Friday, March 17, 2017

All in the game: misleading tennis racquet endorsements don't support class certification

Ono v. Head Racquet Sports USA, Inc., No. CV 13–4222, 2016 WL 6647949 (C.D. Cal. Mar. 8, 2016)|

Ono sued Head for deceiving the public “into believing that top-ranked professional tennis players actually used [Tour–Line Racquets] during competition,” bringing the usual California claims. Although  he failed, the allegations—which seem to be substantially uncontested by Head—are of the kind that often draw FTC scrutiny, and the FTC doesn’t have the same problems that putative class representatives do.  The FTC does not like misleading endorsements, and Head would be well advised to read the extensive guidance it has offered on the topic, particularly about the endorser’s actual use of the endorsed product.

A press release issued by Head in April 2013, for example, stated that “[Andy] Murray was winning a thrilling match with his HEAD YouTek IG Radical,” that Richard Gasquet was “playing with his HEAD YouTek IG Extreme,” that Tommy Haas was using the HEAD YouTek IG Prestige, and it also mentioned “Maria Sharapova, who swings her new HEAD YouTek Graphene Instinct[.]”Another release from 2011 stated that Novak Djokovic “changed to his new YouTek IG Speed MP at the start of the season” and “Maria Sharapova showed tremendous performances with her brand-new YouTek IG Instinct MP[.]” Ono alleged that “professional tennis players whom Head pays to endorse specific models actually play with different tennis rackets—custom-made rackets that are not available to the general public or older models that have been discontinued or are sold at steep discounts—but which have been painted to look like the latest models that Head sells to the general public[.]”

The court found commonality, but not predominance. Head argued that most of its ads didn’t claim that an athlete used a specific racket.  The court commented that most of Ono’s claims about Head’s ads were supported by the record, which included more than 60 pages of press releases claiming that various professional athletes use specific Tour–Line Racquets in their professional matches. When the Senior Category Manager for Head’s tennis division was asked why Head did that, he answered “it’s always been that way.” Head provides lists to retailers that include “the player and the racquet that they are endorsing or playing with,” even if they weren’t playing with it in professional matches, and even without any knowledge of whether a player is or isn’t using it. Head’s president testified that players’ custom raquets are painted to look like standard Tour-Lines sold to the public, and,. in response to a question about whether that was “dishonest,” he simply said, “it’s inaccurate.”

Further, there was evidence that Head decisionmakers “knew that certain customers care a lot about what racquets their tennis idols use, and the evidence suggests that Head intended to maintain the ‘inaccuracy’ described in the preceding paragraph.” One 2009 employee email discussed Andy Murray’s use of a racquet with a different number of strings than the racquet Head claimed he used: “[i]t just makes it look like he is really not using the racquet we say he is and when this starts getting around on the message boards, it will not help our cause.... [P]eople like to have the same racquet (especially he [sic] techy-geeks) and we are making it impossible.” Another employee email: “[o]ne of our concerns, of course, is that now those serious players that want to play with what our pros play with will doubt they get the chance to play the actual Djokovic racquet.” A manager: “I am aware that players do not play with the retail version and I have no problem with that but we should have tried to make this as invisible to the public as we could, especially on a new series.”  Cf. Endorsement Guidelines, § 255.1(c) (“When the advertisement represents that the endorser uses the endorsed product, the endorser must have been a bona fide user of it at the time the endorsement was given. Additionally, the advertiser may continue to run the advertisement only so long as it has good reason to believe that the endorser remains a bona fide user of the product.”).

Head’s target market for the Tour-Line could, in its own words, be described as “die-hard tennis freak[s]…. They play competitively 5 to 7 times a week and follow the game religiously. They know what’s going on and who’s who in the international Tennis scene and ... are mainly influenced by their player idols, coaches and other players at their age and level of play.”

