By Dennis Crouch
Lexmark Int’l v. Static Control (Supreme Court 2014)
In a unanimous opinion penned by Justice Scalia, the Supreme Court has ruled that standing in §1125(a) false-advertising claims are not limited to competitors. Rather, it can be sufficient that a plaintiff have a commercial injury “flowing directly from the deception wrought by the defendant’s advertising.” The standing decision here is not testing the Constitutional limits of judicial power under Article III but rather is one of statutory interpretation. In particular, the statute provides that a cause of action is available to “any person who believes that he or she is or is likely to be damaged by such act [of false advertising].” Although expanding the scope of potential plaintiffs, the court seemingly continued to hold the line against giving the statute its plain English interpretation that would allow consumer class actions.
False Patent Infringement Claims: Of interest to patent attorneys, the alleged false advertising claims here involve public allegations of patent infringement. The court writes.
First, Static Control alleged that Lexmark disparaged its business and products by asserting that Static Control’s business was illegal. See 697 F.3d 387 (6th Cir. 2012) (noting allegation that Lexmark “directly target[ed] Static Control” when it “falsely advertised that Static Control infringed Lexmark’s patents”).
Under the Supreme Court’s interpretation of the law, those statements (with the requisite intent and resulting harm) can be sufficient to create a cause of action for false advertising.