Alerts

AD-ttorneys@law – August 14, 2018

Alerts / August 14, 2018

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Ferrari Crashes Head-On Into Infringement Suit

Hollywood icon Steve McQueen’s family loses its cool over actor car model

Great Escapism

Cowboy, soldier, cop, Old-West lawman, race car driver, high-stakes gambler – Steve McQueen wasn’t the first actor to inhabit these iconic masculine roles, but did any other celebrity perform all of them as well, for quite so long?

The McQueen persona set the template for 1960s masculine cool, and there was, of course, money to be made from that. By the early 1970s, McQueen was the highest-paid actor in Hollywood; in the years following his death in 1980, his family and estate have worked assiduously to cultivate his image and carefully curate product endorsements.

Love a Stranger?

In a lawsuit filed in California Superior Court, Chadwick McQueen, Steve’s son, along with a trust administered for his granddaughter, Molly, claim to have been “shocked” to learn that luxury sports car manufacturer Ferrari was marketing a special edition car it called “The McQueen.” Specifically, the suit alleges that Ferrari marketed and sold this model to “key customers” as a marked-up, limited edition vehicle alongside other special edition cars as part of its 70th anniversary in 2017.

The marketing, the suit claims, featured McQueen’s photo and a monograph describing the classic Ferrari model he once owned.

McQueen was the star of several car and racing movies, the most famous of which was, of course, Bullitt. Fast, dangerous, skillful driving was synonymous with his image, and remains so to this day. So it’s no surprise that his estate has endorsed, branded and otherwise marketed a number of cars, motorcycles and related gear, including products from Porsche, Metisse and Triumph. But not Ferrari.

According to the suit, Ferrari’s alleged grab for the movie star’s reflected glory was particularly galling. The suit claims that back in 2011, Chadwick McQueen visited the Ferrari factory and met with the company’s president, expressing interest in creating a McQueen-branded Ferrari model, “provided he and his family would maintain approval rights and involvement in the project,” as they customarily do when partnering with manufacturers. Chadwick McQueen also claims to have asked Ferrari to cease using the McQueen name and photographs of the icon in its branding and advertising. Ferrari allegedly responded by cheekily renaming the car “The Actor” – and in at least one advertisement, continued to reference Steve McQueen’s own Ferrari.

The Takeaway

Filed in July 2018, the lawsuit accuses Ferrari of trademark infringement, false endorsement and unfair competition, and seeks to enjoin further production of models that are marketed through Steve McQueen’s name or likeness. We’ll see if excising McQueen’s image and simply noting his historical ownership of Ferraris is enough to mitigate his son’s complaint. Ferrari has yet to respond to the claim.

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SDNY Decries Mathematical Illiteracy in Junior Mint Dismissal

Slack-fill argument ‘coddles’ consumers, court says

It’s a Junior Mint

Who’s gonna turn down a Junior Mint? It’s chocolate, it’s peppermint – it’s delicious!

Three plaintiffs in a recent class action couldn’t: Biola Daniel and Abel Duran of New York and Trekeela Perkins of Mississippi purchased the cool and chocolatey candy in a variety of venues – a Manhattan Duane Reade drug store, an AMC theatre location in a New York suburb and a Walmart store in Mississippi.

But their enthusiasm for the snack waned, the trio alleged in an October 2017 class action, when they discovered that the opaque Junior Mint box concealed nonfunctional slack-fill. The trio banded together to accuse Junior Mint mastermind Tootsie Roll Industries of including up to 43 percent slack-fill in certain boxes, violating the Federal Food, Drug, and Cosmetic Act, the New York General Business Law, and the Mississippi Consumer Protection Act and committing common law fraud.

Cold and Bracing

The Southern District of New York, where the suit was filed, offered a harsh assessment of the action in its Aug. 1, 2018, order to dismiss.

In their suit, the court held, the plaintiffs made two arguments claiming that the information provided on Junior Mints’ packaging was insufficient to prevent misunderstandings about the amount of candy within.

First, the plaintiffs argued, only an “unusually diligent” consumer could figure out how many mints were in each box by multiplying the serving size listed on the label by the number of pieces in each serving.

“We disagree,” the court wrote. “The law simply does not provide the level of coddling plaintiffs seek … the Court declines to enshrine into the law an embarrassing level of mathematical illiteracy. A reasonable consumer is capable of multiplying … 10 by 12 [the amount of mints in the 10.5 oz. box],” and the judge ruled that any consumer “of ordinary intelligence” can figure out how much candy is in a Junior Mints box by reading the label.

The court also threw out the plaintiffs’ second, more subjective, argument in a manner that will be of interest to anyone engaged in product packaging design.

The plaintiffs argued that even if the consumer found the will to multiply out the number of mints in the box, they would be misled about the total amount of candy they were purchasing because the mints pictured on the outside of the box are larger than the actual mints inside. But, the court pointed out, “consumers care about the density or volume of a product only as it relates to the amount or quantity of food.” Since the product packaging disclosed exactly how much food was in the box, the size of the individual pieces in the box was immaterial.