Head’s key argument was that its ads were varied and diverse, and “[m]ost do not include the allegedly false claim at the heart of this dispute—that a professional athlete used a specific racket in competition play.” Much of the advertising featuring professional endorsements “explain[s] the type of player each racket line or model is designed for and/or encourages consumers to visit the website to choose a racket best suited for their needs.” E.g., “The new YouTek IG Speed is specially designed for the needs of players like Novak Djokovic. It offers a stiffer feel for hard hitters with a long, fast swing style.”  The ads didn’t say which specific variant a player is using, or that they’re using a variant available to the public.  Also, Head argued that the reach of its marketing efforts was relatively limited. “Between 2009 and 2013, it placed print ads in two publications circulated to tennis teaching professionals, four tennis publications circulated to consumers …, and some tennis tournament programs; banner advertisements on tennis-focused websites; television advertisements on the subscription-only Tennis Channel; and press releases on its own website, the majority of which have been viewed 59 to 118 times or less in the United States.”

Even if the ads didn’t claim that an athlete used a particular racket in competition, a jury could find that the ads were nonetheless misleading “because reasonable consumers would understand them to mean that professional tennis players are using racquets that Head makes available to the general public.”  Minimal ad exposure also didn’t defeat commonality, which was a question of whether the advertising itself was materially misleading.  Head’s survey witness Hal Poret also conducted a survey in which only six percent of respondents answered “both that endorsement of a racket by a professional tennis player would be a factor in their decision and that they believe[d] from [a sample] ad[vertisement] that Andy Murray plays with the identical version of the racket sold to the public.” Of those who called endorsement an important factor, only 1.5% believed that Andy Murray used the racquet in question.  Still, variations in what class members might have believed or desired didn’t defeat the “relatively minimal showing required to establish commonality,” especially given that some elements of the California claims can be satisfied “without individualized proof of deception, reliance, and injury.”

Still, the case foundered on predominance, for the reasons largely given above.  Likely deception isn’t automatically a classwide question.  Ono failed to show that it was reasonable to assume that all, or even most, of class members were exposed to the allegedly deceptive ads, “and thus the question of exposure would have to be resolved on an individual rather than classwide basis.”  Even if Head’s target super-fans were more likely to be exposed than other people, the class definition wasn’t just super-fans.

Even painting racquets used in pro tournaments didn’t necessarily expose consumers to the deceptive practices.  There was no evidence that Tour’s customers generally watch tennis tournaments, or that they’d notice or be able to determine the model used by a pro on TV or even live. There was no evidence of an extensive decades-long campaign that might be used to infer exposure.

Nor was it reasonable to find that materiality and thus reliance could be litigated with common evidence.  While Head may have targeted its marketing at a segment of the population, there was no evidence that the target consumers were the actual consumers. “It would therefore be inappropriate for the court to presume that Head’s knowing that ‘tennis freaks’ would likely regard celebrity use of racquets as important is the same as Head’s knowing or having reason to know that purchasers of Tour–Line Racquets are similarly influenced.” [This strikes me as wrong: the reason that we infer deception from intent to deceive is that the fact that the seller thinks its representation will help sell its products is good evidence that it will do so; sellers who tout only unappealing features rarely last.]  Ono responded to Head’s survey evidence only by arguing that “those consumers who have purchased or are likely to purchase a tennis racket” in the price range of Tour–Line Racquets weren’t “representative of Head’s target Tour Consumer,” but the court already rejected Ono’s reliance on the target consumer.

In addition, “[e]valuating materiality using common evidence would be particularly challenging in this case due to the different representations regarding different racquets by different celebrity tennis players. While some press releases say outright that a certain professional player plays with a particular Tour–Line Racquet model, other advertisements merely link a player with a particular racquet silo [sub-brand], or describe a particular player’s style of play.”  Each would require separate deception analysis.  Also, the extent of deceptiveness varied—some pro players used racquets very similar to the models available at retail, and others used custom frames that differed more significantly.  Although Ono contested whether these sub-brands were designed for players like the respective endorser, that was a different misleadingness argument than the one about whether the endorser actually used the racquet.

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