FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
TAMARA MOORE; GRETA L. ERVIN; No. 18-15026
RAFF ARANDO; NICHOLS SMITH;
RENEE EDGREN; CYNTHIA WELTON, D.C. No.
on behalf of themselves and all 3:16-cv-07001-
others similarly situated, MMC
Plaintiffs-Appellants,
v. OPINION
MARS PETCARE US, INC.; NESTLE
PURINA PETCARE COMPANY; HILL’S
PET NUTRITION, INC.; PETSMART,
INC.; MEDICAL MANAGEMENT
INTERNATIONAL, INC., DBA Banfield
Pet Hospital; BLUEPEARL VET, LLC;
ROYAL CANIN USA INC.,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of California
Maxine M. Chesney, District Judge, Presiding
Argued and Submitted July 19, 2019
San Francisco, California
Filed July 28, 2020
2 MOORE V. MARS PETCARE US
Before: Michael R. Murphy, * Richard A. Paez, and
Johnnie B. Rawlinson, Circuit Judges.
Opinion by Judge Paez;
Dissent by Judge Rawlinson
SUMMARY **
Consumer Protection Law
The panel reversed the district court’s dismissal of
claims that defendants’ marketing of so-called prescription
pet food violated California’s consumer protection laws and
remanded for further proceedings.
In their putative class action lawsuit, plaintiffs alleged
that the prescription requirement and advertising of pet food
led reasonable consumers falsely to believe that such food
had been subject to government inspection and oversight and
had medicinal and drug properties, causing consumers to pay
more or purchase the product when they otherwise would not
have.
The panel held that the district court erred in dismissing
claims under California’s Unfair Competition Law, False
Advertising Law, and Consumer Legal Remedies Act for
*
The Honorable Michael R. Murphy, United States Circuit Judge
for the U.S. Court of Appeals for the Tenth Circuit, sitting by
designation.
**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
MOORE V. MARS PETCARE US 3
failure to state a claim. The panel concluded that under the
reasonable consumer test, plaintiffs sufficiently alleged that
the sale of the prescription pet food exclusively through vets
or with veterinarian approval was a deceptive practice. In
addition, plaintiffs satisfied the heightened pleading
standard for fraud because they alleged sufficient facts to
show that prescription pet food and other pet food were not
materially different. Further, plaintiffs adequately alleged
reliance because they sufficiently alleged that the use of the
word “prescription” or “Rx” symbol caused their claimed
loss.
In a separately filed memorandum disposition, the panel
affirmed the district court’s dismissal of a federal antitrust
claim.
Dissenting, Judge Rawlinson wrote that plaintiffs did not
state a plausible claim for relief under the California statutes.
She concluded that the majority relied incorrectly on
defendants’ lack of compliance with a Draft Compliance
Policy Guide issued by the United States Food and Drug
Administration, and plaintiffs failed sufficiently to elucidate
the basis for the “reasonable assumption” that the pet food
had been vetted and approved by the FDA. Judge Rawlinson
also wrote that plaintiffs’ claim under California’s CLRA
was preempted by the federal Food, Drug and Cosmetic Act.
COUNSEL
Michael von Loewenfeldt (argued), Kerr & Wagstaffe LLP,
San Francisco, California; Daniel R. Shulman, Gray Plant
Mooty Mooty & Bennett P.A., Minneapolis, Minnesota;
Michael A. Kelly and Matthew D. Davis, Walkup Melodia
Kelly & Schoenberger, San Francisco, California; Michael
4 MOORE V. MARS PETCARE US
L. McGlamry and Wade H. Tomlinson III, Pope McGlamry
P.C., Atlanta, Georgia; Edward J. Coyne III, Ward and
Smith P.A., Wilmington, North Carolina; for Plaintiffs-
Appellants.
Jonathan D. Hacker (argued), Richard B. Goetz, Michael
Tubach, and Hannah Y. Chanoine, O’Melveny & Myers
LLP, Los Angeles, California; John E. Schmidtlein (argued),
Benjamin M. Greenblum, and Xiao Wang, Williams &
Connolly LLP, Washington, D.C.; Jeffrey E. Faucette,
Skaggs Faucette LLP, San Francisco, California; Bryan A.
Merryman and Christopher M. Curran, White & Case LLP,
Los Angeles, California; for Defendants-Appellees.
OPINION
PAEZ, Circuit Judge:
This appeal arises out of a challenge by Tamara Moore
and five other California residents (collectively “Plaintiffs”)
to the marketing of so-called prescription pet food under
California’s consumer protection laws and federal antitrust
law. 1 Plaintiffs brought a putative class action lawsuit
against four pet food manufacturers, two veterinary clinic
chains, and one pet goods retailer (collectively
“Defendants”). Plaintiffs allege that the prescription
requirement and advertising lead reasonable consumers
falsely to believe that such food has been subject to
government inspection and oversight, and has medicinal and
1
Defendants use other terms like “therapeutic pet food” and
“veterinarian recommended” to describe this kind of food, but for
consistency with Plaintiffs’ second amended complaint, we use the term
“prescription pet food.”
MOORE V. MARS PETCARE US 5
drug properties, causing consumers to pay more or purchase
the product when they otherwise would not have. The
district court granted Defendants’ motions to dismiss
Plaintiffs’ Second Amended Complaint. We have
jurisdiction under 28 U.S.C. § 1291, and we reverse. 2
I.
A.
The following facts are taken from Plaintiffs’ allegations
in the Second Amended Complaint, the operative complaint,
“[b]ecause the district court dismissed the complaint on the
pleadings.” Reid v. Johnson & Johnson, 780 F.3d 952, 956
n.1 (9th Cir. 2015) (citation omitted).
Defendants
Defendants consist of pet food manufacturers, Mars
Petcare US, Inc. and Royal Canin U.S.A., Inc. (collectively
“Mars”), 3 Nestle Purina Petcare Company (“Purina”), and
Hill’s Pet Nutrition, Inc. (“Hill’s”); veterinary clinic chains,
Medical Management International, Inc. d/b/a Banfield Pet
Hospital (“Banfield”) and BluePearl Vet, LLC (“Blue
Pearl”); and pet goods retailer, PetSmart, Inc. (“PetSmart”).
Hill’s manufactures and markets its prescription pet food in
2
In a separately filed memorandum disposition, we affirm the
district court’s dismissal of Plaintiffs’ claim that Defendants violated
Section 1 of the Sherman Act, 15 U.S.C. § 1.
3
We use “Mars” to describe Mars and Royal Canin collectively
because Royal Canin is a subsidiary affiliate of Mars, and Plaintiffs
allege that “[s]ome combination of Royal Canin and Mars
manufacturers, produces, [and] markets . . . Royal Canin ‘Veterinary
Diet,’” one of the products at issue.
6 MOORE V. MARS PETCARE US
packaging labeled “Prescription Diet.” Purina manufactures
and markets its prescription pet food under the label “Pro
Plan Veterinary Diets.” Mars manufactured and sold
prescription pet food under the “Iams” label prior to January
1, 2017 and switched to “Royal Canin Veterinary Diet”
starting in 2017.
