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Alimah Gray, Individually; As Parent, Guardian, and Next Friend of v. Abbott Laboratories

July 22, 2011

ALIMAH GRAY, INDIVIDUALLY; AS PARENT, GUARDIAN, AND NEXT FRIEND OF DANIEL FRANKLIN, A MINOR; AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, PLAINTIFF,
v.
ABBOTT LABORATORIES, INC. D/B/A ABBOTT SALES, MARKETING & DISTRIBUTION CO., A DELAWARE CORPORATION; AND ABBOTT LABORATORIES D/B/A ABBOTT NUTRITION, AN ILLINOIS CORPORATION, DEFENDANTS.



The opinion of the court was delivered by: Judge Rebecca R. Pallmeyer

MEMORANDUM OPINION AND ORDER

Defendants Abbott Laboratories and Abbott Laboratories, Inc. (collectively, "Abbott") manufacture and distribute Similac, a brand of widely-used infant formula. In September 2010, Abbott announced that it was voluntarily recalling several of its powdered Similac products because an internal quality review detected the presence of beetles in the production area at one of its manufacturing facilities, creating the possibility that individual containers of the formula might be contaminated. Six-month-old Daniel Franklin became ill after ingesting one of the Similac products that was recalled. Franklin's mother, Alimah Gray ("Gray" or "Plaintiff"), filed this action individually, on Franklin's behalf, and on behalf of all other similarly situated consumers who purchased formula that was later recalled by Abbott. Plaintiff's amended complaint alleges several state law claims: negligence (count I); strict liability (count II); fraudulent misrepresentation (count III); negligent misrepresentation (count IV); breach of express warranty (count V); breach of implied warranty of merchantability (count VI); breach of implied warranty of fitness for a particular purpose (count VII); unjust enrichment (count VIII); and unfair and deceptive business practices (count IX). Defendants move to dismiss Plaintiff's complaint for failure to state a claim. For the reasons explained below, the motion is granted in part and denied in part.

BACKGROUND

Defendant Abbott Laboratories is an Illinois corporation and the parent corporation of Abbott Laboratories, Inc. (collectively, "Abbott" or "Defendants"), a Delaware corporation. Abbott designs, manufactures, markets, and distributes Similac, a popular brand of powdered infant formula. (Am. Compl. ¶¶ 10-11.) During an internal quality control review on September 16, 2010, Abbott discovered the possible presence of a small beetle in certain Similac product lines produced at a manufacturing facility in Sturgis, Michigan. (Am. Compl. ¶¶14-16; Defs.' Mem. Mot. to Dismiss Pls.' First Am. Compl. (hereinafter "Defs.' Mem."), at 2.) As a result, Abbott ceased production at the affected plant and after conducting an inspection of the facility, voluntarily recalled approximately 5 million containers of the product lines offered in plastic containers and cans on September 22, 2010. (Am. Compl. ¶ 18.) In the weeks that followed, the Food and Drug Administration (FDA) released several statements regarding the formula recall and eventually determined that the formula containing the beetles posed no long-term health risks, but explained the possibility that infants consuming the beetles or their larvae "could experience gastrointestinal discomfort and refusal to eat as a result of small insect parts irritating the GI tract." (FDA Press Release of 9/27/210, Ex. B to Defs.' Mem.) The FDA advised parents to consult a physician if such symptoms appeared and persisted for more than a few days, and Abbott offered a full refund to consumers who chose to return the product. Finally, in October, 2010, Abbott began to re-distribute the formula after working with FDA to implement preventative measures at the Michigan facility. (FDA Press Release of 10/26/210, Ex. C to Defs.' Mem.)

Shortly before the recall in September 2010, Gray, a Georgia resident, purchased several Similac products for her six-month-old son, Daniel Franklin. (Am. Compl. ¶ 29.) Gray specifically purchased a 34-ounce container of Similac Advance Early Shield Power with lot number 90341T20, as well as several other unidentified Similac products, all of which Plaintiff alleges were part of the recall.*fn1 (Am. Compl. ¶ 31.) Gray alleges that immediately after Franklin ingested these Similac products, "he became ill with gastrointestinal discomfort, diarrhea, and [refused] to eat . . . ." (Am. Compl. ¶ 32.) Believing that the recalled Similac products caused her son's illness, Gray brought this suit against Abbott on October 5, 2010 individually, on behalf of Franklin, and on behalf of "all others similarly situated." Plaintiff contends that Abbott negligently manufactured and distributed Similac products even though Defendants knew of the possibility that some of the products were contaminated, failed to exert proper quality control measures, and failed to warn consumers of the potential health risks associated with Similac. Plaintiff alleges that Defendants' conduct resulted in her purchasing products that were not safe for consumption and did not provide the benefits Plaintiff expected to receive. (Am. Compl. ¶¶ 19-23.) Plaintiff maintains, further, that she specifically relied on certain advertisement statements on the packaging of Similac products that promoted the formula's "balance of protein, minerals, and other nutrients that help give babies a strong start in life." (Am. Compl. ¶¶ 12-13.) Defendants have moved to dismiss the nine state law claims presented in the Amended Complaint. The court will address each claim in turn.

ANALYSIS

In order to survive a motion to dismiss for failure to state a claim, a plaintiff's complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." FED. R. CIV. P. 8(a)(2). In considering a 12(b)(6) motion, the issue is adequacy of the complaint, not whether it is meritorious; and thus, while detailed factual allegations are not required, a plaintiff has an obligation to provide "enough facts to state a claim to relief that is plausible on its face" and that "raise[s] a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 555 (2007); Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009).

As a threshold issue, Defendants argue that Gray has failed to plead that she purchased a defective product; in other words, Gray's alleged purchase of a recalled Similac product is not enough to state a claim that her individual product was contaminated with insects. Gray contends that she has met her burden at this stage under the Twombly/Iqbal standard, and the court agrees. Gray claims that she purchased several containers of Similac shortly before the recall in September 2010, and her son became ill with gastrointestinal discomfort immediately after ingesting the formula. (Am. Compl. ¶¶ 29, 31.) Plaintiff alleges, further, on information and belief, that some containers of formula Franklin ingested contained insect pieces. (Am. Compl. ¶ 32.) Though she does not specify which particular container caused his illness, she does identify at least one container of Similac that she purchased with a recalled lot number. No more is required at this stage. While it is true, as Defendants suggest, that the symptoms Gray's son experienced are common ailments for any child his age, it is also plausible that infant formula contaminated by insects caused Franklin's illness, and therefore, the court is satisfied Gray has met the notice pleading standard and shown more than a "sheer possibility" that Abbott's product or products caused the injury.

Before addressing the individual claims at issue here, the court pauses to note that Plaintiff has not sought to certify this purported class. Under FED. R. CIV. P. 23(c)(1)(A), the court must determine whether to certify an action as a class action "at an early practicable time after a person sues . . .[,]" and Rule 23(d)(1)(D) authorizes the court to require "that the pleadings be amended to eliminate allegations about representation of absent persons . . . ." The class is currently represented by Gray and further defined as "all others similarly situated" (Am. Compl. ¶ 33), but the court believes greater specification as to the class definition is needed. Plaintiff asserts that this court has subject matter jurisdiction pursuant to the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2), because the amount in controversy exceeds $5 million and a member of the proposed class is a citizen of a state different from both Defendants. Both Plaintiff Gray and Franklin are Georgia residents, but if Gray seeks to represent a nationwide class, common questions of law may not predominate over individual questions. Moreover, a nationwide class, governed by the laws of all 50 states might not be manageable.*fn2 See In re Bridgestone/Firestone, Inc., 288 F.3d 1012, 1015 (7th Cir. 2002).

The court is not asked to certify the class at this stage, however, and will proceed to address the adequacy of Plaintiff's complaint as challenged the instant motion to dismiss. Before addressing the merits of Defendants' motion, the court must point out that Georgia law applies in this case. Plaintiff's claims all rest on state law and in diversity cases such as this one, the court "must follow the conflict of laws rules prevailing in the states in which they sit." Klaxon Co. v. Stentor Electric Manufacturing Co., 313 U.S. 487, 494 (1941). Illinois follows the Second Restatement of Laws' "most significant relationship test" when deciding choice-of-law issues, Barbara's Sales, Inc. v. Intel Corp., 227 Ill. 2d 45, 61, 879 N.E.2d 910, 919 (2007), and the court agrees with Defendants that Georgia is the state with the most significant relationship to the causes of action and the parties: Georgia is where Gray presumably purchased any Similac products and where the alleged injury to her son occurred. See In re Bridgestone/Firestone, Inc., 288 F.3d at 1017 ("If recovery for breach of warranty or consumer fraud is possible, the injury is decidedly where the consumer is located, rather than where the seller maintains its headquarters.").

A. Count I: Negligence

To state a claim for negligence under Georgia law, a plaintiff must allege that a defendant owed the plaintiff a legal duty, the defendant breached that duty, an injury occurred, and there is a causal connection between the breach and the injury.Adventure Outdoors, Inc. v. Bloomberg, 552 F.3d 1290, 1297 (11th Cir. 2008), citing Bradley Ctr., Inc. v. Wessner, 250 Ga. 199, 200, 296 S.E.2d 693, 695 (1982) (quotation omitted). Plaintiff contends that (1) Abbott owes a duty to its consumers to use reasonable care in the manufacture and distribution of its products to ensure that they are not contaminated; (2) it was reasonably foreseeable that consumers of Similac would be injured by contaminated formula; and (3) Plaintiffs were directly and proximately injured as a result of Abbott's negligence. (Am. Compl. ¶¶ 38-41.) According to Defendants, Plaintiff's negligence allegations fall short of the requirements of Iqbal and Twombly because they fail to sufficiently plead injury and causation. The court disagrees. Gray's complaint alleges that she purchased Similac formula in September 2010, her son became ill as a result, and she believes that his gastrointestinal problems were due to consuming contaminated Similac products that were later recalled. The court agrees with Defendants that Gray has not provided a detailed description about the illness Franklin experienced, and it is obviously possible that Franklin's illness was unconnected to his ingestion of infant formula. These circumstances do not, however, require the conclusion that her complaint amounts to a "bare assertion" of causation, as Defendants suggest.

B. Count II: Strict Liability

In Count II, Plaintiff alleges that Defendants are strictly liable for manufacturing and distributing defective Similac products because the insect pieces rendered the products unsafe for human consumption. (Am. Compl. ΒΆ 44.) Plaintiff alleges, further, that her son was directly injured as result of her purchase of these defective products. Defendants contend that Plaintiff's strict liability claim cannot survive under Georgia's strict liability statute, which requires a showing that defective merchandise was the "proximate cause" of the plaintiff's injury. Under Georgia law, [t]he manufacturer of any personal property sold as new property directly or through a dealer or any other person shall be liable in tort, irrespective of privity, to any natural person who may use, consume, or reasonably be affected by the property and who suffers injury ...


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