You are on page 1of 26

Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 1 of 26 Page ID #:1

1 WILSON KEADJIAN BROWNDORF LLP


2 LESLIE G. WILLIAMS (SBN 91932)
lwilliams@wkbllp.com
3 BENJAMIN M. CUTCHSHAW (SBN 263483)
4 bcutchshaw@wkbllp.com
TYLER R. TRAIN (SBN 318998)
5 ttrain@wkbllp.com
6 1900 Main Street, Suite 600
Irvine, California 92614
7 Tel: (949) 247-7832
8
Attorneys for Plaintiffs
9 PATRICIA BLOCH and FARMKIND GmbH
10
UNITED STATES DISTRICT COURT
11
CENTRAL DISTRICT OF CALIFORNIA
12
13
PATRICIA BLOCH, an individual, and Case No. 2:18-cv-8463
14 FARMKIND GmbH, a foreign limited
liability company,
15 COMPLAINT FOR DAMAGES
16 Plaintiffs,
DEMAND FOR JURY TRIAL
17 v.
18 P.S.W. INC., a California corporation;
TASTE NIRVANA INTERNATIONAL
19 INC., a California corporation;
20 SURACHAI “JACK” WATTANAPORN,
an individual; and DOES 1–10, inclusive,
21
Defendants.
22
23
24
25
26
27
28
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 2 of 26 Page ID #:2

1 Plaintiffs Patricia Bloch and Farmkind GmbH, by and through their


2 undersigned counsel, hereby allege as follows:
3 NATURE OF THE ACTION
4 1. This case involves egregious levels of deception and fraud. Seeking to
5 capitalize on the booming market for premium coconut water, Defendants claim their
6 products (sold under the “Taste Nirvana” brand) are 100% pure, contain no added
7 sugar, no added water, and no undisclosed additives. Taste Nirvana attributes its
8 coconut water’s sweet taste and aroma to “better soil and growing conditions.” Since
9 2013, Plaintiffs distributed Taste Nirvana’s products throughout Germany.
10 2. As it turns out, Taste Nirvana’s coconut-water products are not what they
11 claim to be. In fact, the products contain substantial amounts of added sugar, added
12 water, and other undisclosed flavoring agents.
13 3. Confronted with undeniable evidence of their fraud, false labeling, and
14 repeated and intentional misrepresentations, Taste Nirvana initially denied any
15 wrongdoing and refused to cooperate with Plaintiffs or provide reimbursement for the
16 substantial losses incurred as a direct result of Taste Nirvana’s knowing and
17 intentional misconduct.
18 4. Taste Nirvana now admits their claims were false but refuses to
19 compensate Plaintiffs who now face lawsuits in Germany, fines and penalties from
20 German regulatory agencies, substantial economic losses, and likely bankruptcy. This
21 action follows.
22 JURISDICTION AND VENUE
23 5. This Court has jurisdiction pursuant to 28 U.S.C. § 1332 as all Plaintiffs
24 are diverse from all Defendants and the matter in controversy exceeds $75,000,
25 exclusive of interests and costs.
26 6. This Court has personal jurisdiction over Defendants because their
27 products are advertised, marketed, distributed, and sold throughout California.
28 Defendants engaged in the wrongdoing alleged in this Complaint in and from

—1—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 3 of 26 Page ID #:3

1 California; Defendants are authorized to do business in California; and Defendants


2 have sufficient minimum contacts with California and/or otherwise have intentionally
3 availed themselves of the markets in California, rendering the exercise of jurisdiction
4 by the Court permissible under traditional notions of fair play and substantial justice.
5 Moreover, Defendants are engaged in substantial and not isolated activity within
6 California.
7 7. Venue is proper in this District pursuant to 28 U.S.C. § 1391(b) because
8 Defendants reside in this District and each Defendant is subject to personal
9 jurisdiction here. Moreover, a substantial part of the acts, events, or omissions giving
10 rise to the claims occurred in this District as Defendants operated from within this
11 District in doing the acts alleged herein.
12 THE PARTIES
13 8. Plaintiff Patricia Bloch (“Bloch”) is an individual, a citizen of Germany,
14 and resident of Hamburg, Germany.
15 9. Plaintiff Farmkind GmbH (“Farmkind”) is a limited liability company
16 organized under the laws of Germany, with its principal place of business in Hamburg,
17 Germany.
18 10. Upon information and belief, Defendant P.S.W. Inc. (“PSW”) is a
19 corporation created and existing under the laws of California, with its principal place
20 of business located in Corona, California. Surachai Wattanaporn is PSW’s President
21 and agent for service of process. PSW is the owner of the “Taste Nirvana” brand, US
22 trademarks, and the website www.tastenirvana.com. Additionally, by and through its
23 majority owned subsidiary in Thailand, Nirvana Foods & Commerce International
24 Co., Ltd., PSW produces the Taste Nirvana products in Thailand and exports the same
25 from Thailand to the United States and abroad.
26 11. Upon information and belief, Defendant Taste Nirvana International, Inc.
27 (“Taste Nirvana Int’l”) is a corporation created and existing under the laws of
28 California, with its principal place of business located in Corona, California. Surachai

