#romancescams | AD-ttorneys@law – November 2020 #2 | BakerHostetler

Eleventh Circuit Pries Apart Sticky Trade Dress Decision

Is Gorilla Glue throwing a monkey fit after J-B Weld’s loss is torn apart?

Opposites Attract

If you’re an average, buy-it-when-you-need-it glue consumer, you’re probably more familiar with Gorilla Glue’s product line than with J-B Weld’s. With a bright orange label, bold graphics featuring a cartoon gorilla and a line of kids’ products, Gorilla has a higher public profile.

J-B Weld is a bit different. As we mentioned a while back in an article detailing its battle before the National Advertising Review Board, J-B Weld is a company whose staid image reflects a sober, workmanlike product line – dedicated to epoxies and silicone sealants designed for every obscure gluing need (including, somehow, rotten wood).

So, it was bound to be interesting when these two brands clashed.

Epoxy on Both Your Houses!

In October 2017, J-B Weld filed a three-count complaint in the Northern District of Georgia against competitor Gorilla Glue. Eventually, the suit evolved into a six-charge attack including trade dress infringement based on the Lanham Act, Georgia common law of unfair competition, trade dress dilution under Georgia law and false advertising under the Lanham Act, among others.

At issue was the packaging of the companies’ competing epoxy glues. For the uninitiated, epoxies, unlike conventional consumer glues, require the user to mix two components that, once together, dry into a solid bond.

J-B Weld’s epoxy brands, “J-B Weld Original” and “J-B Weld Cold Weld,” were packaged in a distinctive blister package with the two component tubes arrayed in a V formation on the front. The tube on the left was colored black; the one on the right, red. Various graphical and textual elements gave the packaging its distinctive look.

V for Vendetta

J-B Weld sued Gorilla for allegedly copying this design, including the “V” blisters and other design elements. Both companies moved for summary judgment in the district court case; Gorilla Glue won its motion, but J-B Weld was stopped short. The court held that J-B Weld “failed to show a sufficient likelihood of confusion to survive summary judgment on its trade dress infringement claims,” and “had not put forth any evidence that the statements at issue were material to consumer purchasing decisions.” The company filed for appeal.

Which brings us to J-B Weld’s resounding victory before the Eleventh Circuit. The company took Georgia’s Northern District to task for rejecting evidence of actual consumer confusion and ignoring evidence that Gorilla chose to copy the packaging intentionally, as well as arguing “that the District Court applied the wrong legal standard by requiring proof of likelihood of confusion as a necessary element of the claim” in the trade dress dilution charges.

In an opinion issued in late October, the appeals court dissolved most of Gorilla Glue’s original win, arguing that certain important factors impacting consumer confusion were ignored. “The district court’s failure to discuss potentially relevant evidence by choosing not to discuss four factors, when combined with its impermissible fact-finding with respect to the other three factors, indicates that the Court did not ‘fully consider’ the applicable factors,” the appeals court wrote.

The likelihood of consumer confusion was demonstrated well enough by J-B Weld, the court held, to become a “triable issue of fact.”

The Takeaway

Gorilla won on two fronts. The trademark dilution charge – for which Weld claimed it did not have to demonstrate likely confusion – got sent back to the district court for reevaluation. Its false advertising defense was upheld. But J-B Weld’s trade dress charge? It stuck.

One of the interesting pieces of evidence that surely played into the appellate court’s revival of the trade dress charges was a quote from Gorilla Glue’s graphic designer, Heather Tonne. She wrote that “the objective of [the packaging design project] was to go straight up against the top competitor (J-B Weld) and create packaging that mimics the competitor’s architecture. I was able to pull subtle elements into our package, but still keep the package looking tough and geared towards the Gorilla brand.”

The District Court held that this passage demonstrated that Gorilla maintained its color scheme and logo, and therefore clearly “did not intend to confuse consumers.”

“This was error,” the Eleventh Circuit wrote pithily.

GEICO Sues over Unauthorized Price ‘Quotes’

Third-party site used logo to click through to affiliates

You’re Slouching Again, Ted

What’s the secret of GEICO’s marketing success?

We ask because when we informally poll our friends and acquaintances, opinion is bitterly divided.

