legal memo to existing customers wasn't "commercial advertising or promotion"

IHS Global Ltd. v. Trade Data Monitor, LLC, 2021 WL 2134909, No. 2:18-cv-01025-DCN (D.S.C. May 21, 2021)

A trade secret/similar case in which IHS owns a database called Global Trade Atlas, which it acquired from the people who founded defendants, and you can basically guess what happened next.

The false advertising counterclaim arose from a legal memo that IHS sent to customers who had been contacted by two people on behalf of defendant TDM:

We understand that you have been contacted by Trade Data Monitor offering an equivalent service to the Global Trade Atlas. As you may be aware TDM is a business owned by an individual who sold the GTI business (including the GTA) to IHS, and TDM also employs a number of former colleagues of IHS [ ]. I’d like to make you aware that for a number of reasons we have commenced proceedings against TDM to protect our proprietary and other rights. Notwithstanding any proceedings we bring against TDM, we remain committed to support you and all of our GTA customers and to the long-term development of the Global Trade Atlas.

This wasn’t “commercial advertising or promotion” because, first, it was sent to only 9 customers, less than 1% of customers, and communicating with “such a minuscule subset of the relevant market can hardly comprise a ‘sufficient[ ] disseminat[ion] to the relevant purchasing public.’” Second, the memo was not “part of an organized campaign to penetrate the relevant market.” It was “a responsive communication to existing customers” rather than “an active advertisement intended to penetrate a market.”

Nor did the memo breach the nondisparagement clause in the parties’ contract. It didn’t “unjustly discredit” the principal or “detract” from his reputation; it didn’t even say that defendants violated the law or breached a contract.