California Residents Dismiss Egg Price Gouging Lawsuit After Defendants Ask for Dismissal

Plaintiffs in a Northern District of California court case alleging egg farmers and grocery stores illegally raised the price of eggs during the COVID-19 pandemic dismissed their complaints against all of the defendants, without prejudice. An order granting the dismissal and closing the case was signed by Judge Edward M. Chen on Wednesday.

The notice of voluntary dismissal said that the defendants did not answer the complaint or file a motion for summary judgment. Some of the defendants were dismissed from the case individually prior to this notice.

Residents of California, who purchased eggs at higher-than-usual prices, filed the class-action complaint against the companies in late April. They cited a 180 percent rise in the price of eggs since the beginning of the COVID-19 pandemic and said they were seeking relief from egg farmers and retailers, who marked the price up over 10 percent for consumers, who bought eggs during California’s state of emergency.

The defendants filed a motion to dismiss the case in early August. They claimed that the plaintiffs did not plead sufficient facts to establish the court’s jurisdiction, support standing, or state a claim. The memorandum attached to the motion said, “In the very first paragraph of the Complaint, however, Plaintiffs expressly admit that they have no facts or allegations regarding whether any specific Defendant purportedly engaged in price gouging and that they do not have a basis to name all Defendants.” 

The producers and marketers said that the plaintiffs need to seek leave to modify their complaint if the case is to continue; the plaintiffs had reportedly said that they would modify the complaint, but the time to take that action without court approval had passed. The memorandum further said the court should deny the plaintiffs the opportunity to amend their complaint. The “Plaintiffs have known their Complaint is deficient as to the Egg Producers & Marketers since they drafted its first paragraph … The Egg Producers & Marketers therefore maintain that careful scrutiny of a motion for leave to amend is warranted, and futile amendments of a deficient complaint or other stall tactics should not be allowed.”

The plaintiffs include 10 consumers who were represented by Davis & Norris. The defendants, who filed the motion to dismiss, included Rose Acre Farms, Inc., represented by Porter, Wright, Morris & Arthur LLP and Gordon Rees Scully Mansukhani, LLP; Michael Foods, Inc., represented by Faegre Drinker Biddle & Reath LLP; Hickman’s Egg Ranch, represented by DLA Piper LLP; Prairie Star Farms, LLC, represented by Barnes & Thornburg LLP; Daybreak Foods Inc., represented by Proskauer Rose LLP; and Opal Foods LLC, represented by Bona Law PC and Downey Law LLC.