Pleading facts indicating that ad claims are likely impossible suffices for plausibility

Fan Fi International, Inc. v. Interlink Prods. Int’l, Inc., 2017 WL 4293144, No.16-cv-00661 (D. Nev.
Sept. 27, 2017)

After being sued in New Jersey, Fan Fi and ETL sued Interlink in Nevada for false advertising under the Lanham Act and deceptive trade practices and unfair competition under Nevada law, alleging that some of Interlink’s showerheads violated federal regulations because they permitted a flow of greater than 2.5 gallons per minute at 80 pounds per square inch when the flow restrictor was removed and that the flow restrictors could be removed with less than eight pounds of force.

False advertising claims can’t be based on unsettled regulatory provisions. The court found that the force test regulation was ambiguous.  The Department of Energy itself—the promulgating agency—expressly stated in the Federal Register that the meaning was so unclear that DOE had yet to establish a test method to determine whether a shower head satisfies the test. Though the 8-pound requirement is clear, the method by which resistance to removal was to be tested was unclear (e.g., what angle should the force be applied from).

Fan Fi previously alleged that Interlink advertised a 100,000-hour lifespan, exceeding typical industry claims of 25,000-to-50,000 hours, and argued falsity because this claim would take 11 ½ years to substantiate and unidentified consumers had complained that the LEDs failed in as little as two weeks. The court previously dismissed, with leave to amend, reasoning that a claim of product life could be based on a reasonable estimate, and that isolated instances of product failure did not show falsity. To plead falsity required something objective, “e.g., a mechanical comparison of Defendant’s LED system with an LED system of known lifespan” or the like.  Fan Fi now alleged that another entity tested one of the showerheads, finding a lifetime of 199 hours.  The allegations continued that the LED system comprised a motor that generates power to the LED light from the movement of water through the showerhead, and that this motor lasts for several hundred or several thousand hours, meaning that 100,000 hours wouldn’t be possible for the system.  Interlink argued that there was no indication of expert testing or testing of more than one unit, but that didn’t matter at the pleading stage, where plausibility could be achieved by alleging testing and an explanation of mechanical characteristics that made the ad claims likely impossible.