Tuesday, May 26, 2015

"Commercial advertising and promotion" can't be conclusorily alleged

Jus Punjabi, LLC v. Get Punjabi Inc., 2015 WL 2400182, No. 1:14–cv–3318 (S.D.N.Y. May 20, 2015)
Jus Punjabi, a cable and satellite television network serving the U.S. Punjabi community, sued Get Punjabi, a rival television network.  Jus Punjabi allegedly introduced daily live programming—otherwise unavailable to Punjabi viewers in the U.S.—covering news and current events, swiftly building a reputation as a premium channel.  Defendants allegedly undertook a scheme to defraud and destroy Jus Punjabi, stealing confidential information and trying to appropriate Jus Punjabi’s business, including broadcasting “copycat” live call-in news shows, each starting 30 minutes before each of Jus Punjabi’s identically-formatted shows aired.
Jus Punjabi sued for violations of RICO, the Lanham Act, and state law tortious interference and breach of contract.  The RICO claims failed because they were RICO claims.
The court turned to whether Jus Punjabi had alleged “advertising or promotion.”  The touchstone is an organized campaign to penetrate the relevant market.  “Proof of widespread dissemination within the relevant industry is a normal concomitant of meeting this requirement.” Interestingly, the court reformulated the usual test to completely eliminated the now-dubious “by a competitor” requirement, making it into: “(1) commercial speech; (2) for the purpose of influencing consumers to buy defendant’s goods or services; and (3) although representations less formal than those made as part of a classic advertising campaign may suffice, they must be disseminated sufficiently to the relevant purchasing public.”
Jus Punjabi failed to plead “advertising or promotion.”  It alleged that three people gossiped about Jus Punjabi’s founder and that one told others in the Get Punjabi offices that she was “scamming everyone, she is slick and a cheat.” Those statements were plainly not commercial advertising or promotion.  Jus Punjabi also alleged that defendants “defamed and maligned Ms. Sandhu and Jus Punjabi with its advertisers and with cable and satellite providers in order to divert revenue to defendants.” Even assuming that the relevant “consumers” were advertisers and cable and satellite providers [which I think is a reasonable assumption], Jus Punjabi didn’t allege any particular false statements made, nor did they allege sufficiently widespread dissemination to qualify as “commercial advertising or promotion.”
Jus Punjabi alleged that “[d]efendants’ corrupt activities also included extensive advertising and marketing campaigns to disparage plaintiffs’ good[s], services and business operations and integrity,” but these were mere “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements” that the Supreme Court has said are insufficient to state a claim.
Without federal claims, the court dismissed the state claims.

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