PRODUCT LIABILITY
Mass Tort
Plaintiff-Attorney
Advertising
Protected or
Prosecutable?
By Eric E. Hudson
and Kyle R. Cummins
Under the right
The barrage of plaintiff-­attorney advertisements soliciting plaintiffs for product liability litigation often generates
calls by in-house counsel, board members, and other company decision makers to find out what can be done to stop
circumstances the
Lanham Act may be
a good avenue for
challenging mass
tort advertisements.
them. Although certain categories of advertising are constitutionally protected as
“free speech,” developing precedent shows
that attorney advertising may be susceptible to legal challenges under the Lanham
Act. These claims have not been tested in
court, but they present a legitimate possibility for manufacturers to mount an
offensive attack against certain advertisements. This article provides an overview
of the constitutional protections afforded
attorney advertising in the United States,
followed by an overview of new precedent
under the Lanham Act and how it may be
applied to combat certain advertising.
Constitutional Protections
for Attorney Advertising
Attorney advertising in the United States
is well established as constitutionally
protected commercial speech. In March
1975—when many state bar associations
prohibited any form of attorney advertising—two lawyers in Arizona defied their
state bar association’s regulation prohibiting any form of attorney advertising and
placed a newspaper ad that read: “do you
need a lawyer? legal services at very reasonable fees.” Bates v. State Bar of Ariz.,
433 U.S. 350, 385 (1977). When the Arizona
state bar suspended the lawyers for placing the ad, they challenged the disciplinary
rule, paving the way for lawyer advertising
to become protected free speech under the
First Amendment.
The case, Bates v. State Bar of Arizona,
reached the Supreme Court, which found
outright bans on advertising such as that
imposed by the Arizona state bar to be
unconstitutional. Id. at 383. The Court specifically rejected the premise that advertising eroded “true professionalism” in the
legal field and determined instead that it
was protected commercial speech. Id. at
368. As “commercial speech,” attorney
advertising became subject to a four-part
test for evaluating whether regulations
limiting such speech are constitutional:
Eric E. Hudson is a member of Butler Snow LLP in the firm’s Memphis, Tennessee, office. He focuses his
practice on mass torts, drug and medical device litigation, and complex commercial litigation, and he is a
member of the DRI Product Liability and Drug and Medical Device Committees. Kyle R. Cummins is an associate with Butler Snow LLP in the firm’s Memphis, Tennessee, office. He practices in the area of pharmaceutical and medical device litigation and mass torts.
■ © 2016 DRI. All rights reserved.
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PRODUCT LIABILITY
(1) is the speech lawful and not misleading; (2) is the government interest in regulating the speech substantial; (3) does the
regulation actually advance the government interest; and (4) if the interest could
be achieved by a more limited restriction
on commercial speech, the limitation fails.
Bates was the end of absolute bans on attorney advertising.
Given the unlikelihood
that state bar associations
will pursue enforcement
actions against attorney
advertising, challenges by
product manufacturers
must instead be
made under common
law theories such as
defamation and business
torts or statutory claims
under the Lanham Act.
It didn’t take long for attorney advertising to develop into a vehicle for mass torts,
even in the 1980s, with an attorney’s advertisement in 36 Ohio newspapers soliciting
women who used the Dalkon Shield Intrauterine Device. Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio,
471 U.S. 626, 630 (1985). This advertisement contained a drawing of the device,
asked the question “did you use this IUD?”
and claimed that the device was “alleged
to have caused serious pelvic infections
resulting in hospitalizations, tubal damage, infertility, and hysterectomies.” Id.
at 631. The ad offered legal representation,
noting that “[i]f there is no recovery, no
legal fees are owed by our clients.” Id. The
Ohio Office of Disciplinary Counsel found
such advertising was not sufficiently “dig-
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nified” or limited in scope to permissible
information under its rules prohibiting
illustrations and self-­recommendation.
Id. at 632. It also found that the ad violated a rule requiring that contingency-­fee
rates should disclose whether the percentages were computed before or after costs
and expenses. Id. The Supreme Court held
that—except with regard to the misleading
contingency fee statement—the advertisement’s statements and illustration regarding the IUD were not false or misleading
and were entitled to First Amendment protection. Id. at 641.
