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Showing Irreparable Harm

In a March 2015 teleconference sponsored by the ABA entitled Irreparable Harm in Lanham Act False Advertising Litigation, three distinguished panel members (Roger Colaizzi of Venable, David Bernstein of Debevoise & Plimpton, and Rebecca Tushnet of Georgetown University) discussed several recent court cases and the implications for future false advertising cases. A key takeaway was that where once there was a presumption of irreparable harm in Lanham Act litigation—a necessary condition for obtaining a preliminary injunction—recent court decisions have challenged that assumption. Now it is more likely that courts will require evidence of damage to reputation or image (in addition to showing a likelihood of success on the merits) before granting a preliminary injunction. Simply showing that the plaintiff would lose sales were the alleged false advertising (or trademark infringement) to continue is no longer sufficient since that type of injury can be compensated by money damages.

So what is a plaintiff to do? To be effective, a preliminary injunction hearing needs happen quickly—as soon as possible after the advertising debuts. That means that time is of the essence and evidence of irreparable harm would need to be assembled in a matter of weeks.

Actually, it’s not that difficult or unusual a task. For years, market research has measured the impact of advertising on consumer perceptions. We show ads to people and ask questions to measure what was communicated by the ad and how it affects consumer perceptions of the product being advertised. It’s the same idea here except that the focus is not on the product being advertised but on the product claiming to be harmed.

Measuring the impact on reputation or image is done by asking survey respondents to rate the plaintiff’s brand on a series of attributes such as “is a high quality product” or “is a brand I trust.” Other attributes would be included that focused on specific product features. When that measure is taken before and after exposure to the offending ad, the difference measures the degree of harm to brand’s image. Naturally, a control group that sees an ad without the alleged false or misleading statements is needed so that any demand artifacts of the survey can be accounted for. And you would want to ask respondents to rate several brands to avoid their figuring out what the purpose of the survey was. Alternatively, the pre-exposure measurement could be dropped and the ratings taken only after exposure to the ad. This is termed an “after-only” design. The specific experimental design used would depend on the products, the appropriate respondents and the type of harm alleged.

An important benefit to this type of research and experimental design is that it can be quickly and easily be implemented over the Internet. This means that that the preliminary injunction hearing can have real data to support the “irreparable harm” argument.

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