—2—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 4 of 26 Page ID #:4

1 Wattanaporn is Taste Nirvana Int’l’s President and agent for service of process. Taste
2 Nirvana Int’l was formed in 2015.
3 12. Defendant Surachai “Jack” Wattanaporn (“Wattanaporn”) is an individual
4 residing in California. Upon information and belief, Wattanaporn owns, operates, and
5 wholly controls PSW and Taste Nirvana Int’l (the “Company Defendants”).
6 13. In addition, Plaintiffs are informed and believe, and on that basis allege,
7 that Defendant Wattanaporn is the “alter ego” of the Company Defendants and that
8 there exists, and at all times mentioned herein existed, a unity of interest and
9 ownership between Wattanaporn and the Company Defendants such that any
10 individuality and separateness between the Defendants has ceased to exist as
11 Wattanaporn controls the business and activities of the Company Defendants.
12 14. Plaintiffs are informed and believe, and on that basis allege, that at all
13 times mentioned herein, the Company Defendants were and are a mere shell,
14 instrumentality, and conduit through which Defendant Wattanaporn carried on his
15 business in a corporate name, exactly as he would have had there been no corporations
16 at all, exercising complete control and dominance over such businesses to the point
17 where any individuality or separateness between Wattanaporn and the Company
18 Defendants does not, and at all times herein mentioned, did not, exist.
19 15. Furthermore, upon information and belief, Defendant Wattanaporn
20 comingled and continues to comingle his assets with the Company Defendants’ assets,
21 controlled and continues to control the Company Defendants’ finances in their
22 entirety, treated and treats the Company Defendants’ assets as his own, and further
23 engaged and engages in such zealous controlling conduct towards the Company
24 Defendants that the Company Defendants were and are nothing more than mere
25 instrumentalities of Wattanaporn.
26 16. Adherence to the fiction of the separate existence of Wattanaporn as an
27 individual separate and distinct from the Company Defendants would permit an abuse
28 of the corporate privilege and would sanction fraud or promote injustice in that

—3—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 5 of 26 Page ID #:5

1 Wattanaporn might escape liability for the causes of action set out herein and produce
2 an inequitable result.
3 17. Plaintiffs are informed and believe, and on that basis allege, that the
4 Company Defendants share any and all assets and liabilities as the companies share,
5 among other things, the same staff, shareholders, facilities, and headquarters in
6 Corona, California.
7 18. Plaintiffs are informed and believe, and on that basis allege, that at all
8 relevant times, each Defendant was the principal, agent, partner, joint venturer, officer,
9 director, controlling shareholder, subsidiary, affiliate, parent corporation, successor in
10 interest, and/or predecessor in interest of some or all of the other Defendants, and was
11 engaged with some or all of the other Defendants in a joint enterprise for profit, and
12 bore such other relationships to some or all of the other Defendants so as to be liable
13 for their conduct with respect to the matters alleged herein.
14 19. Plaintiffs are informed and believe, and on that basis allege, that each
15 Defendant acted pursuant to and within the scope of the relationships alleged above,
16 that each Defendant knew or should have known about, and authorized, ratified,
17 adopted, approved, controlled, and aided and abetted the conduct of all other
18 Defendants.
19 20. Plaintiffs are not aware of the true names and capacities of the defendants
20 identified herein as Does 1 through 10, and therefore fictitiously name said
21 defendants. Plaintiffs will amend this Complaint to allege the true names and
22 capacities of these fictitiously named defendants when their identities and capacities
23 are ascertained.
24 21. Plaintiffs are informed and believe, and thereon allege, that PSW, Taste
25 Nirvana Int’l, Wattanaporn, and each of the fictitiously named Doe defendants
26 (collectively “Defendants”) were in some manner, and to some degree, responsible for
27 the acts alleged herein and the harm, losses, and damages suffered by Plaintiffs.
28

—4—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 6 of 26 Page ID #:6

1 22. As described further below, PSW, Taste Nirvana Int’l, and Wattanaporn
2 conduct business, produce, distribute, market, promote, and sell products in and from
3 California, throughout the United States, and internationally.
4 FACTUAL ALLEGATIONS
5 23. The most significant recent trend in the refreshment business has been
6 the move from sugary, carbonated soft drinks toward those perceived as healthier,
7 more natural choices. Coconut water—described by the UN Food and Agriculture
8 Organization as “the fluid of life”—has become the beverage of choice for health-
9 conscious consumers worldwide.1
10 24. Since at least 2007, Wattanaporn and PSW have sold coconut-water
11 products in the United States under the “Taste Nirvana” brand name. These products
12 include Pure Coconut Water (described as “All Natural” and containing only “Natural
13 Coconut Water”), Coconut Water with Pulp (described as “All Natural” and containing
14 only “Natural Coconut Water and Coconut Pulp”), and Coco Aloe (described as a
15 “super drink” containing only “Natural Coconut Water and Aloe Vera”), among others
16 (each a “Taste Nirvana Product”). Defendants at all times marketed, advertised,
17 promoted, and represented that the Taste Nirvana Products contained no added sugar,
18 water, or undisclosed additives.
19 25. In early 2012, Bloch was actively researching the coconut-water business
20 in Germany and evaluating potential manufacturers and producers for distribution
21 rights. Bloch called the US-based telephone number listed on Taste Nirvana’s website.
22 Eager to expand into the growing European market, Wattanaporn responded to
23 Bloch’s inquiry.
24 26. Bloch knew the German market well and confirmed that a premium price
25 could be charged for products containing all-natural coconut water with no added
26 1
See Coconut Water as Energy Drink for Joggers and Athletes, Food and Agriculture Organization
27 of the United Nations, Press Release 00/51, September 14, 2000, available at
http://www.fao.org/WAICENT/OIS/PRESS_NE/PRESSENG/2000/pren0051.htm
28