The market for prescription pet food had a slow roll-out.
Hill’s began selling its “Prescription Diet” pet food in the
1960s through vets and, in the late 1980s, began supplying
vets with prescription pads as part of its marketing effort. In
2004, when Hill’s became a significant player in the
prescription pet food market, Mars introduced its own line
of prescription pet food. At an unspecified time prior to
2012, Purina entered the prescription pet food market. Mars,
Purina and Hill’s (collectively “Defendant Manufacturers”)
have over 90 percent share of the U.S. prescription pet food
market.
Three small companies attempt to compete with
Defendant Manufacturers: Blue Buffalo Company,
Diamond Pet Foods, and Darwin’s Natural Pet Products.
Mars—which has 100 percent ownership over Banfield and
90 percent over Blue Pearl—has a strategic partnership with
PetSmart that involves hosting Banfield hospitals in
PetSmart store locations throughout the United States.
Banfield and PetSmart sell prescription pet food made by
Defendant Manufacturers, but not any other competitors.
PetSmart sells Defendant Manufacturers’ prescription
pet food online and in its brick-and-mortar stores, requiring
proof of a prescription from the pet’s vet. At PetSmart
stores, a consumer must first obtain an Rx card from
Banfield, either by visiting a Banfield veterinarian
(hereinafter, “vet”) on site or presenting a prescription from
another vet to Banfield. Consumers may also purchase
MOORE V. MARS PETCARE US 7
Defendant Manufacturers’ prescription pet food directly
from Banfield or Blue Pearl. PetSmart, Bluefield and Blue
Pearl are not the exclusive sources of Defendant
Manufacturers’ prescription pet food, but there is no dispute
that all Defendants require a vet prescription as a condition
for the purchase of prescription pet food.
In September 2012, the U.S. Food & Drug
Administration (“FDA”) published for comment a Draft
Compliance Policy Guide (“Draft CPG”). In the Draft CPG,
the FDA noted that there has been an increase in the number
of pet food products labeled as intended for use in the
diagnosis, cure, mitigation, treatment or prevention of
disease, as well as a shift in marketing toward pet owners
directly. The agency expressed concerns that animal health
may suffer from consumption of these products because they
“affect physiological processes to extents that may not be
tolerated by all animals and/or may not achieve effective
treatment.” The FDA was, however, “less concerned when
such dog and cat food products are marketed only through
and used under the direction of a licensed veterinarian
because the agency presume[d] the veterinarian will provide
direction to the pet owner.” The FDA then proposed a set of
nine factors it would consider in determining whether to
initiate enforcement action against pet food products.
At that time, in late-2012, Defendant Manufacturers’
products violated three of the factors in the Draft CPG. First,
their prescription pet food included indications of disease
claims on the labels. Second, the distribution of promotional
materials with disease claims were not limited to veterinary
professionals. Third, they electronically disseminated
promotional materials with disease claims to consumers on
the internet. The FDA adopted a final Compliance Policy
8 MOORE V. MARS PETCARE US
Guide 4 (“Final CPG”) in April 2016, in substantially the
same form as the Draft CPG, although it added two more
conditions that could lead to enforcement action. Defendant
Manufacturers did not change their behavior despite
violating the same three conditions of the Final CPG. The
FDA has not, however, taken any enforcement action against
Defendant Manufacturers.
Plaintiffs
Plaintiffs are six California residents who purchased
prescription pet food for their sick pets after consulting with
their vets.
For instance, Plaintiff Moore alleges she purchased
“Hill’s Prescription Diet u/d dog food” after her dog,
Pugalicious, underwent surgery to remove kidney stones.
Pugalicious’s vet informed Moore that a prescription was
required to purchase the dog food, and he issued her one.
Moore initially tried to purchase the product from an animal
hospital but was refused because she failed to present a
prescription. She subsequently was able to purchase the
prescription pet food at a PetSmart using a prescription. The
product is marketed to provide for “Urinary Care,” and
claims that it “[p]romotes desirable urine pH,” is “especially
formulated to help support your dog’s bladder health . . .
[and] [e]nriched with taurine, L-carnitine & antioxidants,”
and has “[c]ontrolled levels of high quality, highly digestible
protein.” The product costs $3.44 per pound while urinary
care non-prescription dog foods from other manufacturers
cost $2.73 and $2.45 per pound. The non-prescription dog
food was also marketed to “[p]romote[] balanced urinary
pH” and “a healthier immune system [and] urinary tract,”
4
The Final CPG is published at 81 Fed.Reg. 26,236–01.
MOORE V. MARS PETCARE US 9
and had “a number of overlapping ingredients in common”
with Hill’s prescription dog food, while the “non-
overlapping ingredients are not drugs and are not sufficient
to justify one product being sold by prescription for a
significantly higher price.”
The other five plaintiffs made similar allegations.
Plaintiff Greta Ervin’s dog, Teddy, became ill from giardia,
after which she received a prescription from Teddy’s vet for
Royal Canin Veterinary Diet Gastrointestinal Puppy dog
food, as well as a prescription from a specialty vet for Royal
Canin Veterinary Diet Selected Protein Adult PV dog food.
Ervin “understood a prescription requirement to indicate that
the foods contained medicine and were subject to the
controls associated with prescription drugs.” The
ingredients of the prescription dog food overlapped
significantly with the ingredients of non-prescription dog
food that was also marketed for digestive health and
sensitive digestion, although the price of the prescription pet
food was two to three times that of the non-prescription
counterparts; none of the non-overlapping ingredients
consisted of drugs.
Plaintiff Nicols Smith had two cats, Mimi and Neichi,
who became overweight, and he received a prescription for
Hill’s “Prescription Diet Glucose/Weight Management m/d
cat food” from their vet. When the vet told Smith that a
prescription was required, Smith “assumed and understood
that there was something medicinal in the food, a medically
controlled substance containing a drug.” Because the
product was substantially more expensive than the non-
prescription cat food he had been buying, Smith first
attempted to purchase the Hill’s prescription cat food at a
Petco without a prescription. He was turned away and
advised he could not buy the product without presenting a
10 MOORE V. MARS PETCARE US
prescription from a vet. Hill’s prescription cat food was
marketed to help support a cat’s glucose and weight
management, and its ingredients overlapped over 65 percent
of those of Hill’s non-prescription diet cat food. Again, the
non-overlapping ingredients did not include drugs and did
not justify tripling the cost of the prescription cat food.
Plaintiffs assumed from the prescription requirement
that this pet food was “(a) a substance medically necessary
to health; (b) a drug, medicine, or other controlled
ingredient; (c) a substance that has been evaluated by the . . .
[FDA] as a drug; (d) a substance to which the manufacturers’
representations regarding intended uses and effects have
been evaluated by the FDA; and (e) a substance legally
required to be sold by prescription.” As a result, Plaintiffs
paid more for the prescription pet food than they would have
in the absence of the prescription requirement, had they
purchased it at all.
