Back to the disclaimer: DirecTV wins round against Time Warner

Time Warner Cable, Inc. v. DirecTV, Inc., 2007 WL 1138879 (S.D.N.Y.)

Time Warner sued DirecTV for false advertising under state and federal law. This time, it failed in its attempt to enjoin comparative advertising about the high definition (HD) services available from DirecTV and “cable.” DirecTV’s ads at issue recreated a scene from Back to the Future, in which Christopher Lloyd, in character as Doc Brown, announces that DirecTV has “all the best channels, and soon they’ll have three times more HD capacity than cable!” The court found that “best channels” was nonactionable puffery, and that Time Warner failed to disprove DirecTV’s evidence that it would have three times more HD capacity by the end of 2007, which was “soon.”

The only questionable part of the decision, and one that might often be cited by defendants, involved the ad’s graphic “Starting at $29.99/mo. Everyday price.” The court found this unproblematic, because the small print in the revised commercial states that HD programming – which is, of course, the subject of the commercial – carries an additional fee on top of the quoted price. Given that the commercial is focused on HD offerings and that you can’t get HD from DirecTV for $29.99/mo., I would be willing to find “starting at” deceptive, but the court concluded that, with the small print disclaimer, the ad as a whole was nondeceptive because “starting at” indicated that higher prices were also part of the offer and “the existence of a disclaimer of some sorts is clearly visible at the bottom of the screen.”

The first part of that is much more persuasive than the second – a disclaimer “of some sorts”? How is a consumer supposed to know it’s a disclaimer about price? The court doesn’t contend – nor does anyone, really – that consumers actually read such disclaimers. The court distinguishes a prior case finding a disclaimer ineffective when it’s inconspicuously located or in such fine print that readers tend to overlook it. Here, by contrast, the disclaimer isn’t inconspicuously located, because it’s clearly visible at the bottom of the screen. But that’s not a distinction! The point of “clear and conspicuous” is that consumers should perceive the disclaimer as part of the ad message. Merely being aware that there is a disclaimer, about something or other, is not the same as understanding the ad claim as modified by the fine print.

Side note: When I watched Heroes online (and if you aren't watching the series, you should be), all the ads were for DirecTV, and they were pretty aggressive. A couple of them had the snooty announcer say that hooking up a HDTV to cable was like putting cheap gas in a Ferrari, which seemed like an interesting trademark problem in itself and also signalled that DirecTV is not backing down from its comparative claims, despite TWC’s demonstrated willingness to sue. Sometimes aggressive ads are worth it as a business decision – especially since the Lanham Act doesn’t allow for punitive damages.