Instagram disparagement by alleged competitor isn't commercial speech

Farina v. Omari, No. 24-11098 (SDW) (AME), 2026 WL 1552256 (D.N.J. Jun. 2, 2026)

The court grants a motion to dismiss in this defamation/false advertising claim centered on online videos.

“Farina is a consultant in the aesthetic surgery industry and operates through her business Beauty Brokers. Defendant is also a plastic surgery and aesthetics consultant.” Defendants made several defamatory statements on Instagram questioning plaintiffs’ credentials and alleging that they received kickbacks from surgeons. Omari also streamed live on Instagram, allegedly stating that “Farina is a bad person and bad businesswoman; that she scams a lot of people; and had a surgical procedure but never paid for it.” The complaint asserted (1) defamation; (2) false light; (3) tortious interference with prospective business relations; (4) false advertising/unfair competition; and (5) trade libel.

Defamation: Failed for want of defamatory character/being opinion. The allegedly defamatory claims: 1. “[Farina] is just a dental hygienist.” 2. “[Farina] gets paid on both ends and allegedly gets kickbacks.” 3. “Basically, people now pay $1,000 to have a consult with her so she can suggest one of these surgeons from “Beauty Brokers’ Little Black Book of surgeons.” 4. “Lots of surgeons I know have STORIES, and tons of my followers have sent in stories of [Farina] being super rude, canceling all the time and being late, not helpful, and having a hard time getting their money back if she messes up or doesn’t provide the services promised.” 5. “[Farina] is a bad person/bad businesswoman.” 6. “She scams a lot of people and had a surgical procedure that she owed money for but never paid it.”

Since Farina previously worked as a dental hygienist, “just a dental hygienist” was substantially true, and the complaint didn’t explain why highlighting Farina’s background as a dental hygienist subjects Farina “to contempt or ridicule,” and “harms [her] reputation by lowering the community’s estimation of [her] or by deterring others from wanting to associate or deal with [her].”

“[G]ets paid on both ends” and “allegedly gets kickbacks”: The gist of the first part was substantially true since plaintiffs admitted to a previous membership program where surgeons paid a membership fee to join their referral network, and to experimenting with a fee-splitting arrangement involving surgeons in their referral network and receiving gifts from surgeons. Although “kickbacks” could be read to accuse plaintiffs of a criminal offense or other illicit behavior, in context it referred to payments from surgeons for referrals and not to any criminal or illegal conduct.

The “pay $1,000 to have a consult with her so she can suggest one of these surgeons from Beauty Brokers’ Little Black Book of surgeons” didn’t rise to the level of defamation. And the final statements were opinion, especially given the context: the statements “were delivered by a social media influencer on Instagram,” and Instagram is a place “where a reasonable [viewer] will expect to find many more opinions than facts,” thus “strongly signal[ing] to readers that the posts merely reflect the publisher’s opinions.”

False light failed for failure to plead actual malice. Trade libel failed for the same reasons as defamation did. Tortious interference failed because plaintiffs failed to allege the existence of any lost prospective economic benefit that they would have retained “but for” the alleged interference. Attributing the sixteen customers who cancelled their appointments in the three weeks following the first post to defendant was speculative even though plaintiffs alleged that they normally only get one cancellation per week.  

Lanham Act false advertising: Not commercial speech, even assuming the parties were competitors. “Plaintiffs argue for an overly broad definition of commercial speech, essentially stating that any criticism from a purported competitor must be commercial speech.” But “the alleged misleading statements do not advocate for the reader to purchase a particular product or service over another. In fact, none of the alleged statements explicitly or implicitly refer to the alleged similar service offered by Defendant.” [don’t love this!]

New Jersey’s Uniform Public Expression Protection Act (its anti-SLAPP law) applied in federal court “to the extent that it affords fees, costs, and expenses to a prevailing movant who successfully dismisses a SLAPP suit under Federal Rule 12 or Federal Rule 56.” “For UPEPA to apply, the challenged speech must pertain to an area of public concern.” Farina was a limited purpose public figure, and the challenged statements related to a particular public controversy within the cosmetic surgery industry. UPEPA doesn’t apply to a cause of action asserted “against a person primarily engaged in the business of selling or leasing goods or services if the cause of action arises out of a communication related to the person’s sale or lease of the goods or services.” But the challenged statements weren’t commercial speech and don’t refer to any services offered by defendant. Thus, the defendant could get her fees, costs, and expenses.

despite some skepticism, court mostly allows adtech vendor's disparagement claims against competitor to proceed

Double Verify Holdings, Inc. v. Adalytics Research, LLC, No. 25-1535-TDC, 2026 WL 1133411 (D. Md. Apr. 27, 2026)

DoubleVerify is in the business of “helping brands, agencies, and publishers verify that their digital advertising investments are delivered as intended.” Its customers advertise online and thus seek to ensure maximum viewership by real potential consumers. “Online ads are typically placed on websites through a high-speed, auction-like process.” The auctioneer, a “demand-side platform,” collects “bids” from advertisers; this is the “pre-bid” stage. If an advertiser’s bid is accepted and its ad is displayed, or “served,” to the webpage visitor, the advertiser will be billed for the “impression.”

Online advertisers retain DoubleVerify to avoid having their ads served to bots rather than to humans, and to avoid paying for such impressions if they do occur. DoubleVerify offers two solutions to help customers avoid paying for views resulting from bot activity, aka invalid traffic (IVT): it claims that its pre-bid service successfully filters out 99 percent of GIVT impressions at the pre-bid stage, but it also offers a post-serve service that (1) identifies and removes views resulting from standard bot IVT (GIVT) from the counts of billable views and (2) notifies customers about views resulting from malicious IVT so that they may then seek reimbursement from the publishers. Users can use the pre-bid service, the post-serve service, or both.

Adalytics is an “ ‘ad-tech’ vendor” that “sells an ad transparency service that competes with DoubleVerify” and allegedly carried out a disparagement campaign. Its report quoted DoubleVerify’s claim that it “offers the most comprehensive and accurate pre-bid avoidance targeting available in the market” but didn’t mention DoubleVerify’s post-serve services.

The Report claimed to be the “largest analysis of declared bot traffic in the context of digital advertising.” Relevant claims: (1) “Many publishers which appear to employ the IAS and DoubleVerify publisher optimization tools on their pages were observed serving ads to bots, including to declared bots operating out of known data center IP addresses.” (2) “Hundreds of major brands whose ads’ source code include[s] … code from DoubleVerify appear to have had their ads served to bots in data centers.” (3) Advertisers “whose ads appear to be mediated by DoubleVerify’s Scibids AI technology” were served “to declared bots operating out of known data center IP addresses or to URLScan[’s] bots.”

It concluded that “[i]nterpreting the results of this observational study requires nuance and caution,” and that “[o]ne should not assume that because a given ad tech vendor or vendors transacted a given ad to a bot that those vendors are somehow responsible or ‘at fault’ for the ad being served to a bot.” The Report also cautioned that “[r]eaders should be discerning and careful not to conflate distinct sets of observations or draw inferences about causality, intent, quantitative impact, magnitude, or provenance,” and that it “makes no assertions about” these issues. And it said that it “does not make any recommendations to media buyers with regards to whether or not to transact with specific ad vendors or with specific publishers,” but advised that advertisers “may benefit from undertaking a closer review of their digital advertising.”

DoubleVerify argued that, based on Adalytics’s “willful blindness to post-serve detection and filtration,” the Report “falsely and misleadingly portrays DoubleVerify’s web advertisement verification and fraud protection services as ineffective, including by stating or clearly implying that DoubleVerify’s customers are regularly billed for GIVT impressions.” In addition, references to DoubleVerify in the source code on webpages from which ads were served to bots could have occurred in relation to DoubleVerify customers who did not use its pre-bid services. DoubleVerify alleged that, for all of the ad views, or impressions, cited in the Report that were ostensibly connected to DoubleVerify and that it was able to identify in its records, it confirmed that it had actually detected such impressions at the post-serve stage and either removed them from customers’ billable counts or flagged them for reimbursement.

DoubleVerify alleged additional false or misleading statements or material omissions, including using 115 screenshots of advertisements presented in the Report as having been served by DoubleVerify customers where at least 62 had no apparent connection to DoubleVerify.

