Saturday, June 19, 2010

Court reapplies sunscreen ruling

Schering-Plough Healthcare Products, Inc. v. Neutrogena Corp., 2010 WL 2340226 (D. Del.)

On Neutrogena’s motion for reconsideration of the court’s recent holding that certain claims were literally false, the court ordered a submission addressing the evidence Neutrogena wanted to present to rebut the presumption of consumer deception. But the court also took the opportunity to reiterate key aspects of its holding.

Neutrogena’s ads and packaging for its Ultra Sheer Dry-Touch Sunblock SPF 100k prominently stated that the product contained “Helioplex®,” a proprietary photostabilizing agent. Neutrogena represented “to the court and to the public” that Helioplex® is a proprietary blend of specific compounds: avobenzone, diethylhexyl 2,6-naphthalate ("DEHN") and oxybenzone. Yet, for a year, DEHN wasn’t present in the 100k product; octocrylene was instead. DEHN-free bottles shipped through April 2010, and Neutrogena represented that they would be gradually sold off over time.

Neutrogena was reduced to arguing that Helioplex® need not, as a matter of definition, contain DEHN, and that falsity didn’t matter without a showing of materiality, actual deception/tendency to deceive, and likely injury. (The more I think about this, the more I think that standard marketing dogma about branding would fill out the injury claim. The reason for establishing Helioplex® as a special ingredient only present in Neutrogena products is that it gives Neutrogena a branding boost. So, even if we presume that consumers have no clue what Helioplex really is, then Neutrogena gained brand benefit by using the term across its products. I have no reason to think that the difference between DEHN and octocrylene matters physically, but it strikes me as a difficult position to be in to tell consumers that the presence of Helioplex® is a reason to buy the product and then to tell the court/the jury that, well, by Helioplex® we only mean whatever we decide to put in the product that day because the difference is really all in your head.)

Anyway, the court found literal falsity, since Neutrogena expressly, unambiguously, and explicitly defined Helioplex® to the consuming public, and its 100k product didn’t meet that definition. Neutrogena moved for reconsideration, which is available to correct manifest errors of law or fact or present newly discovered evidence.

At the outset, the court reaffirmed that, once literal falsity is found, a plaintiff need not also demonstrate “materiality, actual deception or a tendency to deceive, and a likelihood of injury.” (One wonders if Neutrogena would have done better by omitting that middle phrase, which is most plainly and soundly covered in the case law: literal falsity is a substitute for evidence of actual/likely deception, as the court’s discussion indicated: “a plaintiff must prove either literal falsity or consumer confusion, but not both” (citation omitted). There is at least more room for argument on materiality and injury. Whereas literal falsity may be irrebuttable with consumer reaction evidence, presumptions of materiality and harm might be rebuttable with such evidence.)

The Third Circuit has held that courts can ignore “superfluous evidence relating to the absence of consumer confusion” where literal falsity is demonstrated. “If survey evidence was deemed relevant rebuttal evidence in this context, plaintiff would be required to present its own surveys in response--obliterating the purpose of the rule.” The court rejected Neutrogena’s attempts to rely on the Schering-Plough case, distinguishing it as involving implicit rather than explicit falsity.

However, a defendant can offer evidence rebutting literal falsity. As to that, Neutrogena argued that Helioplex® had been defined to the public as “a breadth of stabilized sunscreen technologies that deliver superior UVA/UVB protection” without specific reference to DEHN. This ad was not previously brought to the court’s attention; the court allowed Neutrogena to put forward its evidence of this type.

No comments:

Post a Comment