B.
Plaintiffs filed their Second Amended Complaint in
August 2017 after the district court granted, with leave to
amend, Defendants’ initial motions to dismiss Plaintiffs’
First Amended Complaint.
Plaintiffs alleged, among other matters, claims for relief
that Mars and Hill’s violated three California state consumer
protection laws: 5 California’s Unfair Competition Law
(“UCL”), Cal. Bus. & Prof. Code § 17200, et seq.;
California’s False Advertising Law (“FAL”), Cal. Bus. &
5
Four of the six Plaintiffs purchased Hill’s prescription pet food
while the other two purchased Mars prescription pet food. Thus, Purina
is not named as a defendant on these California state law counts.
MOORE V. MARS PETCARE US 11
Prof. Code § 17500, et seq.; and California’s Consumer
Legal Remedies Act (“CLRA”), Cal. Civ. Code § 1750, et
seq. Plaintiffs also sought class certification, injunctive
relief, and damages.
Defendants filed motions to dismiss the Second
Amended Complaint for failure to state a claim for relief
under the California consumer protection laws, failure to
plead those claims with sufficient particularity under Federal
Rule of Civil Procedure 9(b), and for lack of standing. 6 The
district court granted the motions with leave to amend the
California state law claims to specify how the term
prescription or Rx symbol affected each plaintiff’s decision
to purchase such pet food. Plaintiffs elected to rest on the
allegations in the Second Amended Complaint, and the
district court dismissed the case with prejudice. Plaintiffs
timely appealed.
II.
We review de novo the district court’s dismissal of a
complaint under Rules 9(b) and 12(b)(6). Vess v. Ciba-
Geigy Corp. USA, 317 F.3d 1097, 1102 (9th Cir. 2003). All
allegations of material fact in the complaint are taken as true
and construed in the light most favorable to Plaintiffs.
Williams v. Gerber Prods. Co., 552 F.3d 934, 937 (9th Cir.
2008). “To survive a motion to dismiss, 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)).
6
As noted above, Defendants also moved to dismiss the Sherman
Act antitrust claim, which the court granted. See note 1, supra.
12 MOORE V. MARS PETCARE US
“As a federal court sitting in diversity [over Plaintiffs’
California state law claims], we must apply the substantive
law of California, as interpreted by the California Supreme
Court.” Hinojos v. Kohl’s Corp., 718 F.3d 1098, 1103 (9th
Cir. 2013) (quotations omitted).
III.
Plaintiffs argue that the district court erred by dismissing
their California state law consumer protection claims against
Defendants Mars and Hill’s. As discussed below, we agree
that the district court erred in dismissing the California
claims.
California’s UCL prohibits any “unlawful, unfair or
fraudulent business act or practice.” Cal. Bus. & Prof. Code
§ 17200. California’s FAL prohibits any “unfair, deceptive,
untrue or misleading advertising.” Williams, 552 F.3d at 938
(quoting Cal. Bus. & Prof. Code § 17500). “‘Any violation
of the [FAL] . . . necessarily violates’ the [UCL].” Id.
(original alterations omitted) (quoting Kasky v. Nike, Inc.,
45 P.3d 243, 250 (Cal. 2002)). Last, California’s CLRA
prohibits “unfair methods of competition and unfair or
deceptive acts or practices.” Cal. Civ. Code § 1770. Among
the twenty-four activities deemed unlawful within the
CLRA, two are relevant to this case: “[m]isrepresenting the
source, sponsorship, approval, or certification of goods or
services” and “[r]epresenting that goods . . . have . . .
approval, characteristics, ingredients, uses, benefits, or
quantities that they do not have.” Id. §§ 1770(a)(2), (5).
The gravamen of Plaintiffs’ claim is that Hill’s and Mars
violated the UCL, FAL, and CLRA through their false and
MOORE V. MARS PETCARE US 13
misleading advertising of prescription pet food.7
Specifically, through the prescription requirement, their
advertising and marketing statements, and failure to include
an adequate disclaimer, Mars and Hill’s allegedly
misrepresented that the prescription pet food: (1) qualified
as some sort of drug or medicine; (2) met a medical
requirement for the pet; (3) had been evaluated by the FDA
as a drug; (4) had been evaluated by the FDA regarding its
intended uses and effects; (5) required a prescription per
federal or state law; and (6) warranted a particular premium
price.
The district court dismissed Plaintiffs’ California state
law claims on three separate grounds: first, the court
concluded that the sale of the prescription pet food
exclusively through vets or with veterinarian approval was
not itself a deceptive or otherwise misleading practice;
second, the court concluded that plaintiffs failed to plead
enough facts to show that prescription pet food and other pet
food are not materially different; third, the court determined
that Plaintiffs failed adequately to allege that the use of the
word “prescription” or “Rx” symbol to have caused any of
their claimed loss. We disagree with all three grounds.
A. Deceptive or Misleading Practice
Whether a business practice is deceptive or misleading
“under these California statutes [is] governed by the
‘reasonable consumer’ test.” Williams, 552 F.3d at 938
(quoting Freeman v. Time, Inc., 68 F.3d 285, 289 (9th Cir.
7
Because the cause of action under each California state law is
premised on the same allegedly misleading acts in this case—i.e.,
misrepresentation of the certification of and ingredients in prescription
pet food—we evaluate the UCL, FAL, and CLRA claims collectively, as
did the district court and all parties.
14 MOORE V. MARS PETCARE US
1995)). Plaintiffs “must show that members of the public are
likely to be deceived.” Id. (quotations omitted). This
“requires more than a mere possibility that [Defendants’]
label ‘might conceivably be misunderstood by some few
consumers viewing it in an unreasonable manner.’” Ebner
v. Fresh, Inc., 838 F.3d 958, 965 (9th Cir. 2016) (quoting
Lavie v. Proctor & Gamble Co., 129 Cal. Rptr. 2d 486, 495
(Ct. App. 2003)). “Rather, the reasonable consumer
standard requires a probability ‘that a significant portion of
the general consuming public or of targeted consumers,
acting reasonably in the circumstances, could be misled.’”
Id. (quoting Lavie, 129 Cal. Rptr. 2d at 495).
California laws “prohibit ‘not only advertising which is
false, but also advertising which[,] although true, is either
actually misleading or which has a capacity, likelihood or
tendency to deceive or confuse the public.’” Williams,
552 F.3d at 938 (emphasis added) (quoting Kasky, 45 P.3d
at 951). “[W]hether a practice is deceptive will usually be a
question of fact not appropriate for decision on demurrer” or
motions to dismiss. Id. (citing Linear Tech. Corp. v. Applied
Materials, Inc., 61 Cal. Rptr. 3d 221, 236–37 (Ct. App.
2007)). Several themes emerge from cases evaluating the
potential to mislead under the reasonable consumer test.