—5—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 7 of 26 Page ID #:7

1 sugar, water, flavorings, preservatives, or other undisclosed additives. From his


2 headquarters in Corona, California, Wattanaporn sent multiple emails and
3 communicated with Bloch via regular Skype videoconferences between October 2012
4 and February 2013. In these communications, Wattanaporn repeatedly confirmed to
5 Bloch that Taste Nirvana Products met these desired criteria. Wattanaporn also sent
6 Bloch samples, labels, ingredient lists, and manufacturing certifications (certifying the
7 manufacturing process and ingredients) confirming the same. Wattanaporn represented
8 to Bloch that the Taste Nirvana Products were being actively sold in California,
9 throughout the United States, and internationally.
10 27. Wattanaporn further claimed that he had researched different soil and
11 growing conditions and found the best Thailand had to offer. As a result of his
12 research, 100% pure ingredients, and all-natural processes, Wattanaporn claimed
13 “[Taste Nirvana Products] will ALWAYS be naturally sweeter with more fragrant
14 coconut nose [compared to other coconut waters].”
15 28. An example of Defendants’ advertising images available on their website
16 (www.tastenirvana.com) and provided to Bloch in 2012 is shown below:
17
18
19
20
21
22
23
24
25
26
27
28

—6—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 8 of 26 Page ID #:8

1 The 2012 advertisement represents that the Taste Nirvana Products contain no added
2 sugar, in addition to the following product-specific representations:
3
TASTE NIRVANA PURE COCONUT WATER
4 Simply coconut water – that’s it!
5
TASTE NIRVANA COCONUT WATER WITH PULP
6 Simply coconut water & delicious coconut bits – that’s it!
7
TASTE NIRVANA COCO ALOE
8 The only Aloe Vera beverage on the market
9 with no added sugar – just pure coconut water.
Simply coconut water & nutritious aloe vera – that’s it!
10
11 29. Based on Wattanaporn’s written and oral representations, in February
12 2013, Bloch purchased an initial order of Taste Nirvana Products for distribution in
13 Germany. In order to sell the Taste Nirvana Products in Germany, Bloch spent a
14 considerable amount of time and financial resources on label translations, legal
15 analysis of the translated labels, laboratory analysis to confirm the product was fit for
16 human consumption (e.g., containing no microorganisms or pesticides), recycling
17 registration, and customs registration. Bloch also established an online storefront,
18 secured warehouse space, and a logistics system—all at considerable expense borne
19 entirely by Bloch.
20 30. The Taste Nirvana Products sold well. Encouraged by the initial success
21 in Germany, Wattanaporn urged Bloch to expand her efforts and sell more Taste
22 Nirvana Products. Bloch obliged and focused all her time, energy, and money on
23 growing the new enterprise. Shortly thereafter, Bloch officially formed Farmkind
24 GmbH and continued to invest substantial amounts of her personal savings into the
25 company to hire employees, develop marketing materials and advertising, and to
26 secure warehousing and office space. These efforts were required by Wattanaporn to
27 demonstrate Farmkind’s ability to distribute the Taste Nirvana Products in Germany
28 and elsewhere in the EU.

—7—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 9 of 26 Page ID #:9

1 31. Bloch’s efforts paid off as Farmkind secured sales agreements with
2 numerous wholesalers and retailers in Germany including:
3 Edeka (largest supermarket chain in Germany with over 4,000 locations)
4 Tegut (supermarket with over 280 locations in Germany)
5 Budnikowsky (drugstore with over 180 locations in Germany)
6 Dennree (wholesaler to over 500 independent retailers in Germany)
7 dm (premium drugstore with over 2,000 locations in Germany)
8 Farmkind notified Defendants of all agreements and new customer relationships
9 (including each of the foregoing) to plan for shipment quantities and future
10 forecasting. As a result, Defendants were aware of Farmkind’s obligations to each
11 customer.
12 32. Through the efforts of Bloch and Farmkind, German sales of Taste
13 Nirvana Products grew from $0 in 2012 to over $1 million in 2017. Sales in 2018
14 were on pace to surpass $2 million.
15 33. In order to comply with German labeling regulations, Defendants
16 routinely provided Farmkind with product labels used in the United States. Farmkind
17 translated the English labels into German and submitted the translations to Defendants
18 for approval before introducing them into the German market. All German-language
19 labels on products sold by Farmkind were approved by Defendants.
20
21
22
23
24
25
26
27
28

—8—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 10 of 26 Page ID #:10

1 34. For example, the label affixed to all Taste Nirvana Premium Coconut
2 Water with Pulp distributed by Farmkind included a German translation of the
3 following label supplied by Defendants to Farmkind:
4
5
6
7
8
9
10
11
12
13
14
15
16 The label includes the following statements:
17 Simply Coconut Water & Pulp INGREDIENTS: COCONUT
18 That’s it! WATER, COCONUT PULP.
19
20 35. Similarly, to comply with German regulations and the requests of
21 retailers and consumers, Wattanaporn routinely provided Farmkind with product
22 quality reports, manufacturing certifications, and other assurances regarding Taste
23 Nirvana Products.
24 36. For example, on or about August 2, 2017, Wattanaporn provided
25 Farmkind with a letter certifying that Taste Nirvana Real Coconut Water with Pulp
26 contained only coconut water and coconut pulp with no added water and no added
27 sugar. Wattanaporn encouraged Farmkind to provide this certification letter to
28 Farmkind’s customers and the regulatory agencies in Germany.

—9—
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 11 of 26 Page ID #:11

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
37. Wattanaporn provided similar letters to Farmkind certifying the
20
following:
21 Taste Nirvana Real Coconut Water
22 Contains Only Coconut Water
No Added Sugar
23
No added water
24
Taste Nirvana Real Coco Aloe
25
Contains Only Coconut Water, Aloe Vera, and Coconut Pulp
26 No Added Sugar
No Added Water
27
28

— 10 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 12 of 26 Page ID #:12

1 38. Farmkind relied on Wattanaporn’s oral and written assurances and


2 continued to expand Farmkind’s distribution business in Germany and continued to
3 order Taste Nirvana Products.
4 39. Moreover, Defendants reiterated and confirmed each of the foregoing
5 representations when the Taste Nirvana Products they shipped and provided Farmkind
6 with Taste Nirvana Products containing the false labels on monthly shipments from
7 October 2013 to May 2018.
8 40. In May 2018, a competitor confronted Farmkind with certified lab results
9 showing Taste Nirvana Products were not 100% pure with no added water or sugar as
10 they claim to be. In fact, the test results showed that Taste Nirvana Products contained
11 more than 50% added water and 70% added sugar.
12 41. Faced with threats of legal action and irreparable damage to their
13 business and reputation, Farmkind ordered multiple independent tests from two
14 separate labs (in the United States and Germany). The results were shocking. Each test
15 confirmed that Taste Nirvana Products contain significant amounts of added water
16 (not derived from coconuts) and non-fruit sugar (not derived from coconuts).
17 42. In total, Farmkind procured over 25 separate lab tests including every
18 variation of Taste Nirvana Products produced from batches bottled in 2016, 2017, and
19 2018—each with the same result: Taste Nirvana Products contain significant amounts
20 of added water (not derived from coconuts) and added non-fruit sugar (not derived
21 from coconuts).
22
23
24
25
26
27
28

— 11 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 13 of 26 Page ID #:13

1 43. The following is an excerpt of results from a food-testing laboratory in


2 Massachusetts testing Taste Nirvana Coconut Premium Coconut Water:
3
4
5
6
7
8
9
10
11
12
13
The Carbon Stable Isotope Ratio Analysis (Carbon SIRA) identifies the source of
14
sugar in a sample by distinguishing the carbon found in most common fruit juices on
15
the one hand, from cane sugar and corn syrup on the other.2 The expected result of
16
pure coconut water is approximately -24.0. 3 A result of -15.5 indicates that the sample
17
includes non-fruit sugars derived from cane sugar (-12.0) and/or corn syrup (-10.0).
18
The 25 tests procured by Farmkind of Taste Nirvana Products showed Carbon SIRA
19
results ranging from -14.6 to -16.9.
20
44. Similarly, Oxygen Stable Isotope Ratio Analysis (Oxygen SIRA)
21
identifies the source of water in a sample and provides information about how the
22
sample was formulated. Pure juice from tropical fruits such as oranges, grapefruits,
23
2
24 See Carbon Stable Isotope Ratio Analysis, Krueger Food Laboratories, available at
https://www.kfl.com/cs.html
25
3
Imaizumi, V.M., et al., Use of Stable Isotopes of Carbon in Coconut Water Tampering Detection,
26
The Latin American Symposium on Food Science, Vol. 2, 2015, available at
27 https://proceedings.science/slaca/slaca-2015/trabalhos/use-of-stable-isotopes-of-carbon-in-coconut-
water-tampering-detection
28

