John v. Whole Foods Market Group, Inc.

          Argued: October 17, 2016

         Plaintiff-appellant Sean John brings this putative class action alleging that grocery stores in New York operated by defendant-appellee Whole Foods Market Group, Inc. systematically overstated the weights of pre-packaged food products and overcharged customers as a result. The District Court dismissed John's suit at the pleading stage for lack of Article III standing. Because we conclude that John plausibly alleged an injury in fact, we VACATE and REMAND for further proceedings consistent with this opinion.

          Douglas G. Blankinship, Finkelstein, Blankinship, Frei-Pearson & Garber, LLP, White Plains, NY, for Plaintiff-Appellant.

          David E. Sellinger (Gregory J. Casas, Elliot H. Scherker, Brigid F. Cech Samole, on the brief), Greenberg Traurig, LLP, New York, NY, Austin, TX, Miami, FL, for Defendant-Appellee.

          Before: KEARSE, JACOBS, and LOHIER, Circuit Judges.

          LOHIER, Circuit Judge.

         Sean John filed a putative class action alleging that New York City grocery stores operated by Whole Foods Market Group, Inc. systematically overstated the weights of pre-packaged food products and overcharged customers as a result. The United States District Court for the Southern District of New York (Engelmayer, J.) granted Whole Foods' motion to dismiss John's complaint for lack of Article III standing because he failed to allege a sufficient injury in fact. Because we conclude that John plausibly alleged an injury in fact, we VACATE and REMAND for further proceedings consistent with this opinion.

         Background

         Because John appeals from a judgment dismissing the complaint on the pleadings, we accept as true the facts alleged in the complaint, "and we may consider documents incorporated into or integral to the complaint." WC Capital Mgmt., LLC v. UBS Sec., LLC, 711 F.3d 322, 325 (2d Cir. 2013).

         1. Alleged Facts

         In 2014 and 2015 John "routinely shopped" at two Whole Foods stores in Manhattan and made "regular[] purchase[s]" of pre-packaged products, including "pre-packaged cheese and cupcakes approximately one or two times per month." "Pre-packaged" food products are those that Whole Foods weighs and prices prior to shelving, assigning a price to each package based on the weight of the food.

         Whole Foods routinely inflated the weight listed on the labels of pre- packaged products, and, as a result of the mislabeling, overcharged unwitting customers for pre-packaged food. The complaint does not identify a specific food purchase as to which Whole Foods overcharged John. Instead, it more generally describes pervasive overcharging of pre-packaged food throughout Whole Foods' stores in New York City. But the complaint does attach a June 2015 press release of the New York City Department of Consumer Affairs (the "DCA") entitled "Department of Consumer Affairs Investigation Uncovers Systemic Overcharging for Pre-packaged Foods at City's Whole Foods." As its title suggests, the press release announced the DCA's investigation of overcharging by Whole Foods and its preliminary findings that Whole Foods' New York City stores "routinely overstated the weights of its pre-packaged products-including meats, dairy and baked goods." App'x 26. The press release elaborated on these findings:

DCA tested packages of 80 different types of pre-packaged products and found all of the products had packages with mislabeled weights. Additionally, 89 percent of the packages tested did not meet the federal standard for the maximum amount that an individual package can deviate from the actual weight, which is set by the U.S. Department of Commerce. The ...