weak infringement case + bad litigation conduct = fee shift for anticompetitive suit over descriptive term

BBK Tobacco & Foods LLP v. Central Coast Agriculture Inc., No. CV-19-05216-PHX-MTL, 2026 WL 2445019 (D. Ariz. Aug. 20, 2026)

Previously. Although BBK forced Central Coast to an (expensive) trial on its very weak infringement claims over the use of “raw” on smoking-related products, it is now subject to a fee award. “[W]hen a company pushes flimsy legal arguments with scorched-earth, win-at-any-expense litigation to bully its competitors into submission,” it harms consumers by raising prices. “In about two hours, after a two-week trial, the jury returned a verdict fully in favor of Central Coast,” finding no infringement based on the shared word “raw.” “The jury’s verdict makes perfect sense, since the trademarks have nothing else in common other than this three-letter combination. Tellingly, BBK could not introduce a single instance of actual customer confusion.”

But it took over seven years, plus a trip to the Ninth Circuit and the aforementioned jury trial, to get there.

Central Coast (CCA) was the prevailing party because it is now free to use its RAW GARDEN mark without the threat of an infringement suit by BBK. Even though BBK succeeded in voiding CCA’s pending intent-to-use applications, both parties were free to use the marks just as before, and defeating CCA’s cancellation counterclaims left BBK’s registrations just as they already stood. By contrast, “[h]ad BBK prevailed on the infringement claims, CCA would have faced damages and an injunction against its Raw Garden brand, and the defense verdict removed that exposure.” BBK’s successful defense of CCA’s counterclaims didn’t make it a prevailing party, because CCA succeeded on the infringement claims that drove the litigation.

Octane Fitness provides that “[a]n ‘exceptional’ case is simply one that stands out from others with respect to the substantive strength of a party’s litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated.”

BBK argued that the court of appeals, in reversing the initial grant of summary judgment already found the Sleekcraft factors “evenly matched or tip[ped] only slightly in favor of either party” and remanded for trial, foreclosing any finding that its position was weak. But that’s not what the court of appeals did—it said that likely confusion “is a factual question ordinarily reserved for the trier of fact.” (See Sepehr Shahshahani’s useful Fact-Law Confusion for why this is a silly thing to say.) The Ninth Circuit’s “evenly matched” observation “established only that the question could not be resolved on summary judgment … and, in any event, it described a summary judgment record rather than the proof ultimately presented at trial.” Nor was the panel even unanimous on that point.  

“And this Court, having presided over a two-week trial and observed the evidence develop live before the jury, is well positioned to assess the strength of the merits of BBK’s arguments.” The trial bore out all the weaknesses in the central factors. For example, there was no evidence of actual confusion, even though the RAW and Raw Garden brands had been sold in some of the same California dispensaries together for more than five years. “The absence of actual confusion over so lengthy a period of concurrent use in the same market is itself powerful evidence that confusion is unlikely.”

Nor was this unclear to BBK until trial. At summary judgment, the Court found the record “contain[ed] no evidence of actual instances of confusion,” and that the relevant deposition testimony of BBK’s founder was “uncorroborated and self-serving” and insufficient even to create a triable issue, particularly because BBK’s own Rule 30(b)(6) witness was unaware of any confusion. “That BBK could marshal no more than this, after years of head-to-head sales in the same dispensaries, strongly indicates confusion was not occurring.”

BBK’s affirmative confusion evidence came from a survey that produced net confusion rates of roughly 11.9 percent. Rates in that range are “not so high as to constitute persuasive evidence in favor of confusion,” and “survey confusion numbers that go below 20% need to be carefully viewed against the background of other evidence weighing for and against a conclusion of likely confusion.” Weighed against the marks’ visual dissimilarity and the lack of other evidence of confusion, the survey did not show that confusion was “probable, not simply a possibility.”

Nor was BBK’s position on mark similarity justified. “Marks must be compared as a whole and as they appear in the marketplace, rather than by taking a deconstructionist view of the different components of the marks, and across appearance, sound, and meaning.” Apart from the shared descriptive term “raw,” the Court found the marks “visually...not similar” and possessed of “significantly different commercial impressions,” such that “consumers could readily distinguish between the parties’ products as they appear in the marketplace”—a dissimilarity that “weigh[ed] strongly against a likelihood of confusion.”

But this was not the sole reason to find exceptionality, merely a factor weighing in favor of it.  [Comment: if we’re almost never going to allow TM cases to be rejected at summary judgment, then a fee shift for pressing ahead with an expensive trial despite clear weakness in the case is one of the few remaining constraints on abusive litigation, and should be available even in the absence of litigation misconduct. But that’s a worse solution than just actually applying the summary judgment standard.] “The manner in which BBK litigated this case supplies the additional showing that, combined with the weakness of its proof, makes this case exceptional.”

Most significantly, BBK relied on a photograph of a purported Raw Garden product bearing RAW-branded cones, and the Court sanctioned BBK’s counsel under Rule 11 for advancing allegations about that photograph “that counsel must have known were false.” There was no evidence that BBK itself fabricated the photograph, but counsel had been repeatedly warned was not genuine, “and a party’s counsel’s conduct is properly considered in the exceptional-case analysis. Knowingly pressing fabricated evidence to defeat summary judgment is the sort of conduct that makes a case stand out from others.”

That wasn’t the end of it.

BBK introduced, both before and during trial, late-disclosed evidence of supposed actual confusion that it had never produced in discovery, including an affidavit dated years after the close of fact discovery and testimony that roughly fifty people had approached [its principal] expressing confusion. That testimony was at odds with BBK’s own verified discovery responses, in which it had repeatedly denied awareness of any actual confusion. A litigant’s reliance on confusion evidence it withheld through discovery and sprang at trial supports an exceptional-case finding.

This litigation conduct reinforced the court’s conclusion that BBK “pursued scorched-earth tactics aimed at securing exclusive rights to the ordinary word ‘raw.’” The court noted “BBK’s broader litigation practice of strong-arming other companies out of using the term.” It repeatedly threatened and sued businesses that incorporated “raw” into their marks. “Trademark law does not exist to let a single company annex a common, descriptive word and wield costly infringement suits to keep competitors from using it.” Octane Fitness allows the court to consider anticompetitive motive. “The trial record indicates that part of BBK’s aim was to position itself to claim the ‘raw’ name for its own use as the cannabis market moves toward national legalization.”

CCA got over $2.5 million in fees, less than half of what it requested. So BBK was still able to impose a lot of costs on it.

use of (R) on goods for which mark is not registered might be literally false

Southern Marsh Collection, LLC v. Dixie Decoys, LLC, 2026 WL 2431220, No. 24-00905-BAJ-EWD (M.D. La. Aug. 19, 2026)

This opinion deals only with defendant’s attempt to get claims against its allegedly false use of the ® symbol dismissed; it is otherwise a trademark and copyright infringement case. Southern Marsh sells a variety of outdoor apparel and accessories using a duck-style logo; it has several registrations for its trademarks, including the logo and the slogan “PRESERVE THE TRADITION.” Dixie Decoys allegedly uses a registered mark for its outdoor apparel that is confusingly similar to Southern Marsh’s, as well as “Preserve the Sporting Tradition” and “Preserve Your Sporting Tradition,” which allegedly infringes.

Southern Marsh duck

Decoy duck

These are really weak, anticompetitive claims, but the usual deference given to trademark claims here extends even to the false advertising claim based on misuse of the ® symbol, which is that Dixie Decoys does have a registration for the logo, but only for “Waterfowl hunting decoys.” Nonetheless it uses the ® symbol more broadly.

The court found that general allegations of harm to Southern Marsh’s reputation and goodwill sufficed to plead both standing and sufficient harm to survive a motion to dismiss. That is, let’s say, unusual in false advertising cases. I tell my students to tell, and challenge, “harm stories,” but other than reciting the word “harm,” there is no harm story here. People might believe that Dixie Decoys has a trademark registration for its logo for apparel and … what? True underpants gnomes reasoning here.

The court also rejected Dixie Decoys’ argument that the use wasn’t literally false because there was a registration. “Federal trademark registration is not totally untethered from the goods or services identified in the registration, as Dixie Decoys contends…. [G]iven that federal trademark registration rights are goods-specific, this Court similarly finds that Southern Marsh has plausibly alleged that Dixie Decoys’ use of the ® symbol next to the challenged marks on goods outside of the registration could be a literally false statement of fact.” Thus, no evidence of deception was required, and anyway Southern Marsh alleged that consumers were deceived, which was enough at the pleading stage. [Materiality?]

Midjourney can't force Disney to disclose the prompts it used that didn't generate material in complaint

Disney Enterprises, Inc. v. Midjourney, Inc., No. 2:25-cv-05275-JAK-AJR, 2026 WL 2055488 (C.D. Cal. Jun. 15, 2026)

This is what seems like a significant discovery dispute; I’m not an evidence scholar, but there’s interaction with the fair use analysis that copyright folks should attend to.