— 12 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 14 of 26 Page ID #:14

1 and coconuts have Oxygen SIRA results between -2 and 2. Groundwater or water
2 typically found in a municipal or industrial water supply has Oxygen SIRA results of
3 -10 to -5. The tests of Taste Nirvana Products showed Oxygen SIRA results ranging
4 from -5.3 to -3.2.
5 45. According to a food-testing scientist, these lab results “are not consistent
6 with pure coconut water” and indicate “significant amounts of sugar are added from
7 sugar cane or corn syrup” in addition to “significant amounts of water from industrial
8 or municipal sources.” The added water is used either to dilute pure coconut water or
9 reconstitute the coconut water from concentrate. In short, Taste Nirvana Products are
10 not 100% coconut water—not even close.
11 46. Farmkind reported these findings to Defendants including Wattanaporn.
12 Initially, Wattanaporn denied everything and said labs could not test for added water
13 or added sugar. Wattanaporn refused to fully reimburse Farmkind for the testing costs
14 or Farmkind’s growing legal fees incurred as a result of its mandated cooperation with
15 the German regulatory and enforcement authorities.
16 47. Facing fines from German regulatory agencies, lawsuits, and mounting
17 legal expenses, Farmkind had no choice but to initiate a massive recall of all Taste
18 Nirvana Products and notify their customers that Farmkind would be unable to fulfil
19 existing or future orders of Taste Nirvana Products. The costs of the recall were
20 substantial as Farmkind was forced to reimburse its customers, pay freight and
21 shipping costs, and expand warehouse space to store the recalled products.
22 48. Germany’s Office of Consumer Protection conducted its own lab tests
23 which confirmed Farmkind’s test results. The German authorities have ordered
24 Farmkind not to sell any Taste Nirvana Product and warehouse all remaining stocks
25 pending further investigation.
26 49. In addition to the recall, Farmkind was forced to breach its agreements
27 with multiple customers including Edeka, Tegut, Budnikowsky, Dennree, and dm.
28

— 13 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 15 of 26 Page ID #:15

1 50. Wattanaporn met with Farmkind and admitted that his production process
2 was far less “natural” than Defendants represented. Wattanaporn admitted that
3 significant amounts of water, sugar, and additives including coconut extract are added
4 to all Taste Nirvana Products. Wattanaporn further admitted that this process decreases
5 production costs and enhances the final product’s flavor and fragrance.
6 51. Farmkind was shocked by the deception. Despite attempts to negotiate a
7 fair resolution and compensate Plaintiffs for their damages, Wattanaporn was unfazed
8 and seemingly unconcerned with Farmkind’s plight, legal liabilities, and imminent
9 bankruptcy. Wattanaporn refused to take any immediate remedial steps, reimburse
10 Farmkind, order a global recall, or change the production process.
11 52. Instead, Defendants instructed Farmkind to repeat the following
12 “official” statement:
13 Taste Nirvana proudly stand behinds the quality of our products. We are
currently experiencing raw ingredient supply shortage issues and are working
14 very hard to get stock of our Taste Nirvana Real Coconut Water back on
shelves, so our loyal consumers can continue to enjoy the highest standard
15 from Taste Nirvana products. We will let you know as soon as we can when
16 this will occur and thank you for your loyalty and support.

17 Farmkind knew the “official” statement was not true and refused to repeat it.
18 53. As a result, Farmkind’s entire business has collapsed and, in addition to
19 the costs and damages described above, Farmkind remains liable to consumers,
20 competitors, and regulatory agencies for Defendants’ false labeling, fraud,
21 misrepresentations, and other tortious conduct.
22
23
24
25
26
27
28

— 14 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 16 of 26 Page ID #:16

1 54. Defendants continued to market, sell, advertise, promote, and represent


2 the Taste Nirvana Products without disclosing the truth. As of the filing date of this
3 action, for example, Taste Nirvana Products remain available for purchase via
4 Defendants’ Amazon storefront with the false claim of “Naturally sweet, no sugar
5 added” and falsely claiming that the only ingredient is “Natural Coconut Water.”
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22 55. On information and belief, Wattanaporn is relabeling all Taste Nirvana
23 Products. The new labels, however, remain substantively inaccurate and misleading.
24 FIRST CAUSE OF ACTION
25 (Intentional Misrepresentation)
26 56. Plaintiffs reallege and incorporate herein by reference the allegations in
27 all preceding paragraphs and further allege as follows:
28

