Kucharski-Berger v. Hill's Pet Nutrition

No. 122,833
IN THE COURT OF APPEALS OF THE STATE OF KANSAS
STEVIE KUCHARSKI-BERGER,
Appellant,
v.
HILL'S PET NUTRITION, INC.,
Appellee.
SYLLABUS BY THE COURT
1.
The court's role in reviewing a motion to dismiss for failure to state a claim is to
determine whether the petition sufficiently apprises the defendant of the facts upon which
the plaintiff claims to be entitled to relief, not whether the plaintiff can prove them or
whether they have merit. The defenses to the claims are not the court's concern at this
stage unless they require dismissal as a matter of law.
2.
Motions to dismiss for failure to state a claim are limited to a review of the
pleadings while motions for summary judgment consider all the facts disclosed during
discovery. Litigants are therefore cautioned against conflating cases challenging the grant
or denial of summary judgment with the standard required for pleadings under our liberal
notice pleading scheme.
3.
Whether a deceptive act or practice has occurred under the KCPA is not a question
of law for the court, but a question of fact for the jury to decide.
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4.
While claims brought under the KCPA sound largely in fraud, a plaintiff is not
required to prove a critical element of a common-law fraud action—the intent to defraud.
5.
Conscious parallelism is how firms in a concentrated market might share
monopoly power—setting their prices at a prefixed maximizing, supracompetitive level
by recognizing their shared economic interests and their interdependence on price and
output decisions. The uniform conduct of pricing by competitors permits a court to infer
the existence of a conspiracy between those competitors.
6.
Any showing by a plaintiff that tends to exclude the possibility of independent
action can qualify as a plus factor. If a benign explanation of a defendant's action is
equally plausible or more plausible than a collusive explanation, the action cannot
constitute a plus factor. On the other hand, evidence that a defendant's behavior would
not be reasonable or explicable (i.e., not in its legitimate economic self-interest) if it were
not conspiring to fix prices can constitute a plus factor.
7.
A claim for unjust enrichment is an equitable claim, and generally, an equitable
remedy is unavailable when an adequate remedy exists under another legal claim.
8.
At the pleading stage, a plaintiff may allege both unjust enrichment and a legal
claim for the same behavior, even though the plaintiff cannot ultimately recover under
both theories.
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Appeal from Johnson District Court; ROBERT J. WONNELL, judge. Opinion filed August 20, 2021.
Reversed and remanded.
James P. Frickleton, of Bartimus Frickleton Robertson Rader, P.C., of Leawood, Kimberly J.
Johnson and Wade H. Tomlinson, pro hac vice, of Pope McGlamry, PC, of Atlanta, Georgia, and Edward
J. Coyne III, pro hac vice, of Ward and Smith, P.A., of Wilmington, Delaware, for appellant.
Jennifer B. Wieland, of Berkowitz Oliver LLP, of Kansas City, Missouri, Thomas P. Schult, pro
hac vice, of the same firm, Yaira Dubin and Hannah Y. Chanoine, pro hac vice, of O'Melveny & Myers
LLP, of New York, New York, Richard B. Goetz, pro hac vice, of the same firm, of Los Angeles,
California, and Michael F. Tubach, pro hac vice, of the same firm, of San Francisco, California, for
appellee.
Before ARNOLD-BURGER, C.J., GARDNER and ISHERWOOD, JJ.
ARNOLD-BURGER, C.J.: Stevie Kucharski-Berger bought prescription pet food
manufactured by Hill's Pet Nutrition, Inc. (Hill's), on the advice of and with a required
prescription from her veterinarian. After learning that Hill's prescription pet food has no
medicine or drug, that no prescription is legally required to purchase it, and that it is not
tested and approved for medicinal purposes by the Food and Drug Administration (FDA),
Kucharski-Berger sued Hill's alleging that Hill's and other pet food manufacturers
conspired to monopolize the prescription pet food market and to artificially inflate prices
by self-imposing the prescription requirement. Her petition alleges violations of the
Kansas Restraint of Trade Act (KRTA) and the Kansas Consumer Protection Act
(KCPA). She also raised an unjust enrichment claim against Hill's.
The district court dismissed Kucharski-Berger's petition, holding that she failed to
state a claim upon which relief could be granted. We reverse and remand for further
proceedings.
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FACTUAL AND PROCEDURAL HISTORY
In February 2019, Kucharski-Berger filed a petition in Johnson County alleging
that Hill's, along with other pet food manufacturers, created and enforced an unnecessary
prescription requirement for select pet food which misleads reasonable consumers and
violates Kansas law. The other pet food companies alleged to be involved in the case,
although not named parties, include Mars Petcare US, Inc. (Mars), Royal Canin U.S.A.,
Inc. (Royal Canin), Nestle Purina Petcare Company (Purina), PetSmart, Inc. (PetSmart),
Medical Management International, Inc. d/b/a Banfield Pet Hospital (Banfield),
BluePearl Vet, LLC (Blue Pearl), and VCA Inc. (VCA).
In broad terms, which will be more fully discussed below, Kucharski-Berger
alleged that prescription pet food manufacturers "combined and conspired with pet food
retailers and veterinary clinics . . . to communicate [a] false and misleading message" that
prescription pet food offered benefits over nonprescription pet food justifying its higher
price. She asserts that prescription pet food is largely the same as nonprescription pet
food and that any differences in similar products "are not sufficient to justify one product
being sold by prescription for a significantly higher price." For example, "Hill's
Prescription Diet d/d Canine Skin Support Potato & Duck Dry Dog Food currently sells
for $4.00 per pound and Hill's Science Diet Adult Sensitive Stomach & Skin Dry Dog
Food sells for $1.65 per pound" and has a 65% overlap in ingredients.
According to the petition, federal and Kansas law do not require prescription pet
food to be sold with a prescription from a veterinarian. Similarly, none of the prescription
pet food bought by Kucharski-Berger contains a drug, nor has it been submitted to the
FDA for review, analysis, or approval.
As Kucharski-Berger states it, reasonable consumers are willing to pay a premium
for prescription pet food because a reasonable consumer would expect that pet food that
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requires a prescription from a veterinarian as a condition of purchase has been approved
by the FDA. When purchasing the prescription pet food, a consumer must either buy it
directly from the veterinarian who prescribes it or take the prescription to a business that
sells the food, such as Banfield, Blue Pearl, VCA, or a PetSmart store with a Banfield on-
site. By imposing a requirement of a prescription, Hill's and other manufacturers can sell
prescription pet food at "excessive, inflated prices."
Kucharski-Berger alleges that Hill's managed to maintain the high prices due to
agreements between the pet food manufacturers, distributors, and veterinarians. As a
result of their agreements, Hill's, Mars, and Purina "created a separate and distinct market
for Prescription Pet Food, which had not previously existed, which enabled them to sell
Prescription Pet Food at anticompetitive, enhanced prices, and which they have
dominated."
Kucharski-Berger noted that Kansas defines "'drug'" as "'articles intended for use
in the diagnosis, cure, mitigation, treatment, or prevention of disease in human or other
animals,' K.S.A. § 65-1626(t)(2)" and defines "'[p]rescription-only drug'" as "'any drug
whether intended for use by human or animal, required by federal or state law, including
21 U.S.C. § 353, to be dispensed only pursuant to a written or oral prescription or order
of a practitioner or is restricted to use by practitioners only,' K.S.A. § 65-1626(eee)."
Given her assertion that prescription pet food is a drug, Kucharski-Berger asserts that the
prescription pet food must be registered with the FDA—which it is not.
Kucharski-Berger claimed that Hill's actions caused her injury because she bought
Hill's prescription dog food at a higher price because she believed the prescription dog
food contained some medicine or drug which was intended to treat a specific disease or
health problem.
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As to Kucharski-Berger's claims under the KCPA, the district court held that Hill's
self-imposed prescription requirement was not deceptive, and Hill's did not do it to take
advantage of consumers because the FDA "expressly wants veterinarians to provide
direction and supervision to pet owners" who are purchasing prescription pet food.
The district court also found that Kucharski-Berger failed to plead the fraud with
sufficient particularity. The court also found that when Kucharski-Berger's veterinarian
advised her to purchase the prescription pet food, it constituted an intervening event that
precluded her from properly pleading causation against Hill's. The court noted that
Kucharski-Berger "purchased the product after receiving information from a nonparty–
her veterinarian. Accordingly, [she] could not have relied, as pled, on statements or
claims from Defendant regarding her decision to initially purchase the product."
The district court dismissed Kucharski-Berger's claim under an unjust enrichment
theory because the claim was seeking relief for the same underlying conduct as her
KCPA claim and, generally, an equitable remedy is unavailable if there is a possible
adequate remedy at law.
The district court dismissed Kucharski-Berger's claim that Hill's and the other
companies formed a trust to fix prices because she failed to plead facts that would show
that Hill's and the other nonparties created a trust that manipulated the market. Instead,
the court reasoned that Kucharski-Berger was merely describing an "open and free
market."
Similarly, the district court dismissed Kucharski-Berger's claim that Hill's and the
other nonparties conspired to create a monopoly. The court reasoned that she provided
nothing to support her speculation that Hill's and the other nonparties made agreements or
combinations to restrict market access to other competitors. The court noted that
Kucharski-Berger's theory would lead to unintended results because "any time a new
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producer of a product failed to successfully gain market share, an action could be brought
against the top . . . companies for violations of the KRTA."
Kucharski-Berger timely appealed the district court's decision.
ANALYSIS
I. OUR STANDARD OF REVIEW IS UNLIMITED.
Whether a district court erred by granting a motion to dismiss for failure to state a
claim is a question of law subject to unlimited review. Williams v. C-U-Out Bail Bonds,
310 Kan. 775, 784, 450 P.3d 330 (2019). The appellate court will view the well-pleaded
facts in a light most favorable to the plaintiff and assume as true those facts and any
inferences reasonably drawn from them. If those facts and inferences state any claim
upon which relief can be granted, then dismissal is improper. Dismissal is proper only
when the allegations in the petition clearly demonstrate the plaintiff does not have a
claim. Steckline Communications, Inc. v. Journal Broadcast Group of Kansas, Inc., 305
Kan. 761, 767-68, 388 P.3d 84 (2017); see K.S.A. 2020 Supp. 60-212(b)(6). As a result,
we need not give any deference to the district court's decision and will not seek to outline
our agreement or disagreement with any of its findings. Hill's has adopted most of the
district court's positions as its own, and we will address them as such.
II. WE DISCUSS THE RULES RELATING TO NOTICE PLEADING.
Kansas is a notice pleading state. Generally, a petition needs only "(1) [a] short
and plain statement of the claim showing that the pleader is entitled to relief ; and (2) a
demand for relief sought." K.S.A. 2020 Supp. 60-208(a). Courts are to construe pleadings
"so as to do justice." K.S.A. 2020 Supp. 60-208(e). A legal theory of relief need not be
detailed, so long as the petition apprises the defendant of the facts upon which the
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plaintiff claims to be entitled to relief. Beck v. Kansas Adult Authority, 241 Kan. 13, 25,
735 P.2d 222 (1987).
A court cannot resolve factual disputes on a motion to dismiss for failure to state a
claim. Under notice pleading, the petition is not intended to govern the entire course of
the case. Instead, the pretrial order determines the ultimate legal issues and theories of the
case. Because a party typically moves to dismiss early in a case when many facts have
not yet been discovered and legal theories may be in flux, "[j]udicial skepticism" must be
exercised. Rector v. Tatham, 287 Kan. 230, 232, 196 P.3d 364 (2008); see Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 556, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007) ("a
well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of
those facts is improbable, and 'that a recovery is very remote and unlikely'").
Because the district court dismissed this case at the pleading stage, the question
before this court is whether Kucharski-Berger's petition met the requirements of K.S.A.
2020 Supp. 60-208(a)—a short and plain statement of the claim showing that she was
entitled to relief and a demand for the relief sought. When deciding the issue, this court
looks at the pleading in a light most favorable to Kucharski-Berger and assumes that her
alleged facts and reasonable inferences arising from those facts are true. See Steckline
Communications, Inc., 305 Kan. at 767-68. In doing so, this court is not required "to
accept conclusory allegations on the legal effects of events the plaintiff has set out if
these allegations do not reasonably follow from the description of what happened, or if
these allegations are contradicted by the description itself." Weil & Associates v. Urban
Renewal Agency, 206 Kan. 405, 413-14, 479 P.2d 875 (1971).
With that in mind, we will examine each of Kucharski-Berger's four listed causes
of action.
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III. THE DISTRICT COURT ERRED BY DISMISSING KUCHARSKI-BERGER'S KCPA
CLAIM.
A. Kucharski-Berger's claim under the KCPA
Under K.S.A. 2020 Supp. 50-626(a) of the KCPA, "[n]o supplier shall engage in
any deceptive act or practice in connection with a consumer transaction." So to bring a
claim under K.S.A. 2020 Supp. 50-626, Kucharski-Berger had to allege that Hill's was
"engage[d] in any deceptive act or practice in connection with a consumer transaction."
An act may be found deceptive regardless of whether "any consumer has in fact been
misled." K.S.A. 2020 Supp. 50-626(b). The consumer must also prove that they were
"aggrieved by" the alleged violation of the act. K.S.A. 50-634(a). The statute then
provides a nonexclusive list of deceptive acts and practices—which are "declared to be a
violation" of the act. K.S.A. 2020 Supp. 50-626(b). Those relevant to Kucharski-Berger's
claim are:
"(1) Representations made knowingly or with reason to know that:
(A) Property or services have sponsorship, approval, accessories, characteristics,
ingredients, uses, benefits or quantities that they do not have;
....