DoubleVerify alleged reputational and financial harm from dissemination of these claims, including a WSJ article titled “Efforts to Weed Out Fake Users for Online Advertisers Fall Short,” which stated that DoubleVerify “regularly miss[es] nonhuman traffic.” DoubleVerify’s stock price fell, and it allegedly had to expend employee time and resources to counter the Report. It therefore sued for false advertising under the Lanham Act as well as defamation, injurious falsehood, tortious interference with business relations, and unfair competition.

Was this a “commercial advertisement or promotion”? “Although the Report reads more like an analysis of other products and related technology than a communication aimed at selling Adalytics’s own goods or services, DoubleVerify asserts that Adalytics publishes research of this kind because it ‘uses its blog posts and articles to promote its own platform’ and supports that claim by pointing to a February 2025 statement on Adalytics’s website that it ‘release[s] thought leadership on systemic issues affecting brands and their media investments ... to ... attract new clientele.’” And it alleged an economic motivation for publishing: to win new business from customers of DoubleVerify.

Although the Report didn’t promote a specific product, that wasn’t dispositive of whether this was commercial speech. Nor was whether this was a traditional “advertisement.” At this stage, Adalytics’ direct competition and commercial motivation was enough: “the Report could potentially constitute commercial speech where its focus was the dissemination of the results of an analysis critical of a competitor’s product or service.” And allegations about harm to DoubleVerify’s stock price and “inbound calls from its customers regarding the effectiveness of DoubleVerify’s services” adequately alleged that the Report was “sufficiently disseminated to the relevant purchasing public to constitute advertising or promotion within that industry.”

Adalytics claimed that the challenged statements were all protected opinions on scientific and technical matters. The court disagreed (reaching the same result on defamation).

Defamation: most of the challenged statements weren’t alleged to be literally false. For example, the complaint conceded that DoubleVerify’s pre-bid services do not actually prevent all ads from being delivered to bots when it acknowledged that those pre-bid services filter out only “99% of unwanted GIVT impressions.” But defamation by implication was possible. Under governing Maryland law, if “the expressed facts are literally true,” a plaintiff pursuing a defamation-by-implication theory “must make an especially rigorous showing” and may prevail only if the challenged language “affirmatively suggest[s] that the author intends or endorses the inference.”

The court found it significant that the Report stated that “impression level log file data and financial invoices suggested that advertisers were billed by ad tech vendors for ad impressions served to declared bots operating out of known data center server farms.” This was fairly implied to relate to DoubleVerify. Also, the Report plausibly misled when it claimed to be able to identify whether a given brand had been charged for bot avoidance services, even when these impressions could have been served by DoubleVerify customers that do not have pre-bid solutions enabled. The court was a bit skeptical—DoubleVerify didn’t allege that any material number of its customers place online ads without enabling DoubleVerify’s pre-bid solutions—but the case was in an early stage.

Assuming, without deciding, that DoubleVerify had to plead an endorsement of the defamatory implications even though DoubleVerify wasn’t a public official, it was plausible that Adalytics, which “claimed expertise in advertising technology,” would understand that “DoubleVerify’s customers, in accordance with industry standards, would not be charged for pre-bid impressions served to bots once DoubleVerify’s post-serve processes were run.” Also, DoubleVerify’s “pre-emptive article,” published two months before the Report, put Adalytics on notice. And Adalytics allegedly illustrated its intent to disseminate defamatory information because it sent a draft version of the Report to certain media outlets but never requested any comment from DoubleVerify. These allegations were sufficient if not “overly compelling.”

The disclaimer wasn’t sufficient because it didn’t specifically disclaim the allegedly defamatory implication.

Nor was the Report protected opinion. “[A]lthough Adalytics used some technical methods in the Report, it was published on the company’s general website and was not a peer-reviewed scientific or technical journal article such as those at issue in cases cited by Adalytics on this point.”Even assuming that DoubleVerify was a limited-purpose public figure, it alleged sufficient facts for actual malice, noted above.

Injurious falsehood claims also survived.  Expenses incurred when countering the publication of the Report were sufficient to allege special damage. Common-law unfair competition also survived, but tortious interference claims failed because Double Verify didn’t “identify a possible future relationship which is likely to occur, absent the interference, with specificity.”

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.”

Publisher avoids liability for ad that allegedly disparaged plaintiff's goods

Jewel Sanitary Napkins, LLC v. Busy Beaver Publications, LLC, No. 23-cv-126-slc, 2025 WL 1220311 (W.D. Wisc. Apr. 28, 2025)

Jewel makes sanitary napkins containing a layer of material called graphene that Jewel claims has health benefits, while it touts the risks of tampons. The Amish community is a major market. “Jewel saw its sales drop significantly in the Amish community when, in August 2022, defendant Busy Beaver, a classified advertising publication distributed to Amish and Mennonite communities, published a reader-submitted letter (the Concerned Sister ad) that Jewel says made false accusations about its products.” Jewel sued Busy Beaver for common law libel and trade libel, and the court granted Busy Beaver summary judgment.

(Frankly, I’m pretty surprised at the chutzpah involved in suing here, given the Q-Ray-like nature of the advertiser’s claims, which include that graphene relieves abdominal cramps and fatigue, helps to eliminate bacteria and aroma, and boosts metabolism and immunity. Jewel also said that graphene moves heat away from your core and “contains vibrational energy.” Jewel’s chemist describes graphene as a “quasimetal” that “shares some properties with semi-conductor materials like Silicon” and “is highly conductive for both electricity and heat.” Jewel’s promotional videos show the pad’s graphene strip, or the pad itself, lighting a lightbulb.)

Busy Beaver has regional editions, and in mid-2022, the Busy Beaver Pennsylvania office received a completed classified ad submission form and payment from an individual named Betty Lantz. Lantz checked “no” to the question asking whether she wanted her name or address included in the ad. Busy Beaver’s CFO testified that the publication has printed ads without identifying information, so long as the person who submitted the ad is identified on the submission form. (“Jewel subpoenaed Lantz but she refused to be deposed in light of her Amish belief against involvement in legal matters. Jewel did not seek to compel her deposition.”) The ad:

Attention! Are the Reign products as safe as they say? Graphene is a conductive metal meaning it attracts electrical waves/radiation from the air, Do we want this close to our bodies, Will we see serious consequences for using this product? Don’t just go by what the company says, A concerned sister.

Months before the ad was published, “rumors had begun circulating in the Plains [Amish and Mennonite] communities about Jewel’s products, including that the sanitary napkins caused cancer, were covertly delivering Covid-19 vaccines to women, and contained radiation and metal.” (Live by the junk science, die by the junk science?)

The main salesperson for the Pennsylvania Busy Beaver, Ivan Lapp, is Amish and doesn’t use Google, only email, QuickBooks and specific websites, such as the Busy Beaver website. He proofread the ad, one of approximately 1,400 ads each week. “Many of these ads make claims about health products, and about four to six ads each week are advertisements for Reign products. The Busy Beaver does not independently verify the claims made in the ads it publishes, and does not publish images of women in bathing suits, promotions for rock concerts, or political ads.”

Jewel complained about the Concerned Sister ad, and Busy Beaver offered Jewel free pages in the Busy Beaver every week until the end of the year (about three months) so that Jewel could “print information on Jewel’s products and correct any false information that it believed was circulating.” Even after Jewel sued, Busy Beaver continued to allow Jewel’s distributors to place ads in the Busy Beaver, just as they did before the lawsuit.

Lapp testified that the ad caught his attention when he first proofread it because it was “questioning somebody else’s product,” but he did not have time to do “any research,” did not have a number for Lantz, and ultimately “left it go” without discussing the ad with anyone. “Lapp noted as a general matter that he would call [higher-ups] about an ad if he thought it was inappropriate, such as campaign or entertainment ads that he felt did not fit the publication’s mission, but had done so only eight or ten times over the years.”

Although Busy Beaver initially stated that the original submission form had been shredded after publication, Lapp later recalled that he had taken the form back to Lantz’s house at some point after Jewel called to complain about the ad’s publication. He left the form with Lantz’s mother and said the Busy Beaver would no longer accept such ads. The court denied Jewel’s motion for sanctions related to the putative destruction/fate of the submission form; basically that was what you can expect from a small business.

Jewel conceded that it was a limited purpose public figure, and it couldn’t create a factual issue on actual malice, which requires knowledge of the falsehood or reckless disregard for the truth, which requires that the defendant “in fact entertained serious doubts” about the trust of the statement or that the defendant published it “with a high degree of awareness of [its] probable falsity.”

Busy Beaver’s proofreader, though, averred that he had no idea whether the content in the ad was true or not. Jewel’s circumstantial evidence was insufficient to allow a jury to find knowledge or reckless disregard.

