1516-CV03802 IN THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI, AT KANSAS CITY. Derek Baker, on Behalf of himself and all Others Similarly Situated,

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1 IN THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI, AT KANSAS CITY Derek Baker, on Behalf of himself and all Others Similarly Situated, 3766 Mercier St. Kansas City, Missouri v. NNW, LLC 103 S. McKenna Ave P.O. Box 520 Gretna, NE Plaintiff, Case No. Jury Trial Demanded 1516-CV03802 Serve: David Stage Registered Agent 103 S. McKenna Ave P.O. Box 520 Gretna, NE And Hy-Vee, Inc Westown Parkway West Des Moines, IA Serve: C T Corporation System 120 South Central Avenue Clayton, MO Defendants.

2 CLASS ACTION PETITION Plaintiff, by his attorneys, on behalf of himself and all others similarly situated, makes the following allegations pursuant to the investigation of his counsel and based upon information and belief, except as to allegations specifically pertaining to himself and his counsel, which are based on personal knowledge. NATURE OF THE ACTION 1. This case is a class action brought on behalf of consumers who purchased a whey protein product called NNW Healthy 100% Whey ( Healthy 100% Whey ) from 2009 through This lawsuit asserts that NNW and Hy-Vee deceptively marketed Healthy 100% Whey to their customers as containing high amounts of protein and minimal carbohydrates, when in fact Healthy 100% Whey contained small amounts of protein and was loaded with carbohydrates in the form of sugar and starch. 2. Consumer protein powder products are products that ordinarily have whey protein concentrate and/or whey protein isolate as the primary ingredients. 3. Whey protein concentrate and isolate based products are highly popular products given their ability, among other things, to aid in building and maintaining muscle mass, help manage body weight, support immune systems, and support bone health. 4. Whey protein in its concentrate or isolate form is naturally bitter. As a result, it is difficult to make a whey protein product that tastes good without adding significant amounts of sugar or other fillers such as starch. 5. Starch and sugar on the other hand, are low cost ingredients and taste sweet. 2

3 6. Adding sugar and starch, however, makes the product less valuable and desirable because adding these fillers raises the proportion of the less valuable and beneficial substance, carbohydrates, while reducing the more valuable and beneficial substance, protein. 7. Therefore, the challenge is to make a product that is palatable while still retaining nutritional benefits. 8. Hy-Vee sold Healthy 100% Whey a product manufactured and distributed by NNW from 2009 through September 2013 in Hy-Vee retail stores in Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, South Dakota and Wisconsin. 9. Healthy 100% Whey came in a number of flavors such as: vanilla, chocolate, chocolate peanut butter, strawberry, vanilla caramel swirl, and cinnamon bun. 10. Further, all flavors of Healthy 100% Whey purported to contain "pure whey protein concentrate" and "pure whey protein isolate" as their primary ingredient. 11. Hy-Vee was the exclusive brick and mortar retail seller of Healthy 100% Whey until the product was recalled in September After the recall, NNW began selling Healthy 100% Whey directly to consumers online. 13. With Healthy 100% Whey, NNW appeared to have made an excellent whey protein product: Healthy 100% Whey tasted sweet yet it purported to have twenty-two (22) grams of protein and just one (1) gram of carbohydrates per twenty-eight (28) gram serving. 14. Because of this purported combination of nutrition and taste, Defendants were able to charge $16, $22, and $45 for one, two, and five-pound bags of Healthy 100% Whey. 3

4 15. In order to capitalize on the growing popularity of Healthy 100% Whey with Hy-Vee customers, Hy-Vee did not just sell Healthy 100% Whey; Hy-Vee actively promoted Healthy 100% Whey by engaging in an aggressive marketing campaign. 16. Through this marketing campaign, Hy-Vee actively disseminated the nutritional misrepresentations set forth on the Healthy 100% Whey label on its website, through its dieticians and in-store demonstrations, and on television. 17. When Healthy 100% Whey is subjected to quantitative nutrient lab analysis, the results show that it contains less than five (5) grams of protein and over twenty (20) grams of carbohydrates per twenty-eight (28) gram serving. 18. Quantitative nutrient lab analysis further reveals that Healthy 100% Whey consists of over 50% starch, making starch the primary ingredient of the product. 19. NNW, as the manufacturer and distributor of Healthy 100% Whey, falsely represented the product, by omitting or abstracting the valuable constituent from the product, whey protein concentrate and isolate, and adding, mixing or substituting a less valuable constituent in the form of large amounts of sugar and starch. 20. In essence, Defendants Hy-Vee and NNW sold their customers bags of sugar and starch deceptively labeled Healthy 100% Whey at an astronomical price. 21. In September 2013, Hy-Vee abruptly and without explanation pulled the popular Healthy 100% Whey off store shelves. 22. Plaintiff, individually and on behalf of a class of similarly-situated purchasers of Healthy 100% Whey, seeks relief in this action against Hy-Vee and NNW (collectively Defendants ) for their violation of the Missouri Merchandising Practices Act, and for unjust enrichment. 4