— 15 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 17 of 26 Page ID #:17

1 57. Defendants, directly or through their agents and employees, made false
2 representations, concealments, and nondisclousres to Plaintiffs.
3 58. In making the representations of fact to Plaintiffs described herein,
4 Defendants have failed to fulfill their duties to disclose the material facts set forth
5 above.
6 59. Defendants, in making the representations and omissions, and in doing
7 the acts alleged above, knew that the representations were not true or made the
8 representations recklessly without regard for their truth. Specifically, Defendants
9 knew that the Taste Nirvana Products contained added water, contained added sugar,
10 and contained additional undisclosed additives.
11 60. Defendants’ false representations were intentional as Defendants made
12 and intended the misrepresentations to induce Plaintiffs’ reliance.
13 61. Plaintiffs did rely on these false representations and nondisclousres by
14 Defendants when purchasing the Taste Nirvana Products, investing in and expanding
15 the distribution business, and continuing to sell Taste Nirvana Products which reliance
16 was justified and reasonably foreseeable.
17 62. As a result of Defendants’ wrongful conduct, Plaintiffs suffered and
18 continue to suffer economic losses and other general and specific damages, including
19 but not limited to the amounts paid for the Taste Nirvana Products and amounts
20 invested into expanding the distribution business, all in an amount to be determined at
21 trial but not less than $5,000,000.
22 SECOND CAUSE OF ACTION
23 (Negligent Misrepresentation)
24 63. Plaintiffs reallege and incorporate herein by reference the allegations in
25 all preceding paragraphs and further allege as follows:
26 64. Defendants, directly or through their agents and employees, made false
27 representations, concealments, and nondisclousres to Plaintiffs.
28

— 16 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 18 of 26 Page ID #:18

1 65. In making the representations of fact to Plaintiffs described herein,


2 Defendants have failed to fulfill their duties to disclose the material facts set forth
3 above.
4 66. Defendants, in making the representations and omissions, and in doing
5 the acts alleged above, had no reasonable grounds for believing the representations
6 were true. Specifically, Defendants had no reasonable grounds for believing that the
7 Taste Nirvana Products contained no added water, contained no added sugar, and
8 contained no additional undisclosed additives.
9 67. Plaintiffs did rely on these false representations and nondisclousres by
10 Defendants when purchasing the Taste Nirvana Products, investing in and expanding
11 the distribution business, and continuing to sell Taste Nirvana Products which reliance
12 was justified and reasonably foreseeable.
13 68. As a result of Defendants’ wrongful conduct, Plaintiffs suffered and
14 continue to suffer economic losses and other general and specific damages, including
15 but not limited to the amounts paid for the Taste Nirvana Products and amounts
16 invested into expanding the distribution business, all in an amount to be determined at
17 trial but not less than $5,000,000.
18 THIRD CAUSE OF ACTION
19 (Fraud in the Inducement)
20 69. Plaintiffs reallege and incorporate herein by reference the allegations in
21 all preceding paragraphs and further allege as follows:
22 70. Defendants, directly or through their agents and employees, made false
23 representations, concealments, and nondisclousres to Plaintiffs.
24 71. In making the representations of fact to Plaintiffs described herein,
25 Defendants have failed to fulfill their duties to disclose the material facts set forth
26 above.
27 72. Defendants, in making the representations and omissions, and in doing
28 the acts alleged above, knew or reasonably should have known that the representations

— 17 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 19 of 26 Page ID #:19

1 were not true. Specifically, Defendants knew or reasonably should have known that
2 the Taste Nirvana Products contained added water, contained added sugar, and
3 contained additional undisclosed additives.
4 73. Plaintiffs relied on these false representations and nondisclousres by
5 Defendants when purchasing the Taste Nirvana Products, investing in and expanding
6 the distribution business, and continuing to sell Taste Nirvana Products which reliance
7 was justified and reasonably foreseeable.
8 74. As a result of Defendants’ wrongful conduct, Plaintiffs suffered and
9 continue to suffer economic losses in an amount to be determined at trial but not less
10 than $5,000,000.
11 FOURTH CAUSE OF ACTION
12 (Unjust Enrichment)
13 75. Plaintiffs reallege and incorporate herein by reference the allegations in
14 all preceding paragraphs and further allege as follows:
15 76. As a result of Defendants’ deceptive, fraudulent, and misleading labeling,
16 advertising, marketing, and sales of Taste Nirvana Products, Defendants were enriched
17 at the expense of Plaintiffs through the payment of premium purchase prices,
18 Plaintiffs’ investment in and expanding the German market, and securing lucrative
19 sales agreements with German customers, including major supermarkets and
20 drugstores.
21 77. Under these circumstances, it would be inequitable to permit Defendants
22 to retain the ill-gotten benefits they received from Plaintiffs or through Plaintiffs’
23 efforts in light of the fact that Defendants falsely labeled the Taste Nirvana Products
24 and repeated this falsity orally and in writing over the course of several years. It would
25 be unjust for Defendants to retain any benefit without restitution to Plaintiffs.
26
27
28

