FTC Sued Prevagen Over Representation Of Placebo Results

FTC sued Prevagen

The FTC sued Prevagen’s marketers. Charge: Unsubstantiated marketing. Is the FTC’s claim meritless? Prevagen says yes. So, they’re fighting back.

The case serves as a reminder for dietary supplement marketers: Make sure your promotional materials are in line with FTC compliance standards!

Federal Trade Commission (FTC) to Quincy Bioscience (Prevagen Marketers): Your Brain Supplement Marketing Is Misleading!

Who is suing who? The Federal Trade Commission, alongside the New York Attorney General’s office, is suing Quincy Bioscience (“Quincy”) — marketers of Prevagen.

Why is the FTC suing Prevagen’s Marketers? The FTC regularly penalizes companies for promoting questionable findings. But this case is a bit different. The commission objects to how Quincy presented information, not the veracity of the study from which the information came. Specifically, the FTC condemned Quincy’s failure to disclose near identical results for both placebo and active participants.

How does Prevagen feel about the lawsuit? Often, companies caught in an FTC web lick wounds, cut losses (and a check), and call it a day. But Quincy is swinging back. The supplement marketer feels the FTC has overstepped its bounds and is forcing unfair scientific interpretations down the throats of small businesses.

The Curious Case of the Jellyfish Protein

A jellyfish protein — and active ingredient in Prevagen — researches have used apoaequorin since the 1960s in calcium studies. But newer — arguably fringe — research suggests the substance may enhance memory function.

But, like many touted supplements — (omega-3’s come to mind) — the medical community’s jury is still hanging outside the courtroom. To wit, the American Pharmacists Association summarizes its stance thusly: “Human data on apoaequorin are limited to small, company-sponsored trials that do not meet expected scientific standards.”

Marketing and Science: An Uneasy Partnership

The intersection of science and marketing is riddled with potholes. On one hand, dangerous products shouldn’t land on shelves, which requires a certain amount of oversight. However, mixing scientific studies with promotional materials can be a messy legal recipe. Why? Because science is not a monolith; a singular idea. Scientists don’t always agree. Which raises the question: Should judges be determining the proper way to present scientific findings?

This suit is unique because the FTC and AG aren’t questioning a study’s veracity, which is the norm in “unsubstantiated claim” cases. Instead, commissioners contend that Quincy failed to present the results adequately; (specifically, the near similar results for placebo and dosed participants). To put it another way, the FTC doesn’t think Quincy is providing “reliable evidence of a treatment effect.”

The FTC’s Rule About Scientific Support

You may be wondering: “Why can the FTC sue over some scientific studies but not others?” And that’s the question Quincy wants people to ask. But is it the right question?

Quincy insists the lawsuit is subjectively rooted, and therefore meritless. In a statement the company argued:

“Quincy has amassed a large body of evidence that Prevagen improves memory and supports healthy brain function. This evidence includes preclinical rat studies, canine studies, human clinical studies, and, most importantly, randomized, double-blind, placebo-controlled human clinical testing. This type of testing has long been acknowledged by both the FTC and the FDA to be the ‘gold standard’ for scientific evidence.

“The FTC does not allege that Quincy’s principal clinical study fails to meet the FTC’s and FDA’s own definition of ‘gold standard,’ nor does the FTC allege that the study was poorly designed or inappropriately conducted, or that it failed to rely on scientifically-validated measures.

“The sole dispute rests on the interpretation and analysis of the data, with the regulators attempting to hold the company to a standard that is unreasonable, scientifically debatable, and legally invalid. Their experts simply disagree with ours over how to interpret the study results. The FTC should not be the arbiter in matters of scientific debate. We are proud of the work we have done to support Prevagen’s effects and believe our large body of evidence clearly satisfies the longstanding standard to support such claims.”

This squabble over semantics may prove to be the crux of the case. Quincy could win by convincingly framing the FTC’s argument as scientific interpretation, as opposed to objective oversight. But is an interpretational variance truly the problem?

Scientific method convention stands: If a control group’s results aren’t statistically different than “activated” participants’, then it’s back to the lab to form a new hypothesis. The FTC will undoubtedly argue something to this effect. But, hey, you never know; a sympathetic judge could see it Quincy’s way.

Lame-Duck FTC Means Ruling Should Be Vacated?

Quincy’s also upset that only two commissioners voted on the action. In a statement, the company characterized the suit as “another example of government overreach and regulators extinguishing innovation by imposing arbitrary new rules on small businesses like ours.” Quincy also accused the agency of being “short-staffed and lame-duck.”