Jewel argued that actual malice could be inferred from Busy Beaver’s publication of an “inherently improbable” and “highly disparaging” ad claiming that graphene is a conductive metal that attracts electrical waves and radiation from the air. But “it is not the case that the more serious the charge, the less likely it is to be true.” And, given Jewel’s own claims, a reasonable jury could not conclude that Concerned Sister’s statement about graphene was so inherently improbable that Busy Beaver acted maliciously in publishing it. Nor did it matter that Busy Beaver published the ad “anonymously,” since Lantz put her name and address on the submission form even if not on the ad, and that was not inconsistent with Busy Beaver practice.  “Indeed, in the same issue of the Busy Beaver as the Concerned Sister ad, the Busy Beaver also published an ad with only a phone number asking readers to consider their personal care products and ‘Go toxin free.’” Busy Beaver didn’t violate its own policies (against women in swimming suits, ads promoting rock concerts, or political ads), and, even if Lapp did depart from “professional standards,” that alone is not enough “for finding actual malice” in cases concerning public figures.

Jewel argued that Lapp demonstrated willful blindness by failing to investigate the truth of the ad’s statements, and that the ad could easily have been proven false “with a quick Google search.” But “reckless conduct is not measured by whether a reasonably prudent man would have published, or would have investigated before publishing”; there must be enough evidence to support the conclusion that a defendant “in fact entertained serious doubts as to the truth of his publication.” The court highlighted that “Lapp proofreads approximately 1,400 ads a week and many of these ads make claims about health products that Lapp does not independently verify.” Moreover, there was no evidence that Lapp “accesses the internet in any beyond-business capacity that could include a general internet search about graphene or Jewel’s products without violating his Amish beliefs.”

Even if Lapp had done an internet search, the evidence does not bear out that the alleged falsity of the Concerned Sister ad would have been immediately apparent in the search results to an Amish man who sells and processes classified ads. In point of fact, Jewel produced a screenshot in discovery of an internet search resulting in a description of graphene as “not metallic” but “a quasi-metal since its characteristics of graphene are similar to those of semi-conducting metals.”

Should non-Amish publishers have to do searches?

Jewel argued that Busy Beaver was biased against it, because Busy Beaver didn’t print a retraction, but  “Busy Beaver does not print its own retractions, preferring instead to allow the complainant the opportunity to print whatever corrective content the complainant wants in the complainant’s own words.” Jewel chose to sue instead, but that’s not evidence of malice. As for an alleged threat to cease publication of ads from Jewel’s distributors, that was a confidential, inadmissible settlement communication from Busy Beaver. Anyway, Busy Beaver never stopped publishing ads from Jewel’s distributors, “in further contravention of Jewel’s allegations of ill will.”

trademark infringement accusations are opinion without a final judgment

Trevari Media, LLC v. Colasse, 758 F.Supp.3d 1175 (C.D. Cal. 2024)

Colasse accused Trevari of infringing its trade dress in a “[s]pring-loaded glass-breaking device. Although the trade dress was registered in 2014, when Colasse emailed Trevari alleging infringement in 2021, Trevari responded that the putative trademark was invalid because it was functional, and defendant didn’t respond. Instead, Colasse sent trade dress complaints to Facebook and Instagram, and, as a result, Facebook and Instagram removed posts which advertised Trevari’s glass breaker. While Trevari was petitioning for cancellation at the TTAB, Colasse continued to cause Trevari’s glass breaker product to be removed from various online sites including Shopify, Wordpress, Facebook, and Instagram, and also messaged Trevari’s followers on Facebook and Instagram, claiming that its glass breaker infringed its trademark. In 2023, the TTAB cancelled the registration because the design was functional; Colasse has sought de novo review in district court.

accused design

cancelled registration image

Trevari sued for trade libel, intentional interference with contractual relations, and unfair business practices under California law.

The court found that Colasse’s statements were only opinion. For example, Colasse’s counsel told Shopify that Trevari’s listing was “counterfeited.” The court found it “unclear” whether an assertion of IP infringement could ever be considered provable fact, “at least before a tribunal determines finally whether the IP is valid and infringed.” Although Trevari alleged that Colasse always knew or had serious doubts about the invalidity, the design had been registered at the time the statements were made, providing prima facie evidence of validity. “Given the legal complexity in determining IP validity and infringement, and in line with the above cited cases, the court finds the validity or infringement of IP only becomes a provable ‘fact’ when a final, unappealable decision has been rendered.”

The court also held that “the surrounding context further supports the statement was one of opinion, as the statement was asserted as a ‘reasonable belief’ made in ‘good faith.’” Plus, as to the non-lawyer defendant, “his statement regarding complex legal issues can only reasonably be interpreted as an opinion.”

What about complaints to Shopify calling the product a “Chinese counterfeit” or “cheap low quality made copy from China”? That was also opinion.

Without false factual statements, all the claims failed.

J&J's talc subsidiary can bring trade libel but not Lanham Act claims against testifying experts

LLT Management LLC v. Emory, No. 4:24-cv-75, 2025 WL 438100 (E.D. Va. Feb. 7, 2025)

The defendants “published an article in a scientific journal, asserting that they had identified 75 people, additional to 33 in an earlier study, who had malignant mesothelioma but no known exposure to asbestos except through cosmetic talc.” LLT, J&J’s talc subsidiary, alleged that the statement was false. It allegedly identified six of the anonymous study subjects and alleged that the defendants, through their expert witness work, knew those subjects had been exposed to asbestos through other means. LLT alleged that defendants’ “real goal was to create a body of scientific literature to appease the plaintiffs’ bar, who hired the defendants as expert witnesses in tort cases against LLT.” After the defendants published their article, sales of J&J’s talc-based baby powder allegedly declined due to misinformation about the product’s safety—including in the defendants’ article.

This lawsuit represents yet another disturbing development in the “sue your critics” space and highlights the need for a federal anti-SLAPP regime. Here, the court dismisses the fraud claim on statute of limitations grounds and the Lanham Act claim because of a mismatch between the “commercial advertising and promotion” alleged and the falsity alleged, but allows injurious falsehood/product disparagement claims to proceed.

Trade libel: The court predicted that Virginia would consider this an “injury to property” tort claim with a five-year limitations period. LLT sued within that period, and was thus not barred by the statute of limitations.

Fraud: Virginia has a two-year statute of limitations for civil fraud claims. The court declined to give any weight to LLT’s conclusory allegation that it “could not have known of the [defendants’] fraud until recently.” LLT pled that it discovered the defendants’ fraud by “match[ing] ... the [a]rticle’s subjects to [ ] litigation plaintiff[s]” with “documented alternative exposures to asbestos” that were known to the defendants because of the defendants’ roles as expert witnesses in the subjects’ “underlying tort cases.” Of those six subjects, five were plaintiffs in lawsuits against LLT. Thus, there were no facts in the complaint giving rise “to a reasonable inference that LLT required any additional information, outside of what it already possessed because of its role in earlier litigation, in order to match the alleged study subjects to the testimony of the expert witnesses in their respective trials or to spot the non-talc asbestos exposures the experts identified in each case. And if the matching process itself took years, LLT should have said that, but it did not. Thus, it appears on the face of the Complaint that the study subjects’ alleged non-talc asbestos exposures were discoverable, given the exercise of due diligence, at the time the study was published.”

What about defendants’ alleged concealment of the truth? That allegation was not enough to make out a plausible claim that the defendants’ concealment tolled the statute of limitations. Tolling requires plausible allegations that “the defendant undertook an affirmative act designed or intended ... to obstruct the plaintiff’s right to file [the] action.” LLT alleged: (1) “statements reaffirming the false statements in the [a]rticle,”; (2) “refus[al] to disclose the identity of the 75 subjects of the [a]rticle,” for example refusing to testify about their identities in depositions and stating they didn’t retain documentation of those identities; and (3) “omit[ing] from their publication that their statements regarding the lack of alternative exposures were false and that they knew they were false.” That last wasn’t an affirmative act. Even assuming that (1) and (2) could be affirmative acts, such acts must actually “have the effect of debarring or deterring the plaintiff from his action.” But defendants weren’t alleged to have ever changed their claims that all 75 subjects were new, that none of the 75 study participants had known non-talc asbestos exposure, or to have revealed the study subjects’ identities. “But LLT was able to bring its fraud claim anyway. That makes it facially implausible that the defendants’ repetition of the alleged falsehood or nondisclosure of the study subjects’ names ‘had the effect’ of deterring filing of the claim.”

