Parties duel over press releases, new ads

Star-Brite Distributing, Inc. v. Kop-Coat, Inc., 2009 WL 3462396 (S.D. Fla.)

Star-Brite succeeded in enjoining certain claims Kop-Coat aka Valvtect made about its gasoline additive. Valvtect then issued a press release titled “Court Finds Valvtect’s Comparison Ad Was Not False.” It didn’t mention that the court found the ad misleading and enjoined it, but noted that the court hadn’t ordered the ads recalled and included the statement “nor did the court order prevent Valvtect from placing future ads comparing the performance of Valvtect Ethanol Gasoline Treatment and StarTron.” Star-Brite then issued its own press release, “Starbrite Granted Injunction Against Valvtect.” It variously described the court as finding that the ads were “false or misleading,” “false and misleading,” and “false and deceptive,” which Valvtect contended was itself misleading because of the use of “false,” rather than only “misleading.”

Valvtect moved to increase Star-Brite’s bond based on its allegedly misleading press release. Since that press release was issued in response to Valvtect’s own misleading press release, the court was unimpressed. “While the parties have some freedom to ‘spin’ in the realm of public opinion what court orders mean to the marketplace, neither side is free to mislead the public about the issuance and substance of an injunction.” As for whether Star-Brite’s press release crossed the line, Star-Brite argued that an ad that is not literally false can still be “false” if it’s misleading. At least in the context of this dispute, the court refused to sanction Star-Brite’s characterization. Valvtect’s own press release minimized the actual language of the injunction so significantly as to be misleading; Star-Brite was setting the record straight.

Valvtect also placed an ad referring to some of the same test results the court found misleading but only naming “the Competition.” The court refused to hold Valvtect in contempt because it wasn’t a comparison ad naming Star-Brite by name, citing cases that irreparable harm is presumed when an ad compares two products. I don’t really get this—an ad can be comparative without naming the competition, and there are plenty of cases so holding; otherwise the law would be too easy to evade. In the context of holding a defendant in contempt, perhaps a rule of lenity is more justified. The parties here, however, seem likely to be repeat players before the court.