Labeling on “Cobra Sexual Energy” Supplement Might Violate California Consumer Protection Laws

This posting was written by William Zale, Editor of CCH Advertising Law Guide.

A purchaser of the Natural Balance dietary supplement Cobra Sexual Energy asserted deceptive labeling claims under California consumer protection laws with the particularity required for pleading fraud, the federal district court in San Diego has ruled.

Natural Balance argued unsuccessfully that the purchaser’s claims failed to meet the heightened standards for pleading fraud prescribed by Rule 9(b) of the Federal Rules of Civil Procedure.

Deception, Reliance, Injury

Under the California Unfair Competition Law (UCL), False Advertising Law (FAL), and Consumers Legal Remedies Act (CLRA), conduct is deceptive or misleading if it is likely to deceive an ordinary consumer.

The purchaser articulated the “what” and “who” of the misconduct by identifying “Cobra Sexual Energy” and its labeling as the allegedly deceptive product and Natural Balance as its manufacturer and marketer, the court found. The purchaser provided the “when” by stating that she bought the product this year at a CVS Pharmacy. The purchaser stated the “where” and “how” by providing pictures of the product’s labels and listing each challenged statement with an explanation of why it was deceptive or fraudulent.

The purchaser asserted reliance and injury in fact by alleging that she suffered an economic injury because she paid more for the product than she would have absent the deceptive statements on its labels, which she read and relied upon in buying the product, the court determined.

Natural Balance's arguments about whether the labels contained adequate warnings and whether the labels contained misrepresentations raised questions of fact that should not be decided on a motion to dismiss, according to the court.

Puffery

The allegedly deceptive labeling did not constitute puffery, the court held. Generalized, vague, and unspecified assertions constitute mere puffery upon which a reasonable consumer cannot rely and are not actionable under the UCL, FAL, and CLRA.

The purchaser allegedly relied on statements including “Cobra Sexual Energy”; “aphrodisiac plants to enhance . . . sexual energy”; “scientifically blending select, high-quality herbs”; “offering specialty supplements that work”; and “proprietary formulas.”

This was not the rare situation in which the issue of puffery should be decided on a motion to dismiss, the court said.

Amount in Controversy

The purchaser satisfied the federal Class Action Fairness Act's amount in controversy jurisdictional threshold by alleging that the amount in controversy exceeded $5 million, even though the purchaser did not specify the amount of economic injury suffered by her and the proposed class, the court decided.

There was no evidence that the amount was pled in bad faith, and it was not obvious that this suit could not involve that amount, the court noted. The purchaser alleged that the class would include thousands of individuals who purchased the product throughout the United States.

The February 24 opinion in Peviani v. Natural Balance, Inc. will be reported at CCH Advertising Law Guide ¶64,201.