(Okay, not bitterly divided – that’s just the election talking.)

Roughly half the people in this informal survey love GEICO’s ads, from the original English-accented Gecko to the put-upon hipster cavemen to this hilarious new classic.

The other half doesn’t exactly dislike the ads. Or rather, enjoyment never comes up. It’s the sheer volume of ad time that drives them nuts.

Why? Because GEICO is an advertising juggernaut. They’re an insurance giant, of course, but they’ve been carpet-bombing the airwaves with their various ad creations for years. They helped establish a breezy, wacky, groany-humor strain in the ad zeitgeist.

Diss-simulation

Given this saturation, it’s not difficult to imagine how seriously a company like GEICO takes its brand identity.

Take as a test case Government Employees Insurance Company v. Accretive Capital LLC. If they’re true, GEICO’s accusations against Accretive Capital – doing business as Benzinga.com – are going to give the defendant heartburn with a side of agita and a dollop of shmertz.

Here’s what GEICO said happened: Benzinga – which calls itself a “content ecosystem that makes information easier to consume” – created a “GEICO Auto Insurance Review” page on its site. The company allegedly used GEICO’s well-known marks to offer insurance “quotes” from the company – to “see how GEICO compares.”

The Takeaway

But when the user clicks through on the links, the complaint says, “GEICO never appears on the list of potential insurance providers.” Instead, “Benzinga misappropriates the Registered GEICO Marks in a bait-and-switch scheme, relying on the extraordinary fame of the GEICO brand to lure prospective policyholders before redirecting them to competing insurance providers who pay referral fees to Benzinga.…”

Quite a no-no (if it’s true).

Geico is suing for trademark infringement, trademark dilution and false designation of origin under the Lanham Act, along with trademark infringement and unfair competition under Maryland law.

Advice for our readers? This isn’t the sort of scam any of you would be involved in, of course. But if any aspect of your advertising or social media relies on real quotes or information streaming in from other sites – think twice about using their marks to frame or serve up their information unless you have worked out an explicit agreement.

Social Media Is Petri Dish for New COVID-19-Era Scams

Romance, pandemic relief among the most popular baits for vulnerable consumers

For Love and/or Money

The coronavirus is reshaping our way of life. Back in July, we reported on a Federal Trade Commission (FTC) study that showed how the double threats of COVID-19 infection fright and stay-at-home protective measures were combining to produce unprecedented “undelivered item” scams. Users would go online, try to pick up important goods – mostly coronavirus-related equipment and supplies – pay the cost and simply never receive the expected package.

A few short months later, and the FTC is reporting a new set of stats that are as significant as they are predictable: An explosion of scams is originating through social media.

Unsurprisingly, the spike in scams began in early 2020, when many people began using social media as their lifeline to the world. “In 2019, total reported losses to these frauds reached $134 million,” the FTC wrote in its latest Consumer Protection Data Spotlight. “But reported losses reached record highs, climbing to nearly $117 million in just the first six months of 2020.”

The FTC notes that the scams were “often related to online shopping, romance scams, and supposed economic relief or income opportunities.” In short, financial insecurity and loneliness – two dreaded side effects of the pandemic.

The Takeaway

Social media users inspired most of the complaints in which a villain was identified. Romance scams are as old as the Internet itself – much, much older, obviously, but we’re talking about old in the technological sense. The Federal Bureau of Investigation has interesting material on this type of scam, including first-person accounts of scam victimhood.

Economic scams are also nothing new, of course, but the flavor of recent scam activities reflects the present day: Many scammers claim to be in the business of providing pandemic relief, or are multilevel marketing schemes that promise unrealistic levels of income just when unemployed people are at their most vulnerable.

As always, we know our readers aren’t taking part in anything as nefarious as what’s sketched out by the FTC in its latest Spotlight. But we still recommend that any company that uses social media platforms to do business should be thorough about managing even the faintest whiff of COVID-19-related or even COVID-19-adjacent marketing claims – and completely paranoid about account security. Apparently, scammers are hijacking account identities and launching their scams from within the hacked account.

So throw some extra Funyuns and cans of Fresca to the guys and gals in your tech department. You’re going to want them to operate at 100 percent.

