Temu's "cheaper and way better quality than Shein" claims were potentially falsifiable, not puffery

Roadget Business PTE. Ltd. v. PDD Holdings Inc., 2026 WL 44864, No. 24-2402 (TJK) (D.D.C. Jan. 7, 2026)

Plaintiff, aka Shein, sells low-priced fashion and lifestyle products through a website and mobile application. Defendant runs a competing, discount-driven online platform—Temu. “Each platform has accused the other of engaging in unlawful, multifaceted campaigns to interfere with the other’s competitive posture.” This is Shein’s countersuit alleging trade secret theft, intellectual property right infringement, false advertising, and other unlawful acts. The court allowed trade secret claims and false advertising claims, but dismissed product disparagement or trademark dilution claims (Temu didn’t move to dismiss all of Shein’s claims).

In May 2022, Shein’s mobile app allegedly was the most downloaded app in the United States, and as of the filing of the complaint, Shein had over 33 million followers on Instagram and nearly 10 million followers on TikTok. Shein says it is “one of the most popular” online fashion and “lifestyle brands” worldwide.

Shein alleged that its success stemmed from its data-driven trade secrets about anticipating demand. Shein allegedly owned copyrights in both its photographs and its designs. Shein owns several trademark registrations for the SHEIN brand and its affiliate brands, and consumers allegedly associate all these brands with “the sale of high-quality fashion and home goods at a fair price.”

Temu, by contrast, functions as an “online marketplace” where independent third-party sellers sell their own goods. Temu allegedly stole Shein’s Best Seller Data; used or “instructed” its sellers to use copyrighted images of Shein products as promotional images on the Temu website and app; refused to let sellers “discontinue the sale of infringing products” on Temu, even when sellers request such removal; used the SHEIN trademark (or close variations, like “She/in”) in online ads, including sponsored ads on Google, which suggest that “authentic” Shein merchandise is sold on Temu, but when consumers click on the ads, they are directed to Temu’s website, which offers no SHEIN-branded products for sale; created “fake” accounts that use the SHEIN mark—for instance, by using the handle @SHEIN_USA—to “promote its own website” and to “trick consumers” into downloading its mobile app; and instructing paid influencers to “disparage” Shein’s products. E.g., one influencer (with over 137,000 followers) allegedly posted a series of pictures of herself wearing different Temu apparel with the caption, “Shein Alternatives, cheaper but way better quality! Check Temu.com out! So freakin cute and so freakin cheap!”  

Product disparagement: The court applied Massachusetts law as alleged by Shein. In Massachusetts, a plaintiff bringing a product disparagement claim must plausibly allege that the defendant “(1) published a false statement to a person other than the plaintiff; (2) ‘of and concerning’ the plaintiff’s products or services; (3) with knowledge of the statement’s falsity or with reckless disregard of its truth or falsity; (4) where pecuniary harm to the plaintiff’s interest was intended or foreseeable; and (5) such publication resulted in special damages in the form of pecuniary loss.” As is common with respect to mass advertising claims, Shein failed on (5).

Special damages are “essential” to a product-disparagement claim, and must be pled with specificity. They “limit[ ] a plaintiff’s recovery to the ‘pecuniary loss that results directly or immediately from the effect of the conduct of third persons’ acting in response to the alleged disparagement.’ ” If a statement was so “widely disseminated” that it is impossible to identify specific customers who chose not to buy the plaintiff’s products, then the plaintiff may show “that the loss of the market has in fact occurred and that no other factor caused that loss.” A plaintiff asserting that theory must at least allege “facts showing an established business and the amount of sales before and after the disparaging publication, along with [facts supporting] causation.”

The only, conclusory allegation about attendant damages is that Shein was “harmed by the dissemination of the Influencer Statements because they caused consumers to believe that SHEIN-branded products were inferior in quality to products sold by Temu when this is untrue.” Shein didn’t even allege that it lost any sales, let alone that any such hypothetical losses were solely attributable to influencer statements.