(D) property or services are of particular standard, quality, grade, style or model,
if they are of another which differs materially from the representation;
....
(G) use, benefit or characteristic of property or services has been proven or
otherwise substantiated unless the supplier relied upon and possesses the type and amount
of proof or substantiation represented to exist." K.S.A. 2020 Supp. 50-626(b)(1).
To establish her claim, Kucharski-Berger alleged that Hill's violated K.S.A. 2020
Supp. 50-626 of the KCPA by engaging in
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"deceptive acts and practices in connection with the sale and advertisement of
Prescription Pet Food in trade or commerce in the State of Kansas by misrepresenting and
marketing and selling Prescription Pet Food through a knowingly deceptive, misleading,
and self-imposed prescription requirement having no legal basis or mandate. In so doing,
Hill's has represented that Prescription Pet Food has sponsorship, approval, accessories,
characteristics, ingredients, uses, benefits or quantities that it does not have; represented
that Prescription Pet Food is of particular standard, quality, grade, style or model, when
Prescription Pet Food is of another that differs materially from Hill's representation; and
engaged in the willful failure to state a material fact, or the willful concealment,
suppression or omission of a material fact regarding Prescription Pet Food, specifically
that neither federal, state, nor local law requires the use of a prescription, and that
Prescription Pet Food has not been subjected to FDA testing, review, and approval, and
does not comply with the terms and provisions of the [Federal Food, Drug, and Cosmetic
Act (FD&C)] Act."
B. Kucharski-Berger's factual support for her allegation that Hill's prescription
requirement was deceptive and in violation of the KCPA
According to the petition, Hill's began selling Prescription Diet pet food through
veterinarians in the 1960s. In the 1980s, Hill's began providing veterinarians with
prescription pads as a part of its marketing effort. Prescription Diet pet food is sold only
by prescribing veterinarians and retailers who fill the veterinary prescriptions.
Prescription pet food in general is more expensive and is marketed and sold only to pet
owners who have a veterinarian's prescription for that pet food. The parties agree that
neither federal nor Kansas law requires prescription pet food be sold only with a
prescription from a veterinarian. The parties agree that prescription pet food does not
have any drugs subject to FDA review, analysis, or approval. Hill's has always known
these two essential facts.
In support of her claim, she alleges:
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"By requiring a prescription from a veterinarian as a pre-condition to the
purchase of their Prescription Pet Food, Hill's and its co-conspirators misrepresent
Prescription Pet Food to be: (a) a substance medically necessary to health; (b) a drug,
medicine, or other controlled ingredient; (c) a substance that has been evaluated by the
FDA as a drug; (d) a substance as to which the manufacturer's representations regarding
intended uses and effects have been evaluated by the FDA; and (e) a substance legally
required to be sold by prescription."
She then asserts:
"The intended purpose and effect of the prescription requirement has been to
enable Hill's and its co-conspirators to market and sell Prescription Pet Food at excessive,
inflated prices above the price of non-prescription pet food making substantially similar
treatment claims. The supra-competitive price premium for Prescription Pet Food is not
cost-justified and is the intended result of the false, deceptive, and misleading
prescription requirement imposed by Hill's and its co-conspirators."
C. Hill's argument that the facts alleged do not support a claim of deception
Hill's argues that its prescription pet food, the prescription requirement, and the
marketing surrounding it was not deceptive because it was following FDA guidance in
requiring a prescription. The guidance it alleges it was following is central to its motion
to dismiss.
We pause to discuss the FDA Compliance Policy Guide which the FDA issued in
April 2016 (Sec. 690.150 Labeling and Marketing of Dog and Cat Food Diets Intended to
Diagnose, Cure, Mitigate, Treat, or Prevent Diseases) (CPG) upon which Hill's relies.
https://www.fda.gov/media/83998/download. Hill's in essence asserts that this CPG
represents a complete defense as a matter of law to any claim of deception.
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The CPG begins by noting that it considers animal drugs "unsafe unless they have
an approved New Animal Drug Application" or an equivalent approval from the FDA.
CPG, 4. It also explains that when pet food companies state that their food is intended to
treat or prevent disease, the food is considered to be a drug under federal law. CPG, 3. It
then notes that "all drug manufacturers [are required to] register and list drugs with
FDA." CPG, 4. "Drugs that are manufactured in an unregistered facility, or are not drug
listed, are misbranded" under the Federal Food, Drug, and Cosmetic Act (FD&C Act).
CPG, 4.
The FDA pointed out that "most dog and cat food products that claim on their
labels or in their labeling or other manufacturer communications to treat or prevent
disease are not approved new animal drugs" and the manufacturers have disregarded drug
registration requirements or good manufacturing practices. CPG, 4. But the FDA
acknowledged that in the past it had exercised discretion by not enforcing the
requirements so long as the manufacturers met certain requirements, including
distribution of the product though licensed veterinarians. CPG, 4. The FDA reasoned that
some of its concerns are lessened by requiring such products to be sold through a licensed
veterinarian, such as a pet owner misinterpreting the purpose of a product. As the FDA
noted, because prescription pet foods "have not been evaluated for safety and efficacy,
veterinary oversight is especially important to provide periodic assessment of how the
animal is reacting to the diet." CPG, 5.
To that end, the FDA said that it was "less likely to initiate enforcement action
against dog and cat food products intended to be fed as the pet's sole diet that claim to
treat or prevent disease" when all of 11 factors were present. CPG, 7. Included within the
factors was the requirement that the manufacturer only made the product available to
consumers through licensed veterinarians or through individuals purchasing the product
under veterinarian direction. CPG, 7.
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In short, if a pet food manufacturer markets their food to treat or prevent disease
the FDA considers it a drug which must be registered with the FDA. If the manufacturer
does not comply with this requirement, the FDA considers their dog food misbranded,
adulterated, and unsafe. Manufacturers of pet food have routinely disregarded this
requirement. The FDA has suggested that it is "less likely" that it will act against these
manufacturers if they distribute their products through licensed veterinarians and adhere
to several other conditions.
The CPG does not require, or even suggest, that pet food manufacturers label their
products as prescription only or any derivative of such a label. Instead, it merely says that
the FDA is less likely to enforce violations of the FD&C Act if manufacturers do not sell
their pet food directly to consumers and instead have a veterinarian intermediary to make
sure the pet is not harmed by the food. CPG, 5, 7. To interpret this as authorizing or
mandating Hill's prescription requirement "wrongly equates regulatory forbearance with
regulatory authorization." Vanzant v. Hill's Pet Nutrition, Inc., 934 F.3d 730, 738 (7th
Cir. 2019).