Plaintiffs sued Midjourney over its image and video generation “diffusion models,” arguing that they infringed both by copying their characters in training and by distributing copies of those characters in images and videos to Midjourney subscribers.

Midjourney sought to compel plaintiffs to produce: “(1) documents concerning their development, use of, and policies regarding generative artificial intelligence (‘AI’) tools for image and video creation, and (2) the complete set of Midjourney prompts and outputs that Plaintiffs (or their agents) used” for the operative complaint. The court granted the request in part for (1) but found (2) was privileged.

Plaintiffs objected to producing documents about third-party datasets they used in connection with any AI tool and similar documents. They agreed to produce nonprivileged responsive documents “sufficient to show instances in which [Plaintiffs] authorized its employees or contractors to use generative AI to generate images and/or video outputs intended for consumers, featuring the asserted works.” As for the prompts, they agreed to produce nonprivileged responsive documents “sufficient to identify the prompts used to create the image[s] generated by Midjourney shown in the complaint and put at issue in this action, and the side-by-side outputs contemporaneously generated in response to such prompts,” but not the prompts that they didn’t choose to include.

Midjourney argued that these discovery requests were relevant to both its defense of fair use, as well as its equitable defense of unclean hands.

Fair use: Midjourney argued that its requests bore on multiple elements of fair use, including transformativeness. But the court didn’t buy its argument that, “if Plaintiffs are developing and deploying diffusion models (employing the same technology, training techniques, and public data as Midjourney), that is a powerful concession that such models produce something fundamentally new and useful—relevant evidence of the transformative nature of that (and Midjourney’s) technology.” After all, Warhol says “the same copying may be fair when used for one purpose but not another.” [But this would be the same purpose, just a different user, no?] The SDNY has agreed that “the relevant inquiry under the first fair use factor concerns a defendant’s use of a plaintiff’s copyrighted material, not a downstream use of defendant’s allegedly infringing material by a copyright-holder plaintiff.” In re OpenAI, Inc., Copyright Infringement Litig., 800 F. Supp. 3d 602, 608 (S.D.N.Y. 2025). Likewise, New York Times Co. v. Microsoft Corp., 757 F. Supp. 3d 594 (S.D.N.Y. 2024), held that the fair-use factors “do not require a court to examine statements or comments a copyright holder may have made about a defendant’s general industry, whether the copyright holder has used tools in the defendant’s general industry, whether the copyright holder has admitted that other uses of its copyrights may or may not constitute fair use, or whether the copyright holder has entered into business relationships with other entities in the defendant’s industry.”

Public benefits (part of factor four after GvO): But GvO “made clear” that balancing the public benefits against the losses to copyright owners would not “always [be] relevant to the application of fair use,” and focused on the consequences of Google’s copying, not anything that the plaintiff (Oracle) did in its own business.

Nor was this evidence relevant to market harm. Relevant discovery would include the loss to plaintiffs and how the challenged use might “kill demand for the original,” as well as discovery directed to Midjourney concerning the public benefits from the copying.

What about industry custom and practice? Wall Data Inc. v. Los Angeles Cnty. Sheriff’s Dep’t, 447 F.3d 769, 778 (9th Cir. 2006), says that courts “should bear in mind that fair use is appropriate where a reasonable copyright owner would have consented to the use, i.e., where the custom or public policy at the time would have defined the use as reasonable.” But that’s dicta. [This is contrary to what one might have thought was happening two decades ago.] Sure, “industry custom and practice may be relevant to the analysis of fair use in a particular case,” but “courts consistently reject the argument that ‘everybody else is doing it’ as a defense to copyright infringement.” This is really about the (narrower) defense of unclean hands.

But the equitable defense of “unclean hands is recognized only rarely, when the plaintiff’s transgression is of serious proportions and relates directly to the subject mater of the infringement action.” Indeed, “the alleged wrongdoing of the plaintiff does not bar relief unless the defendant can show that he has personally been injured by the plaintiff’s conduct.”

Thus, plaintiffs’ development, use of, and policies regarding generative AI were not relevant to the defense of unclean hands because none of the discovery would establish inequitable conduct that is both directly related to plaintiffs’ claims and injured Midjourney. [Other than through preventing competition with this lawsuit.]

Still, the requested discovery was potentially relevant to establishing: (1) the potential market for or value of the copyrighted work; (2) industry custom and practice; and (3) the defense of unclean hands. But plaintiffs agreed to produce documents sufficient to show their business plans, roadmaps, research reports, other studies, and approvals of their actual or proposed development or training of generative AI intended for consumers, including their contractors’ authorized use of generative AI intended for consumers, as well as documents about some related matters. That was enough. Documents related to the actual or proposed development of generative AI not intended for consumers were not relevant, or not enough to be proportional. However, the court granted the motion to compel plaintiffs to also produce documents sufficient to show plaintiffs’ approval of the use of generative AI to generate images and/or video outputs intended for consumers, featuring the asserted works, which is relevant to the market-harm factor.

Requests for training-related documents had some relevance to establishing industry custom and practice, but had to be narrowed to focus on actual or proposed development of generative AI intended for consumers. “By contrast, Plaintiffs’ training of generative AI tools not intended for consumers would not provide evidence of industry customs and practices that would be relevant to Defendant’s defense of fair use,” or, if relevant, not enough to justify the burden of production. Thus, plaintiffs needed to produce non-privileged responsive documents sufficient to show their “development, training, or contemplated development or training of any generative AI to generate images and/or video outputs intended for consumers, featuring the asserted works, including training datasets, datasources, or model weights.”

Midjourney prompts: Plaintiffs agreed to produce documents sufficient to identify the prompts used to create the images generated by Midjourney shown in the operative complaints, as well as the side-by-side outputs contemporaneously generated in response to such prompts.

Midjourney argued that “withholding prompts and outputs related to images not used in the operative complaints would allow Plaintiffs to artificially inflate the universe of allegedly infringing outputs, distort the damages calculus, or misrepresent their own engineered images as examples of third-party infringement.” But “the volume of prompts and outputs related to images generated for potential use in the operative complaints, but not actually used, is infinitesimal compared to the true scope of this case which involves tens of millions of subscriber prompts associated with Plaintiffs’ copyrighted works.” Given the current statistical sampling protocol that the parties are finalizing, withholding the prompts wouldn’t distort a damages award.

The non-used prompts and outputs were protected work product.  The work-product doctrine protects “from discovery documents and tangible things prepared by a party or his representative in anticipation of litigation.” This was “classic” pre-suit investigation and efforts to prepare the operative complaints. Such unused prompts and outputs were “core” work product because they necessarily reveal counsel’s “mental impressions, conclusions, opinions, or legal theories developed in anticipation of litigation.” This kind of opinion work product “is virtually undiscoverable.” 

Midjourney argued that plaintiffs waived protection by submitting prompts to Midjourney in the first place because Midjourney’s Terms of Service make prompts and outputs public by default and grant Midjourney a license to reproduce, prepare derivative works of, publicly display, publicly perform, sublicense, and distribute their inputs. But “waiver of attorney work-product protection requires more than the disclosure of confidential information, it requires an act inconsistent with the adversary system.” Pre-suit investigation was not inconsistent with the adversary system. Nothing stops Midjourney from conducting its own investigation of prompts submitted by plaintiffs and their counsel, though.

“Accepting Defendant’s view of selective disclosure would virtually eliminate the protection for attorney work product in the context of any court filing because every court filing inherently reflects strategic choices of counsel in what facts to include and even what legal arguments to make.”

Comment: If you believe, as many people seem to, that “how hard was it to get the model to generate an allegedly infringing output?” is a relevant question, then the rulings here make it harder to conduct that inquiry. I’m no evidence expert, but the ruling seems to make probabilistic/guardrails inquiries off-limits to fair use, which seems directionally wrong to me. (Burden-shifting might help—one could say that if the defendant puts in evidence that it tried to make it hard to generate infringing outputs, then the plaintiff has to do more to show that those guardrails didn’t work, which wouldn’t necessarily require disclosure of attorney work product. This is my optimistic reading of the reference to the millions of prompts at issue in this case.)

Private label brands show lack of exclusive use for Pedialyte's trade dress claim, but bad social media use saves TM claim

Abbott Laboratories v. Revitalyte LLC, 2026 WL 2374024, No. 23-1449 (DWF/DTS) (D. Minn. Apr. 30, 2026)

The court here allows part of Abbott’s infringement claim to proceed, including against “compare to Pedialyte,” which I think is wrong, though Revitalyte did other sketchy stuff that is less clearly comparative. It rejects Abbott’s trade dress claim, in part because so many house brands have the same or similar trade dress.

The parties compete in the market for oral electrolyte solution (OES), drinks intended to relieve symptoms of dehydration. Pedialyte now expands beyond the pediatric market and is now also sold to adults for illness-and exercise-related dehydration; Abbott briefly advertised it as a remedy for alcohol-related dehydration/hangover. Abbott dominates the OES market with over half of the total sales in the category.

