Showing posts with label false association. Show all posts
Showing posts with label false association. Show all posts

Thursday, January 08, 2026

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

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

Some interesting stuff going on in the genealogy world!

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

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

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

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

Hein registered this text:

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

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

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

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

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

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

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

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

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

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

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

Mai’s version:

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

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

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

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

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

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

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

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

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

Amount and substantiality: eight whole photos.

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

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

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

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


Wednesday, December 17, 2025

license agreement termination might be invalid transfer in gross without a new partner for licensor

Form Portfolios LLC v. Food52, Inc., 2025 WL 3638165, No. 24-cv-07690 (NCM) (CLP) (E.D.N.Y. Dec. 16, 2025)

Form designs consumer products, partnering with other companies that license those designs. Food52 sells cookware and other homegoods under the brand Dansk. This dispute arises from their former collaboration.

Dansk is known for products designed by Jens Quistgaard, a Danish designer…. After Quistgaard was no longer Chief Designer for Dansk, Quistgaard continued to develop designs for kitchenware on his own. … In 1992—long before defendant acquired Dansk—Dansk and Quistgaard entered into a contractual arrangement) for Dansk to have the opportunity to purchase designs that Quistgaard continued to invent. … Quistgaard retained all rights for designs not accepted by Dansk. The 1992 Design Agreement provided Dansk with a limited license to utilize Quistgaard’s distinctive and famous name, signature, biographical data, photograph and/or likeness on the accepted designs.

Quistgaard died in 2008; his heirs set up an entity that entered into a new agreement with Dansk, providing it a right of first refusal to certain archival designs and again provided Dansk a limited license to utilize Quistgaard’s name, initials, signature, biographical information, and likeness for promotional materials for the additional accepted designs. This agreement expired in 2022.

The parties then entered into an agreement allowing Dansk to make and sell products based on certain designs owned or managed by Form. Dansk also asked Form to act as an intermediary with the Quistgaard Family because of Form’s expertise working with the heirs of designers. The Quistgaard family granted Form the exclusive right to negotiate a new agreement with Dansk, including provisions making Form its legal representative. The parties then entered into a new license, which said it superseded all previous licenses.

The new agreement stated, among other things, that “[a]ny trademark, other than [defendant]’s house mark or brand, that is adopted by [defendant] in marketing Licensed Products in addition to a Licensed Trademark that becomes associated exclusively with any or all Licensed Products as a result of such marketing, shall revert to [plaintiff] upon termination of this Agreement for any reason,” including “the name of the designer in question, their likenesses, signatures, logos and initials for use in connection with the promotion, advertising, marketing and sale of Licensed Products.”

Then a dispute developed and Dansk allegedly unilaterally ceased making payments to Form. But it allegedly continued to sell products covered by the new agreement and to use various trademarks, including the Jens Quistgaard name and the Kobenstyle registered trademark.

Form sued for trademark infringement under Section 32 of the Lanham Act and false association, false advertising, and trademark dilution under Section 43.

Section 32: Kobenstyle is a specific line of cookware. The parties agreed that this trademark was initially owned by Dansk in 2013, but Form argued that the license agreement transferred it to Form when the license was terminated, implicitly arguing that the Kobenstyle trademark was not “[Dansk]’s house mark or brand.”

First, the court found that summary judgment was the right place to make the argument that the agreement’s reference to “revert” meant that the agreement only covered marks Form previously owned; it never owned Kobenstyle. At the motion to dismiss stage, though, the court accepted the argument that the only things exempt from “reverting” are Dansk’s “house mark or brand.”

Dansk then argued that, regardless, this section would fail to actually transfer ownership because it was a prohibited “in gross” transfer of trademark rights.  “[F]or a trademark transfer to be valid, the transfer must include the underlying trademarked commercial undertaking in some meaningful respect.” It was true that no aspect of defendant’s business has changed hands, but Form argued that a trademark can be validly transferred even without transfer of the underlying business so long as the recipient continues or intends to continue producing similar goods. “The fundamental requirement for a valid transfer of trademark is continuity of the underlying product or business.”

However, the complaint didn’t plead that Form intends to produce or market Kobenstyle products within a reasonable timeframe or partner with a different collaborator to do so. Thus, the section 32 claim failed.

43(a)(1)(A) false association: Form alleged that Dansk’s use of Jens Quistgaard’s name, initials, signature, biographical information, and likeness was actionable. Form properly alleged standing: its interests were within the zone of interests, which for 43(a) doesn’t require trademark ownership, and it sufficiently alleged that its re-licensing rights were being harmed by Dansk’s competing uses.

Dansk argued that it was using Jens Quistgaard’s name and initials only in a descriptive and factual sense—to convey to consumers that defendant is selling goods that were, in fact, designed by Quistgaard. But this doesn’t work on a motion to dismiss because descriptive fair use is a fact-intensive inquiry. (Could this be reframed as a Dastar defense that would work?)

However, the 43(a)(1)(B) claim was dismissed as duplicative with the unregistered trademark infringement claim. T The idea that consumers will falsely believe that defendant is authorized to sell trademarked goods does not sufficiently entail or imply a false statement that “go[es] beyond mere claims of false association.”

Dilution: of course not; Form didn’t even bother to defend it.


Friday, December 05, 2025

wrongfully claiming Amazon ASIN might be false advertising, even with foreign TM rights

Best Glide Aviation Survival Equipment, Inc. v. Tag-Z, LLC, No. 1-23-cv-1080-DAE, 2025 WL 3454210 (W.D. Tex. Aug. 20, 2025)

This case involves an alleged abuse of Amazon’s system to keep out legitimate competitors. Amazon is so big it can help other, smaller would-be monopolists! The parties compete to sell military style P-38 and P-51 can openers, stamped with “U.S. Shelby Co.” Best Glide alleged that U.S. Shelby openers were originally manufactured by Mallin Shelby Hardware until 1983, when the company dissolved, and since then, they have been manufactured, distributed, and sold by various entities.

Best Glide alleged that it began such sales in 2009; that it was well known in the community for making such sales; and that the public has come to associate it as a provider of U.S. Shelby openers on its own website and on Amazon’s. (Seems unlikely, but I don’t think it needs to be true for Best Glide to be in the right here, given what comes next.)

Each product on Amazon has an Amazon Standard Identification Number (ASIN), “akin to a serial number.” Amazon’s Brand Registry Program allows a seller to become a brand owner by registering a brand name, registered trademark, and/or trademark application into the program. “Once entered in the program, a brand owner controls both the content of an ASIN and who is listed as a seller on an ASIN.” With a generic ASIN, no one seller controls the listing or who may be listed as a seller.

Tag-Z filed for, but later withdrew, a trademark application for “US Shelby.” It also filed trademark applications for “P-38” and “P-51.” Best Glide’s opposition to those applications is suspended pending resolution of this case. Tag-Z possesses German trademark registrations for “P-38,” “P-51,” “US SHELBY,” and “US SHELBY CO.” It allegedly used these to enter the Brand Registry Program and block US sales.

Specifically, Amazon informed Best Glide that Tag-Z had registered one or more of its marks in the program and thus was now the brand owner for the previously generic ASINs. This allegedly led to a marked decline in Best Glide’s sales.

Stretching the definition of “commercial advertising or promotion” a little, but not in any way I find troubling, the court found that Best Glide stated a claim for false designation of origin/association/endorsement and unfair competition/false advertising under the Lanham Act and coordinate state law claims.

The court lumped false designation of origin, association, or endorsement together under §43(a)(1)(A), then applied (B) standards to the claim, including materiality. (This is really mostly a (B) claim.)

The (A) claim was predicated on the idea that, by exploiting the Brand Registry loophole, Tag-Z was able to misrepresent that associated reviews should be attributed to it, when they in fact should be attributed to Best Glide; this was plausibly material “since it can be inferred that customers will be influenced by reviews believed to be associated with Defendant when they are in fact attributable to Plaintiff.”

Likewise, the (B) claim survived because it was plausible that the ASINs are commercial advertisements about the good’s designation of origin, association, or endorsement. They were plausibly (1) commercial speech, (2) for the purpose of soliciting business, and (3) sufficiently disseminated to a relevant public audience. ASINs are (as alleged) not only serial numbers, but the shorthand method of describing a product webpage. “[G]iven that consumers can see the associated ASINs on the Products’ webpage listing, the Court finds Plaintiff has pled the speech is sufficiently disseminated to the relevant public audience.” [Yeah, but is it plausible they’re paying attention? I think this could also be analyzed as a series of commercially motivated false statements to Amazon, which is such a big intermediary that misstatements to it are sufficiently disseminated to a relevant audience.] And “Defendant’s excluding other sellers from using the ASINs and thereby positioning itself to consumers as the exclusive seller of these Products with reviews which should be attributed to Plaintiff is sufficient to plead a misrepresentation.” [Note the one-from-column-A-and-one-from-column-B approach here: the commercial speech is the ASINs, but then the misrepresentations come in the reviews associated with the ASINs. I suppose this is analogous to situations where a pharmaco claims “genericity” for something that isn’t bioequivalent, etc.—the ASIN is sufficiently concentrated information, in this context, that it functionally contains the statements associated with it, here the reviews.]

The similar state law claims survived, but tortious interference with contract failed because the complaint (somehow?) didn’t allege the existence of a contract between Amazon and Best Glide. Moreover, Best Glide failed to allege that any contract between itself and Amazon obligated Amazon to allow it to sell products under specific ASINs. “In the absence of a contract requiring that obligation, Plaintiff cannot allege such a contract was breached.” Likewise, tortious interference with prospective economic relations failed for want of alleged interference with a specific prospective contract or client relationship.

Business disparagement also failed because no allegedly false statement was “about” Best Glide, much less defamatory.


Monday, November 17, 2025

Landing page that misdirected searchers away from real senior living community was plausibly false advertising

Cedar Communities at Commerce, LLC v. Caring, LLC, 2025 WL 3187288, No. 1:25-CV-00922-JPB (N.D. Ga. Nov. 14, 2025)

Caring operates a web-based senior living placement and referral service, touting “the longest-running, highest-integrity senior living review program on the web, all to ensure families make the best and most informed choice possible for their loved ones.” Caring claims that it offers “free, personalized guidance from experienced advisors who understand the unique needs of seniors and their families” and that “Family Advisors provide invaluable expertise to ensure you have all the information you need to successfully find the community that meets all of your needs.”

Cedar argued that these statements were false and misleading because (1) Caring exclusively refers potential customers to senior living communities that are in its referral network, for which it earns commissions, and (2) the service is not free, because Caring’s commissions are equivalent to the first month’s rent and care and these costs are passed on to the customer through higher rent and care expenses.

Cedar isn’t part of Caring’s referral network, but when someone searches for “Brookside Commerce” (its dba) a “prominent listing” for that appears on Caring’s site because of Caring’s SEO.

Google result

Cedar argued that this falsely implied that its facility was part of Caring’s network; that the included photo is fake; and that the 3.3-star rating is phony. If a potential customer clicked on this link, they’d go to a landing page tailored for Brookside Commerce, furthering the illusion of network membership.

landing page

A click on “Request Tour,” “Get Costs” or “Find Availability” would be connected to one of Caring’s representatives—not one of Cedar’s representatives—who then directs the inquiry away from Cedar’s facility and to a community within its referral network.

Cedar filed a putative class action for violation of the Lanham Act and coordinate state law. The court declined to dismiss, saying some things about false association that are worrying devoid of context but understandable on these facts, and they are properly framed as false advertising claims—requiring materiality (and commercial advertising).

Caring argued that claims like “comprehensive directories,” “expert consultation” and “free referrals” were either non-actionable “puffery” or true, and that Caring does not purport to offer “unbiased” consultations and openly discloses its commission-based referral network model on the website.

Even without a specific statement about lack of bias, “after viewing the statements as a whole and considering the full context of the statements, the Court finds it plausible that a reasonable consumer under some circumstances would be misled into believing that Defendant’s representatives generate their recommendations in an independent, fact-based manner and select possible options from the entire directory—instead of only promoting communities in their network.”

What about the stock photo and user reviews?  Not really addressing those, the court agreed that the landing page “creates a false impression of affiliation with” Cedar. Here’s the yikes: “As an initial matter, it is reasonable to assume that some people would think that Plaintiff’s facility was part of Defendant’s network simply because the landing page exists on Defendant’s website.” More persuasively, “the option to request a tour, get costs or find availability … give the false impression to potential customers that they have the ability to easily obtain additional information about Plaintiff’s facility by just clicking a button. Importantly, however, when potential customers click on one of those buttons, the potential customer is never provided with more information about Plaintiff’s facility and is instead transferred to one of Defendant’s representatives that recommends a facility that pays commissions to Defendant.” (Note that if the buttons did work as labeled, even without affiliation, there wouldn’t be falsity.)

Materiality: Cedar alleged that choosing a facility is a “complex process” and that families and caregivers “often face overwhelming stress and anxiety when trying to choose the right senior care option for their loved one.” It was plausible that the website misrepresented “the inherent qualities and characteristics of Plaintiff’s facility,” and Caring’s claim that it offers expert recommendations “enhances the likelihood that [the] misrepresentation would influence purchasing decisions” of potential customers, especially where the decision making is complex and stressful.

Injury: Given the diversion from Cedar if consumers clicked buttons requesting a tour, etc., that was plausibly pled, even without identifying specific diverted consumers. Reputational injury was also plausible because consumers may falsely assume that Caring’s alternative recommendations (other assisted-living facilities) are superior.

State-law claims: Cedar argued that Caring’s keyword “manipulation” violated state law against unfair business practices, and so did the “unauthorized” landing page, leading consumers to believe the parties were affiliated. Again, the court allowed the claims—even though keyword advertising on its own is benign.

Friday, July 25, 2025

court finds advertising injury insurance coverage in false association case despite consumer fraud and other exclusions

Illinois Casualty Co. v. Kladek, Inc., No. 22-3214 (DWF/DJF), 2025 WL 2071043 (D. Minn. Jul. 23, 2025)

ICC sought declaratory judgment that it didn’t have to defend (or indemnify) its insured in a Lanham Act false association lawsuit brought by models, and failed, at least as to defense.

In the underlying lawsuit, the models sued over a “Gentlemen’s Club” that used photos of them in social media ads. They alleged 43(a) false endorsement, unfair competition, and false advertising; right of publicity violations; negligence; violation of Minnesota’s Uniform Deceptive Trade Practices Act; and unjust enrichment.

ICC issued Kladek business liability coverage that included advertising injury and also issued an additional cyber protection endorsement. An arbitration panel concluded that the cyber protection endorsement created a duty to defend (but did not resolve the duty to indemnify), but the business liability coverage is broader and so still relevant.

Advertising injury covers, inter alia,

(4) Oral or written publication, in any manner, or material that slanders or libels a person or organization or disparages a person’s or organization’s good, products or services;

(5) The use of another’s advertising idea in your “advertisement”; or

(6) Infringing upon another’s copyright, trade dress or slogan in your “advertisement.”

But ICC contended that exclusions applied. Under Minnesota law, courts read policies in favor of finding coverage, construing words of inclusion broadly and words of exclusion narrowly.

First, ICC argued that it excluded coverage with the “law exclusion,” which covered liability “arising directly or indirectly out of any action or omission that violates or is alleged to violate … (12) Any federal, state, county, municipal or local consumer fraud protection law, regulation, ordinance, order, or directive barring fraud, unfair competition, and/or deceptive business practices.”

The court agreed with Kladek that the Lanham Act and MDTPA claims apply to various types of conduct, not all of which can be labeled “consumer fraud.” The exclusion does not apply to the statutory claims insofar as they do not implicate consumer fraud conduct:

Notably, the Models have not alleged that any “consumer” has been defrauded. Instead, the Models allege that they were wronged because their images were used without their authorization or compensation. These claims are not “consumer fraud” claims at their core, but rather commercial claims involving advertising injury.

“Because the core of the Models’ Lanham Act claim alleges an injury caused by the unauthorized use of their images without compensation by the Club, and not a consumer fraud claim, ICC has not demonstrated that the Law Exclusion applies to the Models’ Lanham Act claim.” Of course, injury to consumers is the method by which the harms of false advertising are inflicted, and courts have rejected models’ Lanham Act claims merely based on failure to pay, but that I suppose is a matter for the merits.

