Antitrust Law Daily Wrap Up, ADVERTISING—S.D. Cal.: ‘Natural’ melatonin mislabeling claims against Procter & Gamble survive dismissal, (Mar 16, 2026)

By Justin Marcus Smith, J.D.

The court concluded a reasonable consumer might understand the word “naturally” to refer to the source of melatonin and that the source was not synthetic.

In a sleep-aid labeling dispute, it was not implausible, as a matter of law, that The Procter & Gamble Company (PG) misled reasonable consumers into thinking certain sleep-aid products contained naturally-derived melatonin, held the federal district court in San Diego, California. The court found ambiguity on the front labels even after consulting the back labels, and it appeared that PG, itself, may not have understood the distinction between plant-derived and chemically-derived melatonin. The court also found PG’s price distinction argument to be unpersuasive. The court accordingly declined to dismiss the consumer’s false labeling claims. However, it otherwise agreed with PG that the consumer did not have standing to seek injunctive relief. The court said it had discretion to remand to state court, but it ultimately decided to dismiss the consumer’s request for injunctive relief without prejudice (Perkins v. Procter & Gamble Co., No. 3:25-cv-01305-TWR-VET (S.D. Cal. Mar. 5, 2026)).

Background. A consumer brought a putative class action against PG. The consumer alleged the melatonin in PG “ZzzQuil Pure Zzzs” sleep-aid products was, contrary to product labeling, not a “natural” melatonin ingredient. She alleged product labels were false, misleading, and likely to deceive reasonable consumers to the extent they would expect a product branded and labeled as being “naturally” capable of inducing sleep would not have an artificial ingredient. The consumer’s first amended complaint (FAC) asserted claims under California’s Consumers Legal Remedies Act (CLRA) and Unfair Competition Law (UCL).

PG moved for dismissal for failure to state a claim under Fed. R. Civ. P. 12(b)(6). On a prior PG motion to dismiss, the court found the front label could not plausibly deceive a reasonable consumer. The FAC now alleged a new consumer theory of deception, that the front labels were unambiguously deceptive because the slogan “HELPS YOU FALL ASLEEP NATURALLY” could cause a reasonable consumer to believe that none of the product active ingredients were derived synthetically, whereas the melatonin in dispute was an artificial and synthetic ingredient.

PG raised two counter-arguments. First, PG argued it was implausible that reasonable consumers would equate the slogan with “natural” melatonin. Second, PG urged that a reasonable consumer would not understand the product front labels to pertain only to the melatonin ingredient.

Ambiguity. The court rejected the PG assertion that a reasonable consumer would necessarily understand that the melatonin in the disputed products must be produced synthetically, i.e., by an industrial chemical process. The court agreed with the consumer that a reasonable consumer would have no idea how the melatonin was produced but might nevertheless understand the word “naturally” to refer to the source of the melatonin and that the source was not synthetic.

As a preliminary matter, the court maintained its prior disposition that the first Merriam-Webster definition of the word “naturally” meant in the usual or expected way or course because the products acted on the innate hormonal pathway for inducement of sleep.

However, the second Merriam-Webster definition, “without artificial aid,” required more analysis because it presented an ambiguity. Reasonable consumers would need to know more before drawing a conclusion whether the products contained “natural” instead of synthetic melatonin. The court noted the ambiguity might be resolved by reference to the back label. However, as the consumer pointed out, the back label only listed “melatonin” as an ingredient without qualification. That forced the court to consider additional information available to reasonable consumers.

Production methods. The court reasoned next that the fact that the human body produces melatonin did not necessarily imply that a reasonable consumer would understand that the disputed products involved chemically-synthesized melatonin. PG argued that plant-based melatonin is not “natural” because it is made in a laboratory, but the court distinguished that was only technically correct to the extent laboratory production is possible. The extraction of plant-based melatonin is otherwise distinct from chemical synthesis of melatonin. Melatonin extracted from plants is both a starting material and an end product, whereas the chemical synthesis method involves combining other materials to make melatonin as an end product.

As the court previously explained, Gonzalez v. Chattem, Inc., No. 23-CV-00102-HSG, 2023 WL 8101923 (N.D. Cal. Nov. 21, 2023) was instructive. The Gonzalez court explained that reasonable consumers might conclude that a product labeled as one that works “naturally” with the human sleep cycle would involve natural components. Proving that would be a separate question after discovery.

The court opined that PG failed to persuade that reasonable consumers would grasp the distinction between plant extraction and chemical synthesis of melatonin where PG, itself, appeared not to understand it on the face of its motion papers. The court found it was plausible that a reasonable consumer might be misled into wrongfully concluding that the slogan “HELPS YOU FALL ASLEEP NATURALLY” implied the disputed melatonin was “natural,” in other words, not artificial or synthetic in origin.

Price differential. The court also rejected the PG assertion that a significant price differential alone would alert a reasonable consumer that they were not buying “natural’ melatonin. PG argued here that the consumer’s deception theory was implausible because of the “significant price differential” between synthetic and plant melatonin. However, the court noted that PG quoted an article about the price differential out-of-context where the authors, later in the same article, expressed surprise that they had found cheaper plant melatonin pills on the market than the chemically-derived ones. The court did not find the article persuasive.

Injunctive relief. The court held the consumer did not have standing to pursue injunctive relief. The court agreed with PG that the consumer was now aware that the melatonin in question was synthetically-derived such that she could not be wronged similarly again. The consumer pleaded she would still buy the product if it contained natural ingredients and might make the mistake of doing so on the assumption that the product was improved.

The court again found Gonzalez instructive. That court found it would have been unreasonable for the consumers in that matter to buy again based on an assumption of product improvement. The court ruled the same analysis applied here.

Remand. The court said it had the necessary discretion to remand the consumer’s injunctive relief claim, as the consumer requested, to the California Superior Court. PG argued remand was impossible because it had affirmatively waived an adequate-remedy-at-law objection. However, the case PG cited against remand was limited to instances in which a plaintiff files a lawsuit in state court seeking only equitable relief with proper removal to federal court. The consumer here sought more than equitable relief.

The court instead analyzed whether the consumer would be barred from seeking injunctive relief in state court. The court saw that the consumer expressed no concern about such preclusion. The court therefore dismissed the consumer’s request for injunctive relief without prejudice.

The Case is No. 3:25-cv-01305-TWR-VET.

Judge: Robinson, T.

Attorneys: Craig Wallace Straub (Crosner Legal, P.C.) for Valerie Perkins. Keri E. Borders (King & Spalding LLP) for The Procter & Gamble Co.

Companies: The Procter & Gamble Co.

Cases: Advertising StateUnfairTradePractices CaliforniaNews