Thursday, May 16, 2024
BIPLA (Boston Intellectual Property Law Association) Writing Competition call for papers
Monday, May 13, 2024
Reminder on Call for Papers: Trademark and Unfair Competition Scholarship Roundtable 2024
The Trademark and Unfair Competition Scholarship Roundtable co-hosted by Harvard, NYU, and the University of Pennsylvania will take place this year at Harvard. The Roundtable is designed to be a forum for the discussion of current trademark, false advertising, and right of publicity scholarship, covering a range of methodologies, topics, and perspectives. Five to six papers will be chosen for discussion over the course of the Roundtable, with each paper allocated an entire hour for discussion and assigned a commentator.
The Roundtable will be held on Friday, October 18, 2024. If there is a critical mass of papers, we may also extend the Roundtable through Saturday morning, October 19. Participation at the Roundtable will be limited and invitation-only and we expect all participants to have read the papers in advance. The Roundtable will cover the travel and lodging expenses for invited authors.
We invite submissions from academics working on any aspect of trademark, false advertising, marketing, right of publicity, or related areas of the law. Priority will be given to those who can attend the entire event and a dinner the night of Friday, October 18. Submissions must be of full drafts in Microsoft word format. The deadline for submission is May 15, 2024, and decisions on participation will be made shortly thereafter, ideally, by June 1st.
To submit a draft paper, please fill out the form here (https://forms.gle/QAfdmH18KmgdZAxp7) and upload an anonymized version of your draft. Please note that the maximum file size that may be uploaded is 10MB. Appendices or other supporting material can be uploaded separately; please do not submit a CV or cover letter.
For further information about the Roundtable, please email: Barton Beebe (NYU): barton.beebe@nyu.edu; Jennifer Rothman (Penn): rothmj@law.upenn.edu, or Rebecca Tushnet (Harvard): rtushnet@law.harvard.edu.
court remands NYC's false advertising case against oil companies to state court
City of New York v. Exxon Mobil Corp., 2024 WL 2091994, No. 21-CV-4807 (VEC) (S.D.N.Y. May 8, 2024)
Being a multitrillion-dollar
corporation means you can survive a “ridiculous” argument or two. Here, the
city successfully wins remand (and a fee award) in this opinion rejecting
removal of its false advertising suit against Exxon, other fossil fuel
companies, and their top trade association for violations of New York City’s
Consumer Protection Law. Following a similar case, Connecticut v. Exxon Mobil
Corp., 83 F.4th 122 (2d Cir. 2023), the court understandably refuses to
distinguish it.
The complaint alleged
that defendants “misled consumers about the impact of their products on the
climate and falsely represented themselves as corporate leaders in the fight
against climate change.”
Defendants removed,
alleging (eventually) six bases for federal jurisdiction: (1) the City’s claims
arise under federal common law because they implicate transboundary pollution
and foreign affairs; (2) the action falls under the federal officer removal
statute, 28 U.S.C. § 1442(a)(1); (3) Defendants’ production and sale of fossil
fuels occur on “federal enclaves;” (4) the Court has diversity jurisdiction
over the action under the fraudulent joinder doctrine; (5) the action is
removable under the Class Action Fairness Act; and (6) the City’s claims
include federal constitutional elements.
The federal removal
statute allows a defendant to remove to federal court “any civil action brought
in a State court of which the district courts of the United States have
original jurisdiction.” “[O]ut of respect for the limited jurisdiction of the
federal courts and the rights of states,” federal courts must “resolv[e] any
doubts against removability.” The “well-pleaded complaint rule” provides that
federal question jurisdiction “exists only when a federal question is presented
on the face of the plaintiff’s properly pleaded complaint.” However, a
plaintiff cannot defeat federal question jurisdiction by pleading its complaint
as if it “arises under state law where the plaintiff’s suit is, in essence,
based on federal law.” Nonetheless, federal question jurisdiction cannot be
created “on the basis of a federal defense, ... even if the defense is
anticipated in the plaintiff’s complaint, and even if both parties concede that
the federal defense is the only question truly at issue.” There are only three
circumstances in which a complaint that does not allege a federal claim may
nevertheless “arise under” federal law for purposes of removal: “(1) if
Congress expressly provides, by statute, for removal of state-law claims; (2)
if the state-law claims are completely preempted by federal law; and (3) in
certain cases if the vindication of a state-law right necessarily turns on a
question of federal law.”