In a footnote, the court said that the duty to defend even one claim triggered the duty to defend in its entirety unless an additional exclusion applied, and that, in the alternative, ICC’s interpretation would render any insurance illusory. “[W]hen policy exclusions appear to be broader than the coverage, so as to ‘swallow up’ the coverage, rendering the insuring promise illusory, a court will avoid that unreasonable result.” The court found that logic compelling, “as it appears that the ICC’s broad interpretation of the policy exclusions would preclude coverage in most factual scenarios.”

Electronic chatroom exclusion: this excluded advertising injury “[a]rising out of any electronic chat room, bulletin board, or blog the insured hosts, owns, or over which any insured exercises control.” ICC argued that Facebook, Instagram, and Twitter, the platforms on which the models’ images were used, “all allow users to post or read messages and control or host their own bulletin boards” and therefore qualified for the exclusion. But the policy didn’t define “bulletin board” or “electronic chat room,” so the plain meanings of those terms applied. Chat rooms involve realtime communication, and a bulletin board is an “online communication system[ ] where one can share, request, or discuss information on just about any subject.” “In contrast, as commonly understood, Facebook, Instagram, and Twitter are social media platforms.” Kladek didn’t host, own, or exercise control over Facebook, Instagram, and Twitter, but rather used them to promote its business. “There is no evidence that it did so with any intention to generate any discussion among viewers. Indeed, the use of the Models’ images did not occur in a chat room, on a bulletin board, or on a blog.” The best description of where these images were was that they were on Kladek’s “social media accounts.”

ICC had one final try: its exclusion for “multimedia peril,” “the release or display of any ‘electronic media’ on your ‘internet’ site or ‘print media’ for which you are solely responsible, which directly results in any of the following”:

a. Any form of defamation or other tort related to the disparagement or harm to the reputation or character of any person or organization, including libel, slander, product disparagement, or trade libel;

b. Invasion, infringement or interference with an individual’s right of privacy including false light, intrusion upon seclusion, commercial misappropriation of name, person, or likeness, and public disclosure of private facts;

c. Plagiarism, piracy, or misappropriation of ideas under an implied contract ….

This exclusion applied unless the cyber endorsement applied—or maybe it did so if the cyber endorsement applied. “In essence, ICC appears to argue that because the ICC has a duty to defend claims under the Cyber Endorsement (as determined by the arbitration panel), all of the Models’ claims are now excluded from coverage under the Policy.” The court disagreed. The arbitration panel didn’t decide indemnification, or which claims in the underlying suit triggered the cyber endorsement duty to defend. Also, the cyber endorsement created several ambiguities, and was unclear on its relationship with the main liability policy. Basically, the endorsement was inconsistent about whether it amended or supplemented the main policy and stated that its coverage was “in addition to, and will not erode, the limits of insurance provided elsewhere under your Policy.” And the main form was written on a traditional “occurrence” basis, while the cyber endorsement was a claims made policy. Finally, “the wording of the Multimedia Exclusion is, itself, circular and facially contradictory” by excluding multimedia liability for advertising injury “except to the extent that coverage may be provided under the Cyber Endorsement.” The court found the language confusing, but one reading was that, once coverage exists under the cyber endorsement, it also exists under the basic liability policy. “Ambiguities are construed against the insurer and in favor of coverage.”


Thursday, July 24, 2025

alleged use of competitor's corporate "persona" didn't cause actionable confusion

SME Steel Contractors, Inc. v. Seismic Bracing Co., LLC, No. 2023-2426, 2025 WL 2057365 (Fed. Cir. Jul. 23, 2025)

Discussion of previous district court opinion here. Because a patent is involved, the appeal on all issues goes to the Federal Circuit, but the Federal Circuit is supposed to apply home circuit precedent to the non-patent claims. Once again we see the powerful discontinuity between TM and false advertising claims produced by the normal absence of any damage requirement in TM.

The parties compete in the design of buckling-restrained braces (BRB), which are structural devices that help buildings withstand seismic activity. SME sued Seismic for patent infringement, false advertising and false association under the Lanham Act, unfair competition and certain deceptive trade practices under Utah state law, and copyright infringement. Seismic secured summary judgment, which the court of appeals affirms. Patent discussion omitted.

The false advertising-related claims centered on representations made by Seismic in a Design Manual that it sent to prospective clients. Its 90 pages included the statements “Produce capacity of over 5000 BRBs per year” and “These patented methods have now been tested and qualified for use on projects in accordance with governing building codes (AISC 341).” The Design Manual further included a report from the University of Utah, testing five of Seismic’s BRBs and concluding that three of those BRBs satisfied AISC 341-10 requirements and two did not. SME argued that these statements were false and that Seismic used SME’s “persona,” including proprietary technical drawings and a similar logo, in the Design Manual. (It didn’t bring a conventional infringement claim.) SME further alleged that it lost business to Seismic because of these misrepresentations.

The copyright claims alleged that Seismic used several of SME’s copyrighted technical drawings of BRB designs in the Design Manual. The district court granted summary judgment to Seismic, concluding that SME had “not presented sufficient evidence of a causal connection” between the alleged copyright infringement and alleged profits; SME sought only disgorgement. (The court of appeals could have pulled a Davis v. Gap move and remanded to assess damages, but there doesn’t seem to be a licensing market here, making that much less attractive.)

Even if there was Lanham Act standing, there was no genuine issue of material fact on injury. No reasonable jury could find a causal connection between misrepresentations by Seismic and SME’s injuries. SME only showed that the Design Manual was sent to several potential customers and that Seismic successfully bid on projects that involved those customers while SME also (unsuccessfully) submitted competing bids on most of those projects. “SME Steel did not present any evidence that the Design Manual—let alone the handful of representations alleged to be misleading within this ninety-page document—played any role in SME Steel’s loss of bids.”

SME argued that it was entitled to a presumption of injury because the parties compete in a sparsely populated market. Under Tenth Circuit law, where “the plaintiff and defendant are the only two significant participants” in a two-player market, “injury may be presumed if the plaintiff shows the defendant made literally false statements or made statements that were literally true but were likely to mislead or confuse customers.” But the two key alleged misrepresentations weren’t shown to be literally false.

“Produce capacity of over 5000 BRBs per year” on its face refers to future capacity. SME argued that this was false because Seismic Bracing uses third-party fabrication shops and did not have such a manufacturing capacity itself. But “produce” can have multiple definitions and may be defined as “to make available for public exhibition or dissemination: such as ... to oversee the making of.” Thus the claim was “ambiguous, precluding literal falsity.”

What about the “tested and qualified” claim given that two of Seismic’s five tested BRBs failed testing? Again, the statement that Seismic’s “patented methods have now been tested and qualified for use on projects in accordance with governing building codes (AISC 341)” was ambiguous, “as the statement could have referred to the BRBs that satisfied the testing requirements, not all of Seismic’s BRBs.”

What about using intent to deceive to presume deception and thus injury? Some Circuits have said so, but, even assuming that the Tenth Circuit would agree, no reasonable jury could conclude that Seismic acted with intent to deceive. Mere awareness of what factors a potential customer might consider important in buying a BRB did not create a genuine dispute.

False association: The district court analysis here was deeply confused. The Federal Circuit noted that “it is not clear what the basis for SME Steel’s false association claim is. SME Steel concedes that ‘this case does not involve a mark,’ but instead, it appears to contend that it has a particular corporate persona, akin to an individual celebrity, and Seismic Bracing appropriated that persona in its Design Manual.” Nonetheless, the Federal Circuit proceeded to affirm the district court’s likely confusion analysis rather than just saying no. It didn’t mention the weirdest parts of that analysis flowing from the conceptual mismatch, just holding that, “[g]iven the admitted care that customers will exercise in reviewing materials related to the bids and selecting BRBs, as well as the absence of evidence of actual confusion, we agree that no reasonable jury could conclude that there was a likelihood of confusion.”

Copyright: SME didn’t show a causal connection between the alleged infringement and any subsequent purchases of Seismic’s BRBs. To show indirect profits, the copyright holder bears “the initial burden to show a nexus between [the alleged] infringement and making of a profit,” and [t]hat showing must go beyond speculation.” That didn’t happen.

Monday, July 21, 2025

AI voice cloning opinion narrows claims to ROP, rejecting TM and (most) copyright theories

Lehrman v. Lovo, Inc., --- F.Supp.3d ----, 2025 WL 1902547, 24-CV-3770 (JPO) (S.D.N.Y. Jul. 10, 2025)

Plaintiffs alleged that Lovo misled them about its use of their voices, using AI to synthesize and sell unauthorized “clones” of their voices. They sued for violations of New York civil rights and consumer protection laws, the Lanham Act, and the Copyright Act, along with common-law contract, fraud, conversion, unjust enrichment, and unfair competition claims. Lovo was partially successful on its motion to dismiss, but had to deal with the NY ROP claims, as well as consumer protection and breach of contract claims. I might not agree with every detail of the extensive opinion, but this is a useful map of the issues. It’s also a reminder of the hazards of not contracting properly with people you don’t employ.

Plaintiffs Lehrman and Sage are voice-over actors. Lovo “sells a text-to-speech subscription service that allows its clients to generate voice-over narrations at a fraction of the cost of the traditional model.” It claims that its software, Genny, was “created using ‘1000s of voices.’ ” Genny is allegedly capable of creating a voice “clone,” which “refers to a virtual copy of a real person’s voice.” It advertised its voice cloning service by emphasizing how similar its cloned voices are to the originals from which they are derived. In one marketing video, Lovo stated, “you will hear five speakers whose voices have been cloned to near perfection. Their tone, accent, and even mannerisms are fully learned by our AI voice system.” One of Lovo’s co-founders described a cloned voice as a replacement for “a real human voice,” allowing users of Lovo’s platform to “make that voice say anything that you want, even if that person has never actually said that before in their life.”

Lovo advertises the commercial use of its platform to “Save $$ and time on voiceovers.” Allegedly, “Lovo represents to its customers that Lovo is granting full commercial rights for all content generated using its platform to users who subscribe to any of its paid plans,” which cover “any monetized, business-related uses such as videos, audio books, advertising, promotion, web page blogging, [and] product integration.”

Lovo originally solicited Lehrman and Sage for the projects relevant to this action on an online marketplace for freelance services called Fiverr. A Lovo employee allegedly contacted Lehrman and hired him to “provide voice recordings for ‘research purposes,’” assuring him that the company would use the recordings for “research purposes only,” and that such research would be only “internal” and “academic” in nature. Lehrman wrote back, asking for a “guarantee that these scripts will not be used for anything other than your specific research project,” to which the employee replied: “The scripts will not be used for anything else ....” The employee further confirmed that the script would not be “repurposed and used in a different order.” He was paid $1,200 for his work.

Similarly, Sage asked what the proposed recordings would be used for, and the Lovo rep (a principal) replied: “These are test scripts for radio ads. They will not be disclosed externally, and will only be consumed internally, so will not require rights of any sort.” Sage asked him to to confirm that the recordings would not be used “in broadcast,” and he again repeated the previous statement. Lovo paid Sage $400 for her work.

Both of them ultimately (after filing suit) registered their scripted performances with the Copyright Office.

Plaintiffs allegedly first learned that their voices had been used in unanticipated ways when they listened to an episode of the Deadline Strike Talk podcast narrated in part by an artificial voice produced by Lovo’s software. They alleged that the voice used in the podcast was “identical to Mr. Lehrman’s voice.” Allegedly, “[n]umerous people who heard the podcast,” including “friends” and “professional colleagues” “told Mr. Lehrman or Ms. Sage” that the “voice on the podcast was virtually identical to Mr. Lehrman’s voice,” and that “the cloned voice would undoubtedly be mistaken for Mr. Lehrman’s actual voice.” They also alleged, with declaration support, that professionals “experience[d] [in] discerning and conveying small differences in voice tone, quality, timbre, and delivery” believe that “Lovo’s cloned voice is a replica of Mr. Lehrman’s real voice.” Lehrman allegedly found that Lovo “had been marketing [the clone of his voice] as part of its subscription service under the stage name ‘Kyle Snow.’ ” The Kyle Snow voice was also in advertisements on Lovo’s website and YouTube. For example, Lovo allegedly advertised the Kyle Snow voice as “an ideal male voice generator ... for all kinds of content” due to his “upbeat tone and slightly faster talking speed.”

Sage also allegedly discovered that Lovo had created a clone of her voice named “Sally Coleman” that was available to Lovo’s subscribers. This was allegedly marketed using “side-by-side” comparisons of Sage’s original audio recordings—the ones she provided via Fiverr—and the “cloned version of her voice,” including in an investor pitch that was posted on YouTube. 

Plaintiffs brought individual claims and also sought to represent a voice actor class and a consumer class of consumers who bought the Lovo software and used the voices.

Breach of contract: Sufficiently pled.

Lanham Act false association: Failed for want of a mark that was used as a mark. Plaintiffs didn’t argue that they could bring §43(a)(1)(A) claims without a valid mark. Persona can be a “mark”—even for a noncelebrity. But celebrity endorsement cases have involved “the unauthorized use of a celebrity’s likeness on merchandise, implying that the celebrity approves of the merchandise or is affiliated with the seller,” or “the explicit use of a celebrity’s likeness in advertising or to promote goods or services.”

Plaintiffs alleged that “they are well-known and sought-after voice actors whose voices are their recognizable calling cards,” which was enough at this stage to make the use of their voices capable of causing consumer confusion. The problem was that the allegations didn’t suggest trademark use. “Because marks can take essentially any form, courts must therefore be careful to ensure that they receive protection only when used as contemplated by the statute—that is, as marks.” The court found celebrity endorsement cases to be an “uneas[y]” fit with this principle, “as celebrities’ personas are also their products,” though at least for advertising cases the service of endorsement seems like the trademark use. Citing Jennifer Rothman, the court emphasized that “personal marks” are treated differently from other marks—they’re harder to register, and the law “is highly skeptical of efforts to restrict individuals from using their own identities in trade” and doesn’t allow “transfer attributes of one’s identity—such as personal skill as an artisan—when one transfers trademark rights in one’s name or likeness.” [My own view is that the latter point isn’t really relevant—it’s just not possible to do that; maybe that means that many name transfers are transfers in gross and should fail, but that is straying pretty far from our concerns here.]

The key issue here was that this wasn’t a celebrity endorsement case: the voices were themselves the products/services being sold. “Plaintiffs here use their voices in ways that are clearly separable from their identities and personalities. Their clients pay them to produce recordings of themselves narrating scripts, which the clients then own and use to produce content, as authorized by their contracts with Plaintiffs.” Thus, their voices “serve dual functions as both ‘one of the most palpable ways identity is manifested,’ and as ordinary services in the voice-over market.” Thus, even as to the alleged false endorsement or “business affiliation” confusion, plaintiffs’ voices were “protectable only to the extent that they function primarily as source identifiers rather than as products themselves.” The court analogized to trade dress product design claims, which are difficult because trademark terminology “is unsuited for application to the product itself.”

Plaintiffs failed to show that their voices were protectable marks. They didn’t plead secondary meaning or the relevant factors except for “a few conclusory references to the recognizability of their voices” and the fact that “Plaintiffs’ work has been sought out by large companies.” Regardless, “Plaintiffs have not alleged that their voices are primarily significant as brands rather than as services to which brands might be attached.” As the court noted, “even extremely famous celebrities are barred from asserting Section 43(a)(1) claims based on the use of their likenesses as products rather than as source-identifying marks.” Product use was descriptive use, not trademark use. An alternate rule would threaten a new voice actor “whose voice happens to sound highly similar to either Lehrman’s or Sage’s,” especially given that identicality isn’t required for likely confusion. The court also pointed out that unregistered trademark rights can be assigned, with “unsettling” consequences for voices:

To allow any artist, actor, or other creative tradesperson to sue their doppelgangers for trademark infringement, as Plaintiffs’ theory would allow, would “create[e] a cause of action for, in effect, plagiarism,” and would be incompatible with the careful ways that courts have circumscribed the Lanham Act to avoid unduly burdening competition and free expression. [Citing Dastar.]