False advertising: potential laches problems, though defendants didn’t show prejudice (shouldn’t the burden be on LLT to plead around it where laches is pled on the face of the complaint?). But that didn’t matter because of the bigger problem requiring dismissal.

LLT plausibly alleged two categories of harm: (1) lost “sales volume and profits,” and (2) costs incurred to “respond to, defend against, and otherwise counteract the [defendants] false statements.”  Even though the article was distributed in a publication “whose audience is doctors, not consumers,” LLT plausibly alleged that the defendants’ intended and actual audience was the plaintiffs’ bar, rather than the scientific community. While actions by the plaintiffs’ bar allegedly contributed to consumer behavior, they were plausibly not “independent” of the defendants’ conduct, and thus didn’t defeat traceability. Nor did preexisting negative publicity for talc break the causal chain. “[T]he Court cannot assume that negative publicity had already influenced 100% of Johnson & Johnson’s customers before the article came out.” And LLT plausibly pled increased litigation costs as a result, since some people might have been motivated to sue by the article. Additionally, “[e]very time LLT has to defend against an expert witness who relies on the defendants’ allegedly false statements in litigation, it costs money LLT would not otherwise have to spend. That too is a fairly traceable injury.” [I have to wonder about the cognizability of that—seems like a collateral attack on the underlying tort litigation. If the expert’s testimony is allowed despite LLT’s objections, should LLT be allowed to sue over it?]

Likewise, the complaint plausibly alleged “a commercial interest in reputation or sales.”  What about proximate causation? Lexmark says that “a plaintiff suing under § 1125(a) ordinarily must show economic or reputational injury flowing directly from the deception wrought by the defendant’s advertising.” “[T]hat occurs when deception of consumers causes them to withhold trade from the plaintiff.” LLT plausibly alleged that defendants led consumers to believe that “cosmetic talc should be considered a probable cause of mesothelioma.” Although one prior study came to the same conclusion as the defendants’ article, “it is at least plausible that the earlier article was not an ‘independent’ case of consumer decisionmaking regarding Johnson & Johnson’s products, since LLT alleges the two publications were designed in concert, to create the impression that a ‘body of literature’ supported the defendants’ claims.” And “the defendants’ article did not merely cement the link to cancer in general—it purported to tie cosmetic talc to “mesothelioma,” which the defendants admit had not been the focus of earlier publicity around the dangers of Johnson & Johnson’s baby powder.”

What about commercial advertising or promotion? The complaint plausibly alleged that the defendants made their statements “in order to influence their own customers—plaintiffs’ attorneys—to hire them to provide expert opinions in tort litigation.” Here, the court stretches—it doesn’t go through the caselaw on identifying commercial advertising or promotion, but instead says that the “impli[cations]” of the article suffice to make it plausibly advertising: “something like ‘we will testify that we have identified 75 more people with mesothelioma who have no known asbestos exposure except to talc.’” That seems to be in tension with most of the false advertising cases about scientific studies as such, where for-profit companies subsidized studies that would allegedly promote their own products. Still, the court understood this as a limiting principle: the statements were only actionable to the extent that they were about the defendants’ own litigation services.

[This workaround has logical flaws of its own: “commercial advertising and promotion” is not an element of statutory standing, as the court assumes, but a separate requirement. If an advertiser, in the course of ordinary advertising for a noncompeting product, randomly falsely disparaged an innocent unrelated product, I think Lexmark would allow that claim. The statutory standing issue is whether the advertising proximately caused the harm, not whether the harm came from the part of the message that most directly served the advertiser’s interests. That’s one reason why we should police the definition of “commercial advertising or promotion” and not treat scientific articles as such in most cases.]

Anyway, doing it the court’s way: LLT had statutory standing to bring its Lanham Act claim only if the defendants’ statements “are construed to be about the defendants’ own litigation services.” But the complaint failed to allege that those statements—that they’d testify for plaintiffs—were false.

Injurious falsehood/product disparagement/trade libel: under New Jersey law, a plaintiff must allege (1) publication (2) with malice (3) of a false statement of fact (4) about the plaintiff’s product or property (5) that causes special damages. Publication and malice were adequately pled, the latter by alleging that defendants were informed in litigation about individual study subjects’ non-talc asbestos exposures or had access to the same information LLT used to demonstrate the alleged falsity of the defendants’ statements.

The court found that the statements at issue were statements of fact, not nonactionable opinion. They were clearly not figurative speech or rhetorical hyperbole, like name-calling, “which cannot reasonably be understood to be meant literally.” They were verifiable “because a factfinder can determine, based on proof at trial, whether any of the 75 study subjects had non-talc asbestos exposures that were ‘known’ to the defendants at the time they published the article, and whether any of the 75 subjects were common to the defendants’ study and the earlier study.” “While the Court takes seriously the ‘risk [of] chilling the natural development of scientific research and discourse’ that can arise from critiquing scientific opinions as though they were verifiable facts, it also has a duty to make all reasonable inferences in favor of the non-moving party at this stage of the litigation.” Thus, a jury “could verify the statements by deciding whether the defendants subjectively knew about non-talc asbestos exposures among the study subjects” and whether the subjects of their study were “additional” to the subjects in the previous study.

Moreover, “statements are not protected solely because they appear in a peer-reviewed journal.” “What matters is whether the facts are adduced through a scientific method, or whether they exist independent of the scientific process.” Defendants’ statements were plausibly construed as assertions about their own knowledge of the study subjects’ medical histories. “Those facts pre-existed the scientific process the article describes—in fact, they were discovered through litigation, not through any scientific method.”

And this was a claim about LLT’s product even without specific references to J&J, because LLT plausibly alleged that Johnson & Johnson’s talc-based products were “the leading brands among a discrete and limited number of cosmetic talc products in the market” and “maintained well over a majority of the market share for talc powder products in the United States.” Thus, “a consumer who learned of the defendants’ statements would understand the defendants to be calling into question the safety of Johnson & Johnson’s products.” The court expressed some interest in the argument that the allegedly false statements were “about the study, not about the talc-based products the study targets—that is, in saying they had 75 new subjects with no known non-talc asbestos exposure, the defendants were merely describing their data set, not commenting on the safety of any talc-based product.” But “it is reasonable at this stage to construe the allegedly false statements not as statements about the defendants’ method or assumptions, but as conveying the thrust of the whole publication—which is squarely about the safety of talc-based products like Johnson & Johnson’s.”

Special damages: The complaint didn’t identify specific customers Johnson & Johnson lost as a result of the defendants’ statements. But special damages are not extra-specific damages; they are simply “the loss of something having economic or pecuniary value.” It was enough to plead “loss of sales and customers” and “irreparable harm to its commercial reputation and goodwill.” [Lots of courts disagree about this, but I haven’t dived into the Virginia cases enough to see if Virginia is special.]

republishing scientific study to prospective customers isn't protected opinion

Advance Dx, Inc. v. YourBio Health, Inc., --- F.Supp.3d ----, 2024 WL 4393314, No. 24-10595-WGY (D. Mass. Oct. 3, 2024)

Advance sued YourBio, which competes in the market for at-home medical device testing patients’ level of anti-Mullerian hormone, for false advertising, tortious interference, defamation/disparagement, unjust enrichment, and unfair trade practices under Massachusetts statutory law.

Advance makes a card used to collect a blood sample obtained from a patient’s lanced fingertip, while YourBio manufactures a device that is used to collect a blood sample by attaching to the back of a patient’s arm and piercing capillaries close to the skin’s surface with microneedles. In 2022, BioMed studied the parties’ products and conventional venipuncture. “After processing the data, BioMed imposed an internal control, calculated based on the Study’s data, to normalize Advance’s results to the venipuncture instead of using the recommended internal control provided in Advance’s guidelines.” It then published the study, concluding that YourBio’s testing device was more accurate, superior, and has stronger consumer preference than Advance’s. YourBio used PR Newswire to tout its superiority and also repeatedly promoted the study “to consumers, industry professionals, and third parties at trade shows and in YourBio’s marketing materials.” However, after it learned about the use of the simulated control, the testing lab “stated that any discordance noted in the Study may be due to BioMed’s failure to follow Advance’s instructions for the Card, and not due to any fault of the Card.”