5 PARTIES, JURISDICTION, AND VENUE 23. Plaintiff Derek Baker is a Missouri citizen and resides in Kansas City, Missouri in Jackson County. Derek Baker purchased Healthy 100% Whey both from NNW online and at Hy-Vee retail grocery stores in Missouri for personal, family, or household purposes during the Class period, as defined below. 24. NNW, LLC ( NNW ) is a limited liability company organized and existing under the laws of Nebraska, with its principal place of business in Gretna, Nebraska, and may be served with process by serving its registered agent, David Stage, 103 S. McKenna Ave, Gretna, NE NNW conducts and conducted business in the State of Missouri by selling and shipping its products directly to Missouri consumers, and by selling its products to Missouri retailers for resale to Missouri consumers. 26. NNW deceptively marketed its products in Missouri and engaged in tortious conduct in Missouri. 27. Hy-Vee, Inc. ( Hy-Vee ) is a corporation organized and existing under the laws of Iowa, with its principal place of business in West Des Moines, Iowa. 28. Hy-Vee is registered to do business and does business in Missouri and may be served with process by serving its registered agent, C T Corporation System, 120 South Central Avenue, Clayton, Missouri Hy-Vee owns and operates over twenty (20) retail grocery stores in Missouri, including multiple stores in Jackson County. 30. Hy-Vee deceptively marketed Healthy 100% Whey products it sold in Missouri and engaged in tortious conduct in Missouri. 5

6 31. Venue is proper in this Court pursuant to RSMo On information and belief, the amount in controversy in this matter does not exceed $5,000, This case is not removable under 28 U.S.C. 1332(d), or any other provision of the federal Class Action Fairness Act. FACTS COMMON TO ALL CLAIMS A. Hy-Vee and NNW Marketed and Sold Healthy 100% Whey to Missouri Consumers. 33. Hy-Vee has at least 230 retail stores located in Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, South Dakota, and Wisconsin. Twenty-eight (28) of these stores are in Missouri. 34. Upon information and belief, in 2012 Hy-Vee had annual sales of more than $7 billion. 35. Hy-Vee ranks among the top 25 supermarket chains and the top 50 private companies in the United States. 36. On or around 2001, Hy-Vee created its first HealthMarket department, a storewithin-a-store, that houses a wide assortment of health- and wellness-minded foods and nonfoods. 37. The HealthMarket department is set apart from the rest of the store with a dropped grid ceiling and warm wood tones on shelves and flooring to give the area a more natural look. 38. To develop product selection and merchandising strategies in the HealthMarket department, in-store dietitians work together with the department s managers. 39. When a Hy-Vee dietitian labels a new item as a Dietitian s Pick or includes it in a recipe, or talks about it on television, Hy-Vee sees an immediate increase in sales on that item. 6

7 40. The HealthMarket department is the fastest-growing department in Hy-Vee s stores. 41. Hy-Vee sells or has sold various protein powder products, including Nectar, Muscle Milk, Trophix, EAS Soy Protein Powder, Gold Standard 100% Whey, and Hy-Vee 100% Whey protein powder. 42. Beginning in or around 2009, Hy-Vee began selling Healthy 100% Whey in its stores, including in the HealthMarket department of its stores. 43. During the Class Period, Defendants sold one, two, and five-pound bags of Healthy 100% Whey for approximately $16, $22, and $45, respectively. 44. Upon information and belief, during the class period, Hy-Vee was the exclusive brick and mortar retailer of Healthy 100% Whey. 45. Plaintiff purchased numerous bags of Healthy 100% Whey from Hy-Vee, including the store located at 9400 East 350 Highway, Raytown, Missouri Further, Plaintiff purchased bags of Healthy 100% Whey online directly from NNW from Plaintiff s home located in Kansas City, Missouri. 47. Set forth below is the label on the front of a representative bag of Healthy 100% Whey: 7

8 100% Whey: 48. Set forth below is the ingredient and nutritional label on the back of Healthy 8