First, “[l]iteral truth can sometimes protect a product
manufacturer from a misleading claim, but it is no
guarantee,” whereas “there is no protection for literal
falseness.” Brady v. Bayer Corp., 237 Cal. Rptr. 3d 683,
691–92 (Ct. App. 2018). For instance, in Kwikset Corp. v.
Super. Ct., the California Supreme Court reversed dismissal
of a UCL claim challenging defendants’ practice of selling
locks with “Made in U.S.A.” labels when some screws and
pins in the assembly were made in Taiwan. 246 P.3d 877,
882, 890–91 (Cal. 2011).
MOORE V. MARS PETCARE US 15
Second, qualifiers in packaging, usually on the back of a
label or in ingredient lists, “can ameliorate any tendency of
the label to mislead.” Brady, 237 Cal. Rptr. 3d at 692. If,
however, “a back label ingredients list . . . conflict[s] with,
rather than confirm[s], a front label claim,” the plaintiff’s
claim is not defeated. Id. at 693. For instance, in Williams,
we held that a reasonable consumer would be misled where
packaging on defendant’s snacks stated “fruit juice” next to
images of fruit when in fact fruit juice was not a listed
ingredient. 552 F.3d at 939–40. Conversely, in Ebner, we
held that a reasonable consumer would not be misled about
the amount of lip balm in a tube because it was undisputed
that the label disclosed the correct weight of included lip
product. 838 F.3d at 965–66; see also Freeman, 68 F.3d
at 289–90 (holding that promotional mailers for sweepstakes
were not likely to deceive reasonable consumers because the
mailers themselves contained qualifying language).
Third, “brand names by themselves can be misleading in
the context of the product being marketed.” Brady, 237 Cal.
Rptr. 3d at 694. Descriptive brand names require of the
consumer “little thought,” which can make consumers
susceptible to purchasing because “they won’t have the time
or interest to read about [the product] on [the] website or
the back of the box.” Id. (quoting the California Attorney
General’s amicus brief). Thus, a product called “One a Day”
gummy vitamins, which required two gummies a day for a
full dosage, is explicitly misleading. Id. at 696–97.
Conversely, if common sense would not lead anyone to be
misled, then the claim may be disposed of at a motion to
dismiss stage. Id. at 690–91.
Under these guidelines, the labeling of “prescription pet
food” does appear deceptive and misleading. Common
sense dictates that a product that requires a prescription may
16 MOORE V. MARS PETCARE US
be considered a medicine that involves a drug or controlled
substance. See, e.g., Prescription, Merriam-Webster,
https://www.merriam-webster.com/dictionary/prescription
(last accessed August 2, 2019) (defining “prescription” as,
among other things, “a prescribed medicine”). This
conforms to general understandings of prescription drugs for
humans and pets. Moreover, the brand name of
“prescription pet food” itself could be misleading. A
reasonable consumer being told about “prescription pet
food” may be surprised to learn that there are no drugs or
controlled ingredient in the pet food by nature of brand
names like “Prescription Diet” or an “Rx” symbol on the
food packaging. See Williams, 552 F.3d at 939 (“The
product is called ‘fruit juice snacks’ and the packaging
pictures a number of different fruits, potentially suggesting
(falsely) that those fruits or their juices are contained in the
product.”).
The district court seems to have discounted the potential
to mislead in part because vets play a role in the referral
process. This reasoning, however, is misguided. The
reasonable consumer test requires looking at “the general
consuming public or targeted consumers.” 8 Ebner, 838 F.3d
at 965 (quoting Lavie, 129 Cal. Rptr. at 495). Plaintiffs
allege, and Defendants do not seem to deny, that Defendant
Manufacturers’ prescription pet food is marketed to
consumers, in addition to vets. In fact, all parties agree that
there has been a historic shift from this kind of pet food being
8
Defendants’ argument—that the individual Plaintiffs lacked
exposure to the term “prescription pet food” prior to receiving a written
prescription from their vets—impacts the standing analysis, but not the
reasonable consumer analysis. See Reid, 780 F.3d at 958 (“[T]he
reasonable consumer standard, unlike the individual reliance
requirement[,] . . . is not a standing requirement.”). We analyze standing
separately. See infra at 20–23.
MOORE V. MARS PETCARE US 17
distributed only through vets to being sold directly to
consumers. Thus, to whatever extent that the district court
assumed that vets could tell the difference between food and
medicine, that reasoning is insufficient under the reasonable
consumer test.
Moreover, even though the FDA, in the 2016 CPG,
explicitly sanctions the role of vets in supervising
consumption of this type of pet food, that does not
automatically defeat Plaintiffs’ claim. The Seventh Circuit
recently addressed the marketing of prescription cat food by
Hill’s and PetSmart and held that the plaintiffs’ complaint
adequately pled a deceptive-practices claim under an Illinois
consumer protection statute. 9 See Vanzant v. Hill’s Pet
Nutrition, Inc., 934 F.3d 730, 739 (7th Cir. 2019). In
analyzing the same CPG, the Seventh Circuit concluded that
it “doesn’t signal [the FDA’s] authorization” and “doesn’t
specifically authorize the [defendant]’s prescription
requirement, prescription label, and related marketing
representations.” Id. at 738. We agree with the Seventh
Circuit’s reading of the 2016 CPG.
We also find it persuasive that the FDA warns in the
CPG that the labeling on such pet food “may lack sufficient
information, particularly for pet owners.” Plaintiffs allege
that Defendant Manufacturers violate three of the conditions
listed in the CPG, which make it more likely that the FDA
would consider enforcement action. Even assuming the
FDA does not expressly prohibit the “prescription”
9
The Illinois law “protect[s] consumers . . . against fraud, unfair
methods of competition, and other unfair and deceptive practices.”
Vanzant, 934 F.3d at 736 (quotations omitted). The California UCL
targets deceptive, unfair and unlawful business practices, see Cal. Bus.
& Prof. Code § 17200, so it is broader but also encompasses acts targeted
by the Illinois statute.
18 MOORE V. MARS PETCARE US
requirement as directed to consumers, an advertising
practice can be deceptive without directly violating FDA
regulations. 10 See Reid, 780 F.3d at 957, 967; see also
Vanzant, 934 F.3d at 738–39. Thus, we conclude that
Plaintiffs have sufficiently alleged a deceptive practice
under the reasonable consumer test.
B. Rule 9(b) Misrepresentation
Plaintiffs’ state law claims are based in part on a theory
of fraud: that prescription pet food is not materially different
from non-prescription pet food and therefore does not justify
the higher cost. “In alleging fraud . . . a party must state with
particularity the circumstances constituting fraud . . . .” Fed.
R. Civ. P. 9(b). In other words, “a pleading must identify
the who, what, when, where, and how of the misconduct
charged, as well as what is false or misleading about the
purportedly fraudulent statement, and why it is false.”