YourBio argued that the study was a non-actionable scientific conclusion and statement of opinion and therefore could not be falsified. The court disagreed. Even under the rule of ONY, Inc. v. Cornerstone Therapeutics, Inc., 720 F.3d 490 (2d Cir. 2013), “we must take into account the statement’s context, including the medium in which the statement was published and the audience to which it was presented.” The medium here was republication by YourBio specifically to promote its devices. “Unlike a typical scientific journal, the medium in this case is not meant to communicate insights into matters of scientific debate, despite the fact that the Study may have been first published by BioMed for exclusively scientific reasons.” The audience was also not “purely scientific,” but rather targeted at customers/potential customers.

The court also found that Advance was not a public figure, so defamation required only negligence, although it did plead that YourBio was aware of the falsity. And damage could be presumed without evidence of economic loss because the statements were of the kind that would harm Advance’s business.

The same basic logic allowed the Lanham Act false advertising claims to proceed. (Advance didn’t say a lot about “interstate commerce,” but alleging that the false statements were published online sufficed.) Unfair trade practices under Chapter 93A MGL are treated the same way as Lanham Act false advertising claims, so they also survived.

Tortious interference and commercial/product disparagement claims likewise survived. Under Massachusetts law, “[p]roduct disparagement is similar to defamation but lacks a reputational harm element and makes greater demands as to the ‘falsity of the statement[s], fault of the defendant and proof of damage.’ ”  That didn’t make a difference here.

Unjust enrichment claims failed, however, because Advance didn’t plead it had the right to some benefit/money that YourBio received.

Expert witnesses as Lanham Act defendants

Via an eagle-eyed correspondent: J&J’s bankrupt subsidiary LTL is suing the expert witnesses for the mesothelioma victims in the underlying tort litigation for injurious falsehood, fraud, and Lanham Act violations for disparaging J&J’s Baby Powder as causing mesothelioma. They allege that the experts' published articles were part of a commercial advertising scheme to get hired as expert witnesses, which is ... not super consistent with existing caselaw. Suing experts, a very normal thing to do. Too bad there’s no federal anti-SLAPP law.

user manuals aren't "commercial advertising or promotion" but do have thin copyright

Santos Elecs. Inc. v. Outlaw Audio, LLC, No. 8:22-cv-827-JVS-KESx, 2022 WL 17328411 (C.D. Cal. Oct. 28, 2022)

Outlaw lost its bid for a preliminary injunction enjoining Santos, aka OSD Audio, from selling products containing user manuals that allegedly infringed Outlaw’s copyright, falsely represented OSD Audio products’ specifications, and falsely represented that OSD Audio and Outlaw’s products are similar. The parties compete in the market for audio products, specifically multichannel amplifiers, and sell online, including on Amazon.

Outlaw allegedly sent Amazon a complaint that claimed OSD Audio “stole[ ] [Outlaw’s] IP relating to custom images and written content” in its OSD5180 user manual; Amazon removed the product from its marketplace. OSD Audio denied Outlaw’s claims but redesigned its user manual, and Amazon reinstated the product. Outlaw then filed two more takedown notices, each of which led to a brief interruption in the availability of the product on Amazon.

OSD Audio then sued Outlaw under §512(f), and Outlaw counterclaimed for false advertising and unfair competition under the Lanham Act, copyright infringement, and trade libel.

Lanham Act: The user manual did not constitute “commercial advertising or promotion.” Outlaw argued that the OSD5180 user manual’s references to the product’s LED blue ring on the front panel and two-way remote manual / trigger switch were literally false because the OSD5180 does not posses these features. But “[n]ot all commercial speech is promotional.” Prager Univ. v. Google LLC, 951 F.3d 991 (9th Cir. 2020). “Statements in a user manual are ‘made to explain a user tool, not for a promotional purpose to penetrate the relevant market of the viewing public.’” Likewise, “OSD Audio did not publish the OSD5180 user manual for economic advantage, but rather to teach its customers how to use its product.”

Outlaw argued that consumers now make their decisions on the Internet, where they can view the manual concurrently with the description of the product. Nonetheless, “a manual’s primary purpose and driving use is still educational.”

Outlaw also challenged OSD Audio’s claims about OSD5180’s signal-to-noise ratio.  While OSD Audio advertised the OSD5180’s signal-to-noise ratio as 115 decibels on third-party websites, it conceded that the OSD5180’s signal-to-noise ratio is 104 decibels. Given this literal falsity, the court presumed that OSD Audio’s statements were material and actually deceived consumers.

But Outlaw presented no evidence of likely injury to itself from loss of sales or goodwill based on the signal-to-noise ratio misrepresentation. Outlaw relied on cases indicating that “where plaintiffs and defendants are direct competitors and there is a literal false statement by a competitor, actual injury may be presumed,” as well as on the 2020 amendment to the Lanham Act providing that likelihood of success on the merits generates a rebuttable presumption of irreparable harm. But it raised these arguments too late (after the court issued its initial denial).

I note that, in a crowded/multiplayer market, presuming injury from a falsehood about the speaker’s own goods is a heavier lift than presuming injury from a falsehood about the target, though in a concentrated market it seems much more likely that there’s not much difference in the effects of the two kinds of falsehoods. As for the 2020 amendment, many courts have yet to grapple with the fact that the modern likely confusion test doesn’t have a harm requirement as an element, while the modern false advertising test does. This means that a trademark plaintiff is never required to show any harm at all before showing likely success on the merits and benefiting from a presumption of irreparable harm, which seems like the wrong result, whereas a false advertising plaintiff will have to show some kind of harm unless Congress also intended to lift that burden (and can constitutionally do so).

 There was no separately cognizable unfair competition claim: “[w]hile Outlaw presents one example of a customer confusing the OSD5180 and Model5000, noting the amplifiers ‘look exactly the same’ and ‘have the exact same spec[ifications],’ there is no evidence this confusion resulted from the specific misrepresentation of the OSD5180’s signal-to-noise ratio.”

Copyright infringement: Outlaw was likely to succeed in showing that it owned a copyright in the manual. Although a user manual receives only “thin” copyright protection, a large swath of the instruction text had apparently been copied verbatim, and the photos and diagrams were also strikingly similar. Thus, Outlaw showed likely success on the merits of this claim.

Trade libel: This was based on a complaint made by an individual working for OSD Audio to Amazon claiming that an Outlaw Model7000x he purchased from the retailer was defective. This allegedly caused Amazon to remove Outlaw’s “Big Box” feature from the platform, a “function that allows Amazon customers to easily add products to a shopping cart instead of going through a multi-step process to add the product to their shopping cart.” But Outlaw failed to provide evidence supporting special damages, which is required for trade libel, and it didn’t provide evidence of falsity, only alleging that it tested and inspected the amplifier and found it to be wholly free from defects without providing evidence of the findings from these tests or inspections.

For the copyright claim, Outlaw didn’t show irreparable harm. OSD Audio showed that it changed the manual in response to Outlaw’s complaints, removing the similarities in design, font, color scheme, and text. “While Outlaw argues that it would still suffer irreparable harm because it has not been confirmed that the infringing manuals were not replaced in the physical copies, it does not identify any adverse effects that would result specifically from having the revisions only online.” Plus, Outlaw didn’t explain its delay in suing—the allegedly infringing manual entered the market in 2017, but Outlaw didn’t sue until March 2022, when OSD Audio sued it. A “long delay before seeking a preliminary injunction implies a lack of urgency and irreparable harm.”

As for false advertising, Outlaw submitted screen shots of Amazon customer reviews discussing the missing features of the OSD5180 as described by its former user manual, as well as online forum posts discussing the similarities of the OSD5180 and Model 5000. Herb Reed: “This evidence, however, simply underscores customer confusion, not irreparable harm.” “Without evidence demonstrating a loss of sales or goodwill, Outlaw fails to satisfy its burden of irreparable harm on its Lanham Act claims necessary for a preliminary injunction.”

The balance of equities tipped in Outlaw’s favor for the Lanham Act claim, but not for copyright infringement. Ultimately, no injunction.

how detailed must pleading be to link falsity with lost sales?

Becton, Dickinson & Co. v. Medline Indus., Inc., 2022 WL 2383722, No. 21-12929 (D.N.J. Apr. 28, 2022)

BD and its subsidiary (BD) sell urologic devices and supplies, including catheter trays, which compete with Medline’s. Medline used to distribute certain BD products, with provisions intended to protect BD from “potential usurpation of BD’s business,” including requirements that Medline not substitute competitive products as an alternative to BD products. The parties are involved in related patent litigation. BD alleged that Medline made false and misleading statements that BD had to change its original design as a result of the patent litigation, that the original was found to infringe one or more of Medline’s patents, that the original was discontinued, and that the reverted design would negatively impact BD’s ability to supply sufficient inventory. Medline also allegedly made “unfounded allegations” that its system was safer and reduced the risk of catheter-induced urinary tract infections (ugh)/that BD’s new design was more likely to cause UTIs.

The court grouped the Lanham Act false advertising and New Jersey statutory and common law unfair competition claims together.

The allegations were sufficient to state a Lanham Act claim. BD alleged that the statements were part of a national “coordinated sale strategy to discredit [BD] and undermine [BD’s] sales” and they lost customers thereby. [A typo in the opinion says they “lost costumers,” which is super charming and now I want a case where that actually happened.]

Medline argued that the complaint didn’t sufficiently link the lost customers to the alleged falsehoods, as opposed to the competition. In particular, the specific customers to which Medline sales reps allegedly made false and/or misleading statements weren’t the same customers that BD allege that they lost. However, at this stage, given that the parties compete directly, the sales reps allegedly made these statements to encourage a switch, and BD alleged that customers did switch, that was enough to survive a motion to dismiss. [Practical considerations—a customer you lost will often not tell you why, even if they truly knew the answer which they might not—support this conclusion.]

Medline also argued that its statements weren’t false, but determining that would require examining documents outside the pleadings, including documents related to a recall, which wasn’t appropriate at this stage.

Trade libel:  A plaintiff must plead and prove special damages with particularity, requiring it to “allege either the loss of particular customers by name, or a general diminution in its business, and extrinsic facts showing that such special damages were the natural and direct result of the false publication.” BD pled that “Medline successfully converted” one named customer in June 2021, on information and belief because of the claims of the increased risk of UTIs associated with BD’s product. This sufficed, given that BD supported its allegation with “specific examples of misleading or false statements that Defendant’s sales representative made to other customers in emails and presentations.” Tortious interference with prospective economic advantage survived for basically the same reasons.

Breach of contract survived, though not the duplicative count for breach of the implied covenant of good faith and fair dealing.

does disparaging a company cast its principal in a false light?

Chaverri v. Platinum LED Lights LLC, 2022 WL 204414, No. CV-21-01700-PHX-SPL (D. Ariz. Jan. 24, 2022)

Plaintiffs (Mito Red) sell red-light therapy products online, in competition with Platinum (which uses the Volkin defendants’ marketing services). Platinum allegedly hired the Volkin defendants to “engage in a strategic defamation campaign online designed to ruin Plaintiffs’ professional reputation and to divert Plaintiffs’ customers away from their products and to Platinum’s competitive products.”

Among other things, Mito Red alleged that blog posts/video such as “Mito Red Light Therapy Scam: What Are They Lying About?” misrepresented their status as neutral reviews or critiques when in fact they were not, and that Platinum told customers that Mito Red “fabricates statistics, uses different LEDs than claimed, and that the lights are cheap and/or low quality knockoffs of Platinum’s lights.”

The statement that “Leaders come first and then all the followers. Mito Red here is the follower” was puffery. Likewise, Mito Red didn’t sufficiently plead falsity as to a blog post that said that Mito Red claims to have up to a three-year warranty even though other parts of its website “say[ ] otherwise,” and that as a result, customers “might just get scammed” out of redeeming their warranties based on “loopholes” on Mito Red’s website. Though the complaint alleged that Mito Red’s warranty terms are clearly stated on its website, that didn’t address the arguably falsifiable part of the statement—that parts of the Mito Red website cut back on the three-year warranty—and the rest was puffery because uncertain terms like “might” and subjective terms like “scam” and “loophole” were generic and vague.

Statements that “Mito Red literally ripped off [Platinum’s] design” and that “[Mito Red] literally took the framing construction of the Platinum LED lights and just changed the logo on the side. Other than that, it’s the exact same as far as a construction standpoint” were, however, sufficiently alleged to be falsifiable given the use of the word “literally” and the reference to specific product characteristics. “Hopefully, from a legal perspective [Mito Red] will get caught,” required more analysis: it came after “a section of the video in which the narrator alleges that Mito Red’s products use three-watt bulbs, which are less powerful than the five-watt bulbs Mito Red says it uses.” Relying on an earlier case with similar “hope” language, the court found it plausible that the statement could be understood as a statement of fact that Mito Red was acting criminally, making it actionable.

But this was “imprecise, generic, and vague” and thus puffery: “The design of the Mito Red Lights devices is not unique either, they mostly take the designs of their competitors’ devices and then use that in their own devices. And they are not providing the customers with anything new with an act like that.”

For other statements about the wattage/irradiance of Mito Red’s products, it was not conclusory to allege that Platinum’s statements were false because the products were truthfully advertised as five watts: that alleged falsity even if there could be a factual dispute over measurement.

The same results followed for the defamation claims.

Interestingly—and it seems to me wrongly—the court likewise refused to dismiss false light invasion of privacy claims brought by Chaverri, even though he was never named, because “statements made about Mr. Chaverri’s business certainly concern him and are about business matters for which he was directly responsible—a fact reasonably discerned from his role at Mito Red. It is plausible, from the facts alleged in the SAC, that the statements created a false implication about Mr. Chaverri even though he was not expressly mentioned.” A false light claim requires “a major misrepresentation of the plaintiff’s character, history, activities, or beliefs, not merely minor or unimportant inaccuracies.” “[A]llegations of negative reviews by a competitor suffice to plausibly state a claim for false light in this case.”

 

disparagement campaign in niche jewelry market could violate Lanham Act

Roberto Coin, Inc. v. Goldstein, No. 18-CV-4045(EK)(ST), 2021 WL 4502470 (E.D.N.Y. Sept. 30, 2021)

Defendants Goldstein and his company Kings Stone supplied plaintiff RCI with a gemstone they called “black jade.” “After RCI stopped sourcing black jade from Kings Stone and found a new supplier, Goldstein contacted a number of stores selling RCI jewelry and disparaged RCI’s stones. Both sides now claim the other is liable for false advertising, among other claims.” For example, Goldstein allegedly told one of RCI’s customers that RCI’s stones were to real black jade as cubic zirconia is to diamond. Defendants also allegedly infringed RCI’s trademarks by using photographs of Roberto Coin jewelry and RCI’s logo in Kings Stone’s advertising after RCI terminated the relationship. Kings Stone counterclaimed that RCI made false claims about (a) the gemological content of the stones from its new supplier and (b) whether those stones had been “certified” by a laboratory. The counterclaims/third party claims were dismissed for failure to prosecute and the results on the plaintiff’s claims were mixed.

When things were going well, Kings Stone provided RCI with an analysis prepared by the National Gem Testing Center — a gemstone testing laboratory based in China — stating that the mineral content of its stones was “black amphibole jade.” About eighteen months after the parties split up, RCI discovered that the Defendants were using photographs of RCI jewelry alongside RCI’s logo, as well as the name “Roberto Coin,” on Kings Stone’s Instagram feed. Instagram ultimately removed the posts. Goldsein also sent marketing materials incorporating RCI images to various vendors, including in a PowerPoint presentation. He stated that he believed RCI “knew about” and “was okay” with this.

Goldstein solicited Borsheims, a jewelry retailer that sold RCI products (including the Roberto Coin “Black Jade” collection), touting Kings Stone’s black jade as “exclusively certified by the china NGTC and the prestigious US based AGL as Black jade.” Borsheims wasn’t interested.

Goldstein emailed Borsheims again, this time pretending to be a customer looking for a “gift for a jade connoisseur.” He expressed interest in a specific Roberto Coin product and asked Borsheims to provide him with “a gem certificate that verifies its authenticity as genuine black jade.” Borsheims’ employee wrote back to say that she had contacted RCI, and that “while they do not have official certificates of authenticity for their jade gemstones, they provided me with the attached card detailing the certification of the jade along with further details.” The “attached card” said: “The most fascinating black amphibole jade, 100% natural identified and certified by China’s National Gemstone Testing Center (NGTC) is the protagonist of the homonymous ‘Black Jade’ collection.” Goldstein responded that the product

does not come with any certification as to its authenticity that the black jade is genuine. If there is no certification available, then legally you cannot claim or advertise that it is black jade, no less then [sic] claiming a cubic zirconia being a real diamond .... My black jade comes with full certification by 3 major Gemological Labs. When dealing with my certified black jade stones you are assured of the highest quality and no reputational risk to your company by selling non certifiable black jade. The real black jade jewelry companies are doing great with our line with sales exceeding the best projections.