Dilution: Shein failed to allege fame. The very “nature of a dilution claim itself makes it difficult to state claim to relief that is plausible on its face.” Its allegations were conclusory, and worsened by the fact that it apparently tried to claim fame for its other “affiliate” marks, including SHEIN CURVE, DAZY, SHEGLAM, ROMWE, and LUVLETTE. It’s not acceptable to lump marks together like that.

Shein alleged that it “has invested significant time, effort, and money promoting, advertising, and marketing its business operations across multiple channels,” and that the “SHEIN brand also enjoys a significant presence on social media.” These allegations were “without more, conclusions, which are not a proper factual basis for a finding of fame.” Shein didn’t allege “how or since when it promoted its marks, or even how much money it invested in any such marketing.”

Shein’s complaint likewise offered no details whatsoever on the “amount, volume and geographic extent of sales” of any products offered under the SHEIN brand, let alone any of its affiliate brands. On “actual recognition of the mark,” a plaintiff cannot “simply allege” that “it has attained widespread and favorable recognition.” That Shein—as a “brand” or marketplace—allegedly enjoys a large social-media presence with “million[s]” of “followers,” says little about consumer recognition of the “trademarks ... in suit.” The Lanham Act protects “the mark,” not “the designer” or “the brand itself.”

“Shein’s alleged popularity on social media also says little about consumer recognition among the general population.” “Many brands are advertised” on social media and have a significant following there, but “not all are famous.” As for its registrations, “[o]ne cannot logically infer fame from the fact that a mark is one of the millions on the Federal Register.”

“[S]tating legal conclusions and reciting relevant factors is insufficient no matter the pleading standard. But especially so when a claim is inherently ‘difficult’ to establish because Congress prescribed a ‘purposely rigorous’ element—in this case, fame.” Shein’s alleged global revenue and growing customer base, or the number of downloads of its “shopping app,” “do not speak to the alleged fame of the SHEIN or any other mark.”

False advertising: Shein did better here, though the “influencer guidelines” were a “close call.”

First, were the accused statements “commercial advertising or promotion” or merely “[p]rivate communications with business partners.” True, providing guidelines to non-customers, without more, wouldn’t be false advertising. But Temu alleged more: that Shein “provided influencers with guidelines” that “require[d] them to make ... false” statements on social media, which were then made; these should, Temu alleged, count as Shein’s statements.

And social-media posts by paid influencers undisputedly qualified as commercial advertising under the Lanham Act. Thus, a plaintiff can state a false advertising claim by alleging that “the defendant itself, or through its paid agents, made false statements in commercial advertisements.” Shein plausibly alleged its agency theory of liability.

Temu’s puffery argument was a closer call, but the statements couldn’t be deemed puffery as a matter of law. (Not every court would agree, though I’m sympathetic.)

Temu’s Influencer Guidelines allegedly “instruct” influencers to include, among others, the following statements in their “Instagram Caption”: “Shein is not the only cheap option for clothing! Check Temu.com out, cheaper and way better quality!” and “Looking for clothes better than Shein but cheaper than revolve? Check Temu.com out.” And Shein gave examples of posts that used these/nearly these captions.

Claims that Temu’s clothes are “cheaper” but “way better quality” than Shein’s were actionable because they made “specific” claims that can “be[ ] proved false” or can “reasonably be interpreted as ... statement[s] of objective fact.” “Cheaper” was undoubtedly “objectively verifiable.” While statements like “better” generally “amount[ ] to little more than an exaggerated opinion of superiority that no consumer would be justified in relying on,” saying that a “product can do something ‘more efficiently,’ ‘easier,’ ‘quicker,’ or ‘safer’ is more specific.” This is especially true when a statement “make[s]” an “explicit comparison” to “other brands” about “particular characteristics that would be important to a consumer.” A reasonable consumer could “believe” that the advertising party actually “test[ed]” and compared competing products and “deduced” that one was “superior in these ways.”