"To be sure, if pet food intended to treat or prevent disease is purchased from or
under the direction of a licensed veterinarian, the FDA is less likely to initiate an
enforcement action based on the lack of an approved new animal drug application—
provided, however, that the other 10 factors are also present. And 'less likely' does not
mean 'will not'; it certainly doesn't signal authorization." 934 F.3d at 738.
A reasonable reading of the CPG could lead one to conclude that if Hill's were to
sell its prescription dog food without veterinarian authorization, the FDA would take
enforcement action because it is contrary to FDA regulations for Hill's to claim on its
labels or in its labeling or other manufacturer communications that its food treats or
prevents disease when the FDA has not approved it for that purpose. It is misbranded,
adulterated, and unsafe. But the FDA retains the discretion to take enforcement action
against Hill's even if it does require a prescription from a veterinarian—because it is still
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misbranded, adulterated, and unsafe under the agency's definitions. The prescription
requirement does not make a product safe that is otherwise unsafe, it simply mitigates the
harm that the food may cause due to the failure to gain FDA approval.
In support of its reliance on the CPG as a complete defense to any claims of
deception, Hill's cites Bomhoff v. Nelnet Loan Services, Inc., 279 Kan. 415, 424, 109 P.3d
1241 (2005), where the Kansas Supreme Court held a lender did not violate the KCPA
because it followed federally mandated practices; therefore, the lender's actions were not
deceptive. That said, Hill's acknowledges the CPG mandates nothing; it at most
encourages. So Bomhoff is inapplicable to this set of facts.
But there is another reason Bomhoff has limited application here. It was a case
decided on summary judgment, not a motion to dismiss on the pleadings. Motions to
dismiss for failure to state a claim are limited to a review of the pleadings while motions
for summary judgment consider all the facts disclosed during discovery. John Doe v.
M.J., 59 Kan. App. 2d 273, 282-83, 482 P.3d 596 (2021). Litigants are therefore
cautioned against conflating cases challenging the grant or denial of summary judgment
with the standard of review required for pleadings under our liberal notice pleading
scheme. There has been no discovery here regarding whether Hill's followed all of the
FDA guidelines and which, if any, are mandatory. So we view any discussion of Hill's
specific practices related to FDA guidelines as premature.
Moreover, Hill's seems to ignore that much of Kucharski-Berger's pleadings focus
on the fact that Hill's labels and markets its products as requiring a prescription. It is that
prescription labeling, and the inferences that a reasonable consumer would make, that
Kucharski-Berger challenges. Kucharski-Berger does not, at least entirely, oppose
veterinarian involvement. Instead, she is alleging that by mandating a prescription, Hill's
is violating the KCPA. "[A]n advertising practice can be deceptive without directly
14
violating FDA regulations." Moore v. Mars Petcare US, Inc., 966 F.3d 1007, 1019 (9th
Cir. 2020).
At least one other court has found that the labeling of pet food as requiring a
prescription could be considered deceptive and misleading.
"Common sense dictates that a product that requires a prescription may be considered a
medicine that involves a drug or controlled substance. See, e.g., Prescription, Merriam-
Webster, https://www.merriam-webster.com/dictionary/prescription (last accessed
August 2, 2019) (defining 'prescription' as, among other things, 'a prescribed medicine').
This conforms to general understandings of prescription drugs for humans and pets.
Moreover, the brand name of 'prescription pet food' itself could be misleading. A
reasonable consumer being told about 'prescription pet food' may be surprised to learn
that there are no drugs or controlled ingredient[s] in the pet food by nature of brand
names like 'Prescription Diet' or an 'Rx' symbol on the food packaging. See [Williams v.
Gerber Products. Co., 552 F.3d 934, 939 (9th Cir. 2008)] ('The product is called "fruit
juice snacks" and the packaging pictures a number of different fruits, potentially
suggesting (falsely) that those fruits or their juices are contained in the product.')." 966
F.3d at 1018.
Ultimately, "[w]hether a deceptive act or practice has occurred under the [KCPA]
is not a question of law for the court, but rather a question of fact for the jury to decide."
Manley v. Wichita Business College, 237 Kan. 427, Syl. ¶ 2, 701 P.2d 893 (1985). And as
we have stated, our role here is only to determine whether Kucharski-Berger's petition
sufficiently apprises Hill's of the facts upon which she claims to be entitled to relief, not
whether she can prove them or whether they have merit. Hill's defenses to the claims are
not our concern at this stage unless they require dismissal as a matter of law. And they do
not.
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D. Kucharski-Berger succeeded in pleading fraud with sufficient particularity as
related to her KCPA claim
Hill's contends that Kucharski-Berger has not sufficiently pled her fraud claim
under the KCPA. It argues that this failure merits dismissal. We disagree.
Under K.S.A. 2020 Supp. 60-209(b), a party alleging "fraud . . . must state with
particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge
and other conditions of a person's mind may be alleged generally." Still, while claims
brought under K.S.A. 2020 Supp. 50-626 "'sound largely in fraud . . . a critical element of
a common-law fraud action, the intent to defraud, need not be proven.'" Wagher v. Guy's
Foods, Inc., 256 Kan. 300, 303-04, 885 P.2d 1197 (1994) (quoting Haag v. Dry
Basement, Inc., 11 Kan. App. 2d 649, 650, 732 P.2d 392 [1987]).
Likewise, to bring a successful action under the KCPA, a consumer is not required
to prove all the elements of common-law fraud. Ray v. Ponca/Universal Holdings, Inc.,
22 Kan. App. 2d 47, Syl. ¶ 2, 49-50, 913 P.2d 209 (1995) (holding KCPA claims may be
established by a preponderance of the evidence rather than by clear and convincing
evidence). Part of that holding is tied to the idea that the Legislature wants the KCPA to
be liberally construed to protect consumers. See K.S.A. 50-623; Ray, 22 Kan. App. 2d at
49.
In this case, Kucharski-Berger alleged that Hill's violated the KCPA by
"misrepresenting and marketing and selling Prescription Pet Food through a knowingly
deceptive, misleading, and self-imposed prescription requirement . . . . In so doing, Hill's
has represented that Prescription Pet Food has sponsorship, approval, accessories,
characteristics, ingredients, uses, benefits or quantities that it does not have [K.S.A. 2020
Supp. 50-626(b)(1)(A)]; represented that Prescription Pet Food is of particular standard,
quality, grade, style or model, when Prescription Pet Food is of another that differs
16
materially from Hill's representation [K.S.A. 2020 Supp. 50-626(b)(1)(D)]; and engaged
in the willful failure to state a material fact, or the willful concealment, suppression or
omission of a material fact regarding Prescription Pet Food [K.S.A. 2020 Supp. 50-
626(b)(3)]."
Two of Kucharski-Berger's claims do not involve an intent requirement, while the last
one does. See Crandall v. Grbic, 36 Kan. App. 2d 179, 196, 138 P.3d 365 (2006);
Cornelison v. Denison State Bank, No. 108,427, 2014 WL 37682, at *11 (Kan. App.