A followup email from Goldstein said that “[w]e have asked Roberto Coin directly numerous times for confirmation of the black jade authenticity and we have not received any response.” He then threatened Borsheims with “filing for class action status on this matter to protect [his] business and the consumers being misled by false advertising.” He said that Borsheims needed to “take remedial action otherwise we will include your company in this [action] since we have legally notified you.... And yes even borsheims has to be held accountable.” Afterwards, Borsheims told RCI it was “removing the black jade” offerings from Borsheims’ website.

Goldstein also contacted other RCI retailers (Macy’s, Neiman Marcus, and Saks Fifth Avenue) seeking confirmation that RCI’s black jade was certified.  He told Saks’s parent corporation that RCI’s black jade was “not ... authenticated or certified as advertised,” and had similar exchanges with Macy’s and Neiman Marcus. He emailed them to say he would be filing a lawsuit against RCI: “I am part of a group of gemstone dealers selling genuine and certified black jade, that are in the process of filing a class action lawsuit against Roberto coin for selling non authenticated black jade.” He said he was letting the retailers know about his lawsuit as a “courtesy” so that they could “take remedial action ... and remove any questionable product that cannot be authenticated.” At his deposition, Goldstein acknowledged approaching “every customer that was advertising the black jade.”  He testified about the steps he took to identify every RCI retailer and that it was a “huge amount of communication.”  (He also emailed “basically industry wide” announcing his counterclaims in this case, reaching “various jewelry-industry players: newsletters and magazines, trade associations, and additional retailers” and analogizing the situation to an earlier scandal about gem misclassification; there was a bribery aspect to that situation but he testified that he wasn’t aware of the bribery part.)

Macy’s and Saks Fifth Avenue also stopped selling the Black Jade collection. Saks, Borsheims and Bloomingdales alone returned jewelry valued at more than $380,000 from the Black Jade collection. “At least one jewelry retailer apparently understood Goldstein to be challenging the authenticity of the gemstones in RCI’s Black Jade collection, as opposed to merely questioning whether RCI had obtained an authentication from a laboratory.”

RCI’s position was that there is no industry-wide “certification” for the “authenticity” of black jade, because “black jade” is not a scientific category. Instead, it contended that “jade” is generally used in the industry to describe two different but related minerals, nephrite and jadeite, and that the term “black jade” cannot constitute false advertising. It did, however, obtain certifications from various gemological labs, including one certifying that RCI’s gemstones were comprised of “Natural Amphibole Material”; another certifying “amphibole and other minerals”; an NGTC certification certifying “Black Amphibole Jade”; and another certifying “Black Nephrite Jade.” However, RCI obtained the latter two certifications — including the one from NGTC — after it emailed the card promoting its stones as “[t]he most fascinating black amphibole jade .... 100% natural identified and certified by China’s National Gemstone Testing Center (NGTC)” — to Saks and Borsheims.  

Lanham Act false advertising: RCI alleged two overlapping subcategories, (1) claims that RCI’s black jade was fake or inauthentic (e.g., Goldstein’s emails to Borsheims discussing the impact that the sale of “Fake black jade” has on Goldstein’s business, making a cubic zirconia/diamond comparison, and calling his company one of “the real black jade jewelry companies”) and (2) statements that RCI’s stones lacked some form of certification or authentication.

Falsity: RCI showed sufficient evidence of literal falsity of (1) to continue, but (2) was murkier. The “not authenticated” statements weren’t literally false, “as RCI did not (at the time) possess a certification expressly confirming that its stones were ‘black jade.’” But given RCI’s evidence that there is no established mineralogical category for “black jade,” a jury could find implied falsity, especially since one retailer seemed to understand the statement as questioning whether the stones were “somehow counterfeit.” A falsity finding would be premature, since a factfinder should address implied falsity and the parties continued to dispute which stones RCI submitted to obtain its certifications. “The existing record does not definitively rule out the possibility that RCI commingled stones from Goldstein and its subsequent supplier, or definitively establish the provenance of the stones RCI submitted for evaluation.”

Goldstein also made legal claims in his emails, e.g., “[i]f there is no certification available, then legally you cannot claim or advertise that it is black jade.” This wasn’t itself actionable, because “a layman’s statements about the illegality of another party’s conduct do not violate the Lanham Act absent a ‘clear and unambiguous ruling from a court or agency of competent jurisdiction’ that the conduct is lawful.” However, a jury could consider them “to the extent they imply (as a factual matter) that RCI was misleading its retailers or other customers about the content of its stones.”

Commercial advertising or promotion: Since the statements to retailers weren’t identical, the court had to decide whether to consider them individually or in the aggregate when assessing the breadth of dissemination. “Goldstein’s statements should be aggregated when assessing the breadth of dissemination, because they were made during a compressed time period (approximately three weeks in April 2018) and concerned similar subject matter (the authenticity and authentication of RCI’s black jade).”  A jury could reasonably conclude that they constituted a single “campaign.” Once that was done, the dissemination was sufficiently broad to qualify as advertising or promotion. The court noted, that, “[o]n the one hand, the global market for fine jewelry is perhaps enormous.”  But “the market for name-brand, artistically produced luxury jewels is surely a discrete subset of that industry.” RCI’s evidence showed that the five prominent department stores that Goldstein emailed accounted for “over 23% of RCI’s gross profits on sales from the black jade collection” in themselves. “[O]n this record, a reasonable jury could conclude that the relevant market is confined to higher-end jewelers like Neiman Marcus, rather than every seller of precious stones in the world,” and that Goldstein communicated with a sufficiently large proportion of that market—a “huge” amount of communication in his own words.

Trademark infringement: Goldstein admitted that he posted photographs of RCI’s jewelry on Kings Stone’s Instagram feed.  RCI’s logo — the letters “RC” with a diamond shape beside them—was superimposed. He used these materials to promote Kings Stone’s black-jade business, and used his PowerPoint similarly. Goldstein argued that he had oral authorization as part of the deal to supply black jade to RCI. (Nominative fair use would be relevant outside the Second Circuit, though use of the logo would definitely pose a problem.) He argued that he’d provided a discount on stones in exchange for this authorization and that such a deal was a “common industry practice.”

The court was unconvinced: “[I]t strains credulity to think that the parties agreed on the duration of the trademark license — specifically, that it would exist in perpetuity — without any corresponding agreement on the period of time for which RCI and its affiliates would purchase stones from Goldstein (a period that, in the end, lasted only about a year).” But more importantly, the Statute of Frauds prevented reliance on such permission, irrespective of credibility. What he had in writing—purchase orders memorializing a “discount price” from Kings Stone and an email from Roberto Coin stating that the “RC brand will bring you lots of credibility in the market”—wasn’t enough to set out the material terms of an agreement. Thus, RCI won summary judgment on its infringement claims.

However, the court would let a jury resolve the question of damages, including willfulness.

Defamation/trade disparagement:  There was sufficient evidence for a jury to find special damages, based on lost customers and revenue. Otherwise, factual questions remained, as with the Lanham Act false advertising claim. Tortious interference: same. Specifically as to the lawsuit threats: “[A] lawsuit or the threat of a lawsuit is wrongful [for purposes of a tortious interference claim] if the actor has no belief in the merit of the litigation.” “It is also wrongful if the actor, having some belief in the merit of the suit, nevertheless institutes or threatens to institute the litigation in bad faith, intending only to harass the third parties and not to bring his claim to definitive adjudication.”

GBL Section 349:  The alleged conduct was not consumer-oriented, even it wasn’t a “garden-variety” dispute between competitors. There was no specific evidence that the “public interest [wa]s harmed” by defendants’ actions.

accusing a home inspectors' group of link with NAMBLA isn't believable enough for defamation

Examination Board of Professional Home Inspectors v. International Association of Certified Home Inspectors, 2021 WL 492482, No 18-cv-01559-RBJ (D. Colo. Feb. 10, 2021)

Although an individual's comments linking his rival to NAMBLA and Jeffrey Dahmer were non-actionable non-facts, statements arguably closer to his expertise were falsifiable despite his over-the-top online persona.