Three kinds of Pedialyte: regular, advanced and sport

It defined its claimed unregistered trade dress as:

the clear rectangular plastic bottle; the bottle’s rounded corners; the placement and appearance of the two ridges or “ribs” around the bottle’s circumference; the placement and appearance of the bottle’s gently sloping shoulders; the bottle volume of roughly one liter; the wrap-around label encircling the middle 50-60 percent of the bottle with the name of the product prominently displayed horizontally; the bright colors of the various Pedialyte flavors as visible above and below the label; the color palette, size, and alignment of the wrap-around label; and the size, color palette, and appearance of the shrink-wrapped screw-on.

Abbott claimed use since 1986, despite slight change in the bottle specifications.

“[C]onsumer research showed that parents and doctors wanted something non-breakable with the ability to see the fluid level. Abbott chose a square bottle shape for the plastic container to mimic packaging from sterile irrigation bottles; the medicinal feel communicated to parents that the product was safe and trusted for medical purposes. Abbott also added the shrink-wrap cap to show the consumer if the product had been tampered with.” [There's more functionality evidence but it is irrelevant.]

Revitalyte targets young adults seeking relief from alcohol-related dehydration. “The link with alcohol abuse and other off-color themes is explicit in the company’s marketing. Its social media pages are rife with references to excessive drinking, hangovers, and partying.”

In the original Revitalyte bottle, the shrink-wrapped cap included the text “Compare to Pedialyte.” The back of the wrap-around label included a disclaimer that Revitalyte was not associated with Pedialyte. Revitalyte also partnered with Barstool Sports on Revitalyte Black Label. Revitalyte initially used PBM Nutritionals as its manufacturer; PBM designed and supplied the bottle itself (it didn’t offer different shapes), the placement of the label, the shrink-wrapped cap, and the “Compare to Pedialyte” language. PBM had a trademark registration for its “block shaped bottle.” “Revitalyte could have further customized by removing the ‘Compare to Pedialyte’ on the shrink-wrapped cap, but chose not to because it would have been more expensive.”

private label with "compare to Pedialyte" on cap

Since 2024, Revitalyte has sold only 20-ounce products and no longer uses PBM as a manufacturer.

current bottle

Revitalyte’s admitted goal was to be an adult version of Pedialyte— “the same product but purchased in the liquor store instead of having to go to the baby aisle.” It used a square bottle to communicate that the product was part of the OES category by matching the category leader. 

also three kinds of Revitalyte

Also:

Revitalyte’s marketing strategy has leaned into the similarity with Pedialyte®. Revitalyte’s website said it was the “same electrolyte formula found in the baby aisle.” Revitalyte’s website also included screenshots of social media posts discussing Pedialyte® by name. (Further, Revitalyte advertised its products using a comparison to Pedialyte®.)

This resulted in consumer confusion, e.g., a social media post calling Revitalyte “Revitalyte by Pediatlyte.” Other posts called Revitalyte Black Label Barstool’s version of Pedialyte (it’s not obvious to me that reflects confusion, but the court thought so). Revitalyte didn’t shut down this confusion. Instead, it shared those posts on its social media pages. This proved to be a bad plan.

retweet of "Revitalyte is the adult version of Pedialyte"

Retweet of "barstool sports brand pedialyte"

similar

quote post of "like Pedialyte" (which should be fine)

Pedialyte tagged as producer of Revitalyte

Revitalyte used social media posts mentioning Pedialyte

Trade dress infringement: Abbott failed to show that its trade dress was protectable. It had no direct evidence of secondary meaning. “Given that Abbott did commission an expert on a related issue, that omission is telling.” Instead, it relied on its advertising and sales; proof of Revitalyte’s intent to copy; and instances of actual confusion by consumers.

If “advertising promote[s] the product’s functions and appearance, not its source,” then advertising expenditures are not probative. The ads in the record focused on function, e.g., the resealable cap, ability to pour and measure, and visibility of the liquid touted as “conveniences” to parents.

Similarly, sales are probative of secondary meaning only if they can be traced to the use of the claimed trade dress. Abbott’s “sales are impressive, but there is no indication that the trade dress specifically was responsible.”

Intentional copying can indicate secondary meaning, but “when a defendant clearly labels its products with its own trademark, the inference of secondary meaning is rebutted.” The Revitalyte trademark was used conspicuously on the bottle and Revitalyte used an express disclaimer. The evidence suggested an intent to compete, which wasn’t sufficient to establish secondary meaning.

Consumer confusion can also be evidence of secondary meaning. But here, its significance was  “refuted by the ample evidence of third-party products with similar packaging because it shows a lack of exclusive use. When there are similar components used among various products, it is more difficult for a consumer to attribute that feature to any one source.” The PTO told PBM , that the applied-for mark was not inherently distinctive because “it is a common practice in the industry to market electrolyte replacement solutions ... [in] bottles with narrow necks that slope down to straight sides.”

Even more telling, the Pedialyte® bottle design was based off medical irrigation bottles. Any claim that the bottle’s features are indicative of only one source is belied by the fact that the bottle design was initially copied from a different type of product. The ubiquity of the square bottle shape in the OES market and in medical packaging suggests that it cannot be attributed to a single source in the minds of consumers.

Abbott argued that the third-party products were “private label brands,” less likely to confuse consumers. Its evidence here is sealed (grrr) but its consumer expert opined that, because Revitalyte is “branded,” that’s more likely to be confusing. “But regardless of whether consumers think Revitalyte® is a private label or national brand, the market is still saturated” (citing Versa Prods. Co. v. Bifold Co. (Mfg.) Ltd., 50 F.3d 189, 216 (3d Cir. 1995) (“The use of private labelling undermines a claim that a product’s appearance denotes its source, because consumers will be less likely to associate the multifariously labeled product with a single source.”)). Thus, Abbott couldn’t show the exclusive use of the trade dress required to establish secondary meaning.

After all that, “Compare to Pedialyte”—the most standard comparative message there is—kept Revitalyte in trouble, along with its hinky social media. The court noted that defendant didn’t provide much in the way of argument on trademark infringement, making it hesitant to grant summary judgment.

The various factors could support a finding either way: The products are similar (thus, “compare”). The different target audiences and different retail locations cut against likelihood of confusion. There was “ample evidence of Revitalyte’s intent to align with the Pedialyte® name, even purposely rhyming with Pedialyte®, which indicates an intent to ‘pass off’ Revitalyte® as part of Abbott.” But Revitalyte’s use of “compare to” and its own branding indicated an intent to differentiate (ciating Conopco, Inc. v. May Dep’t Stores Co., 46 F.3d 1556, 1571 (Fed. Cir. 1994) (finding that a “compare” statement “draws a clear distinction” between products)). Thus, there was a material question of fact on likely confusion.

[Now, how do we segregate the confusion evidence based on name from that supposedly based on shape/trade dress? There’s going to be a causation problem. “Compare to” isn’t likely to cause confusion, but the online behavior much more plausibly is. But that wasn’t clearly based on the name itself, where the overlap in suffix “lyte” has a pretty descriptive meaning. If anything, the strongest claim is false association under 43(a) based on the online conduct, not even really trademark infringement as such.]

Trademark dilution: Revitalyte conceded the fame of Pedialyte. “The textbook example of trademark dilution by tarnishment is the association of a mark with an unsavory context. Revitalyte readily associates its brand with alcohol abuse and uses a crude advertising approach.” Thus, a fact finder could find tarnishment of Pedialyte, “a product centered on health and, often, children’s health specifically.” But Abbott did, at one point, advertise it as a cure for hangovers, so Abbott’s own attempts to identify with that market would justify a finding that associations with alcohol are not a tarnishment to the brand.  

Revitalyte briefly argued that the use of the “compare to” statement mitigates any risk of reputational harm because consumers know they are separate products. True, comparative advertising is exempted from dilution claims.

But, making up something that isn’t in the dilution provision, “the comparative advertisement exception only applies if the user does not do anything to suggest sponsorship or endorsement.” [So apparently the jury can only find dilution by tarnishment if it also finds confusion? Cool with me, I suppose.] And here,

Revitalyte’s attempts to align with Pedialyte® go far beyond a mere “Compare to Pedialyte” statement on the bottle. There are multiple documented examples of Revitalyte reposting social media posts that describe Revitalyte® as owned by Pedialyte® and Revitalyte did not correct that factual error. In some of those posts, there is either no Revitalyte® bottle or no shrink-wrapped seal, so the comparative language is not present to clarify the lack of a relationship. Those advertisements suggest sponsorship by Pedialyte®, which distinguishes this case from those which allow comparative use.

I hate to borrow a bit from copyright law, but this might be better addressed by a use by use analysis. Under no circumstances should the (not misleading) statement “compare to Pedialyte” ever constitute dilution or be enjoined. But the other uses weren’t comparative advertising and weren’t eligible for that exception.