“Here, a reasonable consumer could think just that.” Quality is a specific enough characteristic for clothes, and it’s material, “particularly in the fast-fashion context, where buyers know that low prices (a key selling point) can come at the cost of quality.” Indeed, the fast-fashion context itself renders the statement less “vague” and “unmeasurable,” “because there are only so many ways in which one company’s clothing article can be of ‘better quality’ than another’s.” Also, the “way better quality” claim appeared next to the verifiable claim that Temu’s clothes are “cheaper” than Shein’s, and was made by an “influencer” (depicting herself wearing Temu’s clothes) “whom consumers perceive as having personal experience with—i.e., as having ‘tested’—the products they promote.” How other courts treat a “a specific word is of little help unless that word is used in a sufficiently similar context,” and most of the cases cited by Temu involved general claims of superiority—e.g., “better customer service” and “better coverage,” or “better data network”—with no reference to specific features or specific competitor products.

Although a news article appended to the complaint stated that “Temu’s prices” for clothing “are usually ... 20-30% lower than on SHEIN,” that didn’t show that Temu’s prices are always cheaper than Shein’s—which Temu would need to show to establish that the alleged influencer statements, portraying particular products, are true.

For similar reasons, Shein stated a claim for contributory false advertising, which is available under the Lanham Act, since it’s available for trademark and 43(a) has the same introductory language applied to both causes of action.  “[C]ontributory liability is a common law theory of derivative liability that requires no express statutory basis.”

Dueling genealogists: photo (c) claims allowed, but not Lanham Act or factual compilation claims

Hein v. Mai, 2026 WL 44798, No. 24-01126-JWB (D. Kan. Jan. 7, 2026)

Some interesting stuff going on in the genealogy world!

The Volga German people are individuals of German origin who moved to the Volga region of Russia in the eighteenth century. … There is a sizable Volga German diaspora in the American Midwest. Plaintiff Margreatha Hein and Defendant Dr. Brent Mai are both genealogy researchers on the Volga German people. Their research is the subject of this lawsuit.

Hein operates volgagermans.org, where she publishes her research. Mai is the Dean of Libraries at Wichita State University, has held similar positions with other universities, and operates volgagermaninstitute.org, where he publishes his research.

Hein first objected to Mai’s copying in 2020; in 2023, she registered the copyright in eight photos she took in Europe that were republished on Mai’s website as early as 2017. (This removes her eligibility for statutory damages.) She also registered ten “textual compilations” and alleged that Mai copied 107 textual compilations from her website: paragraph form summaries of genealogical information, organized by last name.

The parties focused on a particular example, which plaintiff’s expert contended was representative; as plaintiff has the burden of proof of infringement, the court extended its finding of noninfringement to the other, unargued examples; plaintiff didn’t provide “any additional examples that vary in a significant way.”

Hein registered this text:

Johann Jacob Hessler (son of Johann Jacob Hessler of Niedergründau) was baptized on 15 December 1718. Anna Maria Meininger (daughter of Johannes Meininger of Mittelgründau) was baptized on 2 December 1725. Johann Jacob and Anna Maria married in Rothenbergen on 26 August 1745.

Baptisms were recorded for the following children, all born in Rothenbergen: Johann Conrad, born 5 February and baptized 12 February 1747 (died 30 April 1754); twin daughters born 28 May and baptized 29 May 1751, Anna Margaretha (died 16 May 1754) and Christina; Anna Margaretha born 22 May and baptized 25 May 1755; Elisabetha, born 24 January and baptized 26 January 1760 (died 27 Jan 1760); and twin sons born 5 February and baptized 7 Feb 1762, Valentin (died 5 Mar 1764) and Friedrich.

Jacob Hessler died on 8 Nov 1762. On 5 Jan 1764, Anna Maria Hessler (widow of Jacob Hessler) married Hartmann Ifland (son of Johannes Ifland from Lützelhausen) in Rothenbergen. They had a daughter Catharina, born 2 January and baptized 8 January 1765.

Hartmann, Anna Maria, and three of the Hessler children (Christina, Anna Margaretha, and Friedrich) arrived in Russia on 9 August 1766. Hartmann apparently died during the journey to the villages.

Mai admittedly copied; he listed Hein as a contributor or researcher. The parties’ research is “freely accessible to the public and neither party receives any income directly from the disputed material on their website.” Mai, however, on occasion receives income from leading tours of the Volga region or translating certain documents. Hein has stated she has no interest in similar business.