— 18 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 20 of 26 Page ID #:20

1 FIFTH CAUSE OF ACTION


2 (Breach of Express Warranty)
3 78. Plaintiffs reallege and incorporate herein by reference the allegations in
4 all preceding paragraphs and further allege as follows:
5 79. Defendants expressly warranted to Plaintiffs on the labels of all Taste
6 Nirvana Products the representations listed above, including that the Taste Nirvana
7 Products were 100% pure, contained no added sugar, water, or additional undisclosed
8 additives, even though such representations were false.
9 80. These express warranties appeared on each and every label of Taste
10 Nirvana Products. These affirmations of fact or promises by Defendants relate to the
11 goods and became part of the basis of the bargain between Plaintiffs and Defendants.
12 81. Plaintiffs purchased and then resold Taste Nirvana Products believing
13 them to conform to these express warranties.
14 82. Defendants breached the express warranties contained on the labels of
15 Taste Nirvana Products. This breach resulted in damages to Plaintiffs who bought the
16 Taste Nirvana Products but did not receive the goods as warranted.
17 83. As a direct and proximate result of Defendants’ breach of express
18 warranties, Plaintiffs did not receive the goods as warranted. Plaintiffs therefore have
19 been injured and have suffered damages in an amount to be proven at trial. Among
20 other things, Plaintiffs did not receive the benefit of the bargain and have suffered
21 other injuries as detailed above. Moreover, had Plaintiffs known the true facts, they
22 would not have been willing to pay the premium price Defendants charged for the
23 Taste Nirvana Products, or would not have purchased the Products at all. Nor would
24 Plaintiffs had invested time, money, and labor into growing the distribution business
25 for the benefit of Defendants.
26
27
28

— 19 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 21 of 26 Page ID #:21

1 SIXTH CAUSE OF ACTION


2 (California Unfair Competition Law – Bus. & Prof. Code § 17200, et. seq.)
3 84. Plaintiffs reallege and incorporate herein by reference the allegations in
4 all preceding paragraphs and further allege as follows:
5 85. Plaintiffs bring this action pursuant to California’s Unfair Competition
6 Law (“UCL”), Cal. Bus. & Prof. Code § 17200. Defendants have engaged and
7 continue to engage in unlawful, unfair, or fraudulent business practices within the
8 meaning of Cal. Bus. & Prof. Code § 17200, causing injury to Plaintiffs.
9 86. Defendants have made, published, disseminated, and circulated false,
10 deceptive, and misleading statements, representations, and advertisements in and from
11 California misrepresenting the actual or true nature, quality, and characteristics of
12 their Taste Nirvana Products with the intent of selling, distributing, and increasing the
13 consumption of, and interest in, Taste Nirvana Products.
14 87. By committing the acts and practices alleged herein, Defendants have
15 engaged in deceptive, unfair, and unlawful business practices in violation of the UCL.
16 88. Plaintiffs have standing to pursue this claim as they have suffered injury
17 in fact and have lost money or property as a result of Defendants’ actions as set forth
18 above.
19 89. The violation of any law constitutes an “unlawful” business practice
20 under Cal. Bus. & Prof. Code § 17200.
21 90. Defendants’ false representations alleged herein violate, among other
22 laws, 21 U.S.C. § 343; 21 U.S.C. § 331; Cal. Civ. Code § 1709; Cal. Com. Code
23 § 2313; and Cal. Bus. & Prof. Code § 17500 et seq.
24 91. Defendants’ false representations alleged herein also violate California’s
25 criminal laws. See Cal. Penal Code § 383 (forbidding the offering for sale food that is
26 adulterated, e.g., “by any means it is made to appear better or of greater value than it
27 really is”).
28

— 20 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 22 of 26 Page ID #:22

1 92. Defendants’ false representations also violate California’s Sherman Food,


2 Drug, and Cosmetic Law, which prohibits the advertising, manufacture, and sale of
3 adulterated and misbranded foods. See Cal. Health & Safety Code §§ 110390, 110395,
4 110398, 110400, 110585, 110620, 110625, 110660, 110705, 110740, 110760, 110765,
5 and 110770.
6 93. In relevant part, the Sherman Law declares that food is misbranded if its
7 labeling is false or misleading in any particular way and further provides that it is
8 unlawful for any person to misbrand any food. See Cal. Health & Safety Code
9 §§ 110660 and 110765.
10 94. The Sherman Law defines a “person” as “any individual, firm,
11 partnership, trust, corporation, … and any representative, agent, or agency of any of
12 the foregoing.” Cal. Health & Safety Code § 109995. Each Defendant is a “person”
13 within the meaning of the Sherman Law.
14 95. Defendants’ acts and omissions alleged above constitute unfair business
15 practices under Cal. Bus. & Prof. Code § 17200 because the gravity of the
16 consequences of Defendants’ conduct outweighs any justification, motive, or reason
17 therefor, particularly considering the available legal alternatives which exist in the
18 marketplace. Furthermore, Defendants’ acts, omissions, and other conduct alleged
19 herein is immoral, unethical, unscrupulous, offends established public policy, or is
20 substantially injurious to Plaintiffs. Defendants’ false and misleading representations
21 and omissions also violate legislatively declared policy as they have violated
22 numerous state and federal laws. Moreover, the gravity of the harm to Plaintiffs
23 resulting from Defendants’ conduct outweighs Defendants’ legitimate reasons,
24 justifications, and/or motives for engaging in such deceptive acts and practices.
25 96. Each false and misleading representation and omission constitutes
26 fraudulent business practices under Cal. Bus. & Prof. Code § 17200 because the
27 representations and omissions were actually false.
28

