Monday, December 07, 2015

Court mashes up Dastar and commercial speech doctrine to protect book from Lanham Act

Keel v. Axelrod, No. 15-1507, 2015 WL 7733973 (E.D. Pa. Dec. 1, 2015)
 
Political operative David Axelrod wrote a book, Believer: My Forty Years in Politics. Frank Keel, a political and media consultant, sued under state and federal law for reverse passing off, claiming that Axelrod falsely took credit for political consulting during the 2003 reelection campaign of former Philadelphia Mayor John F. Street, which Keel identified as a pivotal moment in his consulting career.  Street was in a close race with his Republican challenger, Katz, when members of the Philadelphia Police Department discovered an FBI listening device in Mayor Street’s City Hall office, reportedly placed there as part of a “federal investigation into City Hall corruption.”  The media wanted to know why Street was the target of an FBI investigation, and Street held an impromptu press conference, where he assured the public he had “done nothing wrong.”
 
In the hours after this press conference, Keel allegedly proposed, “[a]s part of the consulting services he was providing to Mayor [Street],” that the campaign “publicly announce that the bug was part of a ‘Republican dirty-tricks’ strategy” from high in the George W. Bush administration.  Keel alleged that he “conceived and implemented” the “Republicans Did It” strategy on his own, without any “input or involvement” from Axelrod.
 
Axelrod’s book, by contrast, says:
 
As we approached the final month of the campaign, I got a call from George Burrell, Street’s savvy political deputy at City Hall.
“I think we have a problem.”
“Problem?” I asked warily.
“Yes, it seems we’ve found a bug in the mayor’s office.” “A bug?”
“Yes, a listening device.”
“And who do we think this bug belongs to?” I said. I really didn’t have to ask, but was hoping against hope for an unexpected explanation.
“It appears to belong to the United States government,” Burrell said, slamming the door on my wishful thinking.
Four weeks before the election, the news would be filled with headlines about a federal investigation of the mayor and his administration. It struck me, as I thought about it, that this was our problem but also our opportunity. In an overwhelmingly Democratic town, a probe launched by the Republican Justice Department in Washington would surely be greeted with skepticism, perhaps even outrage. I called Burrell back. “We need to hold a press conference on the steps of City Hall and accuse John Ashcroft of trying to steal this election.” (Attorney General Ashcroft, a well-known conservative ideologue, was highly unpopular among Democrats.) When Street confronted reporters, frantic over the news, he came armed with a line I had written for him: “I’m happy to speak into a microphone I can see!”
 
Keel alleged that, in fact, right after the press conference, Axelrod demanded that Keel “immediately” stop implementing the “Republicans Did It” strategy. Keel also alleged that Axelrod “plainly also intended the book to provide advertising for promoting his political consulting business,” which was still active, and that he and Axelrod competed for potential clients.  The publisher was allegedly contributorily liable for failing to fact-check.
 
Why not just Dastar this?  The court mentions Dastar, but uses its general rationale that there’s a need to limit the scope of the Lanham Act to harmonize with the requirement of a majority of circuits that there be a “threshold commercial element” to the defendant’s activity.  True, the Second Circuit has indicated that “use in commerce” is broader than “commercial speech,” United We Stand America, Inc. v. United We Stand, America New York, Inc., 128 F.3d 86, 92–93 (2d Cir. 1997) (Lanham Act isn’t limited to “profitmaking activity”).  But all the relevant cases “involve trademark name infringement or the direct solicitation of clients, neither of which have been pleaded here.” Apparently, uses on the front cover of a magazine and online “present a much greater risk of deceiving potential customers as to the proper origin of the slogan than the facts presented in this case.”   Direct solicitations to potential customers can be “use in commerce,” but “a single passage in a nationally marketed book cannot be viewed as a direct solicitation of services to specific clients,” and anyway the book didn’t refer to any trademarked services of Keel, so even in the Second Circuit this claim wouldn’t work.  [This reasoning is extremely shaky, because it doesn’t explain why trademark infringement gets to cross the commercial speech barrier but other causes of action don’t. Not to mention its indifference to the head of §43(a) under which this claim is brought—either reverse passing off is actionable or it’s not, and if passing off would be actionable under the same circumstances I can’t see why the court’s logic works--nor, of course, should passing off be actionable even if the passage had stated that Axelrod was endorsed/sponsored by Keel.] 
 