Abbott also moved to preclude Revitalyte’s rebuttal expert on the “private label” point above. “[R]ebuttal evidence may be used to challenge the evidence or theory of an opponent—and not to establish a case-in-chief.” Id. A rebuttal expert “may only respond to evidence offered by the defendant.”

Though we can’t see it, Abbott’s expert report analyzed whether Revitalyte is better described as a private label brand or a national brand by applying the “4Ps” framework: place, product, price, and promotion and concluded that Revitalyte “exhibits the hallmarks of a national brand.” The report further opined that, as a result of the positioning as a national brand, a meaningful segment of consumers is likely to perceive that Revitalyte is associated with Pedialyte. He didn’t conduct a survey.

The rebuttal report was about a confusion survey that purportedly showed de minimis confusion between Pedialyte and Revitalyte bottles. It didn’t address the issue of national brands versus private labels, nor the 4Ps framework. “Even if using a different approach, [the] rebuttal testimony must have engaged with the 4Ps framework or addressed the central question of national brand versus private label.” Thus this report was excluded.

Given that Abbott was seeking only disgorgement, Revitalyte wasn’t entitled to a jury. [Disgorgement would nicely solve the obvious causation problems, too.]

9th Circuit orders class decertified: common issues on materiality/damages insufficient without deception

Rusoff v. Happy Group, Inc., --- F.4th ----, 2026 WL 2387098, No. 24-7706 (9th Cir. Aug. 17, 2026)

Court’s summary:

This is a deceptive advertising class action concerning “pasture raised” labels on egg cartons. After excluding the opinion of plaintiffs’ expert on egg industry standards, the district court found that plaintiffs’ inability to demonstrate consumer deception on a class-wide basis “precludes a finding of predominance” under Federal Rule of Civil Procedure 23(b)(3). The court nonetheless certified the classes based on assertedly common questions of materiality and damages. Because plaintiffs did not meet the requirements of Rule 23(b)(3), we reverse the grant of class certification.

USDA recognizes caged and cage free eggs; the latter has two subcategories, organic and free range. USDA considers “free range,” “pasture raised,” and certain similar terms to be synonymous. But there are a number of other standards from associations and retailers who operate voluntary certification programs, which egg producers pay to participate in. To these certifying organizations, “pasture raised” is the more stringent standard, so certified pasture-raised eggs tend to command a price premium in the market. But the certifiers’ standards differ, e.g., one requires at least 2 square feet of uncovered outdoor area per hen, while another requires about 22 square feet per hen available for potential use (though only about 5.5 square feet needs to be accessible to the hens at any one time if there’s rotation).

Happy Egg’s egg cartons advertise that its hens are “free range” and “pasture raised on over 8 acres.” Plaintiffs alleged that the more stringent “pasture raised” standards are the dominant industry standards, and that consumers paid a price premium for Happy Egg products based on the company’s implied compliance with these standards (even though Happy Egg did not identify either standard on its cartons).

Plaintiffs’ expert opined that “the prevailing consumer expectation is that an egg producer making a free-range or pasture-raised claim is adhering to the commonly accepted standards pertaining to such claims as set by the AHA or HFAC.” The lead plaintiffs testified that they didn’t know about the standards’ content. The court found that one expert didn’t have a methodology for examining different egg products in Seattle, rather than California or New York (where the class members resided).

There was also a consumer survey expert. The survey results found that using both the “pasture raised” and “free range” labels led consumers to conclude that the eggs were both pasture-raised and free-range, whereas with only a “free range” label, they concluded that the eggs were free-range, but not pasture-raised. The survey did not address whether a reasonable consumer understood “pasture raised” as aligned with either allegedly dominant standards. For materiality, survey respondents were 8.1 times more likely to state a preference for the eggs that included the “pasture raised on over 8 acres” representation.

Thus, plaintiffs’ theory of deception required both experts: the first to show that “pasture raised” had a commonly understood meaning tied to the dominant standards, while the survey would show that a reasonable consumer would understand Happy Egg’s “pasture raised on over 8 acres” claim to mean that its eggs were pasture-raised.

But the district court excluded the first expert, whose methods for assessing what a reasonable consumer would understand—such as photographing egg cartons in stores near his home for his own “personal purposes”—were unreliable, as they “[did] not pass the standards that he would expect of his own survey consultant.” Then, the survey lacked a key foundation piece, and couldn’t prove predominance.

But the district court still certified the class under Rule 23(b)(3) after finding that materiality and damages were common questions that predominated.

The district court correctly excluded the first expert’s opinions as unreliable because they didn’t come from “a rigorous evaluation of how a reasonable consumer understands the term ‘pasture raised.’” As a result, “on the foundational issue of deception, plaintiffs failed to make the required showing.” It wasn’t enough to show that certain industry standards are dominant without connecting that to consumer beliefs.

Plaintiffs responded that deception is governed by an objective “reasonable consumer” standard, which means that all claims by any plaintiff will necessarily rise and fall together. “But in order to reach the reasonable consumer analysis, a plaintiff must first show, on a classwide basis, what deceptive marketing or false advertising a reasonable consumer could have been misled by.” Thus, “[w]here the theory of deception is tied to an industry standard, evidence must be brought forward showing that there is a commonly understood industry standard, and that a reasonable consumer would associate a given representation with that standard.”

Then, the district court erred by not weighing the common issues against the individualized issues and determining whether the common issues are, on balance, important enough to justify class-wide treatment despite the existence of individualized issues. Deception is a central element of the claims. “[O]n this record, the lack of a classwide showing on deception cannot be overcome by supposedly common issues of materiality and damages that are unmoored from any classwide showing of actionable wrongdoing.”

court finds ROP claim preempted where model initially consented to being in ad

Delacruz v. Roc Nation LLC, No. 2:25-cv-11864-AH-(SSCx), 2026 WL 2455107 (C.D. Cal. Jul. 28, 2026)

Should copyright preemption apply to a right of publicity claim where the original, consented-to use of the work was created for advertising? The court here answers yes, although I think I would say no under conflict preemption.

Delacruz is a professional model “whose likeness has been featured in advertisements throughout the world.” Roc photographed her for a fee in connection with an advertising and marketing campaign for Megan Thee Stallion’s Hot Girl Summer swimwear.  She allegedly granted consent only for use in social media, but Roc used her likeness on physical, public billboards. She sued for California statutory and common law misappropriation of her right of publicity and false endorsement/false advertising under the Lanham Act. (A breach of contract claim was apparently dropped.)

The question in the 9th Circuit is whether the use of the likeness forms the basis of a publicity rights claim—if so, it’s not preempted. On the other hand, “merely interfering with the distribution, display, or performance of a copyrighted work” is preempted. While existing precedent “strongly implies that misuse of an individual’s likeness is the ‘basis’ of a publicity-right claim when the name or image is exploited in advertising or on merchandise,” the circuit has considered other factors. For example, where there’s not voice imitation, but rather licensing of an existing sound recording, “the entirety of the allegedly misappropriated vocal performance is contained within a copyrighted medium” and there is preemption. (This is downstream of §301 preemption just being a bad fit for the relevant considerations, as I have argued—the court here, like many before it, mixes and matches statutory and conflict preemption reasoning, not to its benefit.)

The court here also drew on Second Circuit precedent, which looked at whether a plaintiff’s name or likeness was “extracted in any way to appear independently from how it originally appeared” in the works at issue. Melendez v. Sirius XM Radio, Inc., 50 F.4th 294 (2d Cir. 2022). Fleet v. CBS, Inc., 50 Cal. App. 4th 1911 (1996), also found preemption where “the only alleged exploitation occurred through the distribution of the actor’s performance in a motion picture.”

Thus, it wasn’t enough to avoid preemption that the photos were (re)used in commercial advertising when they were created as commercial advertising. Under such circumstances, the plaintiff was objecting to the “ ‘unauthorized distribution and republication of a copyrighted work, not the exploitation of [her] likeness on an unrelated product or in advertising.’ In other words, the entirety of the misappropriated likeness is contained within a copyrighted or copyrightable medium.” She consented to the commercial use of the photographs; her claims arose from the further distribution or duplication of those photographs.

 

Nimmer says that a claim “deserve[s] to be preempted ... [involving] facts of a party trying to suppress the very copyrighted work to which she had earlier voluntarily contributed.” Therefore, “the conclusion cannot follow mechanically that all advertising is actionable.” Following Nimmer, plaintiff “collaborated in the creation of a copyrighted advertising product,” and “even if she ... can also adduce a contractual dispute” regarding the scope of placement of such photographs, her collaboration “precludes her from using the right of publicity to squelch exploitation of that copyrighted work for its intended purpose of appearing on” Hot Girl Summer swimwear advertisements.

