Earlier this week, a federal judge in California dismissed the class action lawsuit alleging that the companies behind the brand JustCBD repeatedly overstated the amount of cannabidiol in their products.
The suit, filed in May 2020 against Just Brands USA, Inc.; Just Brands FL, LLC; Just Brands, Inc.; Just CBD, LLC; and SSGI Financial Services, Inc. by California resident Miguel Rodriguez, claimed that the percentage of CBD in JustCBD products was a fraction of what was advertised on the defendants’ website and on the products’ labeling and packaging.
For example, after conducting independent lab testing, the plaintiff claims that the defendants’ JustCBD Honey Liquid Tincture contains 51 percent less CBD than advertised.
“By misrepresenting the true quantity of CBD in their CBD Products, Defendants are able to charge a substantial price premium on account of these fictitious CBD quantity claims,” the suit alleges.
Cannabidiol is defined in the suit as a naturally occurring phytocannabinoid found in certain strains of hemp that is used to treat anxiety, insomnia, depression, diabetes, PTSD and chronic pain. The plaintiff claims he would not have purchased JustCBD products or have paid as much for them if not for the misleading labeling of CBD content.
The defendants filed a motion to dismiss the suit in November 2020, as well as a motion to stay the action in January of 2021, pending the Federal Food and Drug Administration’s new guidelines on cannabidiol products. The judge denied the motion to stay, stating that, “For the FDA to have primary jurisdiction over this matter, its forthcoming guidelines must affect labeling standards for disclosing CBD content. However, the pending FDA guidelines mainly concern the sale of CBD products as medicine or dietary supplements with ‘unsubstantiated therapeutic claims,’ which violates the law and puts patients at risk.”
The defendants moved to dismiss the plaintiff’s claims for lack of standing under Rule 12(b)(1), lack of personal jurisdiction under Rule 12(b)(2) and failure to state a claim under Rule 12(b)(6). The judge ruled the plaintiff’s first and third causes of action, concerning breach of contract and fraud, dismissed with leave to amend; the plaintiff’s second and seventh causes of action, concerning unjust enrichment and The Florida Deceptive and Unfair Trade Practices Act, dismissed with prejudice; and the Plaintiff’s fourth and fifth causes of action, concerning California’s Unfair Competition and False Advertising Laws, as dismissed with limited leave to amend.
The plaintiff has until June 8, 2021 to file a second amended complaint, or all claims with prejudice will be dismissed and the case will be closed.