2014) (unpublished opinion).
Hill's points to Ayalla v. Southridge Presbyterian Church, 37 Kan. App. 2d 312,
319-20, 152 P.3d 670 (2007), where this court held that the plaintiff failed to properly
plead fraud in an action brought under the KCPA. Hill's reliance on this case is misplaced
for three reasons.
First, Ayalla was a summary judgment case, not a motion to dismiss on the
pleadings. Summary judgment hinges on a review of all the evidence following discovery
to determine whether there are any genuine issues of fact. As we have already stated, the
standard under which to review pleadings is less onerous. We concede that the district
court found that Ayalla was alleging a fraud claim but never added a fraud claim to her
petition—so the analysis would be similar to our motion to dismiss standard of review.
But the court also noted that she could not factually establish fraud even if she had pled it
properly, a decision that goes beyond the pleadings, which limits its application here.
Second, Ayalla sued for breach of contract after Southridge Presbyterian accepted
a competing offer for a home. Ayalla argued that Southridge Presbyterian violated the
KCPA based on its fraudulent misrepresentation of her offer to the competing buyer as a
competing bid rather than an accepted offer. This court affirmed the dismissal of the
claim, finding: (1) Ayalla failed to assert fraud as a separate theory of recovery in her
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petition and (2) even if she had pled fraud properly, she failed to show that she relied on a
misrepresentation. 37 Kan. App. 2d at 319-20. There was no discussion in the case about
the distinction between a traditional fraud claim and a claim of fraudulent conduct under
the KCPA. The cases that we have cited that discuss this distinction are not mentioned at
all in Ayalla. So to assume from the case that a party must always specifically plead fraud
in a KCPA claim is an overreach.
Finally, in analyzing Ayalla's claim as a traditional fraud claim, the panel noted
that to prove fraud requires a plaintiff to show these elements: "'an untrue statement of
fact, known to be untrue by the party making it, made with the intent to deceive or with
reckless disregard for the truth, upon which another party justifiably relies and acts to his
or her detriment.'" 37 Kan. App. 2d at 319 (quoting Crandall, 36 Kan. App. 2d 179, Syl.
¶ 3). And that is correct as to a separate fraud claim. But at the very least, Kucharski-
Berger's two claims under K.S.A. 2020 Supp. 50-626(b)(1) do not require the pleading
requirements for actions brought in fraud because, while similar to fraud claims, they are
not themselves allegations of fraud and contain no element of intent. See Wagher, 256
Kan. at 303-04.
Even if we were to find that the remaining claim under K.S.A. 2020 Supp. 50-
626(b)(3) (willful concealment, suppression, or omission of a material fact)—or the
others—required Kucharski-Berger to plead with particularity, she has done so in this
case. Kucharski-Berger alleged that Hill's made an untrue statement of fact, namely that
Hill's marketed its prescription pet food as prescription only when, in fact, the FDA
merely encouraged prescription pet food be sold only to consumers through a veterinarian
intermediary, and that she relied on the use of the term prescription to her detriment.
Moreover, Kucharski-Berger alleged that Hill's knew that its prescription pet food had no
medicine or drug and was not approved by the FDA and that it used its prescription
labeling and marketing to inflate the price of the prescription pet food.
18
Kucharski-Berger has done enough at this stage of the lawsuit to put Hill's on
notice of what her allegations are under the KCPA.
E. Kucharski-Berger properly pled causation and resultant harm.
Hill's asserts that Kucharski-Berger has failed to allege a causal connection
between the prescription practice and her alleged injury, both of which it argues are
required to establish that she was aggrieved. It claims that this failure requires dismissal.
It relies on Finstad v. Washburn University, 252 Kan. 465, 845 P.2d 685 (1993). In
Finstad, students in the court reporting program at Washburn University filed a claim
under the KCPA based on the University's false representation in its catalog that the
program was certified or soon to be certified when it was not. But Finstad does not
provide the support Hill's seeks for two reasons.
First, Finstad involved a summary judgment motion, not a motion to dismiss on
the pleadings. Summary judgment places a case in a different procedural posture than the
current case. See John Doe, 59 Kan. App. 2d at 282-83 (noting that motions to dismiss
are limited to a review of the pleadings while motions for summary judgment consider all
the facts disclosed during discovery).
Second, when the students filed their petition, K.S.A. 50-626(b) did not include
the current provision that a consumer need not be misled to pursue a claim for a deceptive
act under the KCPA. The court interpreted the new provision, although not applicable to
the case before it, as establishing per se violations of the KCPA for any of the listed
deceptive acts. 252 Kan. at 470. But the consumer still needed to establish that they were
aggrieved by the deception and that there was a causal connection between the deception
and the injury to maintain a private action under the KCPA. The court defined an
aggrieved party as one whose legal right is invaded by an act complained of or whose
pecuniary interest is directly affected. 252 Kan. at 472. The court granted summary
19
judgment to the University because the students did not establish they were aggrieved by
the deceptive act. There was no showing that any of the students relied on the deceptive
catalog information or suffered any injury or loss because of the publication of the
statement. 252 Kan. at 472. Such is not the case here.
Under the current version of the statute, Kucharski-Berger need not establish that
she was misled by Hill's, so long as Hill's was engaged in a deceptive act or practice. See
K.S.A. 2020 Supp. 50-626(b). Kucharski-Berger is not alleging that the prescription pet
food that she is buying is ineffective or harmful to her pet. Given that she continues to
buy it she must see some value in the pet food. Her assertion is that the price of the pet
food is significantly higher than it should be because of Hill's allegedly deceptive
marketing practices. So she properly alleges that she is aggrieved by being required to
pay higher prices for dog food based solely on Hill's manufactured prescription
requirement.
"As a result of the false and fraudulent prescription requirement and the
combination and conspiracy of Hill's and its co-conspirators, Plaintiff paid more for
Prescription Pet Food than Plaintiff would have paid in the absence of the requirement, or
would never have purchased Prescription Pet Food."
Hill's further argues that "'[w]hen causation is based on a chain of events, an
intervening cause may absolve the defendant of liability.'" State v. Wilson, 308 Kan. 516,
522, 421 P.3d 742 (2018) (quoting State v. Arnett, 307 Kan. 648, 655, 413 P.3d 787[2018]). Hill's claims that the fact that Kucharski-Berger based her purchase of Hill's
Prescription Diet pet food on the advice given to her by her veterinarian, the veterinarian
was the intervening event that breaks the chain of causation, requiring her claim to be
dismissed. We find this argument unpersuasive.
20
Kucharski-Berger's claim is premised on Hill's self-imposed prescription
requirement. It has some similarity to the claims made in Golden v. Den-Mat
Corporation, 47 Kan. App. 2d 450, 276 P.3d 773 (2012). In Golden, this court held that a
consumer who received a brochure from Den-Mat but later bought the advertised
product—veneers—from a dentist, could maintain an action against Den-Mat because the
brochure contained representations that "were made 'in connection with' the sale and, if
deceptive, would taint the sale in violation of the KCPA." 47 Kan. App. 2d at 471.
