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From Health Law Daily, December 30, 2013

Amendment to add “all natural” claim disallowed

By Patricia K. Ruiz, JD

The Northern District of California denied the intervention as of right of a second plaintiff consumer in a putative class action misbranding suit but granted the consumer’s permissive intervention, as the timing of the motion did not prejudice the defendant manufacturer, Ghirardelli Chocolate Company (Ghirardelli). The court disallowed the consumer from amending the original complaint to add a new “all natural” claim to the misbranding suit (Miller v Ghirardelli Chocolate Company, December 20, 2013, Beeler, L).

Background. Scott Miller filed suit against Ghirardelli alleging violations of California consumer protection and tort laws, citing Ghirardelli’s labeling of a number of its products as “Ghirardelli Chocolate,” even though the products did not contain chocolate or white chocolate. The court dismissed Miller’s claims having to do with the products Miller did not purchase, leaving only the claim having to do with “Ghirardelli Chocolate Premium Baking Chips – Classic White.” Steve Leyton of Florida filed a motion to intervene and to file an amended complaint adding allegations that Ghirardelli falsely labeled its products as “All Natural,” “100% All Natural,” and containing “All Natural Ingredients.”

Intervention as of right. The court applied the four-part test under Federal Rule of Civil Procedure 24(a)(2) to determine whether intervention as of right was appropriate. The court determined that, although discovery had been modest up to that point and there would be no real prejudice to Ghirardelli because the case deadlines were being extended, Leyton did not have a “significantly probable” interest relating to the transaction, as Leyton’s arguments and interests were identical to those of Miller. Thus, intervention as of right was not proper.

Permissive intervention. Under Rule 24(b), “On timely motion, the court may permit anyone to intervene who . . . has a claim or defense that shares with the main action on a common question of law or fact.” In applying this analysis, the court “must consider whether the intervention will unduly delay or prejudice the adjudication of the original parties’ rights.” As with the intervention as of right analysis, the court determined that the timing of the motion did not unduly delay Ghirardelli’s rights. Accordingly, permissive intervention was appropriate and was granted on Leyton’s motion as to the white chip claims.

All-natural claims. The court applied the five factors under Rule 15 to determine whether it would grant leave to amend the complaint to include Leyton’s all-natural claims—bad faith, undue delay, prejudice to the opposing party (the most important factor), futility of amendment, and whether plaintiff previously amended the complaint. The court agreed with Ghirardelli in its argument that Leyton’s motion was an attempt to “shoehorn new claims by a new plaintiff into the older and much narrower white chips case.” The court noted that the new claims involved new products that were sold in different grocery store departments, marketed by different Ghirardelli departments, and sold to different consumers. Adding new claims would result in a larger and more complex case, requiring more and different discovery before proceeding to class certification. Therefore, the court denied Leyton’s motion to add the all-natural claims.

The case number is C 12-04936 LB.

Attorneys: Adam Gutride (Gutride Safier LLP) for Scott Miller. Benjamin Jefferson Sitter (Reed Smith) for Ghirardelli Chocolate Co.

Companies: Ghirardelli Chocolate Co.

MainStory: TopStory MisbrandingNews LabelingNews AdvertisingNews FoodNews CaliforniaNews

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