True, Toney v. L’Oreal USA, Inc., 406 F.3d 905 (7th Cir. 2005), allowed a publicity rights claim to proceed when the defendant used the ad in which she appeared beyond the authorized time period, but the court thought that conflicted with Ninth Circuit precedent. “[T]he commercial use element does not qualitatively distinguish the right of publicity claim from a claim in copyright because the claim involves acts of distribution for commercial use. Thus, the claim does not involve additional elements beyond the reproduction of copyrighted works.”

Lanham Act: There was no literal falsity. Her theory was that the billboards were misleading because it suggested that she endorsed the Hot Girl Summer swimwear to billboard viewers when she sought to endorse the swimwear to social media viewers only.

However, by agreeing to participate in the photoshoot for the advertising campaign, Plaintiff effectively lent her endorsement of the Hot Girl Summer swimwear. Plaintiff does not allege that there was anything about that endorsement that communicated a limitation to certain viewers only, such that the photograph was misleading when it was posted on a billboard. Moreover, Plaintiff does not allege a theory of likelihood of confusion where the only plausible confusion alleged is who was to receive the message, not anything about the message itself.

compounding pharmacy must face drugmaker's Lanham Act claims based on false 503B compliance statements

Pacira BioSciences, Inc. v. Nephron Sterile Compounding Center, LLC, No. 3:23-cv-05552-CMC, 2026 WL 2267750 (D.S.C. Aug. 6, 2026)

Pacira sells an FDA-approved pain management drug called EXPAREL. Nephron allegedly made various false and misleading statements about two of Nephron’s competing compounded drug products. Specifically, Nephron allegedly represented those products as compliant with Section 503B of the FDCA, and as safe, effective, and superior to EXPAREL. The court granted partial summary judgment to both sides on the resulting Lanham Act claim.

Section 503B defines an “outsourcing facility” as a facility that “is engaged in the compounding of sterile drugs”; “has elected to register as an outsourcing facility”; and “complies with all of the requirements of [Section 503B].” Outsourcing facilities may distribute compounded drugs without obtaining a patient-specific prescription. They are also exempt from the FDCA’s new-drug approval process and certain labeling and supply-chain requirements. But they have to satisfy 11 statutory “conditions.”

The condition central to this case restricts outsourcing facilities’ use of “bulk drug substances” in compounding. They can’t be used unless the government properly identifies a clinical need or a drug shortage. In 2016, the FDA said it needed time to evaluate nominations and wouldn’t act when a bulk drug substance appeared on a list of “Category 1” substances the FDA maintained on its website, which “may be eligible for inclusion on the [clinical need] list, were nominated with adequate supporting information for FDA to evaluate them, and [had] not been identified by FDA as presenting significant safety risks.”

Nephron compounded BKK, a compounded drug product consisting of bupivacaine, ketorolac, and ketamine; later, it switched to RKK, with ketorolac, ketamine, and ropivacaine. Nephron advertised and sold them as “503B products” and as lower-cost alternatives to Pacira’s EXPAREL. In August 2019, Pacira wrote to the FDA urging it to take action against Nephron over its “illegal marketing and promotion” of BKK. It sued in November 2023, alleging false advertising of both products in terms of 503B compliance, comparability to/substitutability for Exparel, and related safety/efficacy claims.

Laches barred claims based on BKK; Pacira knew about the alleged false advertising since at least August 2019 and failed to offer more than conclusory argument to rebut the presumption of prejudice arising from its more than four-year delay in filing suit (period borrowed from state law). Even without the presumption of prejudice, defendants noted that several key witnesses no longer work for Pacira; some witnesses often could not recall basic facts related to the litigation during their depositions, and two, “both of whom reside beyond the subpoena power of the court, indicated they do not intend to appear at trial.” Of the 28 Nephron employees identified in Pacira’s Rule 26(a) initial disclosures, 17 were now former employees, including 11 who “would have still been current employees had Pacira filed within three years of January 2020.” “The unavailability of witnesses, faded memories, and changes in personnel are all indicators of evidentiary prejudice.”

But RKK came later and was allegedly discovered later. Nephron identified no “facts otherwise indicating a lack of vigilance” on the part of Pacira.

The court first held that the RKK Section 503B claims weren’t statements of opinion. Though lay claims about law are generally opinion, sometimes a law is “so clear on its face that no good faith doubt concerning its interpretation [is] possible, even without an explicit statement from [a court or agency].” In that circumstance, the law’s meaning is “so clear as to be a fact for Lanham Act purposes,” and Section 503B is “clear on its face.” Determining whether an outsourcing facility’s claims of compliance with Section 503B’s “bulk drug substance” provision are true “requires no more than consulting two lists.”

Nephron argued that Section 503B permits an outsourcing facility to market and sell a drug (say, RKK) without FDA approval as long as the individual components of that drug appear on the drug shortage list. But that wasn’t true: the drug shortage exception allows outsourcing facilities to “compound using bulk drug substances” only if “the drug compounded from such bulk drug substance appears on the drug shortage list.” Section 503B also defines “compounding” as “the combining, admixing, mixing, diluting, pooling, reconstituting, or otherwise altering of a drug or bulk drug substance to create a drug.” That’s what making RKK is.

Nor did the FDCA preclude Pacira’s Lanham Act claim. The “logical building blocks” of Pom Wonderful apply with equal force to “drug marketing, medical device labeling, cosmetics branding, or any other kind of marking or representation which would fall under both the Lanham Act and the FDCA,” Thus, “courts adjudicating Lanham Act disputes outside of the food and beverage realm” have “almost uniformly” interpreted POM Wonderful “to cover products in other FDA-regulated industries,” including pharmaceuticals. The issue here was not an exception because it wouldn’t “require the expertise of the FDA to resolve,” would call on the court “to make an original determination on an issue committed to the FDA’s discretion,” or would “otherwise conflict with an affirmative policy judgment by the FDA.”

The court declined to consider alleged falsehoods not identified in the complaint: statements allegedly conveying that RKK was compounded “in compliance with Section 503B” or “in a 503B-compliant outsourcing facility,” along with the specific statements that RKK is “generic to or substitutable for EXPAREL,” provides “improved value” over EXPAREL, “reduces post-operative pain[,] complications, risk of readmission, length of stay, [and] patient morbidity and mortality,” “eliminates opioid related adverse drug effects,” and has “low reported incidents of nausea and vomiting.”

Were they false? Nephron’s product lists and pricing sheets were distributed to members of group purchasing organizations (GPOs), healthcare systems, and individual hospitals, enough to constitute commercial advertising/promotion. They listed RKK among Nephron’s “503B Products.” This was a false claim as matter of law: “By listing RKK under that heading, Nephron necessarily communicated to purchasers that RKK belonged to the class of products meeting the statute’s requirements; no other conclusion can be drawn from its designation as a ‘503B Product.’”

But statements that Nephron is “a leading manufacturer of 503B outsourcing products” weren’t literally false; appearing at the bottom of a Nephron “Opioid Free” product handout featuring BKK, RCK, and RKK “could be understood as conveying that Nephron manufactures ‘503B outsourcing products’ as part of its broader business, without necessarily implying that BKK, RCK, and RKK fall within that category.” Pacira’s survey didn’t test the “leading manufacturer” statement, so Nephron got summary judgment.

Nephron’s “503B outsourcing facility” logo appeared throughout Nephron’s materials, including the “Opioid Free” handout and the product label for RKK. Again, this was too ambiguous to be literally false. Here Pacira did have a survey, presenting respondents with a sample marketing email about BKK. Pacira’s expert concluded that a net 14.8% of respondents believed BKK was a Section 503B-compliant drug. “That percentage would ordinarily be sufficient to support a finding that an advertisement misled or tended to mislead consumers.”

The court denied Nephron’s motion to exclude. First, though the email shown to participants focused only on BKK, the deception rate calculated by Butler could be “extrapolated” to RKK; the difference went to weight rather than admissibility:

This is not a scenario where Pacira seeks to extend survey results to an entirely separate and untested statement (as with the “leading manufacturer” statement). Rather, the same “503B outsourcing facility” logo appeared on the product labels for both BKK and RKK, and it is not immediately clear consumers would perceive the logo differently depending on the product to which it was affixed. Under these circumstances, the weight to be given [the survey’s] findings, as applied to RKK, is for the jury to decide.

Other challenges also went to weight: Using closed-ended questions after open-ended questions has both critics and supporters and their limits could be the subject of cross-examination. The survey asked, “Which of the following, if any, are message(s) communicated by this email?” and offered the following response options:

1. BKK, an admixture of bulk drug substances from Nephron, is a 503B compliant drug

2. BKK, an admixture of bulk drug substances from Nephron, is opioid free

3. BKK, an admixture of bulk drug substances from Nephron, is packaged in syringe form

4. None of these

5. Don’t know / unsure

Respondents who selected the first option were asked a follow-up open-ended question to assess why they believed this.

