A New Jersey court last week affirmed a lower court's ruling dismissing a putative class action alleging the Denny's restaurant chain failed to disclose the sodium content of its foods. See DeBenedetto v. Denny's Inc., No. A-4135-09T1 (N.J. Super. Ct. App. Div., 1/11/11).
Plaintiff's second amended complaint alleged that meals he purchased from defendant, Denny's, consisting of ham, bacon, sausage and hash browns, contained excessive levels of sodium that Denny's failed to disclose. Plaintiff alleged that if consumers had been aware of the high sodium content, they would not have purchased those meals, and the failure to disclose the sodium content therefore violated the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -181. Neither plaintiff nor the putative class he claimed to represent asserted any physical injury or harm as the result of defendant's alleged failure to disclose the sodium content.
We have posted before about the risks of CFA claims, and plaintiffs' attempts to expand traditional product liability claims using this device. And the food industry has been a recent prime target.
The appeals court concluded that the trial court correctly found that although framed as a CFA violation, the gravamen of plaintiff's second amended complaint was a products liability claim for which the New Jersey Products Liability Act (NJPLA), N.J.S.A. 2A:58C-1 to -11, established a sole and exclusive remedy. The judge found that although plaintiff argued otherwise, the complaint itself included allegations that excessive levels of sodium are dangerous, that such levels cause an increased risk of bodily harm, and that Denny's failed to warn of those risks. This was, i n essence, a products liability claim, absent the physical injury the PLA requires. Thus, plaintiff had failed to state a claim upon which relief can be granted.
On appeal, plaintiffs pointed to Lee v. Carter-Reed Co., L.L.C., 203 N.J. 496, 531 (2010), which discussed the potential viability of CFA claims concerning the dietary supplement Relacore. But the court of appeals noted that the claims made by the plaintiff class in Lee concerned affirmative acts of misrepresentation; here, in contrast, plaintiffs pointed to no such affirmative misrepresentation. Instead, the claim was limited to a failure to disclose the sodium content.
The court also rejected plaintiffs' claim that any defective product claim escapes the exclusive remedy provisions, and the physical injury requirements, of the PLA merely because the plaintiff fashions the claim as one seeking recovery only for "economic loss." While the PLA was not intended to be "a catchall remedy" when ordinary contract remedies were lost or unavailable, but claims for "'harm caused by a product' are governed by the PLA irrespective of the theory underlying the claim; and the PLA's long-understood requirement is that a plaintiff alleging a product is defective or dangerous must also allege personal injury or property damage.