Lookalike cases involving ads involve “appropriating the identity and the goodwill of the famous plaintiffs—that is, pretending to be Woody Allen—rather than merely engaging in the same trade while happening to look like the famous plaintiffs.” And, the court noted, Allen’s cases involved use of identity in ads, not his lookalike’s presence as part of a good or service. “To allow Plaintiffs to protect the downstream uses of their voices merely because Plaintiffs originated them would disrupt the ‘carefully crafted bargain’ struck by patent and copyright law and ‘misuse’ the Lanham Act to ‘to reward [artisans] for their innovating in creating a particular [work or] device.’”

What we’re seeing, post-JDI, is the further development of a “use as a mark” doctrine to cabin trademark’s nearly unchecked expansion, unfortunately mostly without discussion of the relevant considerations and how they relate to the purposes of trademark law. That’s present here, yay! It would be great for more courts to admit that this not an entirely empirical assessment, or at least it’s only empirical at the categorical level. (See also the pre-JDI Louboutin v. YSL case, the standout entry in the “ipse dixit use as a mark” cases.) In addition, JDI’s language about how even partial TM use is bad is, as has always been apparent, complete nonsense (in the absence of a materiality requirement).

False advertising: Two theories here. First, plaintiffs alleged that marketing their voices under the names “Kyle Snow” and “Sally Coleman” was literally false. The court disagreed: “Plaintiffs point to numerous examples of Lovo marketing the voices as what they truly are—synthetic ‘clones’ of real actors’ voices.” Also, Lovo falsely allegedly stated that the cloned voices “came with all commercial rights.” But even if that’s true, “such misrepresentations do not concern ‘the nature, characteristics, qualities, or geographic origin’ of Plaintiffs’ cloned voices.” (Dastar.)

Second, plaintiffs alleged that Lovo “confus[ed] potential customers ... as to [Plaintiffs’] affiliation with Lovo and the ability to use the Lovo service in place of traditional access to these actors,” and that Lovo “misrepresent[ed] that [Plaintiffs] have partnered with Lovo.” Those were not actionable as false advertising; they were repeats of the false affiliation claim, and “Plaintiffs cannot avoid the requirement of a protectable mark by ‘disguis[ing] a § 43(a)(1)(A) trademark infringement and unfair competition claim as a false advertising § 43(a)(1)(B) claim.’”

In addition, plaintiffs failed to identify any false implication or consumer confusion from Lovo’s advertising, “as opposed to being confused by the similarity of the synthetic voices to Plaintiffs’ voices when heard in the wild. In fact, Plaintiffs actually allege that Lovo’s advertising was clear on the lack of connection between Plaintiffs and Lovo’s voice clones.”

Even if Lovo made misrepresentations, plaintiffs didn’t plead actual injury. Where “the defendant and plaintiffs are competitors in the same market,” materiality and injury usually blend together, but plaintiffs didn’t allege that their losses were related to actionable false claims in Lovo’s advertising. Instead, their losses were allegedly due to the existence of Lovo’s product: “Put differently, Lovo’s services are more desirable to some customers because they are cheaper and more accessible. While Plaintiffs might have a different cause of action for such competitive harm, it does not sound in Lanham Act false advertising.”

Copyright: Four claims, only one of which goes forward. The court approved of the sequence (1) complaint filed without any copyright claims, (2) registration secured, (3) complaint amended to add copyright claims as consistent with Fourth Estate, and I think I agree, since (1) was far from a sham complaint. The discovery rule applied for statute of limitations purposes,

Contractual defenses couldn’t be resolved on a motion to dismiss, even without taking into consideration the chat messages exchanged by the parties. Turns out, Fiverr’s TOS provide special rules for “Voice Over Gigs” “that are inconsistent with a transfer of unrestricted copyrights.” Despite a general work for hire clause, the TOS stated that buyers of voice-over recordings are only “purchasing basic rights, ... allowing them to use the work forever and for any purpose except for commercials, radio, television and internet commercial spots.” Buyers need to purchase higher-tier packages of either “Commercial Rights,” in order to “promote a product and/or service,” or “Full Broadcast Rights,” in order to use the recordings “in radio, television and internet commercials.” Lovo didn’t do that.

First, Sage successfully pled a direct infringement claim based on Lovo’s use of her actual voice recording in an investor presentation, pitches to investors, at a conference, and in Lovo’s external marketing materials. (Although this is for later, the fair use defense for comparative advertising is a distinct subset of copyright fair use cases where defendants generally win. How else are they supposed to substantiate their claim of being as good as a human?)

Both plaintiffs alleged direct infringement based on Lovo’s use of their recordings to train the Genny AI model. These claims failed “for lack of adequate explanation in the complaint.” They didn’t explain “what training is or how it works, even at a very high level of generality. The Court therefore cannot ascertain or reasonably infer which exclusive rights Lovo allegedly infringed, or how.” But amendment was possible, including using information-and-belief pleading. (On the other hand, it might be hard to plead what was outside the scope of the license, even as modified by the chats.)

Copyright infringement by the AI outputs: Here there was really no hope. Sound recording copyright only covers exact duplication of the fixed sounds, which was not alleged here as even a possibility for Genny. And we know that a voice isn’t copyrightable, since that’s what gives them their valid ROP claims.

Contributory infringement: based on AI outputs, therefore failed.

NY ROP: Although NY’s ROP is narrower than other states’, and only covers uses in, essentially, advertising, there was enough here to proceed. (Query how much of plaintiffs’ damage comes from the advertising and not the underlying product; also, later on the incidental use defense—advertising for a product that does not itself violate the ROP is protected where the advertising actually relates to the product—may come into play.)

The statute of limitations is one year, but the republication exception can restart the limitations period, and applied here. But are digital replicas even covered? Lovo argued that NY’s 2021 statutory protection for digital replicas of deceased persons meant that expressio unius applied to exclude that from the main ROP. But that reasoning ignored context. “Just before the amendment was proposed, New York courts held that digital replicas of living persons—at least ones with a visual component—were already covered by the law. There is no indication in the text of Sections 50 and 50-f, or in the legislative history, that the amendment was intended to overturn this precedent, nor to exclude the possibility of a similar holding with respect to audio-only voice clones.” The same could be true of voice. “If anything, the Court views ‘voice’ as having a broader scope than a term like ‘picture,’ because it cannot plausibly be read to refer to any particular form of media or representative device. While Section 51’s statutory ROP “is to be narrowly read” in light of its legislative history, it is nonetheless “not to be obeyed grudgingly by construing it narrowly and treating it as though it did not exist for any purpose other than that embraced within the strict construction of its words.”

As to the substance, plaintiffs sufficiently alleged recognizability and Lovo itself allegedly represented that its creations are “practically indistinguishable from the ‘real’ voice.” While “New York courts have consistently dismissed Section 51 claims based on the use of a fictitious name, even if the depiction at issue evokes some characteristics of the person or the person is identifiable by reference to external sources,” “those cases all involve a fictional character sharing certain discrete attributes or traits with a Section 51 plaintiff, not the use of the plaintiff’s portrait or voice.” “Lovo cannot escape liability merely because it appended fictitious names to those appropriated voices. To hold otherwise would carve out a massive, judicially created loophole in the statute with no textual or doctrinal basis.”

Plaintiffs also adequately alleged use in both advertising and trade. “Advertising purposes has been defined as use in, or as part of, an advertisement or solicitation for patronage of a particular product or service, and trade purposes involves use which would draw trade to the firm,” although the statute doesn’t reach newsworthy uses or matters of public interest. Lovo didn’t raise a First Amendment, newsworthiness, or public interest defense.

The court is a little wobbly on whether the underlying product itself counts as “trade” purposes, though my reading of the NY cases is that it can’t (emphasis added to last sentence):

Whether or not the solicitation of investors itself counts as an “advertisement,” the function of the “investor presentation, which was later posted publicly online, is plausibly understood as promoting Lovo’s underlying product. The same goes for the use of Lehrman’s voice in tutorials and promotional articles posted online. Moreover, even if the voices were not used in formal advertisements or solicitations, they were clearly used for commercial purposes, and to draw trade to the firm. It is plausible to infer that, by illustrating the value of the product and helping show prospective customers how to use it, Lovo used its publicly posted tutorials to increase the appeal of its software, acquire subscribers, and retain subscribers it already had. Plaintiffs allege even that Lehrman’s cloned voice was Lovo’s default product and one of its self-described “best” voices.