Two entities, EBPHI and ASHI, sued InterNACHI. EBPHI administers and owns the National Home Inspectors Examination (NHIE), an exam many states use to license home inspectors. In addition to being a membership association for home inspectors, InterNACHI also offers a competing licensing exam for the home inspection industry. Defendant Gromicko made numerous statements about EBPHI and the NHIE on InterNACHI’s online forum, such as:

The NHIE is a joke of an exam. Meaningless piece of crap and a scam IMHO....;

The questions about basements are fine as basements are part of a home inspector’s SOP . ..even in areas that don’t have basements...the questions about radon and sprinklers are not...I can go to court for you and get an injunction forcing EBPHI to grade your exam without those questions. Then through discovery, I’ll find out everyone else who has ever failed the NHIE, and file a class action suit against the EBPHI....It’s not even a psychometrically valid exam and I can prove it in court. They’ll owe millions in lost revenue....Just say go.

EBPHI sued for (1) defamation, (2) trade libel, (3) commercial disparagement, (4) tortious interference with business expectancy, and (5) deceptive trade practices under the Colorado Consumer Protection Act.

ASHI and InterNACHI are also competitors in the home inspection industry as membership organizations. Member home inspectors enjoy certain benefits, including being advertised to homebuyers on the associations’ websites.

ASHI’s website has a “Find a Home Inspector” tool whose tagline reads, “Educated. Tested. Verified. Certified.” Results list whether the inspector is an ASHI associate, inspector, or certified inspector, ASHI’s three membership classes. Certified inspectors must prove they’ve conducted at least 250 home inspections, pass the NHIE, and meet other standards; inspectors must pass the NHIE or their state’s exam, conduct at least 75 home inspections, and meet other standards; associates must complete the ASHI standards of practice and ethics education modules. Associates are not required to complete the continuing education requirements until after one year of membership. ASHI also began using a background verification logo to indicate which home inspectors had undergone successful background checks; individuals who have been convicted of felonies aren’t given the logo.

InterNACHI was founded by Gromicko, who is quite active on its forum. For example, in response to Washington Post article that purportedly recommended homebuyers use InterNACHI home inspectors rather than ASHI’s, he posted “[t]he reporter failed to note that ASHI (American Society of Home Inspectors) was taken over by NAMBLA on Friday.” An InterNACHI member replied that he searched NAMBLA online and it was not the result he was expecting. Yet another member replied “[m]e either, creepy and not cool.”  There was, of course, no merger with the North American Man-Boy Love Association. After this lawsuit started, he posted, “ASHI is a statistical mass murder [sic] of children on a grand national scale. I’d sooner work with Jeffrey Dahmer. He only killed and ate 17 people.” “Perhaps it goes without saying, but ASHI does not engage in the mass murder of children.” ASHI sued for (1) defamation, (2) trade libel, (3) commercial disparagement, and (4) deceptive trade practices under the Colorado Consumer Protection Act. Defendants counterclaimed against ASHI: (1) false advertising under the Lanham Act, and (2) tortious interference with business expectancy.

Defamation: “[N]o reasonable person, much less a ‘substantial and respectable minority’ could reasonably believe that the NAMBLA comment is factual.” Defendants made the statement “alongside other statements incapable of being factual,” such as that the purported merger was a good thing because most of ASHI’s members suffered from rigor mortis. No reasonable person “could believe that a professional home inspectors’ association merged with a fringe, highly vilified pro-pedophilia group, particularly when such a statement comes from none other than a loud-mouthed competitor.”

What about the claim that the NHIE wasn’t psychometrically valid because it tested subjects outside the industry’s standards of practice? First, was this a matter of public concern? Yes, the exam is offered in 29 states and “has the potential to impact members of the public or the public as a whole.” The statement was made in online, open forum accessible to virtually any member of the public with internet access. And it was made in response to the complaint of a third party—not involved this lawsuit—that she and her husband were “prepared” and “studied hard” for the NHIE but only recognized a handful of questions and ultimately failed the test. “Thus, the content, form, and context of the NHIE comment all support the conclusion that it involved a matter of public concern.” Although the speaker was self-interested, that wasn’t dispositive.

This holding meant that actual malice was required, not mere negligence. “Actual malice may be inferred by the finder of fact if an investigation is grossly inadequate.” Likewise, “a speaker who willfully chooses not to learn the truth prior to making an allegedly false statement can be found to have acted with actual malice.” The record would allow such a finding. Gromicko knew what “psychometrically valid” required; he admitted that he read books and articles on psychometrics and exam writing when creating his own home inspection licensing examination. He wrote the portion of InterNACHI’s website that, at one point, discussed the psychometric validity of its own test in some detail. EBPHI also presented evidence that testing outside of the standards of practice is not a factor that renders a test psychometrically invalid. Thus, the issue was for the jury.

Nor was this a mere statement of opinion. He implied that psychometric validity was a verifiable fact by stating that he could prove the NHIE is invalid in court, which also suggests he had evidence of this “fact.” The context, offering to “go to federal court for you and get an injunction,” further implied provability. And the circumstances did too: “Gromicko is the founder of the largest home inspectors’ membership association in the country. He made this comment on his company website where he communicates with current and aspiring home inspectors. … Using his position of a power as an industry leader, he disseminated this statement to members of the industry and implied that it was factual and that he had evidence to support it.” Despite his, um, quirky online persona, he was still in a position of authority such that “reasonable people would conclude that the assertions [were] ones of fact.”

Was the statement per se defamatory, which is to say did it carry “its defamatory imputation on its face,” or was it defamatory per quod, requiring innuendo or extrinsic evidence to establish its defamatory nature? Traditional categories of defamation per se include “imputation of (1) a criminal offense; (2) a loathsome disease, (3) a matter incompatible with the individual’s business, trade, profession or office; or (4) serious sexual misconduct.” Damages are presumed if the statement is per se defamatory but must otherwise be proved. The court found that this statement fell into category (3).

There was a dispute about falsity, and also about damages—EBPHI submitted expert testimony that the number of test takers for EBPHI’s exam decreased after the comment, and in Florida, the only state to offer both exams, the number of NHIE test takers dropped following the comment.

 Tortious interference: Though defamation is a wrongful means of interference, EBPHI couldn’t prove damages. It identified no individuals with whom they intended to contract but for InterNACHI’s interference. A drop in the number of test-takers might be sufficient to establish an inference of injury in other contexts, but was is insufficient for a tortious interference with business expectancy claim. “EBPHI’s evidence proves nothing more than that EBPHI had a ‘mere hope’ that more people would sit for their exam, which is insufficient.”

Counterclaim based on ASHI’s allegedly false tagline “Educated. Tested. Verified. Certified”: There was no evidence of intentional interference with InterNACHI’s relationships. After using the tagline, ASHI experienced a rise in associate members. But that didn’t show intentionality, or that InterNACHI had anything more than a “mere hope” that the associate members who joined ASHI would have joined InterNACHI but for the tagline.

Commercial disparagement/trade libel: Same results as defamation.

Colorado Consumer Protection Act: Requires a showing that the challenged practice “significantly impacts the public as actual or potential consumers.” Courts consider “the number of consumers directly affected by the challenged practice; the relative sophistication and bargaining power of the consumers affected by the challenged practice, and evidence that the challenged practice previously has impacted other consumers or has significant potential to do so in the future.”

First, even if the NAMBLA comment did support a claim for defamation, this court has held that “making defamatory statements...is not a deceptive trade practice....it is purely a private wrong.” And there was no evidence of public impact; it wasn’t enough to say that the public read or saw the comments.

Second, the NHIE comment hadn’t been shown to significantly impact the public. It wasn’t enough that twenty-three fewer people took the exam in Florida the year after the comment was made, given that the NHIE is a national exam.

Lanham Act counterclaim against “Educated. Tested. Verified. Certified.”

First, was this commercial advertising or promotion? While Angie’s List’s statements about one company on its review statements weren’t commercial speech as to Angie’s List, this was a very different situation. The tagline wasn’t speech about one member, but rather “speech that purportedly applies to every ASHI member, and therefore it is a statement about ASHI as an association.”

Second, did defendants show injury or damages? Defendants argued that they were entitled to an inference of harm because they’re in a two-party market (which they would prefer to monopolize, per public comments, noted by the court, that they might eventually have cause to regret). Despite this competition, the court held that defendants still “must show some evidence of causation and injury,” which they have not done.  Although “ASHI experienced a spike in new associate members” after including the tagline on its website, they didn’t show any loss suffered by InterNACHI, nor that any of the alleged members who joined ASHI had any knowledge of InterNACHI’s membership program. Defendants admitted that the associates who joined ASHI might not have been welcome at InterNACHI even if they had wanted to join, because InterNACHI “never promotes uncertified members to the public.”  ASHI was thus “the only membership service in this two-player market that would allow novice home inspectors to gain experience and be advertised to homeowners prior to certification.”