Caltex Plastics, Inc. v. Shannon Packaging Co., 2015 WL 3407889, No. 2:13–cv–06611 (C.D. Cal. May 27, 2015)
Caltex makes polyethylene bags and laminated products for military and electronics. Shannon competes with Caltex. The Department of Defense has a Qualified Products List (QPL), which lists products that the DOD has approved to be used in Defense Department contracts that require a “qualified” product. Caltex has a product on the QPL for a particular specification (Type III, static shielding), and this is presently the only qualified product for that specification. There was no evidence that Shannon ever said that its products were on the QPL or that they were DOD-qualified. Its data sheets previously said that its competing product was “[d]esigned to meet the performance of [the Type III standard].” Shannon stopped saying this, and, when it accepts an order, now advises the customer that its bags are not on the QPL. Shannon’s previous representation was based upon the results of testing Shannon conducted of its material, or which a third party conducted on behalf of Shannon of its material; Caltex did not test them for this litigation.
The court, not interested in implicature, found that Shannon’s claim of “designed to meet the performance” of the QPL standard wasn’t literally false just because Shannon’s product wasn’t on the QPL. Even assuming that Shannon’s statement was an establishment claim, Caltex didn’t prove that the bags weren’t “designed” to meet the standard, or that Shannon didn’t test them through the DOD-approved test method. Lack of substantiation is itself not actionable under the Lanham Act. Nor was there evidence of consumer deception, so that was it.