The Supreme Court’s unanimous opinion in POM Wonderful LLC v. Coca-Cola Co. (Dkt. No. 12-761) (June 12, 2014) highlights the key role of Lanham Act false advertising claims in protecting consumers from misleading advertising and labeling.
Reasoning that competitors often are in a better position than regulators to identify false advertising and other unfair competition, the Court held that the Lanham Act and the Federal Food, Drug, and Cosmetic Act (FDCA) exist in parallel, and that the FDCA does not preclude false advertising claims attacking product labels. Coming on the heels of the Court’s March 25, 2014 decision in Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. (2014) – which confirms that Lanham Act plaintiffs need not be in direct competition with their defendants − we predict (i) a further increase in false advertising cases brought under the Lanham Act, and (ii) that defendants facing Lanham Act false advertising cases will find increasing resistance to preemption, preclusion and primary jurisdiction arguments. Food and beverage companies in particular will need to revisit their longstanding belief that a label that complied with a detailed FDA food labeling regulation was essentially immune from a challenge based on an allegation that the label was “misleading.”