— 21 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 23 of 26 Page ID #:23

1 97. Plaintiffs are entitled to restitution and disgorgement of Defendants’ ill-


2 gotten gains as a result of Defendants’ wrongful conduct.
3 SEVENTH CAUSE OF ACTION
4 (California Unfair Competition Law – Bus. & Prof. Code § 17500, et. seq.)
5 98. Plaintiffs reallege and incorporate herein by reference the allegations in
6 all preceding paragraphs and further allege as follows:
7 99. Defendants knew, or in the exercise of reasonable care should have
8 known, that their publicly disseminated statements and omissions relating to their
9 Taste Nirvana Products were false or misleading. Defendants’ false advertising
10 statements and omissions injure consumers generally and Plaintiffs specifically.
11 Defendants' false and misleading statements include, among others, that Taste Nirvana
12 Products were 100% pure, contained no added sugar, water, or other undisclosed
13 additives.
14 100. By making such untrue or misleading statements, Defendants have
15 engaged in false advertising in violation of the statutory law of the state of California,
16 Cal. Bus. & Prof. Code§ 17500, et seq.
17 101. By reason of Defendants’ conduct, Plaintiffs have suffered injury in fact
18 and has lost money or property.
19 102. Plaintiffs are entitled to restitution from Defendants.
20 EIGHTH CAUSE OF ACTION
21 (Tortious Interference with Existing and Prospective Business Relationships)
22 103. Plaintiffs reallege and incorporate herein by reference the allegations in
23 all preceding paragraphs and further allege as follows:
24 104. Defendants knew that Plaintiffs sold Taste Nirvana Products in the
25 German market and have sold Taste Nirvana Products in the German market since at
26 least 2013.
27
28

— 22 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 24 of 26 Page ID #:24

1 105. Plaintiffs had a reasonable likelihood of future economic benefit from the
2 continued sales of Taste Nirvana Products to existing and prospective customers in
3 Germany.
4 106. Defendants intentionally and improperly interfered with Plaintiffs’
5 business expectancy by failing to provide accurate labeling information and refusing
6 to correct inaccurate labeling information.
7 107. As a direct and proximate result of Defendants’ interreference, Plaintiffs
8 lost existing customers and were severely prejudiced from acquiring new customers.
9 108. As a result of Defendants’ wrongful conduct, Plaintiffs suffered and
10 continue to suffer economic losses in an amount to be determined at trial but not less
11 than $5,000,000.
12 PRAYER
13 WHEREFORE, Plaintiffs pray for judgment against Defendants, providing
14 such relief as follows:
15 A. An order requiring an accounting for, and imposition of a
16 constructive trust upon, all monies received by Defendants as a
17 result of the unfair, misleading, fraudulent, and unlawful conduct
18 alleged herein;
19 B. Restitution, disgorgement, refund, and/or other monetary damages,
20 together with costs, disbursements, including reasonable attorneys’
21 fees pursuant to the applicable statutes and pre-judgment interest at
22 the maximum rate allowable by law;
23 C. Damages, together with costs and disbursements, including
24 reasonable attorneys’ fees, pursuant to the applicable statutes;
25 D. Monetary damages, including but not limited to any compensatory,
26 incidental, or consequential damages in an amount to be
27 determined at trial, together with pre-judgment interest at the
28 maximum rate allowable by law with respect to the claims alleged;

— 23 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 25 of 26 Page ID #:25

1 E. Punitive damages in accordance with proof and in an amount


2 consistent with applicable precedent;
3 F. That such damages and profits be trebled and awarded to Plaintiffs
4 as a result of Defendants’ willful, intentional, and deliberate acts;
5 G. That Plaintiffs recover its costs and reasonable attorneys’ fees;
6 H. That Plaintiffs be granted pre-judgment and post-judgment
7 interest; and
8 I. For such other and further relief as the Court deems just and
9 proper.
10
11 Respectfully submitted,
12
13 October 1, 2018 WILSON KEADJIAN BROWNDORF LLP
14
15
16 By: ____________________________
BENJAMIN M. CUTCHSHAW
17
bcutchshaw@wkbllp.com
18 1900 Main Street, Suite 600
19 Irvine, California 92614
Attorneys for Plaintiffs
20 PATRICIA BLOCH and
21 FARMKIND GmbH

22
23
24
25
26
27
28

— 24 —
COMPLAINT
Case 2:18-cv-08463 Document 1 Filed 10/01/18 Page 26 of 26 Page ID #:26

1
2 JURY TRIAL DEMANDED
3 Plaintiffs hereby demand a trial by jury.
4
5
6 October 1, 2018 WILSON KEADJIAN BROWNDORF LLP
7
8
9 By: __ _________________________
BENJAMIN M. CUTCHSHAW
10 bcutchshaw@wkbllp.com
11 1900 Main Street, Suite 600
Irvine, California 92614
12
Attorneys for Plaintiffs
13 PATRICIA BLOCH and
FARMKIND GmbH
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

— 25 —
COMPLAINT