While Kucharski-Berger does not allege that she personally saw any of Hill's
advertisements or labels for its prescription pet food before purchasing it from her
veterinarian, that does not preclude her from bringing this action. The recommendation
from the veterinarian that Hill's prescription pet food could treat her dog's allergic skin
reactions and that the food was "available only by prescription" is directly related to her
allegations about Hill's alleged deceptive marketing. As alleged by Kucharski-Berger, her
veterinarian telling her that the prescription pet food was only available by prescription
stems from Hill's requirement that veterinarians do so.
On the whole, Kucharski-Berger's pleading was enough to give Hill's notice of her
KCPA claims against the company. Moreover, if particularity was required for pleadings
alleging fraud, her petition was sufficiently particular. She alleged damages, and her
continued purchasing of the dog food does not prove that she was not damaged by the
conduct she alleges Hill's engages in. And the presence of her veterinarian as an
intermediary between Hill's prescription requirement and Kucharski-Berger's purchase of
Hill's prescription pet food is not a barrier absolving Hill's of liability if it is engaging in
deceptive practices and acts. The district court erred in dismissing Kucharski-Berger's
claim under the KCPA.
21
IV. THE DISTRICT COURT ERRED BY DISMISSING KUCHARSKI-BERGER'S CLAIM THAT
HILL'S VIOLATED THE KRTA.
Kucharski-Berger's petition asserts two claims under the KRTA. They are both
closely related and rely on the same factual support.
A. Kucharski-Berger appropriately pleads claims under the KRTA.
To support her first claim under the KRTA, as outlined in K.S.A. 2020 Supp. 50-
101 and K.S.A. 2020 Supp. 50-112, Kucharski-Berger needed to allege that Hill's was
involved in a trust, defined as a "combination of capital, skill, or acts by two or more
persons" for any of several purposes. Those purposes include: (1) creating or carrying
out restrictions in trade or commerce or carrying out restrictions in the full and free
pursuit of an authorized business; (2) increasing or reducing the price of merchandise,
produce, or commodities; (3) to prevent competition in the manufacture, making,
transportation, sale, or purchase of merchandise; and (4) entering into an agreement
which would establish or settle the price of an article or commodity to preclude free and
unrestricted competition in the market. See K.S.A. 2020 Supp. 50-101.
Kucharski-Berger alleges that under K.S.A. 2020 Supp. 50-101 and K.S.A. 2020
Supp. 50-112, Hill's, Purina, Mars, PetSmart, and Banfield
"entered into a trust and contract, combination, or conspiracy in restraint of trade or
commerce in Kansas to fix, raise, stabilize, and peg prices for Prescription Pet Food by
agreeing, combining, and conspiring to misrepresent and market and sell Prescription Pet
Food through a knowingly deceptive, misleading, and self-imposed prescription
requirement having no legal basis or mandate."
She also contends that these actions were per se unlawful under the KRTA,
arguing their actions have restrained trade in the prescription pet food market. Finally,
22
Kucharski-Berger asserts that because of this conspiracy she and others have been
required to pay more for dog food than they would have otherwise paid absent Hill's
violation.
Her second claim under the KRTA is based on K.S.A. 50-132—it is unlawful for
any "person, servant, agent or employee of any person doing business within the state of
Kansas [to] conspire or combine with any other persons, within or without the state for
the purpose of monopolizing any line of business."
Kucharski-Berger alleges that, under K.S.A. 50-132, Hill's and the named
coconspirators entered a conspiracy to monopolize the market for prescription pet food in
Kansas and committed covert acts in furtherance of their conspiracy. They did this by
"agreeing, combining, and conspiring to misrepresent and market and sell Prescription
Pet Food through a knowingly deceptive, misleading, and self-imposed prescription
requirement having no legal basis or mandate, and by agreeing, combining, and
conspiring to limit and preclude non-conspiring competing manufacturers of Prescription
Pet Food from access to major channels of distribution, including their co-conspirator
retailers and veterinary clinics."
Kucharski-Berger properly pleads both claims in the language of the statute. A
legal theory of relief need not be detailed, so long as the petition apprises the defendant
of the facts upon which the plaintiff claims to be entitled to relief. Beck, 241 Kan. at 25.
B. Kucharski-Berger's factual support for her KRTA claims
So we turn to whether Kucharski-Berger has put forward sufficient factual
allegations in her petition to support her claim or whether they are simply conclusory.
In support of her claim, Kucharski-Berger alleges:
23
"In March of 2005, Hill's, Mars, PetSmart, and Banfield entered into a
combination and conspiracy to sell Prescription Pet Food, pursuant to which they agreed:
"(a) to restrict the retail sale of their Prescription Pet Food to pet owners who had
obtained and presented a prescription;
"(b) to require that retail sellers enforce their prescription and presentation
requirement; and
"(c) to restrict retail sellers to those who agreed to enforce the prescription
requirement, all with the purpose and effect of raising, fixing, stabilizing, and
pegging prices of Prescription Pet Food."
Kucharski-Berger alleges that Hill's, Purina, and Mars control somewhere between
95 to nearly 100 percent of the prescription pet food market. So any agreement among
them to continue what Kucharski-Berger describes as the deceptive practice of requiring
a prescription in an effort to keep prices high, would indicate an attempt to monopolize
the market in violation of the KRTA.
Kucharski-Berger later proffers in her petition that she has been "informed and
believe[s] that agreements between and among Mars, Purina, Hill's, PetSmart, and
Banfield prohibit and restrict PetSmart and Banfield from stocking and selling
Prescription Pet Food made by . . . other competitors." In furtherance of this conspiracy,
"Hill's entered into a 'merchandising agreement' with PetSmart and Banfield, which Mars
and PetSmart owned, to sell Hill's Prescription Pet Food in all PetSmart stores with an
on-site Banfield pet hospital." She alleges that although Mars had the power to exclude
Hill's from PetSmart and Banfield, it entered into the merchandising agreement against its
economic interests, but as part of the previously noted agreement to control the market.
Purina later joined the conspiracy. She alleges that Hill's and its coconspirators have
intentionally blocked smaller prescription pet food manufacturers from selling in
PetSmart and Banfield stores.
24
Kucharski-Berger claims in her petition that all of this points to an effort by Hill's
and its coconspirators to monopolize the prescription pet food market and force out the
few competitors that remain. This has led to "unjustifiably increased prices for
Prescription Pet Food." She also alleges facts to support her claim that prescription dog
food is priced unjustifiably high based solely on the prescription requirement that she
claims is at the heart of the KRTA claims.
