Sunday, February 03, 2008

Concrete allegations too vague

Midwest Canvas Corp. v. Commonwealth Canvas, Inc., 2008 WL 162757 (N.D. Ill.)

The parties compete in selling concrete curing blankets, which cover freshly poured concrete and speed up its hardening, a key function in cold weather. One of defendant’s curing blankets, trade name “Cure-All,” is listed on the New York Department of Transportation (NYDOT) website, on its approved list of insulation materials for winter concreting. This is one of 17 curing blankets, including two of plaintiff’s “Insul-Tarp” products, listed as approved. Cure-All is listed as having a thickness of 25 mm/1”, but no pricing or direct ordering information is on the NYDOT website. Based on an order it received from one of defendant’s retailers, plaintiff claimed that Cure-All is not 25 mm thick. Likewise, plaintiff ordered ½” (CC2) and 1” (CC4) curing blankets from, which sells defendant’s curing blankets. The order was confirmed via email and the blankets arrived with a work order listing the CC2 and CC4 blankets. Plaintiff claimed that they were not ½” and 1” thick, respectively.

Plaintiff brought state and federal false advertising claims based on the invoice it received from the first retailer, as well as the work order from The court held that the invoice was not “commercial advertising or promotion” for Lanham Act purposes, because it was sent to an individual customer and thus not disseminated sufficiently to the relevant purchasing public. Moreover, an invoice is not an inducement to buy, but a memorialization of an agreed-on transaction.

Plaintiff argued that the NYDOT listing sufficed as advertising, and that defendant’s distributors disseminated its statements over the internet as part of promoting the sale of 1” NYDOT-approved curing blankets. The court found plaintiff’s claims insufficiently specific for purposes of Rule 9(b), which it found applied because plaintiff was alleging fraud. Specifically, plaintiff failed to allege a connection between the NYDOT website and defendant or its distributors. Anyway, the NYDOT site isn’t a commercial advertisement because NYDOT isn’t in competition with any of the parties; nor is a listing of approved materials an inducement to buy; nor, further, is the purpose of the site to sell materials but to assure quality in NYDOT construction projects.

The court held that the Lanham Act analysis also applied to Illinois state-law false advertising claims. And the same failure to show a commercial advertisement doomed the claim with respect to the work orders. (Comment: it seems like this parsing could have been avoided if plaintiff’s agent had called or emailed and asked about thickness – but in context, it might have seemed obvious to people in the industry.)

No comments: