Last week’s sizeable attorney’s fee award in the lengthy Beastie Boys v. Monster Energy Company legal battle is an important reminder of how critical it is to clear third party IP rights in your advertising materials and the financial risks of not doing so. Last week, a New York federal court ordered Monster Energy to
In 2014, the Supreme Court decided POM Wonderful LLC v. The Coca-Cola Company, 134 S.Ct. 2228, which we have discussed in detail here, and here, and here. In POM Wonderful the Supreme Court held that “Congress did not intend the [Food, Drug and Cosmetic Act] FDCA to preclude Lanham Act suits like POM’s.” Since that decision, enterprising plaintiffs have tried to interpret the decision broadly to argue that post-POM Wonderful district courts could not dismiss Lanham Act claims that allege a violation of the FDCA.
The Ninth Circuit’s recent opinion in Astiana v. Hain Celestial Group, Inc., __ F.3d __ (9th Cir. 2015) confirms that district courts can and should defer to the expertise of the Food and Drug Administration (FDA) under the primary jurisdiction doctrine.
Before POM Wonderful, it was clear that “a private action brought under the Lanham Act may not be pursued when . . . the claim would require litigation of the alleged underlying FDCA violation in a circumstance where the FDA has not itself concluded that there was such a violation.” PhotoMedex, Inc. v. Irwin, 601 F.3d 919 (9th Cir. 2010).
It is pretty rare for the Lanham Act and state law deceptive advertising cases to involve political candidates, but a case in Virginia shows how advertising law can be used to help candidates who have been harmed by entities trying to raise money using their name and likeness. We have more information on the political implications of this settlement on the Political Law Briefing Blog.
How it all Started
In 2013, Ken Cuccinelli was running for governor of Virginia, and a political action committee (“PAC”) decided it would raise money, ostensibly to help him win. What Mr. Cuccinelli discovered, however, was that he only received a small amount of the money raised, and the PAC did not execute its promises of a get-out-the-vote campaign for him. Nearly a year after the election, he sued the PAC and the principals involved for false advertising. The defendants filed a motion for summary judgment. The court held a settlement conference, and the defendants ended up paying Mr. Cuccinelli $85,000, provided him their mailing lists of donors so he can use or rent those lists, and agreed to honor requests from candidates to stop using their name an image. …
Continue Reading Advertising Law Enters the Political Process
There are two Flanax’s. Belmora LLC (“Belmora”) distributes Flanax, a brand of pain relief medicine, in the United States while Bayer has distributed a brand of pain medicine, Flanax, in Mexico for decades. Bayer sought to cancel Belmora’s registered trademark for Flanax in the Trademark Trial and Appeal Board (“TTAB”). Bayer won in that venue.
Then, the parties sought review of that decision and brought additional causes of action in the Eastern District of Virginia. Belmora filed a motion to dismiss Bayer’s counterclaims, which the District Court had granted, and a motion to reverse the TTAB opinion.
In its counterclaim, Bayer alleged that Belmora’s early packaging was “virtually identical” to Bayer’s, and that Belmora’s marketing messages often suggested a historical connection between Belmora’s Flanax and Latino customers. For instance, Bayer alleged that Belmora tried to link itself with Bayer’s Flanax by saying that Belmora’s was a brand that Latinos had turned to “for generations.” …
Continue Reading The Battle of the Two Flanax’s and the Power of the Mexico-United States Border
Launching an advertisement, production, or publication without obtaining the necessary third-party intellectual property (IP) rights can have costly consequences. A jury recently awarded the Beastie Boys and related plaintiffs $1.7 million in a lawsuit against Monster Energy for using Beastie Boys music and references to the Beastie Boys in a promotional video on Monster’s website without proper permission after finding Monster Energy’s actions to be willful copyright infringement and a false endorsement under the Lanham Act. The court recently denied Monster Energy’s post-trial motions for judgment as a matter of law, a new trial, and a reduction in damages. The Beastie Boys are now seeking an additional $2.4 million in attorneys’ fees and costs. Capitol Records, LLC, and Universal-Polygram International Publishing, Inc., have now sued Monster Energy in a related case.…
Continue Reading Beastie Boys Win $1.7 Million Verdict, Underscoring the Importance of Clearing IP Rights
The federal district court in Alexandria, Virginia denied a motion to dismiss the Redskins trademark case, making it clear that the “Rocket Docket” is open for business and ready to hear cases brought by parties who are dissatisfied with decisions made by the Trademark Trial and Appeal Board (TTAB). Pro-Football Inc. v. Blackhorse, 14-cv-01043, U.S. District Court, Eastern District of Virginia (Alexandria).
Parties who are dissatisfied with TTAB decisions can initiate “de novo” proceedings in a unique federal court — the district court in Alexandria known as the Rocket Docket. That court, which is across the street from the Patent and Trademark Office (PTO), is called the “Rocket Docket” because cases there proceed from filing to trial in less than one year under accelerated procedures – that’s more than twice as fast as other federal courts around the country.
