Summary
concluding that the plaintiff seeking preliminary injunctive relief "cannot show a likelihood of irreparable harm caused by a graph that [the defendant] is no longer using"
Summary of this case from Aristotle International, Inc. v. NGP Software, Inc.Opinion
00 Civ. 2881 (JSM)
May, 2000
Thomas A. Smart, Kaye, Scholer, Fierman, Hays Handler, LLP, for the Plaintiff.
Thomas C. Morrison, Patterson, Belknap, Webb Tyler, LLP for the Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiff Pfizer, Inc. brings this action against Merial Limited for false advertising under the Lanham Act as well false advertising, deceptive practices, and unfair competition under state law. Both companies are in the business of making flea and tick control products for dogs and cats. Pfizer claims that Merial's recent television advertising and direct marketing brochures sent to veterinarians in support of its Frontline product are false and misleading and moves to enjoin the ads and brochures while this case is pending. While Pfizer has established that a Merial television ad and one of Merial's brochures are false and misleading, it has failed to establish that it will be irreparably harmed if an injunction does not issue. Therefore, the motion is denied.
This history of false advertising by Merial may be relevant in considering injunctive relief should Merial utilize additional false advertising in the future.
Until recently tick and flea infestations on pets have been treated with powders, sprays, and flea collars containing pesticides. In the last few years several pharmaceutical companies have developed "spot-on" products that involve application of a small amount of liquid to a spot on the animal's back once a month. Pfizer's "Revolution" and Merial's "Frontline" are spot-on products. Both are available only with a veterinary prescription, and both have been the subject of extensive marketing campaigns nationwide.
Under well-settled law in the Second Circuit, a plaintiff is entitled to a preliminary injunction upon a showing (1) of either a likelihood of success on the merits or of sufficiently serious questions going to the merits to make them fair ground for litigation and a balance of hardships decidedly favoring the plaintiff; and (2) that it will suffer irreparable harm. See Warner-Lambert Co. v. Northside Dev. Corp., 86 F.3d 3, 6 (2d Cir. 1996); Castrol, Inc. v. Quaker State Corp., 977 F.2d 57, 62 (2d Cir. 1992).
Section 43(a)(2) of the Lanham Act prohibits "false or misleading representations of fact" in advertising that misrepresent the nature, characteristics or qualities of the advertiser's or another person's products. To succeed on the merits of a false advertising claim, "a plaintiff must demonstrate that `an advertisement is either literally false or that the advertisement, though literally true, is likely to mislead and confuse consumers.'" See Castrol, 977 F.2d at 62 (quoting McNeil-P.C.C. v. Bristol Myers Squib Co., 938 F.2d 1544, 1549 (2d Cir. 1991)). When the claim in a comparative ad is literally false, a court may enjoin the use of the claim without reference to the ad's impact on consumers. See id.
Pfizer primarily takes issue with a graph produced by Merial that reported the results of a comparative efficacy test between Frontline and Revolution. The graph appeared in at least one veterinary journal and was included in a brochure that Merial distributed directly to veterinarians. The graph appears under the headline, "FRONTLINE BEATS REVOLUTION vs. fleas" which is followed by smaller text reading "FRONTLINE works FASTER, performs BETTER lasts LONGER against Fleas. In a recent controlled, head-to-head study, FRONTLINE outperformed REVOLUTION in key aspects of flea control." The graph itself is labeled "Comparative Efficacy of FRONTLINE Top SpotTM and REVOLUTION Against Fleas on Dogs."
The graph's vertical axis indicates percent efficacy of each product in killing fleas and the graph's horizontal axis indicates time over a period of 30 days with the labels "Day 1," "Day 9," "Day 16," "Day 23," and "Day 30" running across the bottom. The graph contains data lines representing the purported efficacy of each product over the 30-day period. Below the graph small print text explains that the test involved 30 dogs in three groups — 10 untreated controls, 10 treated with Frontline, and 10 treated with Revolution. It further explains that the dogs were treated on Day 0 and re-infested with fleas on Day 8, Day 15, Day 22, and Day 29 and that flea counts were taken on Day 1, Day 9, Day 16, Day 23, and Day 30.
The data line in the graph depicts dramatic differences between the two products. For Frontline the line begins at what looks like 98% efficacy on Day 1 then rises to 100% on Day 9 and continues there through Day 30. The Revolution line begins at around 73% on Day 1 climbs sharply to nearly 100% for Day 9 falls a bit to 98% for Day 16 then plunges to 75% on Day 23 and a mere 50% on Day 30.
