice of the particular misconduct which is alleged to constitute the fraud charged.” Semegen v.

Weidner, 780 F.2d 727, 731 (9th Cir. 1985); see also Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th

Cir. 2007) (pleadings governed by Rule 9(b) must include “an account of the time, place, and

specific content of the false representations as well as the identities of the parties to the

misrepresentations.”).

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California,” Figy, 67 F. Supp. 3d 1075, her class claims are facially defective, and must be

dismissed.

CONCLUSION

For the foregoing reasons, The Coca-Cola Company respectfully requests that this Court

dismiss Plaintiff’s complaint.

Dated: March 13, 2017

Respectfully submitted,

/s/ Steven A. Zalesin ___________

Steven A. Zalesin (admitted pro hac vice)

Michelle W. Cohen (admitted pro hac vice)

PATTERSON BELKNAP WEBB & TYLER LLP

1133 Avenue of the Americas

New York, NY 10036-6710

Telephone: 212-336-2000

Facsimile: 212-336-2222

sazalesin@pbwt.com

mcohen@pbwt.com

Tammy B. Webb

SHOOK HARDY & BACON LLP

One Montgomery Tower, Suite 2700

San Francisco, CA 94104

Telephone: 415-544-1904

Facsimile: 415-391-0281

tbwebb@shb.com

Attorneys for Defendant

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