The background of this dispute is well known: The Redskin’s federal trademark protection provides the Redskins with lucrative rights in the famous name, and the power to exclude others from using the same name in the marketplace. Earlier this year, the TTAB cancelled the Redskins’ federal trademark registrations on the basis that it disparages Native Americans in violation of the Lanham Act.
As we previously reported here on March 25, 2014 the United States Supreme Court issued its much-anticipated decision in Lexmark Int’l Inc. v. Static Control Components, Inc. The decision resolved a three-way Circuit split, rejected the test in the Seventh, Ninth and Tenth Circuits that the plaintiff and defendant had to be direct competitors, and articulated a new test for standing to bring a Lanham Act false advertising claim – a plaintiff must be in the “zone of interest” and must have injuries proximately caused by the defendant’s false advertising.
The other recent landmark Supreme Court decision in this area is of course POM Wonderful LLC v. Coca-Cola Co., which we also previously reported on here. That case held that competitors could bring suits under the Lanham Act challenging food and beverage labels that were regulated by the Federal, Food, Drug, and Cosmetic Act (“FDCA”) and complied with those regulations—in other words, the FDCA does not preclude claims under the Lanham Act, at least in the area of food and beverage labeling.
Lower courts are already recognizing that Lexmark and POM Wonderful have broadened the scope of Lanham Act litigation between competitors, and in fact are applying Lexmark and POM Wonderful beyond the realm of false advertising. …
Continue Reading A Whole New Lanham Act? A Look at Lexmark and POM Wonderful in Action
It’s the time of year when we Americans honor the Stars and Stripes, but people all over the world get starry-eyed over celebrities. Recognizing this, advertisers like to use celebrity images in advertising. Recently, we wrote about Katherine Heigl’s $6 million lawsuit against Duane Reade for a tweet using her photo without her permission, and the blog got so many hits that we thought that we would dive deeper and look at a couple of the more interesting new developments in the U.S. and other countries on the issue of who has the right to use celebrity images or likenesses in advertising.
It should come as no surprise that a celebrity wants to control the right of third parties to use his or her likeness in advertising or commerce. A celebrity’s image is her brand, and that brand (sometimes regardless of any demonstrable skill) is what keeps her marketable to the public. Further, in the U.S., many states recognize personality rights, including the right of publicity—in other words, the right to keep one’s name and image from being commercially exploited without permission and/or compensation. With the growing popularity of social media, the ability of third parties to appropriate celebrity images and other intellectual property has expanded, but celebrities have been fighting back, a la Katie Heigl, in both the U.S. and in other countries and in sometimes unconventional ways.
For example, in France, Scarlett Johansson is suing a novelist for €50,000 alleging that his fictional work makes fraudulent characterizations about her life. …
Continue Reading Don’t Let the Stars in Your Eyes Blind You to the Risks of Celebrity Ad Campaigns
The United States Supreme Court paved the way today for competitors to challenge FDA-regulated food and beverage labels under the Lanham Act. The Court’s opinion in POM Wonderful LLC v. The Coca-Cola Co. is the latest chapter in a long-running feud between POM Wonderful and Coca-Cola, which arose in 2008 when POM accused Coke of mislabeling one of its fruit juice blend products by prominently displaying the words “pomegranate blueberry” despite the product consisting mostly of less expensive apple and grape juices. To date, Coke had successfully persuaded a California district court and the Ninth Circuit that POM’s Lanham Act claims were precluded by the Federal Food, Drug, and Cosmetic Act and attendant FDA regulations specifically addressing the labeling of fruit juice blends. …
Continue Reading Supreme Court Opens Door to Food and Beverage Label Challenges Under Lanham Act
In ruling on a motion to dismiss counterclaims brought under Section 43(a) of the Lanham Act, the District Court of Oregon ruled that statements made by a corporate agent to a journalist may be actionable.
In Skedko, Inc. v. ARC Products, LLC, the defendant counterclaimed for false advertising. Both plaintiff and defendant manufacture and sell evacuation devices. Plaintiff’s device is the Sked® Rescue System, “(‘Sked’), an evacuation sled system designed to quickly evacuate wounded people from confined spaces, from high angles, in technical rescues, and in traditional land-based rescues.” Defendant’s device is the Vertical Lift Rescue Sled, “which is an evacuation device that provides quick transport of a nonambulatory individual in a difficult rescue situation or a confined space.”
Among the advertising that defendant challenged through its counterclaims was a statement by plaintiff’s executive and agent that appeared in the article “Cleared for Takeoff” for the publication Military Medical & Veterans Affairs Forum. Skedko’s agent told the author of “Cleared for Takeoff” that “an individual person can have an injured person ready for transport in a Sked sled in a mere 20 seconds and that [the agent] could perform this ‘routinely.’” Defendant alleged that this statement was false because “in reality it takes significantly longer for an injured person to be loaded into and ready for transport into a Sked sled.”