The problem with this graph is that it depicts continuous lines of efficacy for what were really five individual flea counts taken on the dogs in the study. Merial counted fleas 24 hours after the initial treatment and 24 hours after each of the five flea re-infestations. It then represented those flea counts as dots on a graph — so far, so good. The problem arises when those five dots are connected by straight lines. The lines appear to represent the efficacy of the products at all points between the five flea counts. For example, half way between Day 23 and Day 30 on what would be Day 27 the line shows Revolution's efficacy as approximately 65%. But as Pfizer points out and Merial admits, if flea counts are taken 36 hours after re-infestation (instead of 24) Revolution's efficacy returns to nearly 100%. Therefore, the data line at many points throughout the graph is patently false.
Ordinarily, Pfizer would be entitled to a preliminary injunction against the use of the graph. But perhaps realizing the weakness of its position, defendant Merial ceased using the graph shortly after the initiation of this lawsuit. It has begun using a new graph to represent the same study in its advertising and has represented to the Court that it will never use the old graph again. Therefore, Pfizer's motion for a preliminary injunction as to the original graph is moot. See Consumers Union of U.S. v. General Sign Corp., 724 F.2d 1044, 1052 (2d Cir. 1983); American Express v. Mastercard, 776 F. Supp. 787, 791 (S.D.N.Y. 1991). Furthermore, Pfizer cannot show a likelihood of irreparable harm caused by a graph that Merial is no longer using.
Pfizer argues that the Court should enjoin Merial's use of its new graph because it is also false and misleading, but Pfizer has not shown a sufficient likelihood of success on the merits as to the new graph. The new graph appears under the same headline and introductory text. However, the graph is now labeled "Comparative Efficacy of FRONTLINE Top SpotTM and REVOLUTION Against Fleas and Flea re-infestations on Dogs at 24 hours." Instead of data lines the graph contains five pairs of bars representing Frontline and Revolution on each of the five days that flea counts were taken. As in the first graph, the differences between the products appear dramatic, but the graph clearly represents the comparative efficacy only at the five times that flea counts were taken and makes no representation as to what happened between those five times.
According to Pfizer, the new graph is still false and misleading because the overall message of the ad is that Pfizer's Revolution is not effective and that Merial's Frontline is overwhelmingly more effective. This message is false, Pfizer contends, because comparative efficacy looks completely different when based on a "real world" study or, as Merial admits, on a study that takes flea counts at 36 hours after infestation. Essentially, Pfizer contends that Revolution performs as well as Frontline on aspects of efficacy other than those tested in Merial's study. However true this contention may be, it does not render Merial's graph false or misleading.
The message that the graph and the ad as a whole convey is relatively clear: a study demonstrated that Frontline is more effective than Revolution against fleas within 24 hours of treatment and re-infestation, and that the difference becomes more acute later in the month. Basically, Pfizer's arguments regarding the new graph amount to an expression of its wish that Merial would have used a different study to test the relative efficacy of the two products. The products may be comparable when flea counts are taken at 36 hours after re-infestation, but there is nothing inherently false or misleading about choosing to take counts at 24 hours. While Pfizer claims that a 12 hour difference in killing speed means nothing in the grand scheme of 30-day pest control, it is up to vets and pet owners to decide how important it is to them that Frontline kills fleas a bit faster than Revolution. Pfizer is free to conduct its own studies based on "real world" situations or based on flea counts at 36 hours after re-infestation, circulate the findings to vets or the public, and explain why its studies are more relevant to overall efficacy.
Furthermore, Merial has targeted the ad at veterinarians — sophisticated readers who are more likely to understand the limitations of Merial's study. See Sandoz Pharmaceuticals Corp. v. Richardson-Vicks, Inc., 902 F.2d 222, 230 (3d Cir. 1990) (rejecting claim that bar chart used in advertising distributed to doctors was false or misleading and noting that a target audience's special knowledge is highly relevant to any claim that the audience would be misled).
Pfizer asks the court for a broad injunction similar to the one issued in Castrol v. Quaker State, but in that case the court found that the defendant's tests did not substantiate its advertising claims. See Castrol, 977 F.2d at 61-62. Pfizer has made no claim here that Merial falsified its flea counts or otherwise improperly conducted its tests. The test results were valid and support Merial's graph; Pfizer just wishes Merial had used a different test. Because Pfizer is unlikely to prevail on its claim that the new graph is false or misleading, the Court will not enjoin Merial's use of the graph in its advertising.