Davidson v. Kimberly–Clark Corp., 889 F.3d 956, 964 (9th
Cir. 2018) (quotations omitted). 11
10
Although “[c]ompliance with FDA regulations may be relevant to
a preemption argument,” Williams, 552 F.3d at 940 n.4, Defendants do
not make such an argument here.
11
Rule 9(b) requirements may not even be necessary, given that a
defendant can violate the UCL, FAL, and CLRA by acting with mere
negligence. See Williams, 552 F.3d at 938 (applying a “reasonable
consumer” test to UCL, FAL, and CLRA claims); Chamberlan v. Ford
Motor Co., 369 F. Supp. 2d 1138, 1144 (N.D. Cal. 2005) (rejecting
arguments that plaintiffs must show intent to deceive for CLRA and UCL
claims); Khan v. Med. Bd., 16 Cal. Rptr. 2d 385, 392 (Ct. App. 1993)
(holding that FAL “can be violated through negligence”). Thus, because
“fraud is not a required element, Rule 9(b)’s heightened pleading
standard [may] not apply.” See Vanzant, 934 F.3d at 739; Belville v.
Ford Motor Co., 60 F. Supp. 3d 690, 698 (S.D. W. Va. 2014) (agreeing
MOORE V. MARS PETCARE US 19
Here, Plaintiffs’ complaint satisfies the Rule 9(b)
heightened pleading standard in alleging the basic premise
of “what is false or misleading about a statement, and why it
is false.” Vess, 317 F.3d at 1106 (quotations omitted).
Plaintiffs described the six kinds of prescription pet food that
they purchased from Mars and Hill’s and how they overlap
with a substantial portion of ingredients in non-prescription
pet foods that were marketed to treat similar health issues.
More importantly, Plaintiffs allege that all non-overlapping
ingredients are not drugs and are not sufficient to justify one
product being sold by prescription for a significantly higher
price.
We therefore conclude that Plaintiffs have pleaded
sufficient detail to put Defendants on notice as to the fraud
claim. Compare Davidson, 889 F.3d at 964–65 (reversing
dismissal under Rule 9(b) where plaintiff alleged that
defendant’s marketing of its wipes as “flushable” were
false), with Kearns v. Ford Motor Co., 567 F.3d 1120, 1126–
27 (9th Cir. 2009) (affirming dismissal where plaintiff failed
to allege what misleading advertisement or sales material led
him to purchase defendant’s vehicle). If this case had
proceeded in the district court, Defendants could have
submitted evidence about why the difference in ingredients
mattered between those specific prescription and non-
prescription pet foods to justify the price differentials. Cf.
Concha v. London, 62 F.3d 1493, 1503 (9th Cir. 1995)
that because “most state consumer protection laws do not require the
same elements of proof as common-law fraud, . . . . a state-by-state
analysis” is necessary to determine whether Rule 9(b) applies); see also
Wright & Miller, 5A Fed. Prac. & Proc. Civ. § 1297 (4th ed.) (“Some
federal or state statutes may define fraud in a manner that eliminates one
or more of the[] [traditional] elements of a fraud claim . . . .”).
Nonetheless, Plaintiffs did not raise this argument in their briefing, so we
do not decide this issue at this stage.
20 MOORE V. MARS PETCARE US
(“Even in cases where fraud is alleged, we relax pleading
requirements where the relevant facts are known only to the
defendants.”). The fact that Plaintiffs placed Defendants on
sufficient notice to respond to the alleged fraud reflects how
their allegations meet Rule 9(b).
C. Reliance and Standing
Last, the district court faulted Plaintiffs for not providing
more detail as to how each Plaintiff relied on the
“prescription” label or requirement to purchase the food.
Since the passage of Proposition 64,12 a plaintiff must allege
actual reliance in order to have standing to pursue UCL and
FAL claims. See Hinojos, 718 F.3d at 1103–04; see also
Cal. Bus. & Prof. Code §§ 17204, 17535. “[A]ny plaintiff
who has standing under the UCL’s and FAL’s ‘lost money
or property’ requirement will, a fortiori, have suffered ‘any
damage’ for purposes of establishing CLRA standing.”
Hinojos, 718 F.3d at 1108 (citations omitted).
The test for reliance in cases premised on false
advertising and misrepresentations to consumers derives
from the California Supreme Court decision in In re Tobacco
II Cases, 207 P.3d 20, 40–41 (Cal. 2009), and was
reaffirmed as follows:
[A] plaintiff “proceeding on a claim of
misrepresentation . . . must demonstrate
actual reliance on the allegedly deceptive or
misleading statements, in accordance with
well-settled principles regarding the element
12
California voters passed Proposition 64 in 2004, “which restricts
standing for individuals alleging UCL and FAL claims to persons who
‘have suffered injury in fact . . . .’” Hinojos, 718 F.3d at 1103 (citing
Cal. Bus. & Prof. Code §§ 17204, 17535) (brackets removed).
MOORE V. MARS PETCARE US 21
of reliance in ordinary fraud actions.”
Consequently, “a plaintiff must show that the
misrepresentation was an immediate cause of
the injury-producing conduct.” However, a
“plaintiff is not required to allege that the
challenged misrepresentations were the sole
or even the decisive cause of the injury-
producing conduct.”
Kwikset, 246 P.3d at 888 (emphases added) (original
alterations, internal citations, and footnote omitted). “A
consumer who relies on a product label and challenges a
misrepresentation contained therein can satisfy the standing
requirement of [the UCL] by alleging . . . that he or she
would not have bought the product but for the
misrepresentation.” Id. at 890; see also Davidson, 889 F.3d
at 962, 966.
Plaintiffs do not provide much detail in their individual
allegations, but they collectively allege that “[a]s a result of
the false and fraudulent prescription requirement, each
Plaintiff paid more for Prescription Pet Food than each
Plaintiff would have paid in the absence of the requirement,
or would never have purchased Prescription Pet Food.” This
is sufficient under Kwikset to survive a motion to dismiss.
See Hinojos, 718 F.3d at 1105; Williams, 552 F.3d at 939–
40. The fact that vets had prescribed each Plaintiff the pet
food—rather than each discovering the pet food on their
own—does not negate the allegation of actual reliance
because the prescription requirement and advertising need
not be the sole or even the decisive cause of the purchase.
See Kwikset, 246 P.3d at 888.
Moreover, at the motion to dismiss stage, “actual
reliance . . . is inferred from the misrepresentation of a
22 MOORE V. MARS PETCARE US
material fact.” Friedman v. AARP, Inc., 855 F.3d 1047,
1055 (9th Cir. 2017) (quoting Chapman v. Skype Inc.,
162 Cal. Rptr. 3d 864, 874 (Ct. App. 2013)). Whether a
misrepresentation is sufficiently material to allow for an
inference of reliance is generally a question of fact that
cannot be decided at the motion to dismiss stage. See
Chapman, 162 Cal. Rptr. 3d at 874. To allege reliance, a
plaintiff “only need[] establish it to be plausible that a
‘reasonable man would attach importance to [the] existence
or nonexistence [of the misrepresentation] in determining his
choice of action in the transaction in question.” Friedman,
855 F.3d at 1056 (quoting In re Tobacco II Cases, 207 P.3d
at 39). Thus, in Friedman, we reversed dismissal of a
complaint because the plaintiff alleged that a
misrepresentation concerning an undisclosed fee in his
insurance purchase was a material fact that allowed for an
inference of actual reliance. Id. at 1056–57. We noted that
“it is not, as a matter of law, an ‘obviously unimportant’
consideration for a reasonable purchaser of insurance to
know [about] an undisclosed fee.” Id. at 1056 (quoting In re
Tobacco II Cases, 207 P.3d at 39).
