Stroock Special Bulletin
"Non-Competitors May Now Bring False Advertising Claims Under the Lanham Act"
On March 25, 2014, with its decision in Lexmark Int'l, Inc. v. Static Control Components, Inc. ("Lexmark"), the Supreme Court made it easier for a non-competitor to state a claim for false advertising under the Lanham Act. This Stroock Special Bulletin provides an overview of the Lexmark decision, in which the Court resolved a long-standing split among the Circuits by explaining that a company may sue a non-competitor for false advertising under Section 43(a) of the Lanham Act, as long as it alleges "an injury to a commercial interest in reputation or sales" that was proximately caused by the allegedly false or misleading advertisements.
In doing so, the Court overruled numerous potentially more complex tests that had been applied by the Circuit Courts for determining the circumstances under which non-competitors could assert such an action. Specifically, the Court found that Static Control could sue Lexmark under the Lanham Act for statements Lexmark made to Static Control's customers regarding Static Control's alleged violation of Lexmark's intellectual property, even though Lexmark was not Static Control's direct competitor, on the grounds that Lexmark's public statements were the proximate cause of the requisite injury to Static Control.