The court first allowed Dr. Kenneth Crews to testify as a copyright expert, but only about issues of fact (the process of getting a registration and possibly some facts related to fair use, though it’s harder to see how that would work), not ultimate legal issues.

Mai challenged Hein’s standing since she doesn’t seek to generate revenue, but she adequately alleged copyright infringement—which has a sufficient common law analogue—and reputational harm for the Lanham Act by listing her as a researcher/contributor and allegedly including inaccurate information.

Copyright limitations period: contested issue of facts precluded summary judgment for Mai given the discovery rule and the possibility that Mai engaged in new publications when he moved institutions/changed domain names. The court accepted Hein’s argument that she didn’t discover the “full scope” of the infringement until 2023 as sufficient to avoid summary judgment, though I’m not sure how persuasive that is given the 2020 objections.

Copyright in the form compilations of historical genealogical information: This claim failed because Mai did not copy anything copyrightable. The court’s north star was the Supreme Court’s admonition that “the selection and arrangement of facts cannot be so mechanical or routine as to require no creativity whatsoever.” Still, there might be a valid copyright in Hein’s compilations. But even with a triable issue on that, infringement claims failed.

Stripping each entry of uncopyrightable facts/asserted facts, what remained was a mechanical “skeleton.” An abstraction-filtration-comparison approach was useful here given the thinness of the copyright. The sample Hessler text was “composed almost entirely of facts (names, dates, and locations) that are not subject to copyright protection.” Without the facts, here was the selection/coordination/arrangement:

_____________ (son of _____________of _____________) was baptized on _____________. _____________ (daughter of _____________ of _____________) was baptized on _____________. _____________and _____________married in _____________on _____________. … etc.

Mai’s version:

Johann Jacob Hessler, son of Johann Jacob Hessler of Niedergründau, was baptized on 15 December 1718. Anna Maria Meininger, daughter of Johannes Meininger of Mittelgründau, was baptized on 2 December 1725, Johann Jacob and Anna Maria were married Rothenbergen on 26, August 1745.

The Gründau parish register records the baptisms of the following children of Johann Jacob & Anna Maria Hessler, each born in Rothenbergen: (1) Johann Conrad, born 5 February 1747, baptized 12 February 1747, died 30 April 1754; (2 & 3) twins Anna Margaretha (who died 16 May 1754) & Christina, born 28 May 1751, baptized 29 May 1751; (4) Anna Margaretha, born 22 May 1755, baptized 25 May 1755; (5) Elisabetha, born 24 January 1760, baptized 26 January 1760, died 27 January 1760; and (6 & 7) twins Valentin (who died 5 March 1764) & Friedrich, born 5 February 1762, baptized 7 February 1762.

Johann Jacob Hessler died 8 November 1762, and his widow remarried on 5 January 1764 to Hartmann Ifland. They had a daughter Catharina, born 2 January 1765 and baptized 8 January 1765.

The Ifland family, along with 3 of the Hessler children, arrived from Lübeck at the port of Oranienbaum on 9 August 1766 aboard the pink Slon under the command of Lieutenant Sergey Panov.

“While Mai’s reproduction certainly contains the same basic information as Ms. Hein’s skeleton above, it can hardly be said to be a copy of copyrightable content. Basic sentences, which at least in this example Mai does not copy verbatim, and words like ‘baptism’ or ‘born’ which appear throughout, do not possess the ‘creative spark’ required to demonstrate copyright protection.”

What about the “mode of presentation”? “Because Ms. Hein chooses the humble paragraph format to present her information, she argues that Dr. Mai should not have been able to do so. But this argument proves too much. Copyright law cannot grant the first researcher who discovered and published a compilation of facts with little additional synthesis a monopoly over the mode of presentation of that information.” All the other examples Hein submitted were substantially similar; summary judgment for Mai was appropriate.

That left the photos, as to which the court denied Mai’s motion for summary judgment on fair use. (This is also framed as a finding of no fair use, but it seems like it’s still available for trial.)

