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Kaplan v. Fulton Street Brewery, LLC

United States District Court, D. Massachusetts

May 11, 2018

SCOTT KAPLAN and JEFF ROACH, on behalf of themselves and all others similarly situated, Plaintiffs,
FULTON STREET BREWERY, LLC d/b/a Goose Island Beer Company, Defendant.


          Judith Gail Dein United States Magistrate Judge


         The plaintiffs, Scott Kaplan (“Kaplan”) and Jeff Roach (“Roach”), brought this action on behalf of themselves and all others similarly situated, against Fulton Street Brewery d/b/a Goose Island Beer Company (“Goose Island”). As alleged in the complaint, the plaintiffs each purchased several bottles of specialty beer produced by the defendant that contained a bacteria, causing an “off flavor.” Plaintiffs allege that although the defendant acknowledged that certain batches of its specialty beer were “off flavor” and created a refund program to reimburse purchasers of that beer, the refund program was underpublicized and available for an unreasonably short period of time, leaving plaintiffs, and a purported class of other purchasers of the beer, with worthless beer.

         Plaintiffs filed a class action complaint on February 10, 2017 (Docket No. 1) and a first amended class action complaint on May 5, 2017 (Docket No. 6) (“FAC”), asserting subject matter jurisdiction pursuant to the Class Action Fairness Act of 2005, 28 U.S.C. § 1332(d)(2). The FAC purports to state claims for breach of warranty of merchantability (Count I); violation of Mass. Gen. Laws ch. 93A § 2, “Breach of Warranty of Merchantability” (Count II); violation of Mass. Gen. Laws ch. 93A § 2, “Unfair and Deceptive Notification and Recall” (Count III); unjust enrichment (Count IV); and declaratory relief (Count V).

         This matter is before the court on Goose Island's motion to dismiss plaintiffs' claims for lack of subject matter jurisdiction and failure to state a claim, brought pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). (Docket No. 14). For the reasons detailed herein, this court finds that plaintiffs' claims are moot, and that this court lacks jurisdiction to hear this matter. Therefore, defendant's motion to dismiss is ALLOWED.[1]


         Federal Rule of Civil Procedure 12(b)(1) is “[t]he proper vehicle for challenging a court's subject-matter jurisdiction” including a claim, such as the one made by Goose Island, that the plaintiffs lack standing to maintain this action because their claims are moot. See Valentin v. Hosp. Bella Vista, 254 F.3d 358, 362 (1st Cir. 2001). See also Katz v. Pershing, LLC, 672 F.3d 64, 71 (1st Cir. 2012) (to meet the federal case or controversy requirement under Article III of the U.S. Constitution, the plaintiff must satisfy the standing requirements of injury, causation and redressability). In assessing jurisdiction at the pleading stage, the court must “accept as true all well-pleaded factual averments” in the complaint and “indulge all reasonable inferences there-from in [plaintiffs'] favor.” Deniz v. Municipality of Guaynabo, 285 F.3d 142, 144 (1st Cir. 2002). In ruling on a Rule 12(b)(1) motion, the court may consider materials outside the pleadings. Gonzalez v. United States, 284 F.3d 281, 288 (1st Cir. 2002). Indeed, “when a factbound jurisdictional question looms, a court must be allowed considerable leeway in weighing the proof, drawing reasonable inferences, and satisfying itself that subject-matter jurisdiction has attached.” Valentin, 254 F.3d at 364.

         Applying this standard to the instant case, the relevant facts are as follows.[2]

         The 2015 Beer Purchases and the 2016 Refund Program

         Plaintiffs allege that Goose Island advertises its Bourbon County beer as high end beer with “exceptional and complex taste profiles.” (FAC ¶ 66). Plaintiffs also assert that this beer is “premium, award winning beer which many consumers purchase in bulk and let . . . age in order to enhance the beer's flavor.” (Id. ¶¶ 55-57).