NY GBL: Partially survives, raising an interesting Dastar preemption issue. Section 349 prohibits “[d]eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service” and Section 350 prohibits “[f]alse advertising in the conduct of any business, trade or commerce or in the furnishing of any service.”  “To successfully assert a claim under either section, ‘a plaintiff must allege that a defendant has engaged in (1) consumer-oriented conduct that is (2) materially misleading and that (3) plaintiff suffered injury as a result of the allegedly deceptive act or practice.’ ”

Mostly, plaintiffs failed to identify material misrepresentations to the public; they couldn’t rely on misrepresentations to them because they were not acting as consumers in those transactions, and Sections 349 and 350 do not reach such “narrow, private dispute[s].”

However, plaintiffs adequately alleged that Lovo materially misrepresented the scope of the “commercial rights” that it promised to provide to its subscribers, thereby making its offerings appear more attractive. Lovo’s consumers thus “purchased ... [but] did not receive a product with the full value with unlimited usage rights, which would have been a product with legitimately acquired and/or created voices.” Sections 349 and 350 aren’t limited to “nature, characteristics, qualities, or geographic origin.”

Note: While statutory interpretation got us Dastar, if it’s true that extending the Lanham Act to licensing claims would cause a conflict with copyright law, it’s equally true that extending state law to licensing claims would cause a conflict with copyright law, creating conflict preemption. Cf. Jackson v. Roberts (finding preemption of a ROP claim). But the court says that plaintiffs “could not bring a similar GBL claim based on alleged misrepresentations about a copyright license, as such a claim would be preempted by the Copyright Act.” I am not sure about the difference between advertising “commercial rights” or “unrestricted use” and advertising “properly licensed,” but ok.

“Lovo promised its subscribers that they could use Lovo’s voice clones without legal restrictions. While Lovo was correct with respect to federal copyright and trademark law, it was incorrect with respect to New York law. Lovo’s consumers could, like Lovo itself, be liable under Sections 50 and 51 of the NYCRL.” [Again, the language here is open, but I would argue that the only liability for customers would have to be for their own uses in advertising/trade.]

Lovo’s conduct with respect to its subscribers was “consumer oriented” in that it was “directed to consumers” and had “a broader impact on consumers at large.” Although the mere unauthorized use of the plaintiffs’ images would not be “ ‘consumer-oriented in the sense that it potentially affects similarly situated consumers,” reselling the voices to third-party consumers for downstream use by those consumers was relevantly different.

And plaintiffs adequately alleged that they suffered injury from Lovo’s misrepresentations in the form of diverted customers and lost sales. “While it is true that Lovo offered its voice clones at lower prices than the services of traditional voice actors, Lovo was able to poach Plaintiffs’ customers only because it purported to offer products that its subscribers could legally use—that is, because it engaged in misrepresentations made unlawful by Sections 349 and 350.”

Fraud claims failed because (1) plaintiffs didn’t adequately plead damages; although they alleged customer diversion/harm to brand value, they didn’t quantify the “true value of the recordings they sold to Lovo, as opposed to what Lovo paid,” which is the measure of fraud damages in NY, and (2) their fraud claims merely restated their breach of contract claims, which isn’t ok in NY “when the only fraud alleged is that the defendant was not sincere when it promised to perform under the contract.”

Unjust enrichment, conversion, and common law unfair competition claims were preempted by the New York Civil Rights law, which preempts “all common law claims based on unauthorized use of name, image, or personality, including unjust enrichment claims.” Relatedly, unfair competition is like the failed Lanham Act claims (except also requires bad faith), and there were no facts alleged “supporting an inference that Lovo acted with the intent of generating confusion or coopting Plaintiffs’ reputations (as opposed to the desirable characteristics of their voices).”

 

 

 

Friday, June 06, 2025

competitor's challenge to use of expired certification marks must go to trial

FireBlok IP Holdings v. Hilti, Inc., No. 19-cv-50122, 2025 WL 1557924 (N.D. Ill. Jun. 4, 2025)

FireBlok sued defendants, relevantly for false advertising and false association. The court denied FireBlok’s motion for summary judgment.

FireBlok alleged that defendants’ use of the UL certified mark and FM approved mark on their product, the Firestop Box Insert, was false advertising and false association. “According to UL’s website, a product with the UL certification mark is one that UL found to meet UL’s requirements by a representative sample. According to FM’s website, an FM approved mark denotes that a product has completed FM’s testing process.” FireBlok was never FM approved, and its UL certification was withdrawn in 2025. Defendants’ product has used the UL and FM marks since 2008 and 2009, respectively, but requested withdrawal of UL certification/sent an email to FM leading FM to withdraw its listing in 2008.

FireBlok was asserting false association claims on behalf of a third party as false advertising, which led to an “undifferentiated amalgam of a claim.”

 “A ‘literal’ falsehood is bald-faced, egregious, undeniable, over the top.” (This is a bad standard, risking a conflation of falsity with willfulness.)

The court found that it was not enough to get summary judgment on literal falsity that defendants withdrew their certifications with both certifying bodies. Defendants argued that the Firestop Box Insert was, in fact, UL certified as shown by UL’s continued listing of Hilti’s product as a UL certified product and UL’s lack of adverse actions against Defendants for their use of the UL certified mark, and that their use of the FM approved mark was not literally false because FM continued to conduct routine inspections of the manufacturing process, issued Certificates of Compliance, and continued listing the Firestop Box Insert as an FM Approved product. This was a genuine factual dispute over what the use of certification marks meant. A jury could find the use to mean that the Firestop Box Insert met the safety requirements set by UL and FM, “in which case the statement would be true.” But a jury could also reasonably interpret these statements to mean that defendants were authorized to use these marks on their product [though one has to wonder about materiality in that event].

The parties argued over the likely confusion factors, but false attribution isn’t enough: “a false advertising claim requires a showing of deception about the product itself.”

FireBlok also failed to show that there was no dispute about materiality. Nor was injury to FireBlok shown sufficiently to grant summary judgment; it wasn’t enough that the parties competed.

What about false association? (I would probably have held that there wasn’t standing under 43(a)(1)(A), only (B).) Doing conflating of its own, the court said that, without literal falsity, FireBlok had to show misleadingness with actual consumer confusion, and there was no evidence of that. The court would not presume likely confusion from literal falsity in a false association case.

 


Wednesday, January 03, 2024

sending emails under former employees' names may be reverse passing off

LoanDepot.com, LLC v. CrossCountry Mortgage, LLC, 2023 WL 9022893, No. 22-cv-5971 (AS) (S.D.N.Y. Dec. 29, 2023)

loanDepot alleged that CCM, its chief competitor, “improperly poached” 32 employees, and CCM and various former employees. CCM counterclaimed for abuse of process and for violations of the Lanham Act and related state laws; one ex-employee also brought counterclaims against loanDepot for breach of contract and breach of the implied covenant of good faith and fair dealing. I’m only going to discuss the false association/false advertising bits; as to the latter, state law provides more protection than federal because of the “commercial advertising or promotion” requirement for Lanham Act false advertising.

Counterclaims for false association and false advertisement under the Lanham Act, unfair competition under New York common law, and unfair business practices under the New York Deceptive Practices Act were all based on allegations that loanDepot sent blast marketing emails advertising loanDepot’s services from the loanDepot email addresses of former employees after those employees had begun working for CCM.