9 B. Defendants Deceptively Marketed Healthy 100% Whey. 49. During the Class Period, the labeling on the package of Healthy 100% Whey, as sold by Defendants, did not disclose the actual level of protein, total carbohydrates, and sugar. 50. As set forth on the label, a serving size of Healthy 100% Whey is approximately twenty-eight (28) grams. 51. The label on Healthy 100% Whey states that one serving size contains twenty-two (22) grams of protein. In reality, one serving size of Healthy 100% Whey contains approximately less than five (5) grams of protein. 52. The label on Healthy 100% Whey states that one serving size contains one (1) gram of sugar. In reality, one serving size of Healthy 100% Whey contains roughly at least six (6) grams of sugar, and a large proportion of other carbohydrates. 53. The label on Healthy 100% Whey states that it is diabetic-friendly. Given that Healthy 100% Whey contains approximately over six (6) grams of sugar per serving and consists primarily of sugar and starch, it is not diabetic-friendly. 54. The labeling on the package of Healthy 100% Whey, as sold by Defendants, did not disclose the true ingredients of the product. 55. The primary ingredients listed on Healthy 100% Whey are: pure whey protein concentrate, pure whey protein isolate. 56. Nowhere on the ingredient portion of the Healthy 100% Whey label does starch appear as an ingredient despite the fact that the product consists of over 50% starch. 57. Whey protein concentrate and whey protein isolate are not the primary ingredients of Healthy 100% Whey. 9

10 58. On information and belief, Hy-Vee entered into sales and marketing agreements with NNW to uniformly promote and market Healthy 100% Whey. 59. Hy-Vee did not just sell Healthy 100% Whey but actively participated in the dissemination of the nutritional misrepresentations set forth on the Healthy 100% Whey label on its website, through its dieticians and in-store demonstrations, and on television. 60. During the Class Period, Hy-Vee dieticians selected Healthy 100% Whey as a Pick of the Month. 61. For example, on June 5, 2010, Hy-Vee, posted the following on its website, which is currently available at: %20Milk-Gluten-Free-Brownies-R7584.aspx, stating that Healthy 100% Whey had been designated a Pick of the Month by one of Hy-Vee s dieticians in Blue Springs, Missouri: 10

11 62. In this June 5, 2010 posting, Hy-Vee reinforced the nutritional misrepresentations set forth on the label of Healthy 100% Whey, stating that Healthy 100% Whey contains twentytwo (22) grams of protein per serving and is diabetic friendly. 63. Defendants also made recipes available on Hy-Vee s website that included Healthy 100% Whey as an ingredient. 64. For example, set forth below is a chocolate milk gluten-free brownie recipe currently available on Hy-Vee s website at: This recipe includes Healthy 100% Whey as an ingredient: 65. Hy-Vee misrepresented the protein and sugar content for a serving size of recipes on its website that included Healthy 100% Whey as an ingredient. 11

12 66. Hy-Vee states on its website that a serving size of the chocolate milk gluten-free brownie recipe using Healthy 100% Whey identified above contained twelve (12) grams of protein and two (2) grams of sugar: 67. A serving size of this recipe does not contain twelve (12) grams of protein and two (2) grams of sugar. 68. Defendants further marketed Healthy 100% Whey through Hy-Vee dieticians and through in-store demonstrations. 69. During the Class Period, Hy-Vee representatives conducted in-store demonstrations utilizing Healthy 100% Whey. 70. Hy-Vee held Cooking with CardioWellness classes that promoted recipes using Healthy 100% Whey as an ingredient. 71. Defendants also marketed Healthy 100% Whey on television through the use of Hy-Vee dieticians. 12

13 72. For example, on February 3, 2012, a Hy-Vee dietician named Kodi Moore promoted Healthy 100% Whey on the Kansas City, Missouri Fox 4 News Morning Show by presenting a Hy-Vee heart healthy oatmeal recipe with Healthy 100% Whey as an ingredient. 73. Hy-Vee further promoted Healthy 100% Whey by giving it prominent shelf positions within the HealthMarket. 74. On information and belief, Healthy 100% Whey was a popular product with Hy- Vee customers. 75. NNW issued a voluntary recall of Healthy 100% Whey in September Hy-Vee stopped selling Healthy 100% Whey in September The Hy-Vee website has a page devoted to product recalls. 78. Hy-Vee never posted on the recall page of the Hy-Vee website that Healthy 100% Whey was subject to a manufacturer recall. 79. On January 3, 2014, Hy-Vee dietician Jamie Jarvis, in response to consumer inquiry, posted on the official Hy-Vee website that unfortunately there was a voluntary recall made by NNW due to a quality issue with their current formulary. 80. Upon information and belief, after NNW issued the recall of Healthy 100% Whey, NNW began selling the product online directly to the public. 81. Plaintiff continued purchasing Healthy 100% Whey directly from NNW after the recall in September Upon information and belief, NNW still sold Healthy 100% Whey using the same formula as that sold by Hy-Vee after the September 2013 recall, until sometime in 2014, when NNW stopped selling 100% Healthy Whey. 13

