Baseball Rooftop Club Promoter Faces Suit Over Internet Ads

This posting was written by William Zale, Editor of CCH Advertising Law Guide.

The proprietor of a “rooftop club” for viewing Chicago Cubs baseball games (Wrigley Done Right) stated Lanham Act claims of false advertising and false designation of origin against a promoter of competing venues (Ivy League Club and Wrigley Rooftop Club), the federal district court in Chicago has ruled.

False Advertising

An Internet advertisement that promoted the availability of services at the Ivy League club when it was under construction and not operating could constitute false advertising, the court held. From January 2008 until some time in 2009, the promoter allegedly advertised the availability of services at the Ivy League Club on its website, despite the fact that the facility was closed for renovation through the 2009 baseball season and lacked a license required for hosting patrons.

The promoter allegedly deceived consumers into booking reservations for inferior services by accepting reservations and later providing tickets at other facilities with less favorable viewing locations than the Ivy League Club’s.

The Ivy League Club allegedly booked a significant number of reservations as a result of these misleading advertisements, and the diversion of sales allegedly injured Wrigley Done Right’s business.

The promoter contended that construction delays did not amount to fraud and that website disclaimers were posted. However, the advertising and selling of seats at a nonoperating venue for a more than a year and a half went beyond mere “construction delay,” according to the court.

False Designation of Origin

The promoter’s advertising for the Wrigley Rooftop Club could constitute a false designation of origin, the court ruled.

The promoter and the Wrigley Rooftop Club allegedly sponsored an advertisement on the website ballparkrooftops.com featuring a photo of Wrigley Done Right’s building next to a link to the Wrigley Rooftop Club’s website. Wrigley Done Right allegedly was injured as a result of the misrepresentation because sales were diverted to the Wrigley Rooftop Club.

State Law

Claims under the Illinois Deceptive Trade Practices Act and Illinois Consumer Fraud Act would stand or fall based on the outcome of Lanham Act claims of false designation of origin and false advertising, the court added.

The July 12 opinion in Bluestar Management LLC v. Annex Club, LLC will be reported at CCH Advertising Law Guide ¶63,916

Further information about CCH Advertising Law Guide appears here on the CCH Online Store.

Google's Sponsored Links Not False Ads or Designations of Origin

This posting was written by William Zale, Editor of CCH Advertising Law Guide.

Google's publishing of “sponsored links” in response to an online search for a building materials seller's “Styrotrim” trademark could not constitute false advertising or false designations of origin, affiliation, connection, or association of a competitor with the seller in violation of the Lanham Act, the federal district court in Sacramento has ruled.

Ad Words Program

The seller challenged the use of “Styrotrim” as a suggested keyword in Google's AdWords program, through which advertisers bid for placement of sponsored links in keyword search results.

The seller contended that Google's placement of competitors above the seller’s business on results pages confused consumers into believing that competitors' products were preferable to the seller’s and, in essence, was a form of “bait and switch” advertising.

Lack of Direct Competition

Although Google might provide advertising support for others in the seller’s industry, Google did not directly sell, produce, or otherwise compete in the building materials market. Without a showing of direct competition, the seller failed to state a claim for false advertising under the Lanham Act, according to the court.

Even if a “sponsored link” might confuse a consumer, with several different sponsored links appearing on a page it was hardly likely that a consumer might believe each one was the true producer or origin of the Styrotrim product. As such, the seller failed to properly plead a false designation of origin.

Communications Decency Act Immunity

Under the Communications Decency Act, Google was an interactive computer service immune from common law claims including fraud. The seller argued that Google was exposed to liability as an “information content provider” because, through its keyword suggestion tool, Google in fact did participate in the content of advertisements.

Keyword suggestion, however, was a “neutral tool” that did nothing more than provide options that advertisers could adopt or reject, in the court's view.

The opinion in Jurin v. Google Inc. appears at CCH Advertising Law Guide ¶63,777.

Former Sales Director Can Pursue Claims for Misuse of His Name

This posting was written by William Zale, Editor of CCH Advertising Law Guide.

Joseph Krause—the former sales director of the Philadelphia Soul arena football team—can pursue claims for Lanham Act false designation of origin and state law misappropriation of name against the team and its part owner, rock musician Jon Bongiovi (a.k.a., Jon Bon Jovi), the federal district court in Philadelphia has ruled.

Krause alleged that the team’s record-breaking ticket sales were due to his favorable reputation in the sports and entertainment industry. Following the team’s 2008 national championship season, Krause was given a one-week notice of termination when the Arena Football League suspended its 2009 season.

E-Mail to Fans

After Krause’s termination, the team allegedly sent an e-mail to fans from Krause’s Philadelphia Soul e-mail address. The team allegedly sought to trade on Krause’s good name and reputation with the fan base and cause confusion as to Krause’s association with the unpopular decision to cancel the 2009 season and the resulting controversy over season ticket refunds.

Standing to Sue

The court held that Krause had standing to sue for a false designation of origin in violation of the Lanham Act. Although his damages were speculative, this was outweighed by factors supporting standing: the nature of the alleged injury (loss of reputation and goodwill among the public and Philadelphia fans), the directness of the injury from the false designation of the e-mail, Krause’s status as the most clearly identifiable party to bring an enforcement action, and the lack of risk of duplicative damages.

Use of Name, Likelihood of Confusion

Krause succeeded in alleging that his name was protectable mark that had secondary meaning in the sports and entertainment business. Krause relied on Lewis v. Marriott Int’l, Inc. (ED Pa. 2007), CCH Advertising Law Guide ¶62,815, in which the court held that a hotel chain’s use of a chef’s name to promote wedding packages at a Philadelphia hotel could constitute Lanham Act false advertising.

Although Krause did not allege that his name was specifically used in advertisements to promote the Philadelphia soul, he was did not have to make allegations regarding advertising in order to establish false designation of origin, according to the court.

The e-mail at issue contained the line “From: Joe Krause [mailto:jkrause@philadelphiasoul.com].” Krause alleged that the Philadelphia Soul sought to cause confusion among fans as to Krause’s association with the season’s cancellation and that the e-mail actually deceived, or tended to deceive, members of the public. These allegations satisfied the likelihood of confusion element of a false designation of origin claim, the court determined.

Misappropriation of Name

Krause also asserted a state law claim for the tort of invasion of privacy by misappropriation of name, a common law cause of action recognized by the Pennsylvania Supreme Court. Krause adequately pled that the team and Bongiovi sought to appropriate the value of his name by benefiting from his goodwill and reputation with the team’s fans. No pleading of secondary meaning was required to sustain the misappropriation of name claim, the court noted.

The June 4 opinion in AFL Football LLC v. Krause will be reported at Advertising Law Guide ¶63,434.