The false association/coordinate state law claims survived. loanDepot allegedly violated the Lanham Act by using “the name and likeness of CrossCountry employees, including Scott Bonora, Faheem Hossain, and others, in false advertisements sent to potential customers in May and July 2022,” which “wrongly passed off the products and services of CrossCountry as products and services of loanDepot.” There was no requirement that CCM’s name or reputation be invoked for a false association claim, because the Lanham Act also covers “reverse passing off,” in which “A promotes B’s products under A’s name.” Thus, it sufficed to allege that loanDepot “was falsely passing off the services of Mr. Bonora and Mr. Hossain as the services of loanDepot rather than services of CrossCountry.” (I’m not sure this works—at least not without secondary meaning in Bonora and Hossain’s names.)

loanDepot argues that the names weren’t material, but CCM alleged that “loanDepot knew that the identity of Mr. Bonora’s and Mr. Hossain’s employer was material to those contacts, as it was important to the decision by customers to apply for a loan or by referral sources to refer a borrower” and that loanDepot was attempting to “influence a consumer to apply for a loan at loanDepot, or for a referral source to refer a borrower to apply for a loan at loanDepot.” Claims brought by former employees themselves (citing Rubris, Inc. v. Ankura Consulting Grp., LLC, 2021 WL 7210782 (D.D.C. Mar. 26, 2021)) were distinguishable because the employee would have to allege “a commercial interest in his name that could be damaged” and because “nothing about the advertisement itself gives rise to a plausible inference that [the employee’s] name holds commercial value.” And CCM pled that it lost customers based on the use of its employees’ identities in these emails. But the court noted that loanDepot could reprise its arguments at summary judgment (citing Reed Const. Data Inc. v. McGraw-Hill Companies, Inc., 638 F. App’x 43, 45–46 (2d Cir. 2016) (affirming summary judgment on Lanham Act claim when “[d]iscovery revealed only one customer who arguably relied upon [defendant’s] advertising in deciding between” the defendant and plaintiff)). This also allowed the state-law unfair competition claim to move forward; the extra requirement of bad faith was pled by alleging, inter alia, that loanDepot continued to send the emails months after the loan officers left CCM and after CCM sent cease-and-desist letters, and that loanDepot sent similar emails from the accounts of other loanDepot employees who also left to join CCM.

But false advertising failed because “[m]aking allegedly false statements to a finite number of identifiable individuals does not constitute ‘advertisement or promotion’ for Lanham Act purposes.” It was possible that the emails could constitute “an organized campaign to penetrate the market,” as the Second Circuit requires, allegations that emails were sent to “all” of a former employee’s contacts were insufficient. “These allegations provide no information about the size of the market or the number of customers to receive the allegedly false advertising.” Dismissed without prejudice.

The result under NY GBL §349 differed, because it requires alleging only that “(1) the defendant’s deceptive acts were directed at consumers, (2) the acts are misleading in a material way, and (3) the plaintiff has been injured as a result.”

Monday, October 09, 2023

Amazon escapes liability for its Brand Registry advertising

Deetsch v. Lei, 2023 WL 6373073, No. 22-cv-1166-RSH-BLM (S.D. Cal. Jul. 21, 2023)

Deetsch alleged that he owned design patents for CPAP pillow products, which the Lei defendants infringed. They also allegedly used Deetch’s image in ads and on packaging, and allegedly falsely claimed on Amazon that their pillow products “were designed in the United States but are manufactured in China.”

In December 2020, Deetsch notified Amazon of his patents through the Brand Registry portal and asked Amazon to remove the Lei defendants’ products. He sent two letters by mail in March 2022, but was told he needed to use the Brand Registry … which he had already done.

Amazon’s Brand Registry advertises “Automated Protections” that are “[p]owered by Amazon’s Machine Learning.” Amazon claims its service will “save valuable time,” allows users to report “patent[ ] and design right violations,” uses “advanced machine learning that prevents bad listings,” and can “[r]emove counterfeits instantly” “without the need to contact [Amazon].” Deetch signed up for and paid for a Brand Registry service subscription, and submitted multiple complaints through that system, allegedly to no avail.


Since the designs were not plainly dissimilar, infringement was plausible.

False advertising, Lei defendants: The complaint didn’t explain how “designed in the United States but … manufactured in China” was materially deceptive and thus didn’t meet FRCP 9(b) pleading standards. A “true statement that a product was designed in the United States” is not “a representation that the product does not infringe any third party’s intellectual property rights.” Motion to dismiss granted.

False advertising, Amazon defendants: The complaint didn’t explain how any of the statements about the Brand Registry were false or misleading. It wasn’t enough to suggest that “taking all of the statements together, a consumer would reasonably expect the Brand Registry service to work better or faster than it did for Plaintiff.” Even a reasonable consumer’s “disappointment that a service did not work as well or as quickly as hoped” doesn’t show false advertising. Also, plaintiff was a customer, not a competitor, and not within the relevant zone of interests. (State law claims would have been better.)

False association, Lei defendants: Although he alleged that they used his image, he didn’t allege that this would cause confusion, mistake, or deception as to his association with the Lei defendants’ products, nor any facts that would establish that his likeness is recognizable by would-be consumers. Again, right of publicity would’ve been better.

A copyright claim was dismissed because the plaintiff had yet to receive his registration; this couldn’t be corrected by amendment in order to implement the command of Fourth Estate; the dismissal was without prejudice to refiling a new action.

Monday, July 03, 2023

odd 2d Circuit case about misleadingness versus confusion

Gibson v. SCE Gp. Inc., 2023 WL 4229913, No. 22-916 (2d Cir. Jun. 28, 2023)

Another models (and one model’s sister) v. nightclubs case. Gibson et al. appealed partial summary judgment against them on on their claims for false endorsement under section 43(a) of the Lanham Act, and violations of New York Civil Rights Law sections 50 and 51. Appellant Burciaga also appealed a judgment awarding her $5,000. The court of appeals affirmed.

The “falsity of the implied association” between plaintiffs and defendant didn’t relieve plaintiffs of the burden of showing likely confusion. (As I’ve said before, it’s worth noting that the FTC generally thinks that appearing in what is obviously an ad does not itself constitute an endorsement, consistent with this outcome.)

Somewhat oddly, the court then says:

To the extent that this approach to the false endorsement claim diverges from our caselaw involving false advertising, that result is consistent with the fact that the two types of claims are distinct. See Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 122 (2014) (explaining that false association and false advertising claims under the Lanham Act are distinct). Whereas the text of the Lanham Act’s false association provision requires that the false or misleading representation of fact be “likely to cause confusion,” its false advertising provision requires only that a person “misrepresent[ ].” Compare 15 U.S.C. § 1125(a)(1)(A), with id. § 1125(a)(1)(B).

This is one reason people don’t like unpublished opinions; false advertising cases have also required resulting deception, but presumed it in cases of literal falsity—not implied falsity.

This seems like unthinking textualism which future courts will rightly not take seriously. How do you know if something is a misrepresentation (as opposed to literally false) without looking at likely deception?

Tuesday, January 17, 2023

False CMI isn't plausibly related to consumers' decisions to buy/watch TV show

Livn Worldwide Ltd. v. Vubiquity Inc., 2022 WL 18278580, No. 21-cv-09589-AB-KS (C.D. Cal. Jul. 22, 2022)

Interesting Dastar case thrown up by Westlaw. LW alleged that it was the exclusive licensee allowed to distribute and sell a 60-episode series, Martial Universe, in the US. As part of preliminary discussions with Vubiquity about a distribution agreement for iTunes, LW provided master copies of all 60 episodes, but no agreement was ever reached. Nonetheless, Vubiquity allegedly uploaded the series to iTunes for sale and download. This allegedly involved false copyright and release date information, as well as “drastically low bargain-rate prices” and failure to distinguish between HD and SD versions.  

LW sued for copyright infringement, violations of both sections of Lanham Act §43(a), §1202 CMI violations, fraud, and state-law statutory unfair competition.

Both §43(a)(1)(A) and (B) claims failed. §43(a)(1)(A):

[U]nder Dastar’s interpretation of “origin of goods,” the origin of the Martial Universe episodes on the iTunes platform is not determined by who originated or created the ideas behind the Series (Plaintiff). Instead, the origin of the episodes, as it relates to the Lanham Act, is the producer of the Series on iTunes for sale, which is Defendant because Defendant made the content available for sale on the platform. But neither of Plaintiff’s Lanham Act claims rely on allegations that Defendant caused confusion about who placed the Series on iTunes. Instead, Plaintiff’s Lanham Act claims assert that Defendant incorrectly identified the copyright owner of the Series, which is not within the scope of the Lanham Act.

False advertising: Sybersound Recs., Inc. v. UAV Corp., 517 F.3d 1137 (9th Cir. 2008), held that misrepresentations about copyright licensing status did not relate to the “nature, characteristics, and quality” of a good under §43(a)(1)(B), unlike “the visual and audio quality of the good.” So too with the allegedly inaccurate release date information.