The Takeaway

While slack-fill cases have seen a major uptrend in filings – approximately 300 such cases were filed in 2016 and 2017 – many courts have dismissed these claims in a fashion similar to what we see here. It is becoming increasingly more difficult for plaintiffs to get past the pleading stage on such cases.

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Trader Joe’s Slathered With Honey Class Action

Expensive manuka honey may have been cut with inferior varieties

Everyone’s Abuzz

Manuka honey is yet another controversial natural product that proponents claim delivers health benefits to consumers. Its exotic origins no doubt lend some of its appeal: Manuka honey is derived from the nectar of the eponymous tree, native to Australia and New Zealand. It has a unique feel and taste, and is lauded for its richness and complex flavors. And the supposed health benefits have been promoted on the strength of actual scientific research, although the honey may need to be consumed in extremely large amounts for the benefits to accrue.

But still, manuka honey has earned the moniker “liquid gold:” Health-conscious consumers have run its price up to more than $120 per jar. So, when you buy it, you want to be sure you’re actually buying it.

Prices like that, combined with exotic sourcing, meant that a manuka-honey-derived lawsuit was inevitable.

The Northern District of California is the venue for just such a suit: a class action initiated by three individuals from California, New York and North Carolina. Their target: grocery chain Trader Joe’s, which sells its own manuka honey product in stores and online.

The Trader Joe’s product, the plaintiffs claim, is labeled either as “100% New Zealand Manuka Honey” or simply as “New Zealand Manuka Honey” – and it lists “Manuka Honey” as the only ingredient in the product. However, the plaintiffs’ testing (by a New Zealand government lab, no less) allegedly demonstrates that product samples contain between 57.3 and 62.6 percent manuka-derived honey. Trader Joe’s is reaping extra profit, they claim, by cutting the manuka honey with other varieties.

The action, filed at the end of July 2018, hits Trader Joe’s with violations of several New York, California and North Carolina statutes of the deceptive, unfair and false advertising varieties, including California’s Consumer Legal Remedies Act.

The Takeaway

The plaintiffs are seeking unspecified damages, cessation of allegedly deceptive marketing and “a corrective advertising campaign.”

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Louisiana to Robocallers: You’ll Regret Those Calls, if We Catch You

New state law doubles down on civil penalties

Ain’t Playing

Aug. 1, 2018, saw the debut of a new law in Louisiana that takes dead aim at robocalls. Introduced in March 2018, the new law is a big ramp-up of the state’s previous statute.

The original law made spoofing – knowingly inserting false information into a caller ID system with the intent to “mislead, defraud, or deceive” – illegal. The statute allowed victims to recover the greater of three times the amount of actual damages or $5,000 per violation, and allowed the attorney general or district attorneys to enjoin further violations and fine up to $5,000 per violation.

The new law doubles the civil penalty fine to $10,000 per violation and prevents the statute from precluding other possible remedies sought by plaintiffs. Moreover, the new law makes violators subject to injunctive relief, and replaces the original recovery scheme with treble damages and attorney fees.

The Takeaway

While the ramp-up in penalties will please any Louisianan who’s been overwhelmed by robocalls, the sponsors of the legislation are realistic about the effect of the new rules.

In conversations with fellow legislators and the press, Pelican State officials shared their concerns: That for all the new penalties at the disposal of the state, the real problem was catching offenders in the first place. This is a common problem for state legislatures, since they simply do not have the reach to haul offenders – who most likely live in another jurisdiction – into the courtroom. Hence, the policy behind providing a private right of action: Victims and their lawyers can be motivated by their own economic benefit to bring consumer protection actions where permitted.

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New Kid-Safe Tech Sidesteps YouTube

SuperAwesome says it’s a compliance-minded platform aimed at content producers, not kids

YouTrouble

Back in April 2018, YouTube took a double punch on the chin.

First, a complaint signed by more than 20 advocacy groups was filed at the Federal Trade Commission alleging that the video streaming/social media giant had been collecting data on children’s viewing patterns for years. Second, a class action complaint was lodged against the company by a mother and child pair accusing YouTube of collecting information on the boy in violation of the Children’s Online Privacy Protection Act (we covered this case in June 2018).

With all the distress swirling around YouTube (and social media companies generally – it’s been a rough year for them), it isn’t shocking to find new technologists leaping into the fray to take advantage of the chaos.

Modesty in Branding

In a fit of modest branding, SuperAwesome – a kid-friendly content sharing company that sells itself on its COPPA/GDPR-K compliance – has entered the scene. How does it work?

Well, for one thing, it’s not aimed at kids.

The platform itself is meant to be used by content producers and advertisers as a one-stop solution to guarantee that their offerings are compliant and kid safe. That includes managing the portions of the user interface that often stymie companies that offer services for the under-13 crowd, such as age-gates, parent portals and other authentication tools.

The Takeaway

A new offering from the company is its video player, which will allow companies to serve up videos in their own apps and websites without having to go through YouTube. Like its other services, this one is designed with compliance in mind. Other products and services include a kid-friendly ad platform, a social content platform, a GDPR-K guide for children-specific GDPR compliance, a certification program for kids who produce content, and even engagement tools to help brands interact with kids on (you guessed it) YouTube.

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