Regulatory Restrictions on
Attorney Advertising
The American Bar Association’s Model
Rules of Professional Conduct (Model
Rules) serve as a standard for state bar
associations, and each of the 50 states and
the District of Columbia have adopted some
variation of the Model Rules. See Chronological List of States Adopting Model Rules,
Am. Bar Ass’n, http://www.americanbar.org/.
The initial ethics rules, published in 1908,
sought to compile a collection of norms for
all attorney conduct. Colin Croft, Reconceptualizing American Legal Professionalism:
A Proposal for Deliberative Moral Community, 67 N.Y.U. L. Rev. 1256, 1306 (1992).
Solicitation by advertisement was deemed
“unprofessional,” and all forms of “self-­
laudation” were “intolerable,” “def[ying]
the traditions and lower[ing] the tone
of our high calling.” Final Report of the
Committee on Code of Professional Ethics,
Canon 27, available at http://www.americanbar.
org. Indeed, the best advertisement was
“the establishment of a well-merited reputation for professional capacity and fidelity to trust.” Id.
The ABA Model Rules published in
1983—after Bates—permitted attorney
advertising through various publication
modes, including television. Model Rules
of Prof’l Conduct R. 7.2 (1983). The 1983
Model Rules also put specific limits on
lawyers’ direct solicitation of prospective
clients and on lawyers’ statements about
certification fields of practice. Model Rules
of Prof’l Conduct R. 7.3, 7.4 (1983). But
several Supreme Court rulings striking
down state rules similar to the Model Rules
spurred amendments. See Shapero v. Ky.
State Bar, 486 U.S. 466 (1988) (striking
down Kentucky’s rule regarding direct
contact with prospective clients that was
identical to the model rule); Peel v. Attorney Registration & Disciplinary Comm’n,
496 U.S. 91 (1990) (holding that states may
not impose restrictions that burden a lawyer’s truthful statement that he or she is
a specialist, certified by an organization).
Further amendments resulted in the key
limitation that the attorney advertising be
shown to be false or misleading speech.
Model Rules of Prof’l Conduct R. 7.1. Under
the Model Rules, an advertisement is “false
or misleading if it contains a material misrepresentation of fact or law, or omits a fact
necessary to make the statement considered as a whole not materially misleading.”
Id. The result of the dilution of restrictions on advertising in the Model Rules
after Bates is that most attorney advertising soliciting plaintiffs for mass tort litigation is permitted by state bar associations.
Challenging False or
Misleading Advertising
Given the unlikelihood that state bar associations will pursue enforcement actions
against attorney advertising, challenges
by product manufacturers must instead
be made under common law theories such
as defamation and business torts or statutory claims under the Lanham Act. These
claims focus not on statements about the
lawyer or the lawyer’s services, but on the
content of the advertising that relates to a
company’s products and the effect of the
advertisement on those products.
The most straightforward example of
advertising that is “false or misleading”
and susceptible to challenge is an ad that
is obviously false. For example, an ad that
claims a drug or medical device has been
recalled by the FDA, when in fact it has not
is false and subject to immediate challenge.
Such ads are usually addressed through
cease-and-desist letters without the need
for litigation.
Other examples of obvious falsity
include misstatements about the product
itself. For example, in 2011, Zimmer, Inc.
sued Pulaski & Middleman, LLC—infamous for its “1-800-BAD-DRUG” ads—for
“making false, misleading and defamatory
statements about Zimmer and [its] NexGen® Knee System” in television advertisements. Complaint ¶¶ 53–58, Zimmer, Inc. v.
Kresch/Oliver PLLC et al., No. 11CV00063,
2011 WL 767056 (N.D. Ind. Feb. 26, 2011).
See also Erin Fuchs, Knee Device Maker
Sues Plaintiffs Firm Over Ads, Law360 (Nov.