Similarly, it certainly seems plausible that a reasonable
consumer would at least partially rely on the prescription
labeling to pay more money for a certain type of pet food
over others. Cf. Vanzant, 934 F.3d at 739. As the California
Supreme Court has emphasized, “labels matter.” Kwikset,
246 P.3d at 889. These California laws exist to protect
consumer interests in accurate label representations
“because consumers rely on the accuracy of those
representations in making their buying decisions.” Id. The
misrepresentation of prescription pet food as medicine or
FDA-controlled can be a material fact for a reasonable
consumer—particularly for a pet owner who is dealing with
possibly a sick or unhealthy pet. In other words, it is
MOORE V. MARS PETCARE US 23
reasonable for a consumer to rely on the prescription
requirement and labeling in her purchasing decision for an
ailing pet. Pets can, after all, be as cherished and cared for
as family members, and a reasonable person in Plaintiffs’
shoes would rationally gravitate toward a “prescription”
product if that family member’s health is at risk.
We therefore reverse the district court’s dismissal of
Plaintiffs’ California state claims. 13
13
We also reject Defendants’ additional arguments about the relief
that Plaintiffs seek. First, Defendants’ assertion that Plaintiffs have no
standing for injunctive relief is foreclosed under our recent case,
Davidson, in which we held that “a previously deceived consumer may
have standing to seek an injunction against false advertising or labeling,
even though the consumer now knows or suspects that the advertising
was false at the time of the original purchase.” 889 F.3d at 969. There
is sufficient cognizable injury where Plaintiffs allege that they cannot
rely on Defendants’ labeling of a product when deciding whether to
purchase it in the future. Id. at 970–71. Second, Defendants’ argument
that Plaintiffs cannot seek equitable relief under the UCL or FAL, given
an adequate legal remedy under the CLRA, is foreclosed by statute. The
UCL, FAL and CLRA explicitly provide that remedies under each act
are cumulative to each other. See Cal. Bus. & Prof. Code §§ 17205,
17534.5; Cal. Civ. Code § 1752. Last, Defendants argue that Plaintiffs
do not have standing to enjoin all of Defendant Manufacturers’
prescription pet food products because Plaintiffs have not purchased
every single type of prescription pet food available from Hill’s or Mars.
This does not constitute a basis for dismissal because Plaintiffs’
challenge to prescription pet foods is to the common scheme of the
prescription requirement and prescription-based advertising. Cf. In re
Tobacco II Cases, 207 P.3d at 40–41 (holding class representatives had
standing to challenge common marketing of cigarettes despite
differences in the advertisements or statements on which class members
relied).
24 MOORE V. MARS PETCARE US
IV.
For the reasons above, we reverse the district court’s
dismissal of the California state law claims and remand for
further proceedings on those claims consistent with this
opinion.
The parties shall bear their own costs on appeal.
REVERSED and REMANDED.
RAWLINSON, Circuit Judge, dissenting:
I respectfully dissent from the majority’s conclusion that
the district court judge erred in dismissing the putative class
action complaint for failure to state a claim.
Plaintiffs’ complaint asserted that Defendants violated
California’s Unfair Competition Law, False Advertising
Law and Consumer Legal Remedies Act. Plaintiffs
specifically alleged that:
By requiring a prescription from a
veterinarian as a pre-condition to the
purchase of their Prescription Pet Food,
Defendants misrepresent Prescription Pet
Food to be: (a) a substance medically
necessary to health; (b) a drug, medicine, or
other controlled ingredient; (c) a substance
that has been evaluated by the FDA as a drug;
(d) a substance as to which the
manufacturer’s representations regarding
intended uses and effects have been
MOORE V. MARS PETCARE US 25
evaluated by the FDA; and (e) a substance
legally required to be sold by prescription.
After extensive briefing and arguments from the parties,
the district court ultimately concluded that these allegations
did not state a plausible claim for relief under the California
statutes. The district court was not persuaded that Plaintiffs
sufficiently pled that use of the word “prescription” caused
any of Plaintiffs’ claimed losses.
My colleagues in the majority are persuaded that
Plaintiffs have pled a plausible claim for relief. They rely
heavily on the Defendants’ “violations” of a Draft
Compliance Policy Guide published by the United States
Food and Drug Administration (FDA). 1
As an initial matter, it is of note that the Draft Policy
Guide clarified from the outset that it was intended to serve
only as “non-binding recommendations” for the “labeling
and marketing of nutritional products intended to diagnose,
cure, mitigate, treat, or prevent diseases in dogs and cats.”
The Draft Policy Guide explicitly provides with black-box
emphasis:
This Draft Compliance Policy Guide, when
finalized, will represent the Food and Drug
Administration’s (FDA’s) current thinking
on this topic. It does not create or confer any
rights for or on any person and does not
1
Use of the term “violations” is not really accurate because, as the
majority acknowledges, the FDA has never initiated any enforcement
action against Defendants.
26 MOORE V. MARS PETCARE US
operate to bind FDA or the public. . . .
(Emphasis added).
Notwithstanding the non-binding nature of the Draft
Policy Guide, the majority opinion rests its conclusion that
Plaintiffs stated a plausible claim for relief on the
Defendants’ “violation” of the following FDA
recommendations:
5. The product does not include indications for a
disease claim (e.g. obesity, renal failure) on the label.
6. Distribution of labeling and promotional materials
with any disease claims for the product is not limited
to veterinarians.
7. Electronic resources for the dissemination of
labeling information and promotional materials are
not secured so that they are available only to
veterinarians.
It is helpful to juxtapose the provisions in the guide to
the pleading requirements of the California statutes upon
which Plaintiffs’ claims are predicated.
California’s Unfair Competition Law prohibits use of
“any unlawful, unfair or fraudulent business act or practice
and unfair, deceptive, untrue or misleading advertising.”
Cal. Bus. & Prof. Code § 17200.
California’s False Advertising Law prohibits the
dissemination of “untrue or misleading” statements in
advertising. Cal. Bus. & Prof. Code § 17500.
California’s Consumer Legal Remedies Act prohibits a
delineated number of “unfair methods of competition and
MOORE V. MARS PETCARE US 27
unfair or deceptive acts or practices” in connection with
consumer transactions. Cal. Civ. Code § 1770.
