Candyland,
Inc. v. Cornfields, Inc., No. 14-3119 (D. Minn. Feb. 5, 2015)
Candyland,
which sells popcorn, candy, and chocolate, sued Cornfields and Snyder’s Lance
for trademark infringement and unfair competition based on their use of the
mark Chicago Mix. Candyland uses the
registered mark CHICAGO MIX for a mixture of traditional, caramel, and cheddar
popcorn. Defendants also sell popcorn
called Chicago Mix. Defendants counterclaimed for violations of the state
deceptive trade practices law, false advertising under the Lanham Act, and
defamation. Candyland was partially
successful in its motion to dismiss the counterclaims.
Defendants
challenged Candyland’s website statement, Chicago mix Trademark
Information, that they were “‘corporate sharks’ and ‘shameful companies’ out to
‘steal the trademark and use it at their discretion, punishing the entire
nation with over-priced, bad tasting, unappetizing, tainted mixtures of
popcorn.’” Candyland also called
Cornfields’ product an “infringing” “knock off,” and wrote, “Snyders of Hanover
aka Jay's Potato Chips aka Okedoke aka Gross! I mean lets [sic] be honest, is
it even popcorn?” In an article on
another website, Candyland accused Cornfields of producing “inferior products”
that “degrade the brand,” and accused Cornfields and others of “stealing the
name” in a book. A Candyland email to
bloggers said “We are doing whatever we can to protect the origin, history and
integrity of the Chicago Mix® trademark—We are just protecting something that
is being stolen from us, as would anyone else!”
Defendants alleged that these statements were defamatory and constituted
false advertising in violation of state and federal law.
The court
first asked whether the statements were falsifiable, considering 1) the precision
and specificity of the disputed statement; 2) verifiability; 3) literary and
social context; and 4) public context. Most of Candyland’s statements could not be
proven false because they were neither precise nor verifiable. There was no
objective standard for judging what’s a “corporate shark” or a “shameful
company.” Calling the defendants’ popcorn
“over-priced,” “bad tasting,” “unappetizing,” “gross,” “inferior,” or “degrad[ing] the brand” were statements of
judgment, not empirically verifiable facts.
The
epithet “tainted” also couldn’t be proven false. Though it could mean spoiled or rotten, in
context, the term “emphasize[d] Candyland’s disrespect for the general quality
of Cornfields’ and Snyder’s-Lance’s popcorn.”
It followed derogatory terms such as “bad tasting,” “unappetizing,” and
“punishing the nation,” and preceded the “hyperbolic” “is it even popcorn?”
Thus, the term indicated dislike, not an accusation of unfitness for human
consumption. Similarly, the “knock off”
accusation was opinion.
Only one
type of statement could be proven false: Candyland’s claims that the defendants
were “stealing” its trademark. (Not “infringing”?) Courts have disagreed
whether statements about the legality of a party’s action are opinions or can
be proven false; context is key. A statement
is provably false if “a speaker is aware that statements are either untrue or
unsupported conclusions not based on the prevailing law” but it is opinion if “the
speaker is only opining on unsettled areas of the law.” Here, the statements allegedly implied an
illegal activity. Whether they were
provable or mere interpretation depended on context, and on the result of the
trademark litigation. The statements
weren’t necessarily falsifiable; they might also be true. But at the motion to
dismiss stage the allegations sufficed for defamation. A similar result obtained for the state and
federal false advertising claims.
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