Date: Jan 19, 2012
A Lanham Act advertising case was challenged recently under the heightened pleading standard required in all civil cases by the Supreme Court's Twombly and Iqbal opinions. An apparent intent of this standard is to give defendants a better chance to rid themselves of questionable litigation before the door to expensive discovery opens.
The parties compete in testing urine for drugs. The primary challenged claims were in a billing letter that Defendant sent to physicians who bought its testing services and to the Medicare patients of those doctors.
The letter informed patients that they were not responsible for co-pay or deductible charges. Plaintiff alleged that statement was misleading, because it implied, falsely, that Medicare patients were subject to such charges.
On two Lanham Act elements, the complaint alleged merely that the representations in the billing letter (1) are "likely to deceive a substantial portion of the targeted customers" and (2) had "already, and will continue to, influence materially purchasing decisions to the extent that customers choose [Defendant's] services instead of [Plaintiff's]."
Defendant moved to dismiss the complaint for failure to state an actionable claim.
Defendant's motion was granted, without prejudice to amend. Some of the court's key findings based on the Twombly-Iqbal standard were:
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