"For example, Hill's produces a Prescription Pet Food product called
'Prescription Diet Urinary Care c/d Multicare' cat food that sells for $5.62 per pound, and
another substantially similar non-prescription product called 'Adult Urinary Hairball
Control' cat food that sells for $3.51 per pound. The two products make essentially the
same health claims and have a 75 percent overlap in ingredients. The non-overlapping
ingredients are not drugs and are not sufficient to justify one product being sold by
prescription for a significantly higher price. Given the overlap in ingredients, and the
absence of any drug or other ingredient required to be sold by prescription in the
Prescription Pet Food product, the only meaningful distinction between the two products
that is apparent to Plaintiffs and those similarly situated is the prescription requirement.
The price differential is therefore based largely, if not entirely, on the prescription
requirement imposed by Hill's and the other manufacturing conspirators in the
combination.
"Prescription Pet Food contains no drug or other ingredient not also common in
non-prescription pet food. Hill's and its co-conspirators impose and enforce the
prescription requirement to prey on the known propensities of consumers to love their
pets and trust their vets."
She then alleges that when the FDA was considering a draft CPG that would
require enforcement actions against dog food manufacturers that made claims about the
therapeutic benefits of their food, many in the industry agreed that such claims were
misleading.
"At the time of the Draft CPG, both the pet food industry and the veterinary
profession widely held the view that use of a prescription requirement was improper and
25
misleading for products not subjected to FDA review and approval. In a filed comment
on the Draft CPG, the American Feed Industry Association, representing 'more than 550
domestic and international companies and state, regional and national associations,'
recommended 'that pet food products subject to this CPG should be regulated in a manner
similar to human medical foods, as veterinary medical foods.' According to the FDA,
'The labeling of medical foods may not bear the symbol "Rx only",' because 'medical
foods are not required by federal law to be dispensed by prescription,' and '[t]herefore,
the use of the symbol "Rx only" in the labeling of a medical food would misbrand a
medical food under section 403(a)(l) of the FD&C Act because it would be a false and
misleading statement about that product.' Another filed comment from the American
Veterinary Medical Association ('AVMA'), known as 'the recognized national voice for
the veterinary profession,' representing 83 percent of all U.S. veterinarians, recommended
that because Prescription Pet Food had "not been evaluated by FDA for safety, efficacy,
or nutritional adequacy . . . all pet food products with implied or explicit health or drug
claims [should] include a prominent statement on the label that these claims have not
been evaluated by the FDA.''
But from September to early November 2012, Hill's and its coconspirators, when
faced with a draft CPG from the FDA that would have made the sale of their dog food
illegal unless approved by the FDA, used their positions of power within the Pet Food
Institute (PFI) to request that the FDA insert a requirement that the food be available only
through a veterinarian. Thereafter,
"[t]hey further agreed that they all would construe the Draft CPG to require them to use a
prescription requirement, and to contend that their use of the prescription requirement
was a good faith effort to comply with the Draft CPG, notwithstanding their clear
violations of its conditions."
If these claims are true, Kucharski-Berger has pled sufficient evidence to go
beyond mere conclusory allegations. She has supported her pleading with facts revealing
the who, what, when, and where of the alleged KRTA violations. At this stage of
litigation Kucharski-Berger did not have to prove that the case was a winning case. She
26
was merely required to put Hill's on notice of what she was alleging. The court and
parties can address the merits of the allegations at later stages of litigation.
C. Hill's argument that the facts alleged do not support any claim under the KRTA
Hill's argues that Kucharski-Berger failed to allege direct evidence of a trust or
conspiracy to fix prices. In support, Hill's cites Smith v. Philip Morris Companies, 50
Kan. App. 2d 535, 335 P.3d 644 (2014). Because it is at the heart of Hill's motion to
dismiss this claim, we will examine it in more detail.
In Smith, the court discussed the need for either direct or circumstantial evidence
of a conspiracy to fix prices or monopolize to support a KRTA claim and avoid summary
judgment. Based on Smith, Hill's surmises that Kucharski-Berger needed to show in her
pleadings that Hill's and other manufacturers entered into an express agreement or
"'conscious commitment to a common scheme designed to achieve an unlawful
objective.'" 50 Kan. App. 2d at 565-66. It alleges that she has failed to do so.
But Kucharski-Berger did allege a specific meeting in March 2005 where the issue
of the prescription requirement was discussed and agreements were made—the purpose
and effect of which was "raising, fixing, stabilizing and pegging prices of Prescription Pet
Food." The central theme was to agree that they would support the prescription
requirement to keep prices inflated. This alone provided enough detail to put Hill's on
notice of what conduct it was alleged to have participated in. And if true, it is certainly
the "smoking gun" that Hill's argues is necessary to support a conspiracy claim.
Also citing Smith, Hill's asserts that Kucharski-Berger is in essence alleging
conscious parallelism on the part of Hill's and its coconspirators (the process "by which
firms in a concentrated market might in effect share monopoly power, setting their prices
at a prefixed maximizing, supracompetitive level by recognizing their shared economic
27
interests and their interdependence with respect to price and output decisions." Brooke
Group v. Brown & Williamson Tobacco Corp., 509 U.S. 209, 227, 113 S. Ct. 2578, 125
L. Ed. 2d 168 [1993]). The theory is that the uniform conduct of pricing by competitors
permits a court to infer the existence of a conspiracy between those competitors.
Because the evidence of conscious parallelism is circumstantial, courts are
concerned that they do not punish unilateral, independent conduct of competitors. See
Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 594, 106 S. Ct.
1348, 89 L. Ed. 2d 538 (1986). They therefore require that evidence of a defendant's
parallel pricing be supplemented with "'plus factors.'" Smith, 50 Kan. App. 2d at 563. Our
court described "plus factors" as simply "an articulation of the requirement that an
inference drawn from the plaintiff's circumstantial evidence offered to establish collusive
pricing must be reasonable." Smith, 50 Kan. App. 2d at 568. In other words, evidence
from which a court could reasonably infer that they were acting by agreement and not
simply their own self-interest.
"Any showing by a plaintiff that tends to exclude the possibility of independent
action can qualify as a plus factor. If a benign explanation of a defendant's action is
equally plausible or more plausible than a collusive explanation, the action cannot
constitute a plus factor. On the other hand, evidence that a defendant's behavior would
not be reasonable or explicable (i.e., not in its legitimate economic self-interest) if it were
not conspiring to fix prices can constitute a plus factor." Smith, 50 Kan. App. 2d 535, Syl.
¶ 8.
So Hill's asserts that Kucharski-Berger had to plead plus factors to support the
conspiracy and her failure to do so dooms her KRTA claim.
But Hill's misapplies Smith to the facts here.