The next issue is whether Merial's current television advertising for Frontline should be enjoined. Pfizer initially challenged four television spots, but Merial has discontinued three of them and has represented that it has no intention of using them again. The only ad that Merial is currently running is a 30-second spot titled "Answers" which features an actress playing a veterinarian. The ad depicts the "vet" in a white lab coat examining dogs and cats in her office and at one point holding up a Frontline brochure. In relevant part, she says:
I think people are definitely confused about which flea and tick protection to use for their dogs and cats. Yeah, there's others out there, but the fact is FRONTLINE is still the best. That's because FRONTLINE kills 100% of fleas within a day. And only FRONTLINE kills all major ticks, including the one that can carry Lyme disease.
The bone of contention here is the statement that "only FRONTLINE kills all major ticks, including the one that can carry Lyme disease." This statement is literally false because another product, "Defend Exspot," also kills all major ticks including the one that carries Lyme disease.
Merial argues that the statement when taken in the context of the ad as a whole is not false or misleading. Apparently, Defend Exspot kills all major types of ticks but also has a tendency to kill cats. Therefore, vets can only prescribe it for use on dogs. Merial argues that because the actress in their ad initially says, "I think people are definitely confused about which flea and tick protection to use for their dogs and cats," the overall message of the ad is that "only Frontline kills all major ticks, including the one that carries Lyme disease for dogs and cats." But that is not what the ad says. The ad says that "only Frontline kills all major ticks," and the larger context of the ad does not change the literal falsity of that statement. For a cat owner who views the ad the effect of the false statement is not particularly misleading; Frontline is the only product available that kills all major ticks and can be used on the viewer's cat. But for the dog owner who views the same ad the effect is unequivocally both false and misleading; there is another product available that kills all major ticks and can be used on the viewer's dog.
The only problem with the preliminary injunction motion as to the TV ad is that Pfizer has not sufficiently shown a danger of irreparable harm if the motion is not granted. Pfizer argues that because the ad in question is literally false, irreparable harm should be presumed. However, the rule Pfizer refers to has only been applied in cases involving literally false comparative advertising involving the plaintiff's product. See e.g., McNeil-P.C.C., Inc. v. Bristol-Myers Squibb Co., 938 F.2d 1544, 1545 (2d Cir. 1991); McNeilab, Inc. v. American Home Products Corp, 848 F.2d 34, 35 (2d Cir. 1988). Moreover, the Second Circuit has stated explicitly that there is no presumption of irreparable harm on a Lanham Act preliminary injunction motion. See Coca-Cola Co. v. Tropicana Products, Inc., 690 F.2d 312, 316 (2d Cir. 1982); Johnson Johnson v. Carter-Wallace, Inc., 631 F.2d 186, 190 (2d Cir. 1980). While the party seeking an injunction does not have to produce specific evidence of actual sales losses, it must come forward with some evidence to show that it is likely that defendant's advertising has caused or will cause such losses. See Johnson Johnson, 631 F.2d at 190.
In this case, Pfizer's Revolution is not mentioned in Merial's Frontline ad, and the ad's claims are absolutely true as to Revolution. Unlike Frontline, Revolution does not kill all major ticks. The only real harm Frontline's false statement will cause is to the makers of Defend Exspot-the other product that kills all major ticks. At argument, Pfizer's counsel cited the "halo effect" caused by the Frontline commercials as a harm to Pfizer. In other words, statements that a product is "the best" or "the only one" tend to raise the product's esteem in consumers' minds, making them more likely to buy the product whether or not they need the touted quality. In this instance, the logic is that even people whose pets are not afflicted by ticks will be more likely to buy Frontline over Revolution because of the "halo" created by the claim that Frontline is the only one that kills all major ticks.
But this potential injury to Pfizer is speculative at best. Logically, it is safe to say that the false statement in the Frontline ad will only have an substantial impact on consumers who are looking for a product that kills all major ticks. Even assuming that these consumers purchase Frontline because of the false statement, there is absolutely no harm to Pfizer because Revolution does not kill all major ticks. Pfizer has not produced any evidence to counter this reasoning or support its "halo effect" argument raised for the first time at oral argument. On this scant record, the Court does not find a sufficient likelihood of irreparable harm to support a preliminary injunction.
Pfizer's motion for a preliminary injunction is denied.
SO ORDERED.