As discussed, Plaintiffs and the majority hinge their
assertion of a plausible claim on the requirement of a
veterinarian’s prescription to purchase Prescription Pet Food
and on Defendants’ “violation” of the Policy Guide.
However, assertion of plausible claims on these bases is
problematic, as recognized by the district court.
The sum and substance of Plaintiffs’ allegation regarding
the prescription requirement is that an individual seeing the
word “prescription” in connection with pet food would
reasonably assume that the pet food has been vetted and
approved by the FDA. However, Plaintiffs did not elucidate
the basis for the “reasonable assumption” that the pet food
has been vetted and approved by the FDA. Indeed the
FDA’s own Policy Guide expressly noted that “[f]or more
than fifty years, dog and cat food manufacturers have
marketed products identified on their labels or in labeling as
being intended for use to diagnose, cure, mitigate, treat or
prevent diseases” without FDA approval.
This statement seriously undercuts the reasonableness of
Plaintiffs’ asserted assumption, particularly where the
assumption is not supported by any underlying factual
assertions. See Ibarra v. Manheim Investments, Inc.,
775 F.3d 1193, 1199 (9th Cir. 2015) (clarifying that when a
“chain of reasoning includes assumptions . . . [,] those
assumptions cannot be pulled from thin air but need some
reasonable ground underlying them”). In Ibarra, we
concluded that neither the party advancing the assumption
nor the party contesting the assumption proceeded from a
position “grounded in real evidence.” Id. This approach is
consistent with the well-established pleading standard set
forth in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007)
28 MOORE V. MARS PETCARE US
and Ashcroft v. Iqbal, 556 U.S. 662 (2009) requiring
pleading of facts to state a plausible claim. See Twombly,
550 U.S. at 555 (mandating sufficient “[f]actual allegations
. . . to raise a right to relief above the speculative level”)
(citation omitted); see also Iqbal, 556 U.S. at 680 (clarifying
that a complaint does not “suffice if it tenders naked
assertions devoid of further factual enhancement”) (citation,
alteration and internal quotation marks omitted).
As described in greater detail below, the majority’s
reliance on “violations” of the Draft Policy Guide does not
cure the defect in Plaintiffs’ allegations because the Draft
Policy Guide sets forth non-binding recommendations rather
than actual regulations that could be violated. In addition,
the Draft Policy Guide encourages veterinarian oversight in
the selection and use of prescription pet food rather than
discouraging such involvement. Finally, our precedent and
precedent from one of our sister circuits foreclose the claim
made by Plaintiffs based on use of the term “prescription.”
It is informative to examine in some detail the provisions
of each of the California statutes upon which the Plaintiffs’
complaint is based. Such examination further exposes the
deficiencies in Plaintiffs’ pleading.
1. California’s Unfair Competition Law
Interpreting California’s Unfair Compensation Law
(UCL), and applying California precedent, we have
recognized a claim under the “unlawful prong” of the UCL
predicated on violation of “virtually any state, federal, or
local law.” Freidman v. AARP, 855 F.3d 1047, 1052 (9th
Cir. 2017). However, there must be an actual law involved.
See id. As noted earlier, Plaintiffs did not rely on “any state,
federal, or local law” in the allegations of their complaint.
Id. (citation omitted). Rather, they referenced “violations”
MOORE V. MARS PETCARE US 29
of a non-binding Policy Guide. Under our interpretation of
the “unlawful prong” of the statute, id., these allegations did
not suffice to state a plausible claim for relief. See Iqbal,
556 U.S. at 678 (explaining that the Rule 8 pleading standard
“demands more than an unadorned, the-defendant-
unlawfully-harmed-me accusation”) (citation omitted) 2, 3
2. California’s False Advertising Law
To state a claim under California’s False Advertising
Law, the Plaintiffs must allege that they relied on a
misrepresentation on a product label and, as a result of that
reliance, they “paid more for a product than they otherwise
would have paid, or bought it when they otherwise would
not have done so.” Reid v. Johnson & Johnson, 780 F.3d
952, 958 (9th Cir. 2015) (citations omitted). Plaintiffs
cannot state a plausible claim because they did not read the
product labels prior to purchasing the products. Rather, they
admittedly relied on the advice of their respective
veterinarians to purchase the prescription pet foods.
The majority opinion references “promotional materials
with disease claims.” Majority Opinion, p. 7. However, the
majority does not, and cannot, point to any allegation that
any of the Plaintiffs relied on these “promotional materials”
to purchase prescription pet food. The majority cannot make
this assertion because the Plaintiffs made no such assertion.
Rather, the Plaintiffs consistently asserted that their
2
Plaintiffs made no specific allegations of “unfair” or “fraudulent”
business practices in their complaint.
3
The advertising provisions of California’s Unfair Competition Law
overlap with the False Advertising Law.
30 MOORE V. MARS PETCARE US
purchases were prompted by referrals from their
veterinarians.
Because the Plaintiffs failed to plead reliance on any
product labels to induce their purchases of prescription pet
food, the district court committed no error in dismissing their
claim under California’s False Advertising Law. See Reid,
780 F.3d at 958.
3. California’s Consumer Legal Remedies Act
To state a claim under California’s Consumer Legal
Remedies Act, a plaintiff must allege that defendants
engaged in one or more of the following unlawful practices,
as potentially relevant to this case:
(1) Passing off goods or services as those of another.
(2) Misrepresenting the source, sponsorship, approval,
or certification of goods or services.
(3) Misrepresenting the affiliation, connection, or
association with, or certification by, another.
(4) Using deceptive representations or designations of
geographic origin in connection with goods or
services.
(5) Representing that goods or services have
sponsorship, approval, characteristics, ingredients,
uses, benefits, or quantities that they do not have or
that a person has a sponsorship, approval, status,
affiliation, or connection that he or she does not have.
MOORE V. MARS PETCARE US 31
(6) Representing that goods are original or new if they
have deteriorated unreasonably or are altered,
reconditioned, reclaimed, used, or secondhand.
(7) Representing that goods or services are of a
particular standard, quality, or grade, or that goods
are of a particular style or model, if they are of
another.
(8) Disparaging the goods, services, or business of
another by false or misleading representation of fact.
(9) Advertising goods or services with intent not to sell
them as advertised.
...
Cal. Civil. Code § 1770.
As discussed below, California’s Consumer Legal
Remedies Act is preempted in this context because the FDA
has exclusive enforcement authority over the claims made
by Plaintiffs predicated on alleged misrepresentations
through use of the term “prescription pet food,” and the
healing properties of that food. Nevertheless, for purposes
of our discussion, the only provisions of California’s
Consumer Legal Remedies Act that potentially apply based
on the allegations of the complaint are:
(2) Misrepresenting the source, sponsorship, approval,
or certification of goods or services.
(3) Misrepresenting the affiliation, connection, or
association with, or certification by, another.
32 MOORE V. MARS PETCARE US
(5) Representing that goods or services have
sponsorship, approval, characteristics, ingredients,
uses, benefits or quantities which they do not have or
that a person has a sponsorship, approval, status,
affiliation, or connection which he or she does not
have.