NAD: Therapeutics Manufacturer Can’t Back Up Pain Claims

Avadim Health’s studies don’t jive; but why, NAD, why?!

Night Terrors

Anyone who has been tormented by nocturnal cramps or restless leg syndrome (RLS) can testify to how maddening these conditions can be. The discomfort caused by the cramping itself is compounded by long nights of interrupted sleep; some people who experience restless leg syndrome can feel like they’re going mad.

That’s why a company like Avadim Health can appear to be a godsend to people who suffer from RLS (and from the more quotidian, yet still aggravating, pain of arthritis). Avadim promotes two products – Theraworx Relief for Muscle Cramps and Spasm Foam, and Theraworx Relief for Joint Discomfort & Inflammation Foam – that make some pretty brave claims about pain reduction, including simple tags like “prevents cramps and spasms when used daily,” and more detailed boasts like “[i]n a research study including patients diagnosed with RLS, Theraworx Relief was shown to reduce symptoms commonly associated with and accompanying RLS, including muscle cramps and spasms.”

Inquiring Minds

But the tricky aspect of pain treatment is the role the mind can play in reducing discomfort. If a consumer purchases a product like either of Avadim’s offerings, will they convince themselves they feel better because they laid out the cash? Or because they desperately need to feel better? Or both?

National Advertising Division (NAD) case summaries are always worthwhile reads, although they can sometimes be … tantalizing. NAD’s look at the Theraworx claims, for instance, notes that “Avadim should demonstrate via competent and reliable scientific evidence that its [claims are valid] after controlling for other confounding factors like a placebo effect. … NAD carefully reviewed the studies submitted by Avadim … but determined that the evidence was not a good fit for such claims.” NAD concluded that “the advertiser did not provide a reasonable basis for such claims and recommended they be discontinued.”

The Takeaway

Based on this critique, NAD recommended that the claims (there are a lot of them) be discontinued.

In addition, NAD asked that the company take down its health care professional endorsements, noting that Theraworx “presented no survey evidence of healthcare professionals (or pharmacists) to show that a substantial portion of healthcare professionals recommend its products.”

Avadim will appeal all of NAD’s recommendations to the National Advertising Review Board.

Clean, Clean Wine (Doesn’t) Go to My Head

Cameron Diaz pitches “clean” vino, but what is she talking about?

She Has Her Rieslings

“Avaline! It’s here! It’s here! It’s finally here!” enthuses Tonight Show host Jimmy Fallon, in full talk-show-host mode. In this clip Fallon is, apparently, very, very, very excited over the arrival of Avaline, a new wine brand introduced by Cameron Diaz, who introduced the line to Fallon and his audience in July.

Pour Decision?

According to a Truth In Advertising Inc. (TINA) ad alert, Diaz is launching into dicey marketing territory the further she moves along in the clip. “There are 73 ingredients that are allowed to be put into the winemaking process,” Diaz continues. But it was hard for her and her partner to find wines that used less of those ingredients – “clean” wines, if you can parse out the word salad that follows.

Diaz (seems to?) claim that these clean wines make her and her partner “feel better” when they drink them. They want to share. So the next logical step? Bring “clean” wine to the hoi polloi. And Avaline was born.

The Takeaway

The problem, according to TINA, is that “clean” is whatever Diaz wants it to be. No one is saying that Diaz is being deceitful: From what we can gather, she’s simply saying that wine with fewer ingredients is “cleaner” than other wines. But what does “clean” mean to the average consumer? Do they understand her definition, or do they interpret it in a completely different manner?

TINA points out that there is no legal definition for what makes wine “clean.” Moreover, the term is problematic – here’s an interesting article on why the tag is being used, and how it may land wine brands in legal trouble.

There is such a thing as “organic wine”; because many wines – like Avaline, for instance – use sulfites as preservatives, they must stick to the more unwieldy term “made with organic grapes.” Sulfites rob most wines of one of the most popular ad tags of our era. And in rushes “clean” to take its place.

TINA is waiting to hear back from Avaline for more background on this campaign. But in any case, watch out for slippery, undefined terms like “clean” when you’re marketing food or beverage products, particularly if you don’t define how you are using the term to consumers. You may gain a little attention and approval in the short term, but you’re probably contributing to consumer confusion rather than dispelling it.


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