         In 2015, Kaplan purchased 12 bottles of Goose Island Bourbon County Brand Stout beer, for approximately $12.99 per bottle; two bottles of Goose Island Bourbon County Brand Coffee Stout beer, for approximately $10.99 per bottle; and one bottle of Goose Island Bourbon County Brand Barleywine beer, for approximately $18.99, for a total purchase price of approximately $196.85. (Id. ¶¶ 12, 14-16).

         In 2015, Roach purchased 32 bottles of Goose Island Bourbon County Brand Stout beer; two bottles of Goose Island Bourbon County Brand Coffee Stout beer; and six bottles of Goose Island Bourbon County Brand Barleywine beer. (Id. ¶ 37). Roach spent approximately $12.00 to $15.00 per bottle of beer.[3] (Id. ¶ 38).

         In 2016, Goose Island discovered, and subsequently acknowledged, that certain 2015 Bourbon County beer contained a lactobacillus acetotolerans bacteria, which the parties agree can create a sour taste, inconsistent with the advertised flavor profile of the beer. Plaintiffs do not allege that they became ill from drinking the beer, and defendant asserts, and plaintiffs do not dispute, that the affected beer does not pose a health risk, but merely can taste different than advertised. (See Id. ¶¶ 19, 39, 48; Def. Mem. Ex. 2 at 2). Kaplan and Roach allege that their 2015 Bourbon County beer purchases included beer that was “contaminated” with the bacteria and/or had “off” flavors. (FAC ¶¶ 18, 39-41).

         In 2016, Goose Island released information relating to the affected beer and instituted a refund program for that beer.[4] (Id. ¶ 21). Plaintiffs allege that the refund program was “unfair” or “deceptive” in that it was insufficiently advertised, was available for an unreasonably limited time period, and imposed conditions requiring purchasers to prove the beer was part of the refund program in order to participate. (Id. ¶¶ 22-25, 27-30, 43-44). As a result, plaintiffs allege that Kaplan was not able to participate in the refund program, and Roach was only able to receive a partial refund for his purchases. (Id. ¶¶ 32, 46). As such, plaintiffs allege that they are left with beer that is “undrinkable, ” “valueless, ” of “diminished value, ” and which does not “meet the standards and quality advertised” by Goose Island. (Id. ¶¶ 33-36, 51-54). They further assert that they represent a class of “[a]ll persons who purchased a Contaminated 2015 Bourbon County Beer(s) which were subject to the 2016 [refund program, ]” excluding those purchasers who were fully reimbursed through the 2016 refund program. (Id. ¶ 79).

         Plaintiffs' 93A Demand Letter and Defendant's Response

         Plaintiffs commenced this action on February 10, 2017. By letter dated the same day, plaintiffs served a 93A demand letter on Goose Island, which included the following demands on behalf of themselves and “a putative class of similarly situated persons”:

1. That Goose Island immediately and satisfactorily market and notify all potential Class Members of the contaminated 2015 [Bourbon County] Beers in a manner aimed at effectively reaching all such persons (such as in-store recall notices at all locations where the contaminated [Bourbon County] Beers were sold/distributed);
2. That Goose Island refund all amounts for purchases of contaminated 2015 [Bourbon County] Beers to customers; and
3. That Goose Island extend the redemption period related to the refund of contaminated 2015 [Bourbon County] Beers for a period of no less than three years from the date of receipt of this demand.

(See Demand Letter at 2, 4).

         By letter dated April 6, 2017, [5] Goose Island responded to plaintiffs' demand letter and enclosed checks in the amount of $3, 000 to Kaplan and $5, 000 to Roach, explaining:

Goose Island believes that the fixed submission period for refund requests related to the 2015 Bourbon County Stout release was a reasonable limitation, particularly when no safety or health issue was involved. Nonetheless, Goose Island has granted substantiated requests for refunds on the affected variants after the expiration of the deadlines in some instances. We likewise are willing to provide refunds to Mr. Kaplan and Mr. Roach. Enclosed for that purpose are checks ... payable to [each], respectively. These payments reflect the maximum amount potentially available to them under M.G.L. ch. 93A, plus additional funds to cover court costs and attorneys' fees....
[T]he monetary tender enclosed provides more than full relief, and we trust it will ...

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