Purpose and character: Mai “primarily” argued noncommerciality, not transformativeness, which probably makes sense.  “While the court agrees that Dr. Mai’s use is on its face non-commercial, there is at least a question of fact as to whether the photographs contribute to Dr. Mai’s other sources of income, such as his tours or translations.”

Nature of the work: photos are creative. (Sigh; no mention of publication status or free availability elsewhere, though that shouldn’t necessarily outweigh creativity—but not all photos are the same!)

Amount and substantiality: eight whole photos.

Market value: Because Hein has no interest in monetization of the website or through tours and translations, “there can be no effect on the market.” However, “the fair market value could at some future date be affected should Ms. Hein ever decide to monetize her work.” Summary judgment denied. Mai’s pyrrhic victory on factor four is probably matched by Hein’s overall pyrrhic victory, given that statutory damages and attorneys’ fees are unavailable.

Lanham Act/state law unfair competition claims: Hein argued that the use of her name, with the title “researcher” or “contributor” placed next to it, diminished her stature in her research field and falsely indicated she has a professional association with Mai. Mai argued that Hein wrongly tried to create a “required citation format” through federal law, highlighting “apparently conflicting complaints that Dr. Mai does not give Ms. Hein credit but also diminishes her when he cites her.” (This is Dastar’s concern, too.)

The court didn’t have to reach the issue because it found that the Lanham Act and state law claims didn’t cover noncommercial uses. “The court’s survey of Lanham Act case law confirms a commerciality requirement.” (Citing Lexmark and its progeny—this requires the plaintiff to suffer a commercial injury and is different from requiring the defendant to be commercial.)

Although Hein alleged that the use of her name enabled Mai to receive income from selling tours and translations on a different page of his website, that wasn’t enough; it was simply “too attenuated,” given that Mai’s website was “overwhelmingly noncommercial in nature,” despite its link to another website with information about his tours. Even more attenuated were other alleged commercial connections:  Mai’s “paying for a URL and copyright registrations, having a bank account, and spending substantial sums on hard copy research materials, subscription websites, technical support for a website, and travel for research and to attend conferences.” Thus, Mai wasn’t using Hein’s name “in commerce.”   

false advertising's injury requirement causes reverse passing off claim to fail

Kesters Merchandising Display International, Inc. v. SurfaceQuest, Inc., --- F.4th ----, 2026 WL 35198, No. 24-3112 (10th Cir. Jan. 6, 2026)

SurfaceQuest allegedly marketed its products with photographs of its competitor Kesters’ competing product. Kesters sells “a lightweight, seamless material used in architectural products” called MicroLite, while SurfaceQuest mainly sells “architectural film that goes on surfaces like MicroLite.” Indeed, around 2014, the parties jointly marketed MicroLite samples wrapped in SurfaceQuest film. In connection with that, Kesters supplied SurfaceQuest with products, specification guides, and photographs of Kesters’ products. SurfaceQuest then applied its film to the products.

However, two years later, “SurfaceQuest decided to sell and market its own lightweight beam wrapped in SurfaceQuest film. These marketing efforts included advertisements using photographs of MicroLite.” Kesters alleged that SurfaceQuest “published a video characterizing MicroLite as SurfaceQuest’s product,” “published images from a grocery store renovation and misrepresented them as depicting SurfaceQuest products,” “placed a SurfaceQuest sticker on a MicroLite binder and falsely represented to a Kesters customer that SurfaceQuest had manufactured MicroLite,” “put a SurfaceQuest sticker on a MicroLite sample and falsely told Kesters customers that SurfaceQuest had invented MicroLite,” and “allowed a SurfaceQuest dealer to advertise with an image of MicroLite.”

Kesters lost its Lanham Act claim because “injury isn’t presumed and the plaintiff has not presented evidence of an actual injury.”

Kesters had the burden of showing injury: either a direct diversion of sales or a loss of goodwill. The court of appeals reasoned that a presumption of injury exists when the plaintiff proves material falsity and the “plaintiff and defendant are the only two significant participants in a market or submarket.” But, even presuming literal falsity, Kesters failed to create a genuine dispute of material fact regarding the presence of a limited market.