The fraud claim was preempted by §301 of the Copyright Act. The allegations that defendant (1) generated images from the series to sell it on iTunes; (2) knowingly provided false CMI to induce the public to buy it; and (3) priced the content badly, in ways that didn’t signal its value, did not provide qualitatively distinct extra elements. The fraud claim was, at its core, about “unauthorized use, reproduction and distribution of the Series.” As to pricing, LW didn’t identify what was concealed or misrepresented. Claims under California Business & Professions Code § 17200, which prohibits “unfair competition,” were preempted for the same reason.

CMI: § 1202(a) requires that the plaintiff “plausibly allege that the defendant knowingly provided false copyright information and that the defendant did so with the intent to induce, enable, facilitate, or conceal an infringement.” It’s not enough to allege that a defendant provided false information about the copyright owner without the resulting inducement etc.

First, a release date is not CMI.

Copyright ownership information is CMI. But LW didn’t allege facts sufficient to plausibly establish that Defendant knowingly distributed that false CMI with the intent to induce infringement:

Plaintiff argues that by distributing false copyright ownership information, Defendant had to have done so with the intent to induce and enable iTunes subscribers to purchase and download the content, thereby satisfying the intent requirement of section 1202(a). However, “formulaic recitation of the elements of a cause of action, including allegations regarding a defendant’s state of mind, are not sufficient to satisfy Rule 8.” … [F]alsely identifying a copyright owner does not seem to further, or have any correlation with, iTunes subscribers buying the series, or with any sort of infringement in this case. In other words, regardless of who Defendant said the copyright owner of the Series was, it is not plausible that the number of purchasers and downloaders of the content would change.

[This seems absolutely correct as to purchasers/downloaders. But surely the copyright ownership claims affected Apple’s behavior. But then again, does Apple look at CMI on/associated with works, or is there a separate form, and would that separate form constitute CMI?]

Likewise, LW failed to allege facts showing injury based on the use of its name as opposed to its licensor’s name or nothing at all.

Because distribution rights weren’t violated merely by “making available” the work, or allowing subscribers to download or stream copies, the copyright claims were dismissed in part, but obviously the core copyright claim remains.

Friday, January 13, 2023

putting a label on a product you produce isn't direct false advertising, but could be direct false association

OK, I admit I'm pretty baffled by this.

Hawaii Foodservice Alliance, LLC v. Meadow Gold Dairies Hawaii, LLC, 2023 WL 159907, No. 21-00460 LEK-WRP (D. Hawai’i Jan. 11, 2023)

Plaintiff alleged that defendant MGD advertises and sells milk that is one hundred percent from cows outside of Hawai‘i. Defendant dairy farmers allegedly apply labels to the pre-packaged milk products “indicating such products originate from ‘Hawaii’s Dairy,’ are ‘Made with Aloha,’ and, in some instances, are associated with the farmers in Oahu who produced milk from their cows in Hawaii through the ‘Dairymen’s Association’ beginning in the late 1800s, before they are shipped to MGD in Hawaii.” Some mainland milk was allegedly pasteurized in California, shipped to and re-pasteurized on the Island of Hawaii, and then packaged by MGD with identical labeling. “Hawaii’s Dairy” and “Made with Aloha” on the labels allegedly falsely represented origin, as did MGD’s website claims of “AN ISLAND TRADITION,” “that MGD is proud to be locally owned and operated” and MGD “continue[s] to produce your Meadow Gold favorites always made with aloha.” “MGD’s website also prominently features the MGD mascot known as ‘Lani Moo’ in local Hawaii attire, along with several photographs of farmland and a cow in Hawaii[.]” Plaintiff alleged, however, that “MGD owns zero cows in Hawaii ... and owns zero dairy farms in Hawaii.” Allegedly, a different “Meadow Gold” entity long ago operated dairy farms in Hawaii, but MGD didn’t.

Plaintiffs’ claims sought to hold the dairy farmers directly or contributorily liable under the Lanham Act, and alleged unfair competition/false advertising/deceptive trade practices under Hawaii law. The dairy farmers sought dismissal.

Was a false geographic origin claim one for false association, § 1125(a)(1)(A), or false advertising, § 1125(a)(1)(B)? Courts have treated them as one, the other, or both; the court here said that they could be both.

Why does this matter? Perhaps because courts are tougher on false advertising claims in a lot of ways, including with precedent that, for false advertising, direct liability only attaches to actors who actively make false or misleading claims, while false association allows direct liability for those who only “use” such claims (note this doesn’t actually matter to the outcome of this case, but it matters to retailers). Here, under §43(a)(1)(A), “Plaintiff need only allege that the Dairy Farmers used in commerce any word (or words) which is likely to cause confusion as to the geographic origin of their milk products by another person.” That was sufficiently alleged. The defendants allegedly put the products in interstate commerce and applied the labels to them. The court didn’t bother to analyze contributory liability.

What about direct liability for false advertising? Defendants argued that there was no literal falsity, but misleadingness and materiality was also alleged. Here, the dairy farmers allegedly individually produced, packaged, and labeled the milk products on the mainland then sent them to Hawai’i for MGD to sell on the island.  “[H]owever, Plaintiff does not allege that the Dairy Farmers had control over, or involvement in, creating the statements on the labels. Thus, the Court cannot determine whether the Dairy Farmers are the entities that made ‘the specific, false statements at issue in the litigation[,]’ even if they ultimately applied the labels to the products.” [This strikes me as a really constrained reading of direct liability, and very much in contrast to the leniency IP claimants get. Compare an allegedly false statement presented in an ad as a quote from an endorser: would the advertiser not be directly liable because it wasn’t the first to make the statement?] Thus, the direct liability claim for false advertising was dismissed with leave to amend.

Contributory false advertising: This requires that the defendant contributed to direct false advertising either by knowingly inducing or causing the conduct, or by materially participating in it. Participation can occur when “the defendant directly controlled or monitored the third party’s false advertising,” or possibly when the defendant provided “a necessary product or service, without which the false advertising would not be possible.” On a motion to dismiss, courts look for a plausible inference of knowing or intentional participation, examining “the nature and extent of the communication” between the third party and the defendant regarding the false advertising; “whether or not the [defendant] explicitly or implicitly encouraged” the false advertising; whether the false advertising “is serious and widespread,” making it more likely that the defendant “kn[ew] about and condone[d] the acts”; and whether the defendant engaged in “bad faith refusal to exercise a clear contractual power to halt” the false advertising.

Here, plaintiff sufficiently alleged direct false advertising against MGD.  And it alleged that the milk producers knew that their respective milk products were not sourced from Hawai‘i and that the labels they applied to those products were false, misleading, and/or deceptive, but supplied the milk products to MGD nonetheless.

But plaintiff didn’t adequately allege that the Dairy Farmers “intended to participate or actually knew about the false advertising.” Labeling products with packaging that said “Hawaii’s Dairy” and “Made with Aloha,” does not on its own “suggest[ ] a plausible inference of knowing or intentional participation.” [Um, if they were doing it on the mainland, why not? Surely they knew they were doing it on the mainland, and not in Hawai’i?] Plaintiff failed to allege “the nature and extent of the communications between” the dairy farmers and MGD regarding the statements and thus they didn’t allege material participation. [I also have no idea how a plaintiff is supposed to allege internal communications.]

In addition, plaintiff failed to plead the requisite knowledge with particularity. [I’m not a civ pro expert, but I thought that, even with fraud, knowledge and intent can be alleged generally as matters entirely within the knowledge of the defendant.]

“Ultimately, Plaintiff does not sufficiently allege the Dairy Farmers induced, caused, or worked to bring about the alleged misleading statements.” But there was leave to amend.

Unfair competition under Hawai’i law: This requires unfair conduct that “offends established public policy and … is immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers,” plus injury that negatively affects competition or harms fair competition. This too failed as to the dairy farmers, who allegedly did nothing more than labeling and packaging their milk product. So too with state law false advertising.

Deceptive trade practices: This applied to a person who, inter alia, caused likely confusion about source etc. or used deceptive representations or designations of geographic origin. This was plausibly alleged. The dairy farmers “used those labels and statements insofar as they packaged, labeled, and shipped the milk products to Hawai’i.”