When is a photoshopped picture not false? when it's basically accurate

Louisiana-Pacific Co. v. James Hardie Building Products, Inc., No. 18-5913, -- F.3d --, 2019 WL 2710225 (6th Cir. Jun. 28, 2019)

Because termites, woodpeckers, and other pests may be able to damage engineered-wood building siding such as that which LP sells, the district court correctly denied LP a preliminary injunction to stop its competitor Hardie from advertising LP’s siding as vulnerable to pest damage.

LP makes “engineered-wood” siding—wood treated with zinc borate, a preservative that poisons termites; Hardie sells fiber-cement siding. Hardie advertised that “No Wood Is Good,” claiming that all wood siding—however “engineered”—is vulnerable to damage by pests. Its marketing materials included (1) digitally-altered images and video of a woodpecker perched in a hole in Louisiana-Pacific’s siding; and (2) nearby text boasting both that “Pests Love It,” and that engineered wood is “[s]ubject to damage caused by woodpeckers, termites and other pests.”

Was the digitally altered image/video literally false? A Hardie rep noticed that a home fitted with LP siding had a fist-sized hole; he photographed the damage and the photos ended up with Hardie’s ad agency. The agency used one photo in “No Wood Is Good,” “sharpening the image’s colors, darkening the interior of the hole to make it appear deeper, and superimposing a woodpecker.” Still, this wasn’t literally false. “The Lanham Act doesn’t require advertisers to lie in wait, cameras in hand, for an actual woodpecker to drum away at a house’s siding. Reasonable consumers know that marketing involves some level of exaggeration, and some amount of digital retouching to tell a story. Here, neither party contests that the photograph depicts a real hole in Louisiana-Pacific’s siding. And no reasonable consumer would expect that Hardie caught a woodpecker in flagrante delicto.” (Footnote: LP challenged Hardie’s expert’s qualifications to opine on the source of the hole, but he testified to 35 years of experience involving wildlife and human structures, including thousands of woodpecker cases. The district court didn’t abuse its discretion in crediting the expert.)

Additionally, “the advertisement fairly represents engineered wood’s susceptibility to woodpecker damage.” LP’s rep testified that the company had never tested its siding’s woodpecker resilience, had no data to support any assertion “that our product is resistant to some level against woodpecker damage,” and “can’t say [woodpecker damage] won’t happen .... [I]t’s possible.” Hardie’s expert evidence was the picture conveyed an accurate message— “namely, that a woodpecker probably created the photographed hole, and that woodpeckers often damage wood-based siding. Thus, though its digital enhancements might, colloquially speaking, render the image ‘false,’ they are not the sort of literal falsity the Lanham Act targets.” [Inaccurate, not false?] In other words, LP “proffered no evidence that the photographs misrepresent woodpecker behavior,” so it didn’t show literal falsity.

Nor did LP show misleadingness. It wasn’t enough to offer (1) testimony that Hardie intended the advertisements to affect consumer-purchasing decisions, (2) documentation that the campaign’s advertisements reached a large audience, and (3) a Hardie study demonstrating that consumers rely on manufacturers’ websites for product information, and that an ad featuring a woodpecker nesting in a hole would be more likely to persuade consumers than just a photo of a hole. None of the evidence showed that that Hardie’s ads “tricked buyers into believing an untruth (here, that woodpeckers peck holes in Louisiana-Pacific siding when they actually do not).”

LP also challenged the tagline “Pests Love It,” but that was just puffery. “No reasonable purchaser would believe that Hardie knows—or could discover—whether pests ‘love’ engineered-wood siding” or that it conveyed a quantifiable, objective fact about pest preference. Context can turn puffery into empirically verifiable claims; LP argued that the accompanying phrase, “[s]ubject to damage caused by woodpeckers, termites and other pests that can harm wood,” had been proved false by tests that rated both engineered-wood and fiber-cement siding as completely resistant to termite damage.

Hardie disputed the interpretation of the tests, and noted that LP’s siding resists damage because it’s treated with zinc borate, but termites must still eat small amounts before the zinc borate poisons the termites. Hardie argued that its statement was truthful, or at least ambiguous. LP rejoined that such grazing causes no structural or obvious aesthetic damage, but its own experts admitted that grazing results in some damage. And LP’s warranty explicitly excluded non-structural termite damage. Under the circumstances, the question was whether reasonable consumers would interpret Hardie’s use of the word “damage” to unambiguously mean structural damage. LP didn’t show that they would. And again, LP didn’t show that consumers were misled with extrinsic evidence.