Products Liability Law Daily Wrap Up, WARNINGS ISSUES—Dietary Supplements—W.D. Wash.: Injury-in-fact element satisfied upon allegations of exposure to undisclosed NDIs, (May 27, 2025)

By Jeffrey H. Brochin, J.D.

A purchase of “all natural” supplements later found to contain amphetamines satisfied the injury-in-fact element for standing where the product’s formula contained New Dietary Ingredients (NDIs) not listed.

A federal district court in Washington has denied the motion to dismiss filed by Brand Nutraceuticals, Inc. and Brand Packaging Group, Inc., (Brand) in a lawsuit brought by a consumer who was allegedly exposed to amphetamines in the non-prescription supplements manufactured by Outliers, Inc. (d/b/a Thesis Nootropics or Thesis) and marketed by the companies. The consumer subsequently failed a military drug test, lost her promotion, was dismissed from the military, and suffered numerous other injuries as a result of exposure to the New Dietary Ingredients (NDIs) not listed in the ingredients. The court found that such injuries satisfied the injury-in-fact element for Article III standing, and, that it was not necessary to rule on the issue of punitive damages at the pleading stage (LeDoux v. Outliers, Inc., No. 3:24-cv-05808-TMC (W.D. Wash. May 16, 2025)).

Army nurse anesthetist. The consumer worked as a Certified Registered Nurse Anesthetist at a U.S. Army base working “long” hours and sometimes “struggled with concentrating, remaining focused, alert, and awake during and after surgery.” She came across several advertisements for Thesis’s Formula Nootropic Supplements which represented that the supplements were a “safe, all-natural, better alternative” to prescription stimulants, such as Adderall. The consumer read the published ingredients list, decided to purchase the supplements, and subscribed to monthly subscriptions.

Failed drug test. As an army nurse, she was subject to random drug screenings for controlled substances consumed without a valid and current prescription. She submitted a urine sample on August 16, 2021, for which she tested positive for the presence of amphetamines. The military began an investigation into her drug screen results, which included the appointment of a Medical Review Officer (MRO) who inquired as to prescriptions not included in military records. She provided a list of over-the-counter substances she was taking then, but without a prescription for amphetamines, she could not explain the cause of her positive result.

What followed next was a military criminal trial resulting in her losing her eligibility for a promotion from Major to Lieutenant Colonel, being “administratively flagged,” and made to leave the military before the expiration of her mandatory retirement date. She also suffered the loss of her full pension from the military, and “millions in bonuses, pay, and other military benefits.” In addition, she was forced to participate in an “Impaired Provider Program” at the military hospital where she worked and was directed to attend the Army Substance Abuse Program, and, had her security clearance revoked. She expressed a fear that her state license to work as a Certified Registered Nurse Anesthetist would be revoked, and she was indexed in the National Crime Information Center (NCIC) database. Upon discontinuing the supplements, she allegedly suffered physiological withdrawal effects such as depression combined with cravings and dependency symptoms. She was later diagnosed with severe clinical depression, suicidal ideation, and post-traumatic stress disorder.

Challenge to Article III standing. The consumer filed suit under Washington’s Consumer Protection Act (CPA), and the Washington Product Liability Act (WPLA) for negligence; unfair trade practices; failure to warn; design and manufacturing defect; breach of warranty; and misrepresentation and fraud. Following amendment of her complaint and early discovery, she added claims that the Formula Supplements contained NDIs not listed in the ingredients, some of which have not been verified as safe for human consumption, while others have been identified “as a drug that is possibly marketed outside the United States” but not approved for use as a drug in the country. Had she known of the contents, she would not have purchased the product.

The companies moved to dismiss arguing that the allegations regarding NDIs suffer a “fatal problem” in that they failed to allege any adverse effect, injury, or damage resulting from her alleged exposure to NDIs, and that the consumer asserted no palpable and distinct harm from her alleged exposure to NDIs. Accordingly, they claimed that the allegations concerning the NDIs failed to meet the requirements for Article III standing. They also argued that punitive damages for claims under the CPA and WPLA were prohibited because they were not authorized by statute; and, in their reply they raised a new preemption argument: that the claims sound in federal Food, Drug, and Cosmetics Act (FDC Act) violations and were therefore preempted because the FDA has sole authority to enforce the FDC Act.

Several injuries suffered. The court disagreed with the companies, finding that the consumer sufficiently alleged several injuries she suffered from exposure to the NDIs, and alleged that had she been truthfully informed of the contents of the supplements, she would not have purchased or used the products. The court referenced a Ninth Circuit ruling that clarified that, where a party purchases something because of a company’s misrepresentations about the product—but would not have if he or she had known the truth—then economic injury has been shown, and such economic injury is clearly a sufficient basis for standing. Accordingly, an injury-in-fact was established at the pleading stage.

The court next turned to the contention that the consumer could not assert punitive damages because her claims were brought under the CPA and WPLA—statutes that do not allow for punitive damages. However, the consumer referenced the fact that the CPA authorizes “exemplary damages,” and, at the court’s discretion, treble damages upon appropriate findings. The court agreed that because the CPA allows both actual and treble damages, the CPA claim need not be dismissed.

Possible conflict of laws. As to the WPLA claim, the consumer contended that a conflict of laws issue existed because New York (state of residence of the companies) did allow for punitive damages under such statutes, and, that the “most significant relationship” test instructed as to the issue of punitive damages. However, the court found that it need not resolve the question at the current stage because the Washington State Supreme Court “is wary to dismiss questions that turn on a choice of law at the Rule 12(b)(6) stage,” and because the conflict of laws analysis in a given case depends upon the underlying facts of that case, which here, had yet to be developed.

FDA preemption. As to the companies’ FDA preemption argument, the court rejected that due to the issue being raised for the first time in reply, it being well established that new arguments and evidence presented for the first time in reply are waived.

The case is No. 3:24-cv-05808-TMC.

Judge: Cartwright, T.

Attorneys: Jocelyn Christine Stewart (Law Offices of Jocelyn C. Stewart Corp.) for Joann LeDoux. Christian McGuire (Murphy Ball Stratton LLP) for Outliers Inc. d/b/a Thesis d/b/a Thesis Nootrpics d/b/a Find My Formula d/b/a Formula.

Companies: Outliers Inc. d/b/a Thesis d/b/a Thesis Nootrpics d/b/a Find My Formula d/b/a Formula

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