7, 2011), http://www.law360.com/. Zimmer
alleged that the Pulaski Firm’s ad was false
or misleading by saying, “Reports show
the ZIMMER NEXGEN KNEE IMPLANT
MAY HAVE A FAILURE RATE OF 9 percent.” Complaint, supra, ¶ 54, n.30. Zimmer
sued, alleging defamation, tortious interference with business relationships, false
advertising under the Lanham Act, product
disparagement, and several trademark theories. See id. ¶ 70–104. The parties reached
a confidential settlement, summarized by
Zimmer in a public statement that the law
firms “retracted the misleading claims in
their advertisements” and that the firms
would run corrective statements on their
respective websites for six months. Zimmer’s statement also indicated that the law
firms either paid a monetary settlement,
issued a retraction, or did both. Correcting the Record: Zimmer’s Lawsuit, ZimmerFacts, http://facts.zimmer.com/background/
index.html (last visited Jan. 29, 2016). Pulaski
& Middleman’s statement on its website
admitted that it had “determined that the
sources we previously relied upon to make
claims about the Zimmer NexGen Knee
System do not support the statements or
implication” in the ads. Alex Nussbaum &
David Voreacos, Artificial-­Knee Suits Targeting Zimmer Haunt Lawyers, Bloomberg
(Aug. 9, 2011), http://www.bloomberg.com.
While the Zimmer example is informative when an attorney advertisement
obviously misstates factual information
about a product, the more difficult question
arises when an advertisement is not per se
false, but is arguably misleading. Although
claims for defamation and business torts
remain options, recent precedent under the
Lanham Act suggests that product manufacturers may have a better avenue to combat false or misleading advertising.
Lanham Act Developments and
Challenges to Attorney Advertising
The Lanham Act provides a federal cause of
action akin to unfair competition claims. It
seeks to protect commercial interests—lost
sales and damage to business reputation.
The act’s provision regarding false advertising states:
(1) any person who, on or in connection with any goods or services… uses
in commerce any word, term, name,
symbol, or device, or any combination
thereof, or any false or misleading representation of fact which—
…
(B) in commercial advertising or
promotion, misrepresents the nature,
characteristics, qualities, or geographic
origin of another person’s goods services or commercial activities, shall be
liable in a civil action by any person
who believes that he or she is likely to be
damaged by such act.
Lanham Act §43(a), 60 Stat. 441, codified at
15 U.S.C. §1125(a).
Traditionally, a false-­advertising claim
under the Lanham Act arises when “one
competito[r] directly injur[es] another by
making false statements about his own
goods [or the competitor’s goods] thus
inducing customers to switch.” Lexmark
Int’l, Inc. v. Static Control Components,
Inc., 134 S. Ct. 1377, 1393 (2014) (internal
quotation marks and citations omitted).
The situation presented here is factually
different, yet based on the same underlying principle: an attorney advertisement
makes a false or misleading statement
about the manufacturer’s goods, inducing
customers to refrain from using a product
or switch to a different product. Indeed,
“although diversion of sales to a direct
competitor may be the paradigmatic direct
injury from false advertising, it is not the
only type of injury cognizable under” the
Lanham Act’s false-­advertising provision.
Id. This underscores that any Lanham Act
false-­advertising claim must be framed
around economics—the manufacturer is
losing business on the product because of
the defendant law firm’s false advertising
about that product.
Standing
The initial hurdle under the Lanham Act
is standing to sue. Federal courts are prohibited from hearing cases in which the
plaintiff has not “suffered or been imminently threatened with a concrete and particularized ‘injury in fact’” that is traceable
to the defendant’s action. Id. at 1386 (citing
Lujan v. Defenders of Wildlife, 504 U.S. 555,
560 (1992)). In 2014, the Supreme Court,
in Lexmark International, Inc. v. Static
Control Components, Inc., resolved a circuit split pertaining to the proper test for
standing under the Lanham Act. 134 S. Ct.
1377 (2014).
Before Lexmark, a widely used limitation on Lanham Act claims was the “direct-­
competitor test,” which required that a
plaintiff be in direct competition with the
defendant in order to have standing. Under
The Lanham Act p rovides
a federal cause of action
akin to unfair competition
claims. It seeks to protect
commercial interests—
lost sales and damage
to business reputation.
this test, a product manufacturer would not
have standing to sue a law firm that would
not be in competition with it. Lexmark
rejected this approach, concluding that
“a rule categorically prohibiting all suits
by noncompetitors would read too much
into the Act’s reference to ‘unfair competition.’” Id. at 1392 (citing 11 U.S.C. §1127).
The Court noted that when the Lanham
Act was adopted, noncompetitors could
sue one another under the common law
tort of unfair competition. Thus, it would
be “a mistake to infer that because the Lanham Act treats false advertising as a form
of unfair competition, it can protect only
the false-­advertiser’s direct competitors.”
Id. at 1392.
The Lexmark Court held that when a federal statute—such as the Lanham Act—creates a cause of action, “a direct application
of the zone-of-interests test and the proximate-cause requirement supplies the relevant limits on who may sue.” Id. at 1391. To
be “within the zone of interests in a suit for
false advertising under [the Lanham Act],
a plaintiff must allege an injury to a commercial interest in reputation or sales.” Id.
at 1390. Plaintiffs must also show that their
injuries are proximately caused by violaFor The Defense November 2016 41
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PRODUCT LIABILITY
tion of the statute. Therefore, a manufacturer would have to show “economic or
reputational injury flowing directly from
the deception wrought by the defendant’s
advertising; and that that occurs when deception of consumers causes them to withhold trade from the plaintiff.” Id. at 1391.
While noncompetitors do not lack
standing per se, the Lexmark Court noted
Presuming that
the Supreme Court’s
ruling in Lexmark gives
manufacturers standing
to pursue a Lanham Act
claim for false advertising,
the manufacturer must
still prove the elements
of the claim itself.
that “a plaintiff who does not compete
with the defendant will often have a harder
time establishing proximate causation.”
Id. at 1392. This makes sense. It is easier
for courts to infer proximate causation for
standing purposes in a traditional Lanham
Act false-­advertising claim if one company’s statements lead consumers to abandon a competitor’s product for its own. In
a hypothetical suit by a product manufacturer against a law firm, the chain of causation is attenuated because the purpose of
a law firm’s advertisement is not primarily
to deter consumers from using a product
or ingesting a medicine. Thus, to meet Lexmark’s principle of standing, a manufacturing defendant must demonstrate a clear
chain between a false or misleading statement in an advertisement and lost sales as
a result of that statement.
Nevertheless, Lexmark stands for the
proposition that “whether a plaintiff has
standing to bring a false advertising claim
under the Lanham Act does not turn on
whether the plaintiff is a competitor with
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the defendant, but instead requires a plaintiff to allege injury to a commercial interest and proximate cause.” Luxul Tech. Inc.
v. Nectarlux, LLC, 78 F. Supp. 3d 1156, 1170
(N.D. Cal. 2015).
Elements of a Claim
Presuming that the Supreme Court’s ruling in Lexmark gives manufacturers standing to pursue a Lanham Act claim for false
advertising, the manufacturer must still
prove the elements of the claim itself. Generally, the plaintiff in a Lanham Act case
must prove five elements:
(1) the defendant has made false or
misleading statements of fact concerning his own product or another’s;
(2) the statement actually or tends to
deceive a substantial portion of the
intended audience; (3) the statement
is material in that it will likely influence the deceived consumer’s purchasing decisions; (4) the advertisements
were introduced into interstate commerce; and (5) there is some causal link
between the challenged statements and
harm to the plaintiff.
Fed. Exp. Corp. v. United Parcel Serv., Inc.,
765 F. Supp. 2d 1011, 1016–17 (W.D. Tenn.
2010) (quoting Am. Council of Certified
Podiatric Physicians & Surgeons v. Am. Bd.
of Podiatric Surgery, 185 F.3d 606, 613 (6th
Cir. 1999)).
First and foremost, the focus of the claim
must be that losses are suffered because a
false or misleading statement influenced
a consumer’s purchasing decision. The
fact that the advertisements result in an
increase in litigation is not relevant to any
claim under the Lanham Act. An actionable statement in an advertisement “must
be based upon a statement of fact, not of
opinion,” Am. Council of Certified Podiatric Physicians & Surgeons, 185 F.3d at 614.