Federal common law
that completely preempts state claims based on transboundary pollution and
foreign affairs: That’s not a thing. False advertising claims “do not become
claims about transboundary pollution and foreign affairs just because the
alleged deception relates to the impact of fossil fuels on the climate.” Plus, “there
is no indication that Congress expressly authorized or intended to completely
preempt state laws that have a glancing relationship to transboundary pollution
or foreign affairs,” and the constitutional structure doesn’t do that all on
its own. “Even if federal common law could, in the abstract, have complete
preemptive effect, it would not preempt Plaintiff’s claims, which are
garden-variety false advertising claims…. There is simply no conflict between
the State’s interest in ensuring its consumers are not misled by false
advertising and any federal interest in regulating environmental pollution.” So
too with foreign affairs: “[T]his Court cannot imagine any state of affairs
under which [foreign affairs] would be affected by an order enjoining
Defendants from disseminating misleading ads in New York City.”
Federal officer
removal: The federal officer removal statute permits removal of a state court
civil action “that is against or directed to ... any officer (or any person
acting under that officer) of the United States or of any agency thereof ...
for or relating to any act under color of such office.” For non-federal
officers to invoke this statute, they “must (1) show that [they are] a person
within the meaning of the statute who acted under a federal officer, (2) show
that [they] performed the actions for which [they are] being sued under color
of federal office, and (3) raise a colorable federal defense.” They did not.
Federal enclave
jurisdiction: This is the “silliest” of defendants’ argument. Section 8 of
Article I of the U.S. Constitution authorizes Congress “[t]o exercise exclusive
Legislation in all Cases whatsoever ... over all Places purchased by the
Consent of the Legislature of the State in which the Same shall be, for the
Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful
Buildings.” Defendants’ theory, “contrary to fact,” was that the complaint
targets their extraction, production, and sale of fossil fuels, including
“operations that occur on military bases and other federal enclaves.” Also, the
advertising the City alleged is false reaches federal enclaves, i.e., “API’s
Super Bowl ads reach federal enclaves, such as Ellis Island and Fort Tilden.” This
is silly because (1) the complaint doesn’t target extraction, production, and
sale of fossil fuels, and (2) the “advertising reaches federal enclaves”
argument is “ridiculous” and would federalize “all consumer protection laws
that relate to advertisements (and probably everything else); it is
self-evident that all advertisements on the internet, television, radio and in
newspapers can be viewed or heard by persons who happen to be in a federal enclave.”
Diversity
jurisdiction: Defendants argued that the only non-diverse party, ExxonMobil,
was fraudulently joined. Not so.
CAFA: This was “[s]econd
in absurdity.” The City was suing under its parens patriae power, not as a class
action. As the court pointed out, the City can sue without proof that consumers
have actually been injured, “a far cry from the basic requirement in Rule 23
that a class representative have a representative injury.”
First Amendment: Federal
jurisdiction where a complaint doesn’t state a federal claim exists if a
federal issue is: “(1) necessarily raised, (2) actually disputed, (3)
substantial, and (4) capable of resolution in federal court without disrupting
the federal-state balance.” For a federal issue to be “necessarily raised,” the
“mere presence of a federal issue in a state cause of action” is inadequate;
the question of federal law must be “a necessary element of one of the
well-pleaded state claims.” The false advertising claim would “necessarily
raise” a federal issue only if it was “affirmatively ‘premised’ on a violation
of federal law.” But they didn’t: the false advertising claim requires that
defendants (1) engaged in “deceptive or unconscionable trade practice[s]” and
(2) those practices involved “consumer goods or services.”
Still, defendants
argued that their speech was on a matter of public concern, so the court couldn’t
resolve the misrepresentation claims without addressing whether the First Amendment
protected the advertising. That argument confused a defense (the statements
were truthful protected speech) with an element of the city’s claim. “If the
law were as Defendants urge, every libel, slander, and false advertising claim
in the country” would be removable.
Fee-shifting in unsuccessful
removals is up to the district court’s discretion, but should deter “removals
sought for the purpose of prolonging litigation and imposing costs on the
opposing party.” Here, the Second Circuit rejected three of the (initially)
seven grounds for removal defendants argued, plus three that weren’t before the
Second Circuit, but had been “roundly rejected by countless courts throughout
the country.”
Even if removal was
in good faith before the Second Circuit’s ruling, the renewed motion to remand
was briefed afterwards, and it made multiple already-rejected arguments. The
court found it appropriate to award costs and fees “in connection with
arguments that it was not reasonable for Defendants to press when the City
renewed its motion for remand: arguments that had largely been decided by the
Circuit in Connecticut – federal common law, federal officer removal,
and First Amendment defenses, and those that were objectively absurd – federal
enclaves and CAFA.” Only the diversity jurisdiction argument was not
unreasonable.