14 83. Plaintiff was unaware that the Healthy 100% Whey protein powder contained less than five (5) grams of protein and over six (6) grams of sugar per serving at the time he purchased and consumed the product. 84. Plaintiff was unaware that starch is the primary ingredient of Healthy 100% Whey at the time he purchased the product. 85. Plaintiff, in the exercise of reasonable prudence, could not have discovered the deceptive practices and misrepresentations of the Defendants earlier because, like nearly all consumers, Plaintiff did not have food testing capabilities whereby he could have uncovered the true nutritional content of Healthy 100% Whey. 86. Healthy 100% Whey cost more than similar products unassociated with misleading advertisements and misrepresentations and would have cost significantly less (or could not have been sold at all) absent the false and misleading statements. 87. Plaintiff and members of the Class paid more for Healthy 100% Whey than they otherwise would have had Defendants not falsely characterized the product. 88. For these reasons, Healthy 100% Whey was worth less than what Plaintiff and members of the Class paid for it. 89. Instead of receiving a product that had the advantages inherent in consisting of primarily whey protein concentrate and whey protein isolate as an ingredient, Plaintiff and members of the Class received a different, adulterated product that consisted primarily of starch and sugar. 90. Plaintiff and members of the Class lost money in the amount of the purchase price of the product as a result of the Defendants deception in that they did not receive what they paid for. 14

15 91. Plaintiff and members of the Class altered their positions to their detriment and suffered damages in the amount equal to the amount they paid for Healthy 100% Whey. CLASS ACTION ALLEGATIONS 92. Plaintiff brings this class action pursuant to RSMo and Missouri Rule of Civil Procedure on behalf of the following consumer class (the Class ): All purchasers for personal, family, or household purposes of Healthy 100% Whey in the State of Missouri from January 1, 2009 to the present (the Class Period ). Excluded from the Class are Defendants, their parents, subsidiaries and affiliates, their directors and officers and members of their immediate families; also excluded are any federal, state or local governmental entities, any judicial officers presiding over this action and the members of their immediate family and judicial staff, and any juror assigned to this action. 93. Members of the Class are so numerous that their individual joinder herein is impracticable. On information and belief, members of the class number at least in the hundreds. The precise number of Class members and their identities are unknown to Plaintiff at this time but will be determined through discovery. Class members may be notified of the pendency of this action by publication and/or mailing through the sales records of NNW and Hy-Vee. 94. Common questions of law and fact exist as to all Class members and predominate over questions affecting only individual Class members. Common legal and factual questions include, but are not limited to: (a) (b) (c) (d) whether NNW and Hy-Vee were unjustly enriched by their conduct; whether NNW and Hy-Vee advertised, or marketed Healthy 100% Whey in a way that was false or misleading; whether Healthy 100% Whey failed to conform to the representations, which were published, disseminated and advertised by Defendants to Plaintiff and the Class; whether NNW and Hy-Vee concealed from Plaintiff and the Class that Healthy 100% Whey did not conform to its stated representations; 15

16 (e) (f) (g) whether, by the misconduct set forth in this Complaint, NNW and Hy-Vee have engaged in unfair, fraudulent or unlawful business practices with respect to the advertising, marketing and sales of Healthy 100% Whey; whether NNW and Hy-Vee violated the Missouri Merchandising Practices Act; and whether, as a result of NNW and Hy-Vee s misconduct as alleged herein, Plaintiff and Class members are entitled to restitution, injunctive and/or monetary relief and, if so, the amount and nature of such relief. 95. Plaintiff s claims are typical of the claims of the members of the Class as all members of the Class are similarly affected by NNW and Hy-Vee s wrongful conduct. Plaintiff has no interests antagonistic to the interests of the other members of the Class. Plaintiff and all members of the Class have sustained economic injury arising out of NNW and Hy-Vee s violations of law as alleged herein. 96. Plaintiff is an adequate representative of the Class because his interests do not conflict with the interests of the Class members he seeks to represent. Plaintiff has retained counsel competent and experienced in prosecuting class actions. The interests of Class members will be fairly and adequately protected by Plaintiff and his counsel. 97. The class mechanism is superior to other available means for the fair and efficient adjudication of the claims of Plaintiff and Class members. Each individual Class member may lack the resources to undergo the burden and expense of individual prosecution of the complex and extensive litigation necessary to establish NNW and Hy-Vee s liability. Individualized litigation increases the delay and expense to all parties and multiplies the burden on the judicial system presented by the complex legal and factual issues of this case. Individualized litigation also presents a potential for inconsistent or contradictory judgments. In contrast, the class action device presents far fewer management difficulties and provides the benefits of single 16