And a plaintiff must show that the advertisement “is literally false or that it is true
yet misleading or confusing.” Id. If a statement is literally false, a plaintiff need not
show actual deception of consumers; if a
statement is literally true yet misleading,
or too ambiguous to support a finding of
literal falsity, the plaintiff must show that
consumers’ decisions to purchase were
actually influenced. Id. See also Osmose,
Inc. v. Viance, LLC, 612 F.3d 1298, 1318–19
(11th Cir. 2010).
A less stringent burden of causation
applies to a claim for injunctive relief,
in which a manufacturer plaintiff need
only show a tendency of the statement
to deceive, rather than actual consumer
deception. Am. Council of Certified Podiatric Physicians & Surgeons, 185 F.3d at
618 (citing Max Daetwyler Corp. v. Input
Graphics, Inc., 608 F. Supp. 1549, 1551
(E.D. Penn. 1985)). This is an important
distinction because in many instances the
primary goal in this sort of case would
be to prevent further deceptive advertising. Courts are generally unclear about
what type of evidence satisfies this lower
“tendency-­to-­deceive” standard. Although
consumer surveys, discussed below, are
not required, letters from a few consumers are not sufficient. See Herman Miller,
Inc. v. Palazzetti Imports & Exports, Inc.,
270 F.3d 298, 323 (6th Cir. 2001). Courts
also are quick to point out that a plaintiff still needs some legitimate showing
that a statement likely confuses consumers. See, e.g., Decorative Ctr. of Houston,
L.P. v. Direct Response Publ’ns, Inc., 264
F. Supp. 2d 535, 555 (S.D. Tex. 2003). Furthermore, “puffery” falls into its own category. As explained elsewhere, “[p]uffery
is exaggerated advertising, blustering, and
boasting upon which no reasonable buyer
would rely and is not actionable under”
the Lanham Act. Time Warner Cable, Inc.
v. DIRECTV, Inc., 497 F. 3d 144, 160 (2d
Cir. 2007) (quoting United Indus. Corp. v.
Clorox Co., 140 F.3d 1175, 1180 (8th Cir.
1998)). The determination of whether a
statement is ambiguous “is a question of
law, while determining whether facts exist
so as to make a statement true is a question of fact.” Fed. Exp. Corp., 765 F. Supp.
2d at 1017.
In the context of a fairly well-­recognized
series of advertisements soliciting pharmaceutical plaintiffs, the word “bad” next to
“drug” in “1-800-BAD-DRUG” would be
evaluated in context to determine whether
it misleads consumers. Since the phrase
“bad drug” may be “too ambiguous to
support a finding of literal falsity,” a product manufacturer suing a noncompetitor
law firm would likely have to present “evidence of the public’s reaction through consumer surveys” showing “that a significant
portion of the consumer population was
deceived.” Am. Council of Certified Podi-
PRODUCT LIABILITY
atric Physicians & Surgeons, 185 F.3d at
616. In this context a survey would have
to be designed in recognition of the fact
that although the advertising is directed at
the general public, prescription pharmaceuticals are only available for “purchase”
through prescribing physicians. Regardless, evidence that a single physician or
patient was deceived by drug or device
(1) the ‘universe’ was properly defined,
(2) a representative sample of that universe was selected, (3) the questions to
be asked of interviewees were framed in
a clear, precise and non-­leading manner,
(4) sound interview procedures were followed by competent interviewers who
had no knowledge of the litigation or
the purpose for which the survey was
conducted, (5) the data gathered was
accurately reported, (6) the data was
analyzed in accordance with accepted
After proving that a
statistical principles and (7) objectivity
of the entire process was assured.
statement was misleading
Smith v. Wal-Mart Stores, Inc., 537 F. Supp.
2d 1302, 1322 (N.D. Ga. 2008) (quoting Toys
and deceived consumers,
R Us, Inc. v. Canarsie Kiddie Shop, 559 F.
Supp. 1189, 1205 (E.D.N.Y. 1983)).
a plaintiff must overcome
The failure to satisfy any one of these criteria affects a court’s determination that
yet another hurdle: proving
confusion or deception has occurred. Id.
Therefore, even after retaining an expert
that the false advertising
and conducting a survey purporting to
show deception, a manufacturer must
caused lost sales.
defend the survey’s reliability.
