Reading list: Lanham Act standing after Lexmark

Virginia E. Scholtes, The Lexmark Test for False Advertising Standing: When Two Prongs Don’t Make a Right, 30 Berkeley Tech. L.J. 1023 (2015):

Part I of this Note tracks the development of standing under § 43(a) of the Lanham Act and analyzes the three-way circuit split on false advertising standing that existed before the Lexmark decision. Part II describes the Supreme Court’s decision in Lexmark, focusing on the Court’s reasoning for formulating the new two-pronged test and the Court’s interpretation of the Lanham Act’s purpose. Part III assess the extent to which both the zone-of-interests prong and the proximate cause prong serve the purposes of the Lanham Act. First, Part III shows how the zone-of-interests prong gives a right of action to plaintiffs with an injury the Lanham Act was intended to protect, focusing on the issue of consumer standing under § 43(a). Next, Part III explains two situations where the proximate cause prong may fail to serve the purpose of the Lanham Act: when the defendant has a low market share, and when the plaintiff’s injury was inflicted through network effects. Finally, Part III analyzes courts’ application of the proximate cause prong in false advertising cases and concludes that the relaxed application of the proximate cause requirement will likely prevent this prong from barring plaintiffs who otherwise fall within the class of plaintiffs the Lanham Act was intended to protect. Overall, the Lexmark test for federal false advertising standing serves the purpose of the Lanham Act because it grants a cause of action to plaintiffs with a commercial injury, thus deterring unfair competition.