Nephron argued that closed-ended questions should be avoided when testing consumer deception because they are “highly susceptible to demand effects and focalism.” But “there is nothing inherently wrong in using closed-ended questions to test consumer impressions.” They can be “suitable for assessing choices between well-identified options” and “may remind respondents of options that they would not otherwise consider or which simply do not come to mind as easily.” And open-ended questions have their own problems, such as decreasing reporting of actually-held views: “respondents answering open-ended questions may be less likely to report some information that they would reveal in response to a closed-ended question when that information seems self-evident or irrelevant” (quoting Shari Diamond). They also require subjective coding: “Because respondents are answering in their own words and may not provide precise answers, many answers are simply not clear enough to definitively evaluate or categorize reliably.” Also, the “Don’t know / unsure” answer choice is a recognized way “to screen out respondents who may not have an opinion on the issue under investigation.”

Nephron also argued that the survey expert made “excessive and biased” changes to the stimulus shown to the control group. The control group saw an email that (1) removed both instances of the “503B outsourcing facility” logo; (2) added a disclaimer stating, “Note: the admixture of bulk drug substances sold as BKK is not compounded in compliance with Section 503B”; (3) removed the statement “Nephron continues to strive to provide drugs that are critically short and meet all needs of the Country!”; and (4) modified the statement “This is something that will be huge in helping hospitals decrease opioid and Exparel use” by deleting the reference to EXPAREL. The disclaimer, Nephron argued, was “overly broad and inaccurate” because it “would likely lead participants to conclude that no part of BKK is 503B-compliant.”

It was logical to address only BKK in the disclaimer because that was the specific product being tested by the survey. “The court struggles to see why respondents needed to be informed of the compliance status of bupivacaine, ketorolac, and ketamine individually when they were being asked about the admixture BKK.” Anyway, this was for cross-examination.

Finally, Nephron argued that the survey was an improper “reading test” because the stimulus was visible while respondents answered questions. Again, experts disagree on this, so it was for cross-examination and competing expert testimony. Thus, there was a genuine issue of material fact on misleadingness for use of “503B outsourcing facility” logo on the “Opioid Free” product handout and RKK’s product label.

Statements that RKK (1) is “generic to or substitutable for EXPAREL” and (2) provides “improved value” over EXPAREL: Pacira didn’t show any use of the exact phrase. The closest it got was one email stating “Nephron produces BKK, RKK, & RCK as generic, clinical need medications as requested by physicians across the country.” That didn’t mention EXPAREL at all.  Summary judgment granted on (1).

The “improved value” statement was in the “Opioid Free” product handout. But it didn’t make an express or implicit comparison to EXPAREL, and it was puffery.

RKK safety and efficacy: these statements claimed that RKK (1) “reduces post-operative pain[,] complications, risk of readmission, length of stay, [and] patient morbidity and mortality”; (2) “eliminates opioid related adverse drug effects”; and (3) has “low reported incidents of nausea and vomiting.” These weren’t establishment claims [side note that courts used to be much more open to the argument that scientific/health claims are establishment claims by necessary implication, which seems right to me], and Pacira showed only that they weren’t substantiated.

Of the remaining statements, there was no genuine dispute that “503B Product” was material, given that GPO customers “required Nephron to warrant that the compounded drugs it sold complied with Section 503B.” “Parties do not typically bargain for guarantees on matters they consider unimportant. That Nephron’s contracts with GPOs included an express warranty of Section 503B compliance is compelling evidence that such compliance mattered to purchasers of RKK.”

But the materiality of the “503B outsourcing facility” logo was still in dispute.

There was also a factual issue of injury based on evidence that certain customers who had previously purchased EXPAREL (1) began buying RKK when it came on the market, (2) simultaneously reduced their purchases of EXPAREL, and (3) were members of GPOs that had received Nephron pricing sheets listing RKK as a “503B Product.” So these issues, and damages and/or disgorgement, remained for trial.

anti-Chinese memory chips blog & report weren't commercial speech despite alleged competitor funding

Yangtze Memory Technologies, Inc. v. Micron Technology, Inc., 2026 WL 2350276, No. 1:25-cv-01795 (CJN) (D.D.C. Aug. 13, 2026)

On the one hand, there’s a risk of suppressing valuable noncommercial speech if we apply the Lanham Act too broadly; on the other, there’s a risk of allowing false advertisers to launder claims through supposedly noncommercial speakers if we interpret it too narrowly. Here, the court finds the political valence of anti-China speech relevant to determining that the alleged falsity was not made in commercial speech.

YMTC alleged that defendants ran an astroturfing campaign that discouraged customers from purchasing memory chips from YMTC due to its connections to the Chinese government. Defendant Micron competes against YMTC in the market for memory chips. It allegedly worked with defendant DCI, a public affairs firm, “to erect a sophisticated ... ‘astroturfing’ campaign ... to damage YMTC’s reputation and business for their own profit.” It allegedly funded a website called China Tech Threat that “purport[ed] to be focused on policy” but was actually a front “to disseminate favorable messages about Micron’s products and disparaging messages about YMTC’s competing products.”

For example, CTT published a blog post, “As YMTC Booms, China Aims to Dominate Flash Memory Industry,” asserting that YMTC was associated with “criminal activity, including a Social Security spoofing scam, identity theft and cyber extortion.” A June 2022 report, “Silicon Sellout: How Apple’s Partnership with Chinese Military Chip Maker YMTC Threatens American National Security,” implored “Apple to voluntarily end its partnership with YMTC” and “source its chips from existing suppliers like Micron.” [Yeah, if the funding facts are as stated, that seems like commercial speech to me.]

Apple allegedly suspended its plans to purchase chips from YMTC in October 2022, resulting in “hundreds of millions of dollars in lost revenue.” The astroturfing campaign also allegedly “inflicted lasting damage on YMTC’s reputation and commercial standing across the technology sector.”

The court found Article III standing because YMTC pled “a plausible chain of events that links DCI’s actions to YMTC’s injuries.” DCI argued that other sources gave the same warnings, “[b]ut the existence of, perhaps, an equally important player in the story does not erase [DCI]’s role.”

However, the blog post and report were not actionable under the Lanham Act, despite including apparently factual claims such as “YMTC chips equipped with spyware and installed on Apple devices could funnel collected data back to Beijing” and “Electronics with embedded chips are enabled with a ‘kill switch’ .... Such features, under Chinese military production, could be enabled ... to shut down remotely by an unauthorized Chinese government actor.”

The court primarily reasoned that the 2021 blog post and 2022 report do not constitute “expression related solely to the economic interests of the speaker and its audience,” which strikes me as a way to insulate all factual claims from scrutiny given that we’re at a point in which anything can be politicized. But:

The blog post warned about the risk of China overtaking the United States in the flash memory industry and accordingly encouraged the Trump administration “to implement controls to stop the flow of [semiconductor manufacturing equipment] to China.” Given this clear focus on national security concerns, the post was not primarily—much less solely—about economic interests. As for the report, although it at least arguably contained some references to economic competitors in the chip industry, the vast majority of it either outlined the foreign policy risks of the deal between YMTC and Apple or proposed potential solutions to mitigate those risks. The report mentioned that the deal may have economic implications, but it was far from solely focused on that aspect.

The court also thought that the post and report weren’t “speech proposing a commercial transaction,” and that “this non-advertising medium strongly counsels against YMTC’s position.” (Just because astroturfing isn’t identified as a conventional ad shouldn’t make it ok!) “[E]ven if Micron, through DCI and China Tech Threat, would potentially benefit financially from seeing its competitor’s reputation suffer, that general economic motivation cannot alone transform the specific means at issue here—a blog post [and report] flagging national security concerns—into commercial speech.”

What about references to specific products, also part of the commercial speech inquiry? Well, discussing the potential risks of “YMTC chips” “generally” aren’t enough to constitute a reference to a specific product. That conclusion seems quite bizarre. An entity that sold flavored condoms, different sizes of condoms, lubricated and unlubricated condoms, and then touted condoms generally is making a specific product reference (Young of Bolger v. Young made Trojans, and also wanted to send flyers promoting condoms generally as well as Trojans specifically). And targeting a specific producer seems certainly within the Lanham Act’s concerns (see also “commercial activities” in 43(a)(1)(B)).

Ultimately, the court concluded, the publications are “political speech expressing a point of view, not commercial speech attempting to promote a good or service.” They called for government—not consumer—action. “YMTC’s attempt to focus on only four statements out of a 20-page report and one sentence out of a two-page blog post cannot overcome the overwhelmingly political nature of the publications.” This also distinguished Ariix, LLC v. NutriSearch Corp., 985 F.3d 1107 (9th Cir. 2021), which concerned a review guide “that compares and reviews nutritional supplements sold in the direct marketing industry”— “a much more commercial publication.” [Again, this distinction seems wrong to me. The issue in Ariix wasn’t that publications about nutritional supplements are inherently more likely to be commercial speech—plenty of such speech is noncommercial. It was the secret control by a funder who was spoken of well in the guides. And there was no showing in Ariix that the disparaging matter was a significant part of the guides, which covered lots of different supplements.]

heavy weather for heavy metals in infant food

Choudhry v. Mead Johnson & Co., 2026 WL 2349932, No. 25-cv-09480 (ER) (S.D.N.Y. Aug. 13, 2026)

Plaintiffs alleged that various Enfamil infant formulas contained arsenic, cadmium, and lead, heavy metals that present significant health risks, particularly to young children, and “can cause serious and often irreversible damage to brain development,” including from “low levels of exposure.” They sued for false advertising under NY law.