“[A] market is sparsely populated only when the other participants are insignificant. Otherwise, the court can’t assume that the plaintiff’s lost sales would go to the defendant.”  SurfaceQuest showed the existence of multiple competitors. Kesters had a competing affidavit, but it only offered it in support of its own summary judgment motion, not in opposition to SurfaceQuest’s summary judgment motion, and it only offered the affidavit too late—in a reply brief.

Dipping its toes into antitrust reasoning (always a dangerous move), the court of appeals reasoned that even considering the affidavit wouldn’t have helped. “To determine the scope of the market, we examine ‘cross-elasticity of demand,’ which measures the substitutability of products.” The affidavit didn’t address cross-elasticity of demand, only similarities between the products made by Kesters and SurfaceQuest. “But these similarities didn’t necessarily affect the ability to substitute products,” and “a single market may include companies making dissimilar products.”

Evidence of actual injury was also insufficient. Kesters argued that it lost a bid for work on a grocery store’s health markets, but there was no evidence that SurfaceQuest obtained those projects or that the store had seen SurfaceQuest’s marketing materials, whether directly from SurfaceQuest or otherwise. Thus, the district court couldn’t reasonably infer a causal connection between SurfaceQuest’s false advertising and Kesters’ loss of the bid.

laches, once established, bars Lanham Act claims even during more recent periods

Design Gaps, Inc. v. Distinctive Design & Construction LLC, --- F.4th ----, 2025 WL 3492373, No. 24-1860 (Dec. 5, 2025)

Super complicated facts; I’ll try to focus on the Lanham Act laches part because of that. “[A]fter a squabble developed over a cabinet and closet job for a luxury home in Charleston, South Carolina, the parties went to arbitration. The arbitration turned out well for the homeowners and the general contractor overseeing the home renovations but badly for the cabinet maker.” The cabinet maker nonetheless sued in federal court, including suing people that the arbitrator had held could not be brought into the arbitration because they weren’t bound by the agreement. The court of appeals nonetheless found that, because the disallowed parties were in privity with entities validly in the arbitration, res judicata and collateral estoppel precluded any claims against them based on the job.

Design Gaps “designs and installs cabinetry in luxury homes,” and frequently worked with defendant Shelter, “a general contractor engaged in homebuilding and renovation.” They had disputes during their years of working together. “For example, Design Gaps claimed from time to time that Shelter advertised Design Gaps’ cabinets without attributing the work to Design Gaps.” These claims were not covered by the arbitration, but they were still barred by laches.

The parties accepted that South Carolina’s three-year statutes of limitations for fraud and unfair trade practices supplied the analogous limitations period. Design Gaps filed its lawsuit on January 13, 2023, meaning that any alleged Lanham Act violations occurring before January 2020 presumptively were barred by laches.

Design Gaps argued that it did not have sufficient information concerning Shelter’s violations until arbitration commenced. But it sent a C&D in April 2018 about Shelter’s unattributed uses of Design Gaps’ work specifically referencing the Lanham Act in connection with its failure-to-attribute objections. While “mere knowledge that [a trademark owner] might have an infringement claim at some future date is not sufficient to trigger the period of unreasonable delay required for estoppel by laches,” the inquiry is objective. And the objective evidence was that “Design Gaps knew Shelter was using Design Gaps’ cabinet work in its promotional materials and that Shelter was not attributing that work to Design Gaps. Design Gaps had also stated in writing that it believed such conduct was false and misleading as to the origin of the cabinet work and that Design Gaps was being harmed. These facts are virtually identical to those alleged to support Design Gaps’ Lanham Act claims in this lawsuit.”

Would laches also cover continuing the same conduct during the presumptively not-lached period? Yes. Here, the core “claim” remained the same, so the continuing violation doctrine extended laches to the more recent period.

Design Gaps argued that its delay was excusable based on Citibank, N.A. v. Citibanc Group, Inc., 724 F.2d 1540 (11th Cir. 1984); there, Citibank should have known of the defendants’ use of its name “prior to 1960, but did not file suit until 1979.” “When [Citibank] first learned of defendants’ adoption of Citibanc as the name of its holding company in 1972, [Citibank] wrote letters warning that it regarded the use of” the name “as an infringement of [Citibank]’s rights.” But, unlike Citibank, Design Gaps did not “sen[d] several other letters over the next few years” before bringing suit. Moreover, in Citibank, the defendants did “not rel[y] on the delay of plaintiffs in expanding their use of the mark; indeed, they [ ] expanded their use while asserting their right to do so, in the face of plaintiff’s constant complaints.” By contrast, the record here didn’t indicate that Shelter asserted its belief that it had the right to promote its work in the way it did to Design Gaps.

Design Gaps also argued that settlement discussions excused its delay, but the record didn’t support the existence of discussions, only that Shelter didn't respond to the letter.

Design Gaps also argued that there was no prejudice. Prejudice can be economic or evidentiary. For trademark, a defendant’s “assertion that it would suffer economic injury if enjoined from using” a plaintiff’s mark, “without reference to any evidence beyond the length of time it has used the mark, is simply insufficient to establish economic prejudice.” In another false advertising case, the Fourth Circuit found that “unreasonable delay prejudiced” the defendant “because of [the defendant]’s continued use of the advertisement on all of its [products] in over a dozen retail stores for years,” to the point that the plaintiff alleged that the defendant “ha[d] been unjustly enriched by over $27 million.” The record didn’t show that much here, but Shelter “demonstrated its continued economic investment in promotional materials between 2015 and 2022.”

For evidentiary prejudice, a defendant must “articulate how” intervening time “would prejudice [its] defense specifically.” Indeed, a defendant “ha[s] an obligation to adduce specific evidence of prejudice” to use this type of laches. Shelter relied on the death of a Mr. Butler, one of its principals, who communicated with Design Gaps about the challenged conduct. Design Gaps argued that it served interrogatories and requests for production on Mr. Butler ten weeks before his unexpected death and that Shelter’s refusal to answer discovery and deficient responses created the prejudice Shelter claims to have suffered. “Design Gaps has not supported this argument with citation to the record. Besides, written discovery responses are no substitute for live testimony. Any responsibility for discovery issues does not change the fact that Shelter has demonstrated some evidentiary prejudice. When considered in the context of over four years of unreasonable delay, we conclude that Shelter has carried its burden.” (Not entirely sure why it’s Shelter’s burden given the presumption of laches, but ok.)

what particularity is required when an ad campaign has zillions of possibly algorithmic variants?

Ledesma v. Hismile, Inc., --- F.Supp.3d ----, 2025 WL 3785960, No. 24-cv-03626-KAW (N.D. Cal. Sept. 23, 2025)

Blogging because it’s one of the first cases I’ve seen that has to address questions raised by algorithmically modified ads that are different for different users. Hismile allegedly engaged in fraudulent marketing of its teeth whitening products, “which promise to deliver instant and dramatic results.” Plaintiffs brought the usual California claims. The judge grants the motion to dismiss, with leave to amend (except as to a nationwide class for breach of warranty/unjust enrichment, which is out for good).

Hismile allegedly advertises its products through social media, particularly on TikTok, Instagram, and Facebook, with falsified before-and-after images, misleading celebrity endorsements, deceptive/undisclosed influencer marketing, and “customer reviews” by its own employees.

For example, ads for one product allegedly show the product’s purple serum while it is still on the models’ teeth, giving an illusion that the purple serum cancels out the yellow tones (consistent with their advertising focusing on “color correction” and the “color wheel”), but “fully rinsing off the product causes the color-correcting effect to disappear entirely.” They also allegedly used unnaturally bright lighting and models who already have very white teeth to exaggerate the before-and-after effect of another product. Celebrities paid to endorse allegedly already have very white teeth and are not bona fide users. They also allegedly made false claims of clinical proof, in contradiction to the science indicating minimal effectiveness.

Hismile’s primary argument was that plaintiffs failed to identify the specific ads they saw sufficient to satisfy Rule 9(b). (I’m not convinced that Rule 9(b) should apply to false advertising statutory claims, which were designed to change all the key elements of common-law fraud, but most courts routinely apply it.) The court agreed, but indicated its willingness to accept a somewhat more detailed pleading.

Plaintiffs argued that it was enough to describe their experiences and provide example ads. E.g., plaintiff Tanaka “relied on before-and-after images and videos on Defendants’ Instagram and TikTok, customer reviews, and customer reactions on Defendants’ website and on social media.”  It’s true that “courts have found that pleadings are insufficient where the complaint included a number of representative advertisements, but it was unclear which specific advertisement the plaintiff had seen and relied upon in making their purchase. Likewise, courts have often found it insufficient to simply point to a particular misleading and fraudulent statement or phrase that appeared in various advertisements. Courts have also found it insufficient to merely provide representative advertisements without stating that those were the same advertisements that the plaintiffs saw and relied upon.”

However, plaintiffs argued that they alleged exposure to a long-term advertising campaign, allowing their claims to proceed under In re Tobacco II Cases, 46 Cal. 4th 298 (2009), which stated that when “a plaintiff alleges exposure to a long-term advertising campaign, the plaintiff is not required to plead with an unrealistic degree of specificity that the plaintiff relied on particular advertisements or statements.” The circumstances of the advertising campaign may make it “impossible” to identify the specific advertisement that persuaded an individual to purchase a product.

The court reasoned that “this appears to be a case where Plaintiffs could potentially allege a pervasive, targeted advertising campaign over a period of time, all of which pushes the same message: that Defendants’ products will ‘instantly and dramatically whiten’ teeth.” They alleged a multi-million dollar advertising campaign on social media; they also alleged posts of fifteen or more advertisements per day. One plaintiff alleged seeing approximately sixty advertisements before deciding to purchase the products; requiring a plaintiff to “specifically identify each and every one of these sixty advertisements hardly seems practical or practicable.”

This is especially true for modern social media advertising. At the hearing (not in the pleadings, which is key), plaintiffs noted that the ads include a “seemingly infinite variations of what the ads can look like,” with multiple ads including the same video but in different orders. “One video may include the yellow rubber duck clip followed by a scientist clip, while another video may have the scientist clip come first followed by the yellow rubber duck clip or a yellow banana clip. In short, the same yellow rubber duck clip may be in hundreds of different of ads, making it difficult to identify which advertisement an individual may have seen.” The realities of social media exposure to “numerous 30-second or shorter advertisements, each of which may have focused on demonstrating that whitening worked through color-correction technology,” had to be taken into account.

Bottom line: “To find that Rule 9(b) requires a plaintiff to meet such a high standard would be the same as insulating a defendant from liability simply because they have created so many different types of advertisements that are then repeatedly pushed onto social media users. This would not be a fair result.”

However, the complaint wasn’t enough as currently pled. “Plaintiff must still plausibly allege that this is the type of advertising campaign that would not require them to identify the specific advertisements they viewed,” with allegations about its duration or their exposure; allegations about the strategy of using the same clip in multiple advertisements; and/or allegations that defendants’ social media accounts include thousands of false advertisements.  

Also, with respect to some categories of claims— “before or after videos, videos with scientists and dentists explaining color theory, and videos demonstrating color theory by wiping off purple paint from yellow objects”—there was more specific information, but some plaintiffs alleged that they relied on influencer endorsements without identifying who the influencer was and what was stated:

Significantly, Plaintiffs do not appear to allege that all influencer endorsements are false, such that every influencer endorsement would constitute false advertising. Likewise, some Plaintiffs relied on customer reviews, but do not specify who made these reviews or what they stated. Again, Plaintiffs do not allege that all positive reviews are fake, nor do they suggest that reviews from real customers would be actionable. To the extent Plaintiffs intend to rely on influencer endorsements or reviews, Plaintiffs will need to provide sufficient allegations to demonstrate that the endorsements or reviews they relied upon were false.

The court also commented, looking forward to an amended complaint, that claims of “instant” and “dramatic” whitening might well be non-actionable puffery; “[s]tatements that characterize the speed of an action with terms like ‘fast’ are frequently held to be puffery.”