FTC Sued Prevagen And They’re Not Backing Down

The FTC and AG are standing firm in their decision. Jessica Rich, an agency director, chastised, “The marketers of Prevagen preyed on the fears of older consumers experiencing age-related memory loss. But one critical thing these marketers forgot is that their claims need to be backed up by real scientific evidence.”

Warning Letter Dates Back To 2012

Was the suit a shock to Quincy? Maybe not. According to reports, the Commission sent the company a warning letter in 2012. Which just goes to show: Don’t assume you’re in the clear if nothing ever came of that FTC caution from years ago.

The FTC Keeps A Close Eye On Dietary Supplement Marketers

The FTC’s Prevagen censure comes as little surprise. Not only are the ads ubiquitous (in certain regions), but they appeal to senior citizens. The AG remonstrated, “It’s particularly unacceptable that this company has targeted vulnerable citizens like seniors in its advertising for a product that costs more than a week’s groceries, but provides none of the health benefits that it claims.”

Yes, The FTC Wins Dietary Supplement Lawsuits – A Lot

This post isn’t a case-merit analysis. It’s still early stages; both sides have reasonable arguments; the devil will be in the litigatory details.

However, as attorneys who work with dietary supplement marketers and keep abreast of industry happenings, we wanted to point out a small curiosity in Quincy’s statement. It reads:

“The FTC has already brought three similar cases against three other companies in which the Commission tried to impose its own rigid interpretation of a company’s scientific evidence to prohibit truthful, non-misleading claims. In each case, the FTC lost.”

How did you interpret that statement? Did you walk away thinking the FTC lost every deceptive marketing case involving a nootropic? Not the case. For example, in 2015, the Commission went head-to-head with the folks behind Procera AVH, a product promising to “restore memory loss and improve brain function.” Originally, the court slapped a $150 million judgment on the supplement distributors, but the FTC agreed to a final payout of $1.4 million to satisfy the censure.

We point this out not to question Quincy, but to warn dietary supplement marketers: The FTC does prevail…often. Don’t be complacent when it comes to advertising compliance.

Connect With An FTC Attorney

Being investigated by the FTC? Have questions about advertising and marketing compliance? We’re here to help.

Blacklisting Alibaba: What Does It Mean For Online Sellers?

Picture of Alibaba marketing material to accompany blog post about blacklisting Alibaba
The USTR finally got around to blacklisting Alibaba.

That’s right, Alibaba’s Taobao flea-market boomeranged back onto the U.S. Trade Representative’s Notorious Markets List, a Scarlet-A register of websites and marketplaces accused of cozying up to counterfeiters.

Is the news a shock? Not really. Capitol Hill has been grumbling — loudly — about the site’s perceived piracy problems for years. (Actually, this is the second time Alibaba made the list.)

Alibaba: We Do A Lot To Fight Counterfeiting

Predictably, Alibaba isn’t thrilled. A company president admonished:

“We are far more effective and advanced in [intellectual property rights] protection than when the USTR took us off the list four years ago. The decision ignores the real work Alibaba has done to protect IP rights holders and assist law enforcement to bring counterfeiters to justice.”

Last year, Alibaba did expand anti-counterfeit efforts. And as it happens, because of those efforts, people are questioning this latest development (which we’ll get to below). But, according to the USTR, the company hasn’t done enough, explaining:

“While recent steps set positive expectations for the future, current levels of reported counterfeiting and piracy are unacceptably high.”

Will Alibaba’s Spot on the Notorious Markets List Affect Online Sellers?

So, what does “blacklisting Alibaba” mean for FBA and other online sellers? Very little, actually.

Yes, the Notorious Markets List is a government production — and we use the word “production” purposefully, because it’s really just a political theater prop; listed parties don’t suffer sanctions. Essentially, the Notorious Markets List is the USTR’s version of Santa’s naughty list.

That said, it is a reputation blow. If customers grow leery of regional products, it could effect folks who manufacturer products in China, or buy from Alibaba vendors.

Blacklisting Alibaba: Fair or Shortsighted?

Not everyone is praising the USTR’s decision.

On Forbes.com, Michael Zakkour explained why the decision might have been wrong.

He reasons:

While the designation does not carry any official sanction or penalty[,] it does have the effect of muddying the truth about Alibaba’s marketplaces and the important role the company is playing in the evolution of cross-border commerce and the re-imagination of the retail model.

First we must clarify that Alibaba has two major platforms for selling brands to Chinese consumers. Taobao is a platform for individuals and third party companies to sell merchandise on a C2C basis. The company’s B2C marketplace, Tmall, is the platform where global and Chinese brands create flagship stores to sell direct to consumers. Tmall, the more important platform to global retailers and brands, is virtually counterfeit-proof.

Zakkour also outlines his three arguments for why the USTR erred in blacklisting Alibaba.

  1. Online counterfeits are a global scourge that brands from all over the world have to combat on a daily basis.
  2. [Listing Alibaba on the Notorious Markets List is akin to] Cutting off the nose to spite the face.
  3. Alibaba has made a massive and sincere effort to eliminate fakes from Taobao.

Zakkour’s article is worth the read for anybody involved in cross-border e-commerce. For similar news, head to our online retail section.

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Kelly / Warner’s e-commerce law attorneys have assisted hundreds of online businesses — of all sizes — with all manners or Internet retail issues. Get in touch to start solving.

eBay Defamation Case Study: Jeweler v. Buyer

picture of eBay signage to accompany a blog post about eBay defamationThis post is about an eBay defamation case currently making its way through the courts. Our firm, Kelly / Warner, doesn’t represent either side. We do, however, help folks in similar situations.

If you’re here to read about a customer review defamation case, keep scrolling. If you’re struggling with an online reputation issue, Kelly / Warner can help. Get in touch today; let’s start weighing your legal options.

Introductions and self-shout-outs aside, without further ado, we present The Case of the eBay Ring Refund

eBay Defamation Case Study: Unsatisfied Client v. Jeweler

Refund Confusion Results In Legal Tussle

Several months ago, a woman (whom we’ll call “Alice”) bought a ring from an eBay store; she split the purchase between two credit cards.

Unfortunately, Alice decided the ring wasn’t for her and initiated the return process. At first, the jeweler didn’t realize that Alice had used two cards and only refunded one.

That’s when things supposedly took a vengeful turn.

Business Owner Said…

Allegedly, the refund confusion compelled Alice to create a phony Yelp page. But Alice didn’t use her own information. Instead, she purportedly created a fake Yelp page under the jeweler’s name — and for the coup de grâce, littered it with negative reviews, including an accusation of “[stealing] thousands of dollars through this diamond scam.”

Customer Said…

No way, insists Alice, who swears she is not the one. In a statement, Alice shared her side of the story:

“[T]here were two other people involved in this dispute with the eBay seller and they were the ones who posted on Yelp and other online sites. I have email evidence that I did not write any of the comments. The plaintiff’s eBay account was shut down due to her misconduct based on eBay’s investigation.”

Reviews Lead To Job Insecurity For Plaintiff and Defendant

The jeweler suffered serious setbacks because of the reviews. Customers canceled orders; eBay removed listings; Intuit even canceled her payment processing account.

Alice didn’t fare any better. You see, for the past decade, she reportedly had worked for the Chamber of Commerce, but lost her job soon after this defamation debacle. Her former employer refused to comment on Alice’s departure, but when asked about the situation, she said, “I am considering filing a countersuit for defamation of character leading to loss of income.”

The Difference Between Bad Reviews and Defamatory Reviews

Judging from online discussions, many people seem to think businesses can sue over negative reviews on sites like (but not limited to) Yelp, eBay, Ripoff Report, and Amazon.

Not true.

Free Speech is an American solemnity. Since the Founding Fathers distributed The Federalists Papers, our nation has enjoyed a long and storied history of public criticism. Every person on U.S. soil can shout their opinions from the top of Denali or a digital pedestal.

But we can’t publicly lie about a person or business, to the point of material hardship. Ask yourself: What would you do if a customer or colleague spread rumors about your circumstances or business? Would you shrug it off, citing free speech, even if the fib destroyed your livelihood?

Winning an eBay Defamation Case

How can plaintiffs win online review lawsuits? Every case is different, but at the very least, claimants must convince a judge or jury that the defendants:

  • Made false statements of fact, which caused material harm to befall the plaintiffs; and
  • Acted negligently — or with actual malice — in publishing or broadcasting the declaration.

Considering An eBay Defamation Lawsuit?

Are you weathering a reputation storm? Wondering whether or not you can sue for defamation? Our team regularly assists people overcome reputation challenges.

Get in touch to talk about your situation.

Online Trade Libel Attorney Gets Facebook Defamation Ruling Reversed

Picture of blackboard featuring the word Trust to accompany blog post about online trade libel caseTo his client’s relief, online trade libel attorney Dan Warner convinced an Arizona appeals court to vacate a trial court’s ruling in a Facebook defamation case. By successfully arguing that the presiding judge failed to properly apply the appropriate legal tests established in Mobilisa, Inc. v. Doe, Warner was able to slip his client from the defamation liability noose.

About the Case: Business Criticism On Facebook Leads To Online Trade Libel Lawsuit

An online trade libel lawsuit, the Plaintiff (whom we’ll call “Acme”) sued an anonymous user (“John Doe”) for allegedly posting false and defamatory statements about Acme’s product on Facebook.

Since the user posted under an alias, Acme filed a John Doe claim to uncover the real name of the anonymous defendant. After initiating the lawsuit, Acme sent subpoenas to Facebook and Domains by Proxy, in search of information (like an IP address) that would help reveal the identity of the product-critiquing user.

Upon receiving the subpoena, Facebook notified John Doe; Doe then retained online trade libel attorney Dan Warner who filed a motion to quash the subpoenas.

Online Trade Libel Catch-22: Preserving Privacy v. Accountability

Online service providers avoid passing out user data like Gremlins avoid bright lights. Why? Because online privacy is a legal quagmire, and if they’re not careful, ISPs can unwittingly find themselves dragged into users’ legal battles. Thus, to avoid unnecessary, resource draining, litigation entanglements, most websites adopt a hands-off approach when faced with civil information requests.

In some cases, however, ISPs are legally compelled to release user data, by force of a court order.  However, in Arizona, to secure a subpoena that forces websites to hand over identifying information on anonymous Internet speakers, plaintiffs must show that:

  • The speaker has been given adequate and a reasonable opportunity to respond to the discovery request;
  • The plaintiff’s action could survive a summary judgment on elements, irrespective of the speaker’s identity; and
  • The balance of the parties competing interests favors disclosure.

Unfortunately, in Acme’s case, the trial court judge denied the motion without making any findings of fact — or conclusions of law — regarding the required three-part Mobilisa test.

Warner’s appeal included several points on which the appellate court could have hung a reversal, but it chose to focus on the trial judge’s failure to adequately apply the “balancing” test, as outlined in Mobilisa.

The appeals court, in Warner’s client’s case, expressly held:

Because of the conclusory nature of the order below, we are unable to tell if the trial court correctly used the 3-part test outlined in Mobilisa v.  Doe, 217 Ariz.  103, 170  P.3d  712 (App.  2007) (using  a  summary  judgment  standard)  or  the  lower  prima facie standard urged by Dream Steam below with their citation to Best W. Int’l Inc., v. Doe, WL 2091695 (D. Ariz. July 2007). See Chaparral DIVISION ONE FILED:  RUTH A. WILLINGHAM, CLERKBY: 6/27/2016 RB Dev. v. RMED Int’l, Inc., 170  Ariz.  309, 311, n.3,  823  P.2d  1317, 1319  (App.  1991) (citation  omitted)  (conclusory  rulings  impair effective  appellate  review).    We  are  likewise  unable  to  discern whether  the  trial  court  engaged  in Mobilisa’s third-prong  balancing test when considering whether the disclosure of Doe’s name outweighed the community’s protected interest in supporting anonymous speech on the internet.

In other words, the court of appeals ruled that it was unclear if the trial court judge considered whether the plaintiff’s business interests outweighed the defendant’s right to anonymously express opinions on the Internet.

Consult With An Experienced Online Trade Libel Lawyer

In today’s digital, viral marketplace, a pristine reputation is crucial to maintaining a competitive edge; protecting your business’ good name is arguably as important as securing seed money.

If you’re fighting a product or business disparagement headache, get in touch with our team of online defamation fixers. We can help.

To learn more about online trade libel lawyer Dan Warner, head here.

Supplement Marketers: Are You Crossing The Language Compliance Line?

picture of apple filled with dietary supplements to accompany blog post about supplement marketersLegal advice for supplement marketers: Be careful wording promotional materials. Strict rules apply. Breaking them could cost you millions.

FDA Takes Notice Of Trade Show Marketing Materials

Picture it (TM Sophia Petrillo). March 2016; the Natural Products Expo West Center [wavy lines transport us to a flashback]…

Health enthusiasts buzzed round the nutraceutical carnival; aromatherapy dominated olfactory senses, and a Washington State supplement brand charmed marketing materials into recycled tote bags.

Several weeks later, the material found its way to the FDA, who in turn issued a stern warning about “non-compliant disease claims.”

What Phrases Should Supplement Marketers Double Check?

So, with what wording did the FDA take issue? Here’s a list:

  • “…used in herbal medicine to help slow the progression of disorders for the eye…”
  • “…lowers blood pressure in hypertensive individuals…”
  • “…lower cholesterol levels…”
  • “…protects against cardiovascular diseases…”
  • “…slow the progression of diabetic and hypertensive retinopathy…”
  • “…protect against development of cancerous prostate cell lines…”
  • “…clinically effective in treatment of alcoholic cirrhosis…”
  • “Clinically improves cognitive function [for Alzheimer’s, vascular or mixed dementia patients].”

Are the above expressions always out of bounds? No. It’s important to understand that context is key.

Play it safe by having a marketing lawyer review your advertising materials before launching a campaign — everything from your website to trade show pass outs