They allegedly relied on the following claims on the packaging: “ ‘Brain Building,’ ‘#1 Recommended Brand by Pediatricians,’ ‘The Only Hypoallergic [sic] Formula With LGG® Probiotic,’ ‘No Artificial Growth Hormones,’ ‘LGG® probiotic to help support digestive health’ and ‘does not use table sugar,’ ” along with “expert recommended,” and some others. They alleged that reasonable consumers would not think these products contained heavy metals.

A consumer survey conducted by their counsel found that 77.8% of survey participants answered “No” when asked, “After seeing the label would you expect arsenic, cadmium, lead, and/or mercury in the infant formula?” The survey followed up:, “how important, if at all, would it be to your purchasing decision if the infant formula you purchased contained, or risked containing, even a small amount of arsenic, cadmium, lead, and/or mercury,” and 71.0% of participants answered “Very important,” 25.4% “Important,” and 3.6% “Not at all important.” Mead Johnson received judicial notice for the fact that, “[i]n April 2026, the FDA released a report finding low levels of Heavy Metals in many infant formulas, cautioned that this was not automatically reason for alarm, and that additional guidance is forthcoming, but did not provide a timeline for that guidance.”

The court declined to apply the primary jurisdiction doctrine. White v. Beech-Nut Nutrition Co., 2024 WL 194699 (2d Cir. Jan. 18, 2024) vacated the district court’s dismissal of a similar case based on the primary jurisdiction doctrine; detailed consideration wasn’t required because “the FDA had no expected timeline to provide actionable guidance on the safe levels of Heavy Metals in infant formulas, which outweighed ‘any advantages of deferring to the FDA under the primary jurisdiction doctrine.’” That was still true.

Also, courts are well-suited to determine if a product’s packaging was misleading or deceptive. This case didn’t require the court to determine what levels of heavy metals should be permissible, so there is not “a substantial danger of inconsistent rulings.”

Standing for unpurchased products: although the ingredients weren’t identical, the same alleged misrepresentation was on all of them, which was enough at this stage.  

GBL §§ 349 and 350: Not subject to 9(b) pleading requirements. Mead Johnson questioned plaintiffs’ reliance, but they alleged that they “read and relied upon the packaging of the Infant Formulas when making their purchasing decisions,” which sufficed.

Material misleadingness to “a significant portion of the general consuming public or of targeted customers, acting reasonably in the circumstances”: Courts will not permit such claims “where the plaintiffs’ alleged inference appeared fundamentally incompatible with basic common sense.” Plaintiffs didn’t allege that the formulas advertised that they didn’t have heavy metals, “but that the packaging misleadingly represented the products as healthy, safe, and nutritious when they contained or risked containing Heavy Metals,” with claims like “Brain Building,” “expert recommended,” and “#1 Recommended Brand by Pediatricians.” The court agreed that the survey bolstered this inference.

Interesting comment:  

Plaintiffs’ pleading satisfies this low burden because it demonstrates that the majority of consumers would assume the product did not contain Heavy Metals based on its label. This does not definitively establish that a reasonable consumer would be misled by the packaging. However, at this stage, despite certainly requiring an inferential leap, Plaintiffs sufficiently allege that this supposed deception is not “patently implausible” such that the Court can determine as a matter of law that reasonable consumers could not be misled by the packaging. (emphasis added)

Is the court saying that a majority of consumers could still be unreasonable? Empirical v. normative claims about reasonable consumers are scattered throughout cases, with courts rarely articulating the relationship between “reasonable” and “common.”

Anyway, implicit misrepresentation was plausible. What about an omission theory?  Mead Johnson argued that plaintiffs failed to allege that knowledge about heavy metals was solely in its possession and that consumers could not obtain the information, and also that heavy metals in food is widely known.

At the motion to dismiss stage, “a plaintiff bringing an omission-based claim for § 349 liability must show that ‘the business alone possesses material information that is relevant to the consumer and fail[ed] to provide this information,’ or that plaintiffs could not ‘reasonably have obtained the relevant information they now claim the [defendant] failed to provide.’ ” This was sufficiently alleged. Plaintiffs alleged Mead Johnson’s superior knowledge; that consumers reasonably expected Mead Johnson to test for heavy metals and disclose that information to the public; that Mead Johnson deceptively hid that it failed to monitor for the presence of heavy metals in its products; and that consumers could not detect their presence without conducting scientific tests.

Materiality to a reasonable consumer: not a separate element, but it would be reasonable to assume that heavy metals’ presence would be material because of their health risks.

For common law fraudulent misrepresentation, Mead Johnson argued that its efforts as part of a trade organization to lobby against a California bill that would require disclosure of heavy metals content was insufficient to plead scienter because it is “legitimate First Amendment activity,” not “conscious misbehavior.” That alone wasn’t sufficient to establish the required “strong circumstantial evidence” of scienter, but it could bolster the claims.

However, unjust enrichment was dismissed as duplicative.

a lot of balls: golf ball manufacturer states claim for allegedly false UV light comparison

TaylorMade Golf Co. v. TopGolf Callaway Brands Corp., 2026 WL 2244259, No. 3:26-cv-250-GPC-BJW (S.D. Cal. Aug. 4, 2026)

TaylorMade sued Callaway, a competitor in the golf ball market, for federal and state false advertising/unfair competition. TaylorMade alleged substantial investment in innovating and advertising its golf balls, including a golf ball for tour-level performance known as “TP5 Brand.” Callaway has a TP5 brand golf ball equivalent called “Chrome Tour” golf balls.

TaylorMade alleged a misinformation campaign, including through sales reps and influencers and promotion to third-party golf publications.

TaylorMade’s TP5 Brand golf balls allegedly have two layers of coating: the first inner layer is white paint, and the second outermost layer is “clearcoat” that has a low concentration of “optical brightener” for cosmetic and stain-resistance purposes. TaylorMade alleged that the optical brightener had no impact on ball flight, distance, spin trajectory, or any other performance attribute. However, the “clearcoat has the highest potential impact on ball performance in flight” and therefore, its intentional thin coating approach is allegedly a deliberate design decision to improve ball performance. “As such, the splotchiness on its balls under UV light is Plaintiff’s design choice to have a single, thin, clearcoat layer to prioritize performance and not inferior quality or performance.”

TaylorMade alleged that Callaway similarly applies two layers of coating to their Chrome Tour golf balls, but both layers contain clearcoat with optical brightener, resulting in a brighter appearance that allegedly does not increase quality or performance.

TaylorMade was not alleging that uneven paint application cannot impact golf ball performance or quality; rather, it claimed that Callaway’s UV light demonstration was an unreliable way to evaluate paint coverage, paint uniformity or golf ball quality and performance. “In fact, the UV light demonstration only reveals the distribution of optical brightener additives, a cosmetic ingredient that has no bearing on ball flight.” Thus, using a UV light demonstration to make comparative quality claims was false/misleading—but that is what Callaway allegedly did.

For example, one sales agent stated that the demonstration would show whether there is “too much paint” on the ball, and if so, would result in a “mudball.” “Mudball is a derogatory term used to describe a golf ball that has a bad flight, trajectory, shape and distance due to the presence of mud on the ball and is the ‘bane of any pro golfer’s existence.’” The sales rep claimed that dark spots on the ball could “potentially act like a piece of mud is on the ball and who knows where the ball is going to go... all about quality control.”

Thus, TaylorMade challenged the following claims: (1) the use of UV light can measure golf ball quality or performance; (2) the difference in appearance of golf balls under UV light are indicative of overall golf ball quality and performance, (3) the uniform appearance of Calloway’s golf ball dimples and brightness under UV light is indicative of superior quality or performance; (4) TaylorMade’s golf balls are “mudballs”; and (5) TaylorMade’s quality control is inferior to Callaway’s.  

TaylorMade further alleged that the UV light test is unreliable, misleading, and lacks standardization “because it is highly sensitive to other variables including wavelength and intensity of UV light, distance and angle of which the light is held, the duration of the UV light exposure, prior UV exposure, and ambient lighting conditions, none of which can be standardized.”

This campaign was allegedly extensive. For example, MyGolfSpy, “a popular digital platform with over 22 million consumers,” published “Callaway Doubles Down on Speed and Precision With New Chrome Tour, Chrome Tour X, and Chrome Soft Golf Ball” which contained several statements from the alleged misinformation campaign and had a “DIY side note” encouraging consumers to conduct their own UV light demonstration as a way to measure a golf ball’s quality and performance based on its “paint coverage.”

