Izquierdo v. Panera
Bread Co., No. 18-CV-12127 (VSB), 2020 WL 1503557 (S.D.N.Y. Mar. 30, 2020)
Panera sold a “blueberry
bagel” that allegedly wasn’t. [My father
thinks that bagels with fruit etc. in them already aren’t bagels, but the
allegation here is about the blueberry.] The court dismisses plaintiff’s claim
for injunctive relief because he isn’t likely to be injured again, but otherwise
denies the motion to dismiss his consumer protection claims.
The ingredient list
for the Bagel “is not displayed in-store,” but allegedly “contains only trace
amounts of real blueberries” and a “far greater proportion of imitation
blueberry ingredients.” Even inspecting the product, a reasonable consumer
allegedly couldn’t identify this fact. For context, Panera also sells a
Blueberry Muffin, which contains “fresh blueberries” as the second-to-last
ingredient and no imitation blueberries, and allegedly “[e]ven low-cost,
supermarket-shelf blueberry bagels contain only real blueberry ingredients,” so
that “[a] reasonable consumer would expect a blueberry bagel sold at a
bakery-café that stresses its healthfulness and authenticity to contain more
real blueberries than its low-cost, supermarket-shelf counterparts.”
The Second Circuit
isn’t as easy on future purchases as the Ninth, so plaintiff didn’t
successfully plead likely future injury and lacked standing for injunctive
relief.
However, he
plausibly alleged misleadingness to a reasonable consumer. The bagel is
advertised in stores with a placard reading “Blueberry” and online as a
“Blueberry Bagel,” and it allegedly appears to contain discrete pieces of fruit
scattered throughout the bagel. “It is plausible that a reasonable consumer
would believe that these visible pieces are real blueberries, in light of the
placard on the basket and their normal expectations of blueberry baked goods,”
especially given that it appears under a sign advertising Defendant’s
commitment to “clean food” and “menu transparency,” and is sold alongside a
Blueberry Muffin that contains only real blueberries.
It was not enough
that the bagel did contain some blueberries and that the ingredient list was “readily
available.” It can be “materially misleading to suggest a product contains a
greater proportion of a preferred ingredient than it actually does, even where
there is a visible ingredients list that states the correct composition of the
food.” (Citing Mantikas v. Kellogg Co., 910 F.3d 633, 639 (2d Cir. 2018)
(involving “whole grain” and “made with whole grain” claims where crackers were
primarily enriched white flour), and some earlier cases.) Although this was a close case, the court
noted that there were no allegations that a customer purchasing the bagel
in-store would have ready access to an ingredients list prior to making a
purchase, and anyway Mantikas made clear that “a reasonable consumer
should not be expected to consult the Nutrition Facts panel on the side of the
box to correct misleading information set forth” elsewhere on the packaging.
Similarly, plaintiff
adequately, though barely, pled injury by alleging that the bagel had
“significantly less value than it warranted.” A price premium theory was
plausible, even though every Panera bagel sells for the same price; the
appropriate comparator could be other blueberry bagels, which plaintiff alleged
are “low-cost” yet contain “only real blueberry ingredients.”
Fraud was also,
though just barely, alleged. The facts alleged with particularity suggested “conscious
misbehavior or recklessness,” including: (1) Panera knew the bagel’s true
composition, as evidenced by its publication of the ingredient list; (2) Panera
produced the bagel in such a way that the imitation blueberries are
indistinguishable from the real blueberries; (3) Panera purposely advertises
“menu transparency” and its “clean” food; (3) Panera is aware of consumer
beliefs about the healthful qualities of blueberries; and (4) Panera sought to
capitalize on those beliefs and its branding to sell more bagels by calling it
a Blueberry Bagel.
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