Friday, May 10, 2024
reasonable consumers of ovulation test kits understand details of hormone signalling
La Rosa v. Abbott Laboratories, No. 22-CV-5435 (RER) (JRC), 2024 WL 2022297 (E.D.N.Y. May 7, 2024)
Plaintiffs alleged
that defendants’ at-home ovulation test kits were deceptive because they
advertised “ovulation test kits” alongside the front-of-package statement “99%
ACCURATE,” which conveyed that that the tests are 99% accurate at testing for
ovulation, when in fact, the products detect a surge in luteinizing hormone (LH),
and not actual ovulation. “All the kits state in small writing on the side or
back of the packaging that they are 99% accurate at detecting LH levels.” Some kits
include an asterisk next to the claim “99% ACCURATE”; others include statements on the front of the
packaging that they detect “LH Surge” or “No LH Surge.”
As alleged, the kits
detect a rise in urinary LH levels, which typically precedes ovulation by
twenty-four to thirty-six hours. But LH surges may occur at other times in a
person’s menstrual cycle; body mass index, age, contraceptive use, sports
activity, and smoking may affect urinary LH levels; when a person has an
irregular cycle, the test could inaccurately indicate that no ovulation occurred;
and more than ten percent of menstrual cycles are subject to a condition known
as “Luteinized Unruptured Follicle Syndrome,” during which there is a normal LH
surge and menstruation, but no egg releases. LH surges may also be detected in
women who are infertile. The only current method for predicting ovulation with
“a high degree of accuracy” is an invasive transvaginal ultrasound.
The court found that
plaintiffs failed to state a claim under NY and California consumer protection
law. Courts sometimes demand a lot of “reasonable” consumers—here, the court reasoned
that reasonable consumers know the scientific details of fertility and should
know the difference between LH surges and ovulation, especially given the
package disclosures:
First, a key contextual inference arises from the products themselves:
it is impossible to test for actual ovulation. A reasonable consumer does not
expect to purchase a product that is impossible to find in the marketplace. …
The FDA explains that at-home ovulation urine tests measure LH to detect
ovulation and are successful at doing so “reliably about 9 times out of 10[.]”
This explains that tests that reveal actual ovulation do not exist. Although a
reasonable consumer is not expected to have medical expertise, in the context
of a niche, specialty product, purchasers exhibit a higher degree of care. And
indeed, Defendants’ products are a specialty item targeted to a class of
informed consumers to aid in their attempts to become pregnant. Many buyers of
ovulation test kits have had trouble getting pregnant in the past, and as such,
seek help from various sources. According to Plaintiffs, “[a]s of 2015, an
estimated 7.3 million women had received some sort of infertility service[.]” In
turn, many ovulation test kit consumers would be expected to have at least some
information leading up to their purchase, and therefore know what to expect to
find in the marketplace—they do not expect to find at-home test kits that
indicate actual ovulation.
This does not seem
to me—as someone who has indeed been in the general market for this type of
product—to be a description of reasonable consumers of specialized medical
services, who tend to outsource a lot of the details to presumed experts.
In addition, the
court reasoned,
a reasonable purchaser of Defendants’ products necessarily looks to the
side and back of the box to understand how to use the products. Alongside these
directions, the boxes for all the products in question clarify that the
products test for LH, not for ovulation itself, and that an LH surge typically
precedes ovulation. By contrast, a consumer of something such as a basic food
item is not expected to flip over the packaging to look for clarification or
disclaimers.
Read together,
“Ovulation Test Kit” and “99% Accurate” could imply 99% accuracy at
testing for ovulation, but the two phrases could also be read separately. And,
true, some products include phrases on the front like, “Predicts Your 2 Most
Fertile Days” and “Early ovulation test ... tells you the best 2 days to
conceive.” Nonetheless, “regardless of where the front package falls on the
spectrum, the product requires a standard of care that necessitates looking at
the complete package.” And it wasn’t alleged that the tests didn’t reliably
predict ovulation, even if not at the 99% accuracy level. Thus, “the clarifying
language on the side or back of the packaging dispels any confusion.”
Tuesday, May 07, 2024
online ingredients list can't avoid deception claim, at least where survey suggests deception
Duncan v. Kahala Franchising, L.L.C., --- F.Supp.3d ----, CV 22-7841 (GRB)(AYS), 2024 WL 1936053 (E.D.N.Y. May 2, 2024)
Lots of ice cream
jokes/quotes in here, but the basic question is: “should consumers ordering
pistachio ice cream at one of [Cold Stone Creamery’s] establishments expect
that that product will contain actual pistachios?” Because it doesn’t, the
consumer protection claim survives.