The Third Circuit has yet to impose an explicit commercial use requirement, but the allegedly misleading use “must have a clear, promotional purpose to attract customers.” Also, a number of district courts in the circuit have found that “[t]he Lanham Act regulates only commercial speech.” Other district courts in the Third Circuit have also found that claims under the Lanham Act must concern commercial speech.  Here, there wasn’t “quasi-commercial activities such as trademark infringement or the direct solicitation of clients,” so Keel needed to plead commercial use.

Lanham Act disputes between nonprofits are actionable, but “commercial use” doesn’t depend on the legal status of a defendant.  Instead, it requires promotional use of the plaintiff’s proprietary material. Trademark infringement or the direct solicitation of customers “are clear, promotional and advertising activities.”  [This is the wrong way to the right result, because trademark infringement is only “clearly” promotional if you (a) sufficiently constrain what you’re willing to call infringement (a desideratum in itself, but achieved via Rogers or some other means that itself requires application of commercial speech doctrine), or (b) adopt a circular definition: that which causes confusion is by definition promotional.  (b) should lead you to the same holding with respect to other kinds of falsity with commercial effects, though.]
 
So, was the book passage in question commercial speech?  Under Third Circuit precedent, this question involves a “commonsense distinction between speech proposing a commercial transaction...and other varieties of speech.” Compared to the special on an upcoming NFL video game that the Third Circuit found was an ad in Facenda, the passage in Axelrod’s book didn’t note the availability of his consulting services, nor did it describe unique features of his services.
 
Keel argued that the unique nature of political consulting made false credit claims actionable, citing Gensler v. Strabala, 764 F.3d 735 (7th Cir. 2014).  Though both political consultants and architects rely on their records to acquire customers, “Gensler is distinguishable from the facts of this case because of the defendant’s commercial use of proprietary material.”  [Again, this is a classic example of letting property rhetoric distort analysis—yet so unnecessary to the outcome!  It doesn’t even work, conceptually: since Axelrod is describing the services he provided (according to him), then to the extent that his services also have a reputation he is using “proprietary material” in the sense that the court means it.  It’s “commercial” that’s doing the work here, because Gensler involved the defendant’s use of claims on his business website and associated Flickr account.]  Thus, it was unnecessary to reach the question of whether a reverse passing off claim based on services survived Dastar.
 
“[C]ommunications made primarily for expressive purposes, like the political and narrative purposes of Believer, enjoy broad First Amendment protection, and therefore, are generally not actionable under federal statutes such as the Lanham Act” [citing, among others, Citizens United].  Only if Axelrod plausibly wrote Believer to promote his consulting services to potential clients would his speech be actionable.  Although Axelrod had an economic motivation to sell as many copies as possible, that doesn’t make the contents of the book commercial speech.  The specific disputed passage also lacked an obvious economic motivation to further Axelrod’s political consulting services.  (The court expressed doubt whether the passage even referred to Axelrod’s services, though I think it did; the passage did not, of course, refer to Keel’s services.)
 
Most troublesome, however, was that the excerpt simply wasn’t an ad: “a message with a clear, promotional purpose.” Believer didn’t explicitly tout the availability of Axelrod’s consulting services, and couldn’t fairly be characterized as an “infomercial.”  This contrasted to “the unauthorized use of a trademarked name in a prominent location, such as the front cover of a magazine, or in the domain name for a business website,” which could be deemed ads.  Instead, Believer expressed Axelrod’s political views, and the challenged excerpt was a biographical anecdote.
 
Keel also didn't allege other facts linking Believer to the promotion of Axelrod’s consulting services. He didn’t allege that Axelrod solicited clients at his book signing or otherwise stated that Believer was a marketing tool.  And now we’re back to Dastar, mushing together the predicate “commercial advertising and promotion” with the substance of the claim: if attending book signings were enough to trigger a Lanham Act claim, then any number of authors could be held liable for mischaracterizations of past events; but requiring “this degree of accuracy in crediting strategies, ideas, and/or services mentioned in a larger expressive work” would be the Dastar-barred “search for the source of the Nile and all its tributaries.”

No comments: