United States District Court, E.D. Pennsylvania
STANLEY F. FROMPOVICZ, Plaintiff,
NIAGARA BOTTLING, LLC, ICE RIVER SPRINGS WATER CO, INC., CROSSROADS BEVERAGE GROUP AND JAMES J. LAND, JR., Defendants.
through this case is the question of who is selling genuine
bottled “spring” water and who is not. Plaintiff,
a spring water extractor, alleges that Defendants have
violated the Lanham Act, 15 U.S.C. § 1125(a), and
Pennsylvania's unfair competition law by mislabeling
their water as “spring water.” One of the
Defendants extracts water and three of them bottle, sell, and
label the extracted water as “spring water.”
Plaintiff, who is “in the spring water business,
” possessed a license from the Pennsylvania Department
of Environmental Protection (“DEP”) to operate a
spring water extraction site. He alleges that Defendants'
labeling of their water as “spring water” has
damaged his business because the labels are designed to
entice purchasers to buy Defendants' products under the
false belief that their “spring water” is at
least equal, if not superior, to Plaintiff's true spring
water. Plaintiff brings this case as a putative class action
for “[a]ll persons in the United States who, within the
applicable statute of limitations preceding the filing of
this action through class certification, extract and/or
bottle spring water for sale in the United States, ” as
well as a Pennsylvania subclass.
have filed Motions to Dismiss under Federal Rules of Civil
Procedure 12(b)(1) and 12(b)(6). For the reasons below,
Defendants' motions are granted in part and denied in
Frompovicz, doing business as Far Away Springs,
brings this putative class action under the federal Lanham
Act, 15 U.S.C. § 1125(a), and for unfair competition
under Pennsylvania law, against James Land,  who is engaged in
the business of extracting and marketing water, as well as
three water bottlers and distributors who purchase Land's
water (collectively, “Defendants”). Those
bottlers are Niagara Bottling Co., LLC
(“Niagara”), Ice River Springs Water Co. Inc.
(“Ice River”), and Crossroads Beverage Group
(“Crossroads”) (collectively “Bottler
Defendants”). The crux of Plaintiff's Complaint is
that Defendant Land sells “well water” and the
Bottler Defendants market it as more desirable “spring
water, ” thereby diminishing Plaintiff's market to
sell spring water.
following facts are taken from the Complaint. Bottled water
is the second largest beverage category by volume in the
United States. The success of bottled water is attributable
to several factors, including consumer's perceptions
about taste, healthfulness, convenience, safety, and value as
compared to other bottled beverages. There are many types of
bottled water, including, as relevant here, “spring
water” and “well” or “tap
water.” Spring water typically sells at a premium
compared to other bottled water, such as well water or tap
water, because customers recognize and prefer the taste of
spring water to other types of bottled water. However, spring
water sites require substantially more resources to locate,
develop, and maintain because of the unique characteristics
necessary to extract the water to ensure that it remains
“spring water” throughout the extraction process.
Bottler Defendants source their water from Defendant
Land's facility and label their water as “spring
water.” Plaintiff asserts that the labels are
misleading for four reasons. First, Pennsylvania's DEP
does not recognize Defendant Land's facility as a
“spring water” source. In fact, a DEP permit for
Land's facility, attached as an exhibit to the Complaint,
clearly identifies the site as a “well water”
site, and not a “spring water” site. Second, the
Complaint alleges that the raw water extracted from
Land's facility does not satisfy the Food and Drug
Administration's (“FDA”) definition of
“spring water.” Third, water extracted from
Land's facility has been extracted, handled, or treated
with equipment or techniques that are inconsistent with a
“spring water” classification. Last, water from
Land's facility has tested as containing more
particulates or trace elements than are otherwise permissible
or recommended under industry standards for spring water.
seek to dismiss Plaintiff's complaint on the grounds
that: (1) he lacks standing under Article III of the United
States Constitution; and (2) because he does not have a
“right to sue” under the Lanham Act. Defendants
also contend that Plaintiff's Lanham Act claims are
precluded, by the Food, Drug, and Cosmetics Act.
plaintiff must demonstrate standing in order to avail itself
of the jurisdiction of federal courts. See Common Cause
of Pennsylvania v. Pennsylvania, 558 F.3d 249, 257 (3d
Cir. 2009). In the context of a class action - as is the case
here - if the class representative lacks standing, the court
“must dismiss . . . for lack of subject matter
jurisdiction.” Finkelman v. Nat'l Football
League, 810 F.3d 187, 195 (3d Cir. 2016) (citing
Neale v. Volvo Cars of N. Am., LLC, 794 F.3d 353,
362 (3d Cir. 2015)). Standing is, thus, a “bedrock
requirement” that must be met before a court can reach
the merits of a suit. In re Schering Plough Corp.
Intron/Temodar Consumer Class Action, 678 F.3d
235, 244 (3d Cir. 2012); see also Hartig Drug Co. v.
Senju Pharm. Co., 836 F.3d 261, 269 (3d Cir. 2016)
(holding that Article III standing is a “threshold
Standard of Review
motion to dismiss for lack of Article III standing comes in
the form of a “facial” or “factual”
attack on the Court's subject-matter jurisdiction. The
distinction is important because it determines how the
pleading must be reviewed. See In re Schering
Plough, 678 F.3d at 243. “[A] facial attack
‘contests the sufficiency of the pleadings'
‘whereas a factual attack concerns the actual failure
of a [plaintiff's] claims to comport [factually] with the
jurisdictional prerequisites.'” See
Constitution Party of Pennsylvania v. Aichele, 757 F.3d
347, 358 (3d Cir. 2014) (internal citations omitted).
Moreover, a defendant may mount a factual attack only after
filing an answer. See Mortensen v. First Fed. Sav. &
Loan Ass'n, 549 F.2d 884, 892 (3d Cir. 1977)
(“A factual jurisdictional proceeding cannot occur
until plaintiff's allegations have been
controverted.”). Defendants here have not yet answered
the Complaint. Therefore, each of their Motions to Dismiss is
“by definition, a facial attack.”
Aichele, 757 F.3d at 358.
facial attack calls for a district court to apply the same
standard of review it would use in considering a motion to
dismiss under Rule 12(b)(6).” Id. Thus, in
reviewing a facial attack, “the court must only
consider the allegations of the complaint and documents
referenced therein and attached thereto, in the light most
favorable to the plaintiff.” Id.
Article III standing
Turning, first to Defendants' challenge to Article III
standing: A plaintiff has Article III standing if he has
“(1) suffered an injury-in-fact, (2) that is fairly
traceable to the challenged conduct of the defendant, and (3)
that is likely to be redressed by a favorable judicial
decision.” Spokeo, Inc. v. Robins, 136 S.Ct.
1540, 1547 (2016) (citing Lujan v. Defs. of
Wildlife, 504 U.S. 555, 560 (1992)). Defendants'
position is that Plaintiff cannot meet prongs one and two of
the standing inquiry, which will be addressed,
injury-in-fact element requires that the party seeking relief
“be himself among the injured.” Lujan,
504 U.S. at 562 (internal quotation mark omitted). At the
motion to dismiss stage, “[t]he contours of the
injury-in-fact requirement, while not precisely defined, are
very generous, requiring only that claimant allege some
specific, identifiable trifle of injury.” Blunt v.
Lower Merion Sch. Dist., 767 F.3d 247, 278 (3d Cir.
2014) (emphasis omitted) (citation and internal quotation
marks omitted). “[G]eneral factual allegations of
injury resulting from the defendant's conduct may
suffice, for on a motion to dismiss we presum[e] that general
allegations embrace those specific facts that are necessary
to support the claim.” Lujan, 504 U.S. at 561.
Thus, while a plaintiff must eventually prove an injury, he
need only allege the existence of such an injury at this
Supreme Court has repeatedly recognized that financial or
economic interests are ‘legally protected
interests' for purposes of the standing doctrine.”
Cottrell v. Alcon Labs., 874 F.3d 154, 164 (3d Cir.
2017). In Lexmark v. Static Control Components Inc.,
a watershed opinion in the analysis of this case, it
considered whether a supplier of printer toner replacement
parts had standing to challenge a toner cartridge
manufacturer's allegedly false and misleading marketing
and found that “allegations of lost sales and damage to
its business reputation [confer] standing under Article
III.” 134 S.Ct. 1377, 1386 (2014). Plaintiff's
Complaint alleges that “Defendants' marketing and
sale of their deceptively marketed ‘spring water'
is damaging to the reputation and goodwill of Plaintiff,
” and that Defendants' actions hindered his sales.
Thus, Plaintiff has sufficiently alleged a legally protected
interest, and, thus, an injury-in-fact sufficient to confer
all parties agree that the DEP suspended Plaintiff's
license to extract water in 2015, that fact is water under
the bridge on the question of standing on the facts alleged
here. The statute of limitations for a claim under the Lanham
Act is six years. See Santana Prod., Inc. v. Bobrick
Washroom Equip., Inc., 401 F.3d 123, 135 (3d Cir. 2005).
Plaintiff filed this action on January 8, 2018. And the
Bottler Defendants admit that Plaintiff sold water at least
until 2015. Therefore, Plaintiff has adequately alleged an
actual injury within the statute of limitations at least from
January 8, 2012 until the DEP suspension in 2015. Further,
the fact that Plaintiff's license has been suspended is
not dispositive: a closed company is not necessarily
precluded from maintaining an action under the Lanham Act.
See Lexmark, 134 S.Ct. at 1391. Thus,
notwithstanding the license suspension, Plaintiff has
adequately alleged an injury-in-fact.
suspension does, however, affect Plaintiff's access to
injunctive relief. A “plaintiff must demonstrate
standing separately for each form of relief sought.”
Friends of the Earth, Inc. v. Laidlaw Envt'l
Servs., 528 U.S. 167, 185 (2000). Where a party seeks
injunctive relief, past exposure to illegal conduct is
insufficient to establish standing. The party must also
assert “continuing, present adverse effects.”
Lujan, 504 U.S. at 564. In this case, Plaintiff has
admitted that he is not currently selling water, and though
he stated during oral argument that he intends to re-enter
the industry, there ...