To bolster the plausibility
of her claims, plaintiff alleged that industry practice was to the contrary: Häagen-Dazs
Pistachio Ice Cream and Ben and Jerry’s Pistachio Ice Cream both include actual
pistachios, as does Thrifty brand ice cream, disparagingly described as “a less
premium brand than Cold Stone Creamery.” And Cold Stone Creamery’s “strawberry
ice cream contains strawberry, banana ice cream contains banana, and its
chocolate hazelnut ice cream contains chocolate and hazelnut.” Duncan also surveyed more than 400 U.S.
consumers, each of whom had purchased ice cream within the preceding three
months. Respondents asked “When viewing the image above, what ingredients do
you believe would be included in the Pistachio ice cream? Select all that
apply.” There was a list of ten potential ingredients, including pistachio and
flavor agents, as well as the option “none of the above.” About 85% of the
respondents believed that pistachio would be included; likewise, 88.6% of
respondents expected that the Mint ice cream contains “mint.” (Plaintiff also
challenged the absence of mango, coconut, mint and orange in those respective
flavors, and the absence of butter in butter pecan, but there was no survey on
anything but pistachio and mint.)
Given that the “vanilla”
cases often dismiss claims at the pleading stage, should the court do so here?
The court identified relevant factors in previous cases:
[T]he presence or absence of express representations regarding the
ingredients used, such as “made with”; the availability of an ingredients list
to the purchasing consumer; whether the flavor designation employed finds use
as both a noun and an adjective; and the availability and significance of
consumer survey evidence.
In addition, the
court considered “allegations concerning competitor products giving rise to an
inference about consumer expectations.”
There was no express
“made with pistachio” representation here, but that wasn’t dispositive. Context
includes the ingredients list and the visual appearance of the product. The
fact that the ingredient list was available online was not helpful to
defendant. While back-of-package ingredients lists can clarify any ambiguity,
the analogy to online ingredients lists “fail[ed] spectacularly.”
Courts have rejected defense arguments based on ingredients lists that
are difficult for a consumer to access. [Citing cases rejecting reliance on
small-print or hard-to-find disclosures.] These typographic barriers pale in
comparison to the physical segregation presented in this case: defendant is not
attempting to rely on an ingredients list on the package or in small print on a
sign, which might require a consumer to inspect a side panel or reach for a
pair of reading glasses. Rather, examining defendant’s ingredients list
requires access to an Internet-capable device and conducting a web search to
locate it. If “a reasonable consumer should not be expected to consult the
Nutrition Facts panel on the side of the box to correct misleading information
set forth in large bold type on the front of the box,” it seems inconceivable
that such a consumer should have to search online to find the relevant web page
while waiting in line to order a scoop of ice cream.
In addition,
requiring consumers to check online “also seems antithetical to the experience
offered by defendant to the public, as described on another section of its
website:… We like to think we’re really in the business of making people happy
... It’s all about what we call the 10-Minute Vacation® ... that 10-minute
getaway you deserve from the world outside our doors. Just head inside any Cold
Stone Creamery, and that’s what you’ll get.” That was inconsistent with a duty
to locate, read, and analyze online ingredient statements.
Defendant also
argued that the visual appearance of the ice cream—smooth and without apparent
chunks of pistachio—avoided any deception, but that wasn’t apparent from the
face of the complaint.
Adjectival use as a
flavor name favored the defendant, but that too wasn’t enough for pistachio; it
was weightier for mint, because “as an ingredient descriptor, it is highly
unspecific [as to spearmint, peppermint, etc.], whereas it commonly finds use
as a flavor descriptor without any reasonable expectation that the leaves of a
particular mint plant will be involved.”
Use of actual
pistachios in competitive products favored the plaintiff, again only as to
pistachio.
The survey was the
most helpful. “Defendant attempts to quarrel with the survey methodology, an
effort which proves both unpersuasive and misplaced at this juncture, as the
open-ended questioning here stands in stark contrast to leading questions asked
in other cases.” The nearly 90% results were also significant, though not as
persuasive for mint.
While 88% of the respondents indicated that they expected to find “mint”
among the included ingredients, it is impossible to say what this means. Did
they believe that the ice cream contained mint leaves or the extract of a mint
plant? As “mint” encompasses an entire family of plants as well as common
candies that bear the flavor of mint, this result proves far less compelling.
Perhaps, after all, some respondents expected to find “chunks of red and green
mint candy,” the advertised feature of Hershey’s Premium Peppermint Stick ice
cream ….
Thus, the false
advertising consumer protection claim was plausible as to pistachio, not as to
the other flavors. It’s always so interesting seeing what generalizations about
consumer beliefs courts are willing to make. I guess they have to re-run the
survey with each flavor, and also with a list of mint plants? Would “mint from
a mint plant such as spearmint or peppermint” be an acceptable category?