Thursday, August 08, 2019

Statement that advertiser is "2.0" version of competitor is puffery

GeoMetWatch Corp. v. Hall, 2019 WL 3537297, No. 1:14-cv-60 (D. Utah Aug. 2, 2019)

GeoMet and Advanced Weather Systems Foundation (AWSF) negotiated to create a joint venture for the purpose of constructing and deploying a satellite-hosted weather sensor system and commercially exploiting the data derived therefrom, but the incipient agreement collapsed. Defendant Tempus, and associated individuals and entities, allegedly colluded with AWSF and others to deprive GeoMet of its business opportunity. The court here gets rid of a false advertising claim.

The alleged falsities included: (1) In response to a question from a representative of a prominent American defense contractor about whether Tempus would be “assum[ing] the role of [GeoMet]” in the STORM project, Alan Hall (an owner of Tempus) stated that “yes we are replacing the roles and duties of [GeoMet]. We will own and manage the relationships of all entities in the consortium.” Copies were sent to representatives of AWSF—the putative manufacturer of the proposed sensor.  The court thought it wasn’t clear that a statement to a single defense contractor could be “commercial advertising or promotion” in the absence of facts about how many entities were in the relevant market.  But even setting that side, with the arguable exception of the statement “we are replacing the roles and duties of [GeoMet],” “the statements are all clearly forward-looking” and weren’t literally false: the court found that Tempus had a plan to do these things.  And they couldn’t be misleading to a reasonable business development executive at a multi-billion-dollar defense contractor, who “would not interpret these statements of future intent as ‘representations of fact.’” As for “replacing the roles and duties,” that indicated an ongoing activity, which was true—Tempus was preparing to do this.

Emails among Tempus- and AWSF-associated people also couldn’t ground a Lanham Act claim. Statements to co-venturers aren’t “commercial advertising or promotion.” 

GeoMet challenged Tempus’s website representations that it “designs, manufactures and operates environmental and weather monitoring instruments, known as STORM ... on a global scale.... From our sensors we gather the most sophisticated weather data ever produced and sell it to sovereign governments and commercial entities.” When this was published on the website, Tempus allegedly “had no means of gathering, producing, [or] selling weather data.”  This was thus a literally false statement.  But there was no evidence that this false statement ever confused anyone.  Although Tempus proved that, at the relevant time, “some individuals in the aerospace defense contractor space were confused about whether GeoMet or Tempus would be partnering with AWSF to construct and launch STORM, this confusion is wholly disconnected from Tempus’s false statement that, in April of 2014, Tempus had the ability to gather and sell weather data derived from an operational STORM sensor.”

In a demonstration of how much more rigorous false advertising doctrine is than trademark doctrine, statements that Tempus was “GeoMetWatch 2.0” were also not actionable. Given that the statement was made to a member of Congress—and Mark Twain’s quip on that topic notwithstanding—it wasn’t false or misleading. It didn’t convey the message that Tempus was literally “GeoMetWatch 2.0.” “Rather, any reasonable person—and certainly any reasonable member of the defense, satellite, or meteorological industries—would interpret this statement to mean that Tempus was a newer, better version of GeoMetWatch. In other words, this statement was mere puffery ….”  GeoMet argued that the statement falsely implied that GeoMet was out of the venture, but it didn’t; to the extent that the statement indicated that GeoMet couldn’t compete with Tempus, “that implication is likely to have been expressed and received as mere puffery.”

No comments: