New Discussion: Risks of Comparative Advertising and Establishment Claims, part 1!

Risks 01

An advertisement that specifically references a competitor’s goods or services can certainly be an effective promotional message. By highlighting certain benefits of the advertised brand or specific deficiencies of the competing product, such ads can persuade consumers by comparing a specific feature that is likely to be important to the consumer’s purchasing decision at the point of sale. But, due to the fact that such advertisements specifically target a particular competing business or brand, the accuracy of such representations (either explicitly conveyed or suggested) is likely to be carefully scrutinized.

A number of lawsuits are filed every year asserting liability in connection with comparative advertisements. In one recently filed case, for example, H&R Block filed a complaint in Missouri federal court against Intuit, Inc., the provider of the do-it-yourself tax preparation software Turbo Tax®. The complaint includes allegations of unfair competition and trademark infringement arising out of Turbo Tax® television ads which allegedly include an unauthorized display of H&R Block’s trademark and false representations as to the quality of H&R Block’s tax preparation services. (Case No. 13-cv-00072). Specifically, the complaint alleges that the television ads suggest that Turbo Tax® is used and trusted by more than all other office tax preparation services combined, that H&R Block hires seasonal tax preparers with no experience and that such employees are not adequately trained or credentialed. Although these claims have not yet been decided, Intuit’s alleged comparative ads did not go unnoticed by H&R Block and have resulted in potential legal exposure.
In assessing potential risks associated with comparative ads, one thing advertisers should keep in mind is that different types of comparative statements can be evaluated differently for purposes of determining liability. For instance, courts generally treat general “superiority claims” (i.e., “Product X is better than Product Y”) differently than “establishment claims” which usually compare products with reference to some kind of test or evaluation (e.g., “tests show that Product X is better than Product Y,” or “Product X outperforms Product Y on a particular industry standard”).

George S. Pavlik

Husch Blackwell LLP
George Pavlik is an attorney in the Chicago, IL office of the law firm Husch Blackwell LLP. He works in the firm’s intellectual property department and routinely assists clients in matters involving patents, trademarks, copyrights and false advertising.
The opinions expressed above are those of the author and do not necessarily reflect the views of Husch Blackwell, its clients or any of its or their respective affiliates. This article is for general information purposes only and is not intended to be and should not be taken as legal advice.

About Nate Marks

We live and work in a world of visual images.
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