Callaway argued that its claims were puffery.  A claim that golf balls act “like a piece of mud” due to the uneven paint coating on the ball which negatively impacts the ball’s ability to fly straight was a specific and measurable claim and not puffery, as were the other claims about UV light as a method of proof.  The complaint explained why the UV light demonstration wasn’t reliable.

Did TaylorMade have standing under California’s UCL and FAL? Yes, it sufficiently pled lost sales: “because Defendant is a direct competitor, any alleged false misrepresentations about the quality and performance of TaylorMade’s golf ball will increase sales of Callaway’s golf balls and cause sales of TaylorMade golf balls to decrease.” Also, it was independently sufficient that TaylorMade allegedly lost money when it incurred financial expenses to combat the misinformation campaign by responding to inquiries from customers who saw or heard about the UV light demonstration.

What about reliance? In federal district courts, the majority view is that a plaintiff must allege its own reliance and not the reliance of third parties. But the court here adopted the minority view that a “competitor may allege false advertising claims under the UCL and FAL without alleging its own reliance and need only allege it suffered an injury, loss of money or property, as a result of the alleged misrepresentations.” [seems correct]

Given the alleged Lanham Act violation, “unlawfulness” UCL claims survived, as did unfairness claims, which would allegedly “encourage a race to the bottom” where competitors will resort to misleading demonstrations and pseudo-scientific claims rather than competing on the actual merits of their products.

"battery tender" isn't generic for guess what, but keyword advertising is fine

Deltona Transformer Corporation v. NOCO Company, --- F.4th ----, 2026 WL 2236806, No. 24-13590 (11th Cir. Aug. 4, 2026)

Competitors aren’t generally allowed the same freedom as consumers to “genericize” a term. Here, the 11th Circuit finds no error in a district court’s holding that “battery tender” wasn’t generic, despite calling the product category at issue by that name throughout the opinion (“specialized vehicle-battery chargers called ‘battery tenders’”—they recognize when a battery is fully charged so they don’t overcharge and degrade it, an innovation when introduced). [What is the name of this specialized subcategory, if not “battery tender”? This is an exercise for the reader because the court sure won’t tell you, but moments in the opinion offer “battery-maintaining chargers” or “trickle chargers.”]

Deltona federal registrations for “Battery Tender” and “Deltran Battery Tender.” NOCO made similar charges and advertised its own products as “battery tenders.” A jury found for Deltona on its federal and state infringement claims, and further concluded that NOCO had engaged in false advertising in violation of federal law. The court of appeals kicked out some of the theories—specifically, based on keyword purchases and Lanham Act false advertising—and remanded to recalculate damages.

The allegedly infringing conduct: (1) bidding on Deltona’s marks as “keywords” and using them to trigger NOCO’s ads in Amazon search results; (2) using the term “battery tender” in the text of its own Amazon ads; (3) incorporating the term “battery tender” in its product descriptions on Amazon; and (4) holding out its chargers as “battery tenders” in communications with marketing firms and customers.

Category (1) couldn’t infringe, but the rest could. NOCO’s position was summarized by a sales manager: An email drafted by Nook and sent by a NOCO sales manager to a potential customer said, “We understand Battery Tender is a well known brand, but most customers usually refer to the function (battery tender meaning a trickle charger), than the actual brand.” Internal documents showed that NOCO was willing to use “tender” and “battery” in ways that were “passive aggressive.”

The director of advertising at a company that handles Deltona’s marketing testified that one of its customer-service agents spoke to a consumer who had initially reached out to NOCO and was “very confused” when one of its employees “referr[ed] to [NOCO’s] products as a battery tender charger.” And an email exchange in the record shows that a retailer considering whether to stock a new line of battery tenders reached out to NOCO with an inquiry about Deltona’s product.

The jury held that Deltona was entitled to actual damages of $1.3 million and that NOCO had committed intentional misconduct or gross negligence, entitling Deltona to punitive damages of $5.75 million. The district court ordered NOCO to disgorge profits of over $12 million and issued a permanent injunction. The injunction prohibited NOCO from “selling, marketing, advertising, [or] promoting” its products using the terms “Battery Tender,” “Deltran Battery Tender,” “Deltran,” or “Tender,” the latter of which was included because “[t]here was abundant evidence that [the company’s] use of ‘tender’ on its own was done in a way that caused customer confusion and infringed [Deltona’s] Marks.” The injunction exempted keyword purchases and comparative advertising.

Deltona had a genericity survey, but the jury could have rejected it. The marks weren’t inherently generic because they were registered; they were descriptive with acquired secondary meaning. “The fact of registration puts a heavy thumb on the scale against genericness.” [Does that mean that the burden is clear and convincing evidence? Or something else?]

“Battery tender”

entails some level of abstraction—“tend[ ]” is more a metaphorical than literal description of what a battery tender does, which is to preserve the battery by maintaining its charge. That makes “battery tender” more like “vision center”—which might sell glasses and contact lenses but doesn’t literally sell “vision”—than, say, “liquor store”—which is nothing more than a store that sells liquor. Indeed, the term “battery tender” might even be suggestive; it “suggest[s] characteristics of the good[ ]” and seems to require at least some “effort of the imagination” to understand how the product works.

Sigh. Nothing has “inherent” meaning with the partial exception of onomatopoeia.

Deltona’s co-founder made up the term based on an analogy to a ship’s tender. [But if he made it up to identify this new category and distinguish it from prior types of chargers, that shouldn’t matter—“dry ice” didn’t have to be the term for solid carbon dioxide.] The court says that, “as a matter of historical fact, it’s not accurate to say that ‘battery tender’ referred from the very beginning simply to ‘a kind of battery-charging device,’” but doesn’t explain what the generic word was at the very beginning.

NOCO’s consumer survey found that 78% of 558 respondents reported that they believed that “Battery Tender [was] a type of product” rather than a reference to a particular brand. The jury was free to reject that, though; Deltona had challenged the survey’s methodology on the ground that it included people who might simply have been “exposed” to battery tenders [generic use again!] “from shopping near [them]” when walking through an automotive store or department.

The court then held that keyword bidding alone can’t be trademark infringement because the use of the plaintiff’s mark for keyword-bidding purposes occurs “behind the scenes.” [Twenty years later, they figure this out. Sincerely: thanks, Abitron!] Likelihood of confusion “turn[s] on what the consumer s[ees] on the screen and reasonably believe[s], given the context.” (Citing Eric Goldman and the Second, Ninth, and Fifth Circuit cases to similar effect.)

Use in product titles and product descriptions on Amazon, however, was potentially infringing, as was use in communications with marketing firms and consumers, so that part of the award was upheld. Unlike keyword advertising, “[t]he inclusion of ‘battery tender’ in the description automatically not only affected Amazon search results but also drove shoppers searching for Deltona’s battery tenders to NOCO chargers without alerting them in any way—through a ‘sponsored’ tag or otherwise—that they weren’t really looking at battery tenders.”

“A reasonable jury certainly could have concluded that these explicit statements to customers—that ‘battery tender’ was a generic term—were likely to confuse them.” (Confuse them about what? Not about source or sponsorship, given the statement that it was generic.)

The Florida Deceptive and Unfair Trade Practices Act damages award was also problematic, even though the Lanham Act violation could also violate FDUTPA. Monetary relief in the form of actual damages is available only to a “person who has suffered a loss as a result of a violation of this part,” and Florida law generally defines actual damages as “the difference in the market value of the product or service in the condition in which it was delivered and its market value in the condition in which it should have been delivered.” Thus, Deltona couldn’t base its damages on “harm to its reputation or goodwill,” because consequential damages like that aren’t compensable under FDUTPA.

Finally, the district court erred by instructing the jury on false advertising under the Lanham Act based on the same conduct. Deltona’s complaint alleged unfair competition and false designation of origin under the Lanham Act; it never separately articulated a false advertising theory. It was not enough to use the phrase “misleading description and representation of fact,” when read in conjunction with the complaint’s “numerous allegations involving advertisements” and its generic citation to § 43(a), to warrant a separate jury instruction on false advertising under § 43(a)(1)(B).  In context, the complaint clearly referred to § 43(a)(1)(A). NOCO neither expressly nor impliedly consented to trying a false-advertising claim.

The court of appeals had “substantial and ineradicable doubt” whether the jury was properly guided, so that part of the judgment was reversed.

Disgorgement was appropriate, given the willful conduct. [Recalculation doesn’t seem to be required because of how disgorgement is assessed—even kicking out the keyword advertising doesn’t seem to matter (though you’d think that sales made through keyword ads alone wouldn’t have the right causal relationship).]

Also ok: an injunction extending a ban on standalone use of “tender.” “[E]ven though NOCO seems to have ceased its misconduct, the record shows that it has, after brief interludes, repeatedly returned to infringing Deltona’s marks.” “In fashioning relief against a party who has transgressed the governing legal standards, a court of equity is free to proscribe activities that, standing alone, would have been unassailable.”

But the damage award needed to be reassessed, so remand for a new trial it was.