(7) Representing that goods or services are of a
particular standard, quality, or grade, or that goods
are of a particular style or model, if they are of
another.
I am persuaded that these provisions of California’s
Consumer Legal Remedies Act are preempted by the federal
Food, Drug and Cosmetic Act (FDCA). A similar issue was
raised in Perez v. Nidek Co., Ltd., 711 F.3d 1109 (9th Cir.
2013). In Perez, the plaintiffs underwent LASIK surgery for
farsightedness with a laser system that had not yet been
approved by the FDA for that use. See id. at 1112.
Consequently, use of the laser system was considered an
“off-label” use. Id. at 1111. Plaintiffs alleged that had they
known the device was unapproved, they would not have
undergone the surgeries. See id. at 1112.
Because the laser system was “a Class III medical device
under the FDCA, as amended by the Medical Device
Amendments of 1976,” the laser system was subject to
premarket approval before being utilized. Id. (citation
omitted). Although the defendant who developed the laser
system had received premarket approval to use the laser
system to correct nearsightedness, the system had not yet
been approved to correct farsightedness. See id. Plaintiffs
alleged that the physician defendants impermissibly
modified the approved laser system “to correct
farsightedness before [the laser system] was approved for
that purpose.” Id. The plaintiffs also alleged that the laser
MOORE V. MARS PETCARE US 33
developer was aware of the illegal modifications and that the
developer and physicians “conspired [with] and aided and
abetted each other in their unlawful conduct.” Id.
The FDA was aware of claims that the laser system was
being used “off-label” and responded to the claims,
including sending warning letters to the laser developer and
to “certain physicians” who were using the laser system to
correct farsightedness. Id. at 1113. The FDA specifically
warned that because there was no premarket approval of the
laser system for use to correct farsightedness, the laser
system was “adulterated within the meaning of the Act.” 4 Id.
Plaintiffs alleged that despite the FDA’s actions, the
defendants continued to use to laser system to correct
farsightedness. See id.
The plaintiffs asserted a “fraud by omission” claim
against the defendants on the theory that defendants engaged
in misleading behavior by failing to disclose that the laser
system was not FDA-approved for LASIK procedures to
correct farsightedness. The plaintiffs alleged that the
defendants “knew or should have known” that the proposed
class members believed the laser was FDA approved for
such surgeries. Id. at 1117.
We held that the “fraud by omission” claim was
“impliedly preempted because it conflict[ed] with the
FDCA’s enforcement scheme.” Id. at 1119. We explained
that it is the responsibility of the FDA to investigate potential
violations of the FDCA. Because the Act provides the FDA
“with a range of enforcement mechanisms,” we concluded
that “private enforcement of the statute is barred.” Id.
4
This was the same language used by the FDA in the Policy Guide
upon which Plaintiffs rely in their complaint.
34 MOORE V. MARS PETCARE US
(citations omitted). We concluded that the plaintiffs’ “fraud
by omission claim exists solely by virtue of the FDCA
requirements.” Id. (citation, alterations, and internal
quotation marks omitted). We clarified that the plaintiffs
were barred from bringing any “claim that rests solely on the
non-disclosure to patients of facts tied to the scope of [FDA]
approval.” 5 Id. We noted that the plaintiffs failed to cite
even one case “where a court has allowed a plaintiff to bring
suit solely for failure to disclose lack of FDA approval.” Id.
at 1120 (footnote reference omitted).
We discussed that the FDA was aware of the allegations
that the laser system was being used for unapproved
procedures. Although the FDA addressed the allegations
with warning letters and an alert, the FDA “did not take final
action against the defendants.” 6 Id. In affirming dismissal
of the plaintiffs’ claim for “fraud by omission,” we observed
that the claim was preempted because matters of
“adulterat[ion] . . . rest within the enforcement authority of
the FDA, not this Court.” Id.
As noted, the parallels between the facts in Perez and the
facts of this case are inescapable. In both cases, the plaintiffs
alleged that they were misled by the failure of Defendants to
offer a product that had been approved by the FDA. In both
cases, the FDA was made aware of the allegations that the
defendants were providing “adulterated” products, that is
products that were unapproved by the FDA. In both cases,
the FDA addressed the allegations of adulteration—in Perez
5
This claim is remarkably similar to Plaintiffs’ claims predicated on
use of the term “prescription.”
6
In our case, the FDA addressed the allegations against the
Defendants in the Policy Guide, but also took no action against the
Defendants in response to the allegations.
MOORE V. MARS PETCARE US 35
through warning letters and an alert and in this case through
the issuance of the Draft Compliance Policy Guide. In both
cases, no compliance action was taken against the
defendants by the FDA. Under these circumstances, we
concluded in Perez that the plaintiffs’ claim of “fraud by
omission” was preempted.
The same result is appropriate in this case. See id.; see
also Mylan Laboratories, Inc. v. Matkari, 7 F.3d 1130, 1139
(4th Cir. 1993) (holding that the plaintiff’s “claims that the
defendants falsely represented that their drugs had been
‘properly approved by the FDA’ must fail”) (punctuation
omitted).
In Mylan Labs, the Fourth Circuit employed the same
reasoning that we adopted in Perez. See 711 F.3d at 1120,
n.6 (citing Mylan Labs). In Mylan Labs, the Fourth Circuit
addressed a Lanham Act claim brought by Mylan Labs
asserting claims for false advertising under the Lanham Act.
See 7 F.3d at 1131–32. The Fourth Circuit first noted that
the plaintiff in the complaint failed to “point[] to any
statement or representation in the defendants’ advertising
which declared ‘proper FDA approval.’” Id. at 1139. The
Fourth Circuit then added that this deficiency could not be
cured “by contentions that the very act of placing a drug on
the market, with standard package inserts . . . somehow
implies (falsely) that the drug had been properly approved
by the FDA.” Id. (internal quotation marks omitted). The
Fourth Circuit reasoned that this theory, like the theory
advanced by the plaintiffs in this case that use of the term
“prescription” implied FDA approval, “is, quite simply, too
great a stretch.” Id.
In sum, our precedent and precedent from the Fourth
Circuit foreclose a viable statutory claim predicated on
implied FDA approval. Consequently, Plaintiffs’ claim
36 MOORE V. MARS PETCARE US
predicated on the provisions of California’s Consumer Legal
Remedies Act was properly dismissed as preempted by the
FDCA. In addition, as with its other claims, Plaintiffs failed
to adequately plead reliance. See Chapman v. Skype, Inc.,
220 Cal. App. 4th 217, 230–32 (2013) (requiring allegation
of actual reliance to sustain a claim under the Consumer
Legal Remedies Act).
In conclusion, I am of the view that Plaintiffs failed to
state a plausible claim for relief under California’s Unfair
Competition Law, False Advertising Law or Consumer
Legal Remedies Act.
I would affirm the judgment of the district court.