The cell phone wars should ensure the continuing viability of NAD and Lanham Act courts for all time. As noted in a recent challenge by AT&T to T-Mobile advertising, this is an industry that is rapidly innovating and highly competitive, and characterized by direct comparative claims. Staying on the right side of the line, as this case reminds us, between touting demonstrated performance benefits that distinguish your service and overstepping into false disparagement can be as hard as not dropping a conference call on the Acela between DC and NY.
Without getting too into the telecom technical weeds, we can highlight the difficulties T-Mobile had with a few examples from this multi-claim challenge. T-Mobile had solid data showing it had more spectrum per customer and thus more bandwidth. It claimed it had 50% more bandwidth than AT&T and because of this was less congested and less likely to slow down. There was good data to show download speeds on T-Mobile were faster in areas where AT&T used a similar network. NAD was not persuaded that T-Mobile had shown such an advantage in areas where AT&T had upgraded its network to LTE. The result was a recommendation the the claims of more bandwidth, less congestion be discontinued or modified to explain the circumstances in which a customer might enjoy this benefit. NAD added that any such clarification must be explained in terms a customer will understand and not by insider reference to particular networks or technologies.
Another example is the better “call quality” claim. T-Mobile had good third party data showing their calls were comparatively clearer to hear. AT&T asserted that the claim as framed was too broad and could be reasonably understood to refer not only to audio clarity but to less frequent dropped calls and other connectivity quality issues. Both sides submitted consumer survey evidence, one showing confusion and one did not. (As an aside this case file included four separate consumer surveys! ) The call quality surveys tested different ads, one of which used call quality in the context of only audio quality and one which tested the phrase in an ad that also referenced dropping call. The NAD set both of these aside and said it had to make a general conclusion about how reasonable consumers might understand this claim because it was used in different contexts by T-Mobile. It recommended that T-Mobile be more specific with its claim to narrow it appropriately to sound quality.
Another good reminder is the NAD conclusion that claims like Most Advanced Network and Faster 4G Speeds needed to be clarified that they were not competitive comparative claims but rather claims regarding T-Mobile’s innovations and comparisons to their prior service. We did see NAD adopting a slightly more liberal, less literal stance when it found the tagline “T-Mobile has you covered like no one else” to be permissible puffery and not a comparative superior network coverage claim.