When First-of-Its-Kind Meets Dastar

Section 43(a) of the Lanham Act prohibits “commercial advertising or promotion” in which a person “misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities” in 15 U.S.C. § 1125(a)(1)(B) (emphasis added).

The Lanham Act, however, “does not have boundless application as a remedy for unfair trade practices,” and “can apply only to certain unfair trade practices prohibited by its text.” Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23, 29, 123 S. Ct. 2041, 156 L.Ed.2d 18 (2003). In Dastar, the U.S. Supreme Court cautioned “against misuse or over-extension” of trademark and related protections into areas traditionally occupied by patent or copyright. Id. at 34 (citation omitted). For example, trademark law “does not exist to reward manufacturers for their innovation in creating a particular device; that is the purpose of patent law.” Id.

Courts have applied Dastar to bar reverse passing off claims that implicate copyrights or patents because “the nature, characteristics, and qualities of [a product] under the Lanham Act are more properly construed to mean characteristics of the good itself,” rather than its IP status. See Sybersound Recs., Inc. v. UAV Corp., 517 F.3d 1137, 1144 (9th Cir. 2008) (rejecting the argument that a karaoke record’s licensing status was part of the nature, characteristics, or quality of the record and raising concerns about overlap with copyright law); see also Baden Sports, Inc. v. Molten USA, Inc., 556 F.3d 1300, 1302–03, 1306–08 (Fed. Cir. 2009) (rejecting false advertising claim against a competitor promoting itself as the creator of “the innovation known as dual-cushion technology” because a Lanham Act claim could not be based on “the origin of an idea”).

“World’s First Eco-Friendly Cooler”

In a recent false advertising case under the Lanham Act, Vericool alleged it had been selling patented biodegradable coolers since 2017.

Igloo Products allegedly started selling a competing biodegradable cooler named “Recool” in April 2019. Igloo claimed to have begun developing a biodegradable cooler since 2015, manufacturing prototypes since 2017, and completed the final design of the Recool in early 2018.

A few years later, Vericool sued Igloo for falsely advertising that Igloo’s “Recool” biodegradable cooler was the first of its kind—based on statements such as the “world’s first eco-friendly cooler,” “the world’s first cooler made from biodegradable materials,” and the “world’s first cooler made from 100% biodegradable materials.” Vericool World LLC v. Igloo Prods. Corp., 2023 WL 8634803, No. 22-cv-02440-HSG (N.D. Cal. Dec. 13, 2023). Because of Igloo’s market power, Vericool argued that Igloo’s “false and misleading statements duped consumers and retailers into believing that Recool was in fact the first biodegradable cooler manufactured, stealing from Vericool the cachet that comes from producing a pioneering product.”

Igloo argued that any alleged misstatements about the Recool being the “first” biodegradable cooler were nonactionable in view of Dastar.

Barred by Dastar

The Court here found no meaningful distinction between statements of being the “first” and claims of inventorship. Furthermore, the Court noted that “for some reason, Plaintiff has chosen not to bring a patent infringement claim against Defendant.”

Whatever might have motivated this strategic choice, clearly controlling law compels the Court to decline Plaintiff’s invitation to extend such protections under the Lanham Act.

Being the first to use a specific technology did not go to the “nature, characteristics, and qualities” of the good itself. See Williams & Lake LLC v. Genesis Sys. LLC, No. CV-17-00117-TUCCKJ, 2017 WL 6418937, at *6–7 (D. Ariz. Sept. 13, 2017) (rejecting Lanham Act claim based on statements about being the inventor of a braking system); R & A Synergy LLC v. Spanx, Inc., No. 2:17-CV-09147-SVW-AS, 2019 WL 4390564, at *10–11 (C.D. Cal. May 1, 2019) (rejecting Lanham Act claim based on statements that product was “new,” “invented,” and “fill[ed] a white space” in the market); but see Blue Spike, LLC v. Texas Instruments, Inc., No. 6:12-CV-499, 2014 WL 11848751, at *5 (E.D. Tex. July 25, 2014) (distinguishing statements about being the “first to create content fingerprinting technology” as “connot[ing] to the public who was the first to use the technology in a product” rather than being about “who was the first to create an abstract idea”), report and recommendation adopted, No. 6:12-CV-499, 2014 WL 11829325 (E.D. Tex. Aug. 15, 2014); Zobmondo Ent. LLC v. Imagination Int’l Corp., No. CV 09-02235 ABC PLAX, 2009 WL 8714439, at *1 (C.D. Cal. June 23, 2009) (denying motion to dismiss by interpreting the use of the term “original” for a board game as focusing on “who physically manufactured the first board game,” distinguished from the question of who came up with the idea for such a board game).

Thus, the Court granted summary judgment that false advertising under the Lanham Act was Dastar-barred.

 

Thomas P. Howard, LLC litigates nationwide including in Colorado.