After proving that a statement was misleading and deceived consumers, a plainadvertising and chose not to purchase the tiff must overcome yet another hurdle:
product is likely not sufficient, and con- proving that the false advertising caused
sumer surveys become necessary.
lost sales. See Nellcor Puritan Bennett
These surveys, however, are both time-­ LLC v. Cas. Med. Sys., Inc., 11 F. Supp.
consuming and expensive. They must be 3d 861, 881–82 (E.D. Mich. 2014). But
properly conducted and show statistically again, the standard of evidence necessignificant confusion or deception. More- sary for injunctive relief may be lower;
over, the proponent of a consumer sur- courts recognize that a plaintiff seekvey must show that the survey rests on a ing an injunction is often “still at a stage
reliable foundation—in Daubert fashion. where substantial uncertainty exists as
For example,
to the extent of ‘business harm’ being
[t]he evidentiary value of a survey inflicted by the false advertising.” Balance
depends on its underlying objectivity Dynamics Corp. v. Schmitt Indus., Inc., 204
as determined through many factors, F.3d 683, 691–92 (6th Cir. 2000). Regardsuch as ‘whether [the survey] is prop- less, even if a manufacturer demonstrated
erly ‘filtered’ to screen out those who proximate causation sufficient for standgot no message from the advertisement, ing, “false advertising under the Lanwhether the questions are directed to the ham Act requires, among other things,
real issues, and whether the questions a showing of both an injury and a causal
are leading or suggestive.
link between the injury and the allegNovartis Consumer Health, Inc. v. Johnson edly false advertising.” Air Turbine Tech.,
& Johnson-­Merck Consumer Pharms. Co., Inc. v. Atlas Copco AB, 410 F.3d 701, 709
290 F. 3d 578, 591 (3d Cir. 2002) (quoting (Fed. Cir. 2005). In proving harm, a prodJohnson & Johnson-­Merck Pharm. Co. v. uct manufacturer must focus on the prodSmithkline Beecham Corp., 960 F.2d 294, uct. Potential liability from a new mass
300 (2d Cir. 1992)).
tort plaintiff is not the injury at issue; it
Other courts rely on several factors in is the attorney advertisement’s harm on
determining the reliability of a survey, the manufacturer’s commercial interest in
looking to whether
the product that the Lanham Act protects.
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Limits
A product manufacturer will face several
hurdles in bringing this type of Lanham
Act claim. First, it must prove its standing
to bring the claim—that it comes within
the zone of interests of the statute and
that its injuries were proximately caused
by the misrepresentations. Although the
Supreme Court’s 2014 decision in Lexmark
indicates that noncompetitors may bring
claims under the act, lower courts have
not yet considered the standing of noncompetitors that are in different industries
altogether. Second, manufacturers must
prove all of the elements of the Lanham
Act claim, including deception of consumers and reliance.
Conclusion
The First Amendment’s protection of commercial speech allows plaintiff law firms
to solicit clients through advertisements
that are not false or misleading, and states’
rules of professional responsibility generally only prohibit false or misleading
statements by an attorney. The Lanham
Act and other common law defamation
causes of action may be available, but their
proof requirements are strenuous. While
the Supreme Court’s Lexmark decision
suggests that Lanham Act claims may be
available against plaintiff law firms, those
claims have not been tested. Even if lower
courts apply Lexmark to permit Lanham
Act claims by manufacturers against plaintiff firms, manufacturers still face an uphill
battle combating advertisements. Proving
the likelihood of deception through consumer surveys can be an expensive and
timely process, and even injunctive relief
requires some showing of likely deception.
Surveys are not a requirement for injunctive relief, but a plaintiff still needs some
evidence of a tendency to deceive.
Nonetheless, under the right circumstances the Lanham Act may be a good
avenue for challenging mass tort advertisements: “[t]o invoke the Lanham Act’s
cause of action for false advertising, a
plaintiff must plead (and ultimately prove)
an injury to a commercial interest in sales
or business reputation proximately caused
by the defendant’s misrepresentations.”
Lexmark Int’l, Inc. v. Static Control Components, Inc., 134 S. Ct. 1377, 1395 (2014).