28
First, Hill's has again cited a case that involved the criteria for summary judgment
on a KRTA claim, not a motion to dismiss. Summary judgment places a case in a
different procedural posture than the current case. See John Doe, 59 Kan. App. 2d at 282-
83. The Smith court found that "to establish a material question of fact and thereby
survive summary judgment, Plaintiffs must come forward with evidence that Defendants'
wholesale pricing practices resulted from something more than legal conscious
parallelism." (Emphasis added.) Smith, 50 Kan. App. 2d at 568. Hill's cites no caselaw to
support its claim that such "plus factors" are required at the pleading stage. We can find
none in Kansas. But see Twombly, 550 U.S. at 557 ("[W]hen allegations of parallel
conduct are set out [in the pleadings] in order to make a § 1 claim [under the Sherman
Act], they must be placed in a context that raises a suggestion of a preceding agreement,
not merely parallel conduct that could just as well be independent action.").
Moreover, even if plus factors were required at the pleading stage, Kucharski-
Berger sufficiently alleges plus factors and evidence of the implausibility of independent
action to withstand a motion to dismiss. Smith recognized that "[e]vidence of actions
contrary to a defendant's economic self-interest can serve as a plus factor." 50 Kan. App.
2d 535, Syl. ¶ 14. Kucharski-Berger alleged several facts in her petition that pointed to
collective action, not independent action, including actions against self-interest.
She alleged that coconspirator Mars was acting against its self-interest when it
allowed Hill's to sell its prescription dog food in its PetSmart stores with an on-site
Banfield pet hospital. This, she claims, is evidence that the major players in the pet food
industry had reached an agreement to act in concert, not independently.
She alleged:
"The decision to continue their Prescription Pet Food combination and
conspiracy, as they had been doing in violation of federal and state law, was a decision
29
made collectively by Hill's and its co-conspirators, in that such a decision was contrary to
the independent economic self-interest of each of them without agreement with the
others, but rational if made collectively to continue their successful combination. The
conduct of Hill's and each other co-conspirator in violating the FD&C Act and various
federal and state deceptive trade practice and consumer protection laws all by itself
exposed it to multiple risks, including (1) potential solicitation of FDA enforcement
action by a competitor or consumer; (2) suit by another conspirator for deceptive
marketing practices in violation of the Lanham Act, 15 U.S.C. § 1125(a); (3) advertising
to consumers exposing the sham selling of Prescription Pet Food and consequent loss of
sales and consumer good will; and (4) suit by consumers on learning of the deception.
Any of these risks could result in public exposure and the irrecoverable loss of consumer
trust and goodwill, inasmuch as the deceptive use of the prescription requirement
depended for its success on the unquestioning faith of vulnerable pet owners in the
disinterested advice and recommendations of their veterinarians. If, however, all
conspirators, as the dominant sellers of Prescription Pet Food, agreed jointly to continue
selling Prescription Pet Food as they had been, these risks would be substantially
mitigated because of their combined resources and collective market power."
She then alleges the implausibility of independent action.
"Once the Draft CPG was issued, it is further implausible that Hill's, Purina, and
Mars would each have independently concluded that the Draft CPG suggested,
recommended, or authorized the use of a prescription requirement in the marketing and
sale of Prescription Pet Food, or that the Draft CPG suggested, recommended, or
authorized their making disease claims on labeling or promotional materials provided to
consumers, whether in print or on websites. It is further implausible that each would have
independently decided to engage in a course of conduct in violation of the Draft CPG and
the FD&C Act in exactly the same manner, as in fact occurred. That all three
manufacturers decided to violate the Draft CPG and FD&C Act in the same way is
explicable only as the result of a collective decision or agreement."
And we cannot lose sight of the fact that Kucharski-Berger claims that an actual
agreement was reached at a meeting between the coconspirators in March 2005. She
30
makes no claim of conscious parallelism as it relates to that meeting. There are no
inferences required, so no plus factors are required for that claim.
The petition provides appropriate notice of the claims Kucharski-Berger was
bringing under the KRTA, and her alleged facts do not preclude her from obtaining relief.
The district court erred in dismissing her KRTA claims.
V. THE DISTRICT COURT ERRED IN DISMISSING KUCHARSKI-BERGER'S UNJUST
ENRICHMENT CLAIM.
In her petition, Kucharski-Berger alleges that Hill's was unjustly enriched by its
misrepresentations and deceptive marketing practices involving its prescription pet food.
Unjust enrichment arises when (1) a benefit has been conferred upon the defendant,
(2) the defendant retains the benefit, and (3) under the circumstances, the defendant's
retention of the benefit is unjust. See In re Estate of Sauder, 283 Kan. 694, 719, 156 P.3d
1204 (2007). She alleges that she was required to pay an unjustifiably high price for her
pet food because of Hill's false and deceptive prescription requirement. This is the same
conduct that she alleges violated the KCPA.
Unlike its other allegations that Kucharski-Berger presented insufficient evidence
to support her claim, here Hill's argues that Kucharski-Berger's unjust enrichment claim
must be dismissed because it was seeking a remedy for the same conduct covered by the
KCPA. It cites Deeds v. Waddell & Reed Invst. Mgmt. Co., 47 Kan. App. 2d 499, 511,
280 P.3d 786 (2012), for the proposition that "a claim for unjust enrichment is an
equitable claim, and generally an equitable remedy is not available when an adequate
remedy exists under another legal claim." In Deeds, the plaintiff brought a claim under
the Kansas Wage Payment Act and an unjust enrichment theory. Because Deeds had a
statutory remedy through the Kansas Wage Payment Act, this court found that his unjust
enrichment claim was preempted. 47 Kan. App. 2d at 511.
31
Yet again, Hill's seems to ignore the fact that this case is before us on a motion to
dismiss on the pleadings, not on a summary judgment motion. Deeds involved a ruling on
summary judgment. The court found that Deeds had a pending claim under the Kansas
Wage Payment Act with the Secretary of Labor, so his unjust enrichment claim was
preempted by that claim at the summary judgment stage. Hill's cites no Kansas case that
discusses the Deeds holding as it relates to a motion to dismiss based on the pleadings.
And there is a good reason for that.
To apply this rule to a motion to dismiss on the pleadings would ignore Kansas
pleading rules. "A party may set out two or more statements of a claim or defense
alternately or hypothetically, either in a single count or defense or in separate ones. If a
party makes alternative statements, the pleading is sufficient if any one of them is
sufficient." K.S.A. 2020 Supp. 60-208(d)(2); Beams v. Werth, 200 Kan. 532, 549, 438
P.2d 957 (1968) (finding a party will not be required to elect at the pleading stage of the
case which legal theory relied on; this would defeat the purpose of allowing inconsistent
pleading). Clearly, Kucharski-Berger cannot recover under both theories, but she can
plead both at this early stage. See Nieberding v. Barrette Outdoor Living, Inc., No. 12-
2353-KHV, 2012 WL 6024972, at *4 (D. Kan. 2012) (unpublished opinion).
For these reasons, the district court erred in dismissing Kucharski-Berger's unjust
enrichment claim.
Reversed and remanded for further proceedings.
32