17 adjudication, economy of scale, and comprehensive supervision by a single court on the issue of NNW and Hy-Vee s liability. Class treatment of the liability issues will ensure that all claims and claimants are before this Court for consistent adjudication of the liability issues. COUNT I (Violation of the Missouri Merchandising Practices Act) 98. Plaintiff repeats the allegations contained in the above paragraphs as if fully set forth herein. 99. Plaintiff brings this claim on behalf of himself and the Class under the Missouri Merchandising Practices Act, codified at RSMo et seq In connection with the sale and advertisement of Healthy 100% Whey NNW and Hy-Vee both misrepresented that Healthy 100% Whey contained high amounts of protein and minimal amounts of sugar when in fact the product contained minimal protein and was loaded with sugar and starch NNW and Hy-Vee s statements that Healthy 100% Whey had high amounts of protein and minimal sugar and/or starch constitute deception, fraud... false promise, misrepresentation, unfair practice or the concealment, suppression, or omission of any material fact, in violation of the Missouri Merchandising Practices Act Plaintiff and all Class members suffered an ascertainable loss caused by NNW and Hy-Vee s misrepresentations because they paid a premium price for Healthy 100% Whey when the product was worth zero or close to zero based on its actual attributes Plaintiff and all class members have been damaged by NNW and Hy-Vee s misrepresentations because they paid a premium price for Healthy 100% Whey when the product was worth zero or close to zero based on its actual attributes. 17

18 COUNT II (Unjust Enrichment) 104. Plaintiff and the Class members conferred a benefit on Defendants by purchasing Healthy 100% Whey from Defendants Defendants have benefited at Plaintiff s expense by the sale of the deceptively mislabeled product by collecting the price of the falsely represented product, which consumers paid because of the deceptive labeling and misleading advertising of Defendants Defendants retention of the revenues from Plaintiff and Class members purchase of Healthy 100% Whey, under these circumstances is unjust and inequitable because consumers were misled by Defendants to believe that they were receiving a product with vastly more whey protein content and considerably less sugar and starch content than what they in fact received Plaintiff and Class members were injured because they purchased a product they otherwise would not have purchased due to the Defendants misrepresentations Because Defendants retention of the non-gratuitous benefit conferred on Defendants by Plaintiff and the Class members is unjust and inequitable, Defendants must pay restitution to Plaintiff and the Class members, as ordered by the Court. WHEREFORE, Plaintiff, individually and on behalf of all others similarly situated, seeks judgment against NNW and Hy-Vee as follows: A. For an order certifying the Class under Rule 23 of the Federal Rules of Civil Procedure and naming Plaintiff as Class Representative and his attorneys as Class Counsel to represent the Class members; B. For an order declaring that NNW and Hy-Vee s conduct violates the statutes referenced herein; 18

19 C. For an order finding in favor of the Plaintiff and the Class on all counts asserted herein; D. For an order awarding compensatory and punitive damages in amounts to be determined by the Court and/or jury; E. For prejudgment interest on all amounts awarded; F. For an order of restitution and all other forms of equitable monetary relief; G. For an order enjoining and prohibiting Defendants from engaging in the unlawful practices described herein, or for other injunctive relief as the Court may deem proper; and H. For an order awarding Plaintiff and the Class their reasonable attorneys fees and expenses and costs of suit. JURY DEMAND Plaintiff hereby demands a trial by jury on all claims so triable. DATE: February 18, 2015 Respectfully submitted, STUEVE SIEGEL HANSON LLP /s/ Barrett J. Vahle Norman E. Siegel, MO #44378 Barrett J. Vahle, MO #56674 Sean R. Cooper, MO # Nichols Road, Suite 200 Kansas City, Missouri (816) (816) (facsimile) siegel@stuevesiegel.com vahle@stuevesiegel.com cooper@stuevesiegel.com 19

20 THE GUASTELLO LAW FIRM, LLC /s/ David J. Guastello David J. Guastello, MO # Washington, Suite 501 Kansas City, MO (816) (816) (facsimile) 20