Friday, July 09, 2010

Allegations of deception satisfy pleading standard

Forest River, Inc. v. Heartland Recreational Vehicles, LLC, 2010 WL 2674540 (N.D. Ind.)

The parties compete in the recreational vehicle market. Heartland moved to dismiss a false advertising claim based on an ad for Heartland’s North Country trailer comparing it on 24 points with “The Competition.” The name of the product being compared is apparent only in the first two pictures of Forest River’s Puma trailer, with the Puma logo clearly visible under the label “The Competition.” But Forest River alleged that twelve of the pictures in the remainder of the ad are trailers from some other manufacturer, and that the ad has the natural effect of misleading consumers into thinking that those trailers all come from Forest River. Reverse passing off by the competition!

Heartland argued that, when a statement isn’t literally false, a plaintiff has to prove misleadingness with actual consumer confusion, and that Forest River failed to allege literal falsity or to allege actual confusion.

The court disagreed. Forest River alleged, in the court’s words, that customers and dealers “are likely to, and have in fact, assumed that the references in the ad to The Competition mean Puma brand products, when many of the comparison pictures actually show some other RV brand.” The ad, which was attached to the complaint, plus the pleadings together stated a “plausible” claim that the ad was both false and misleading and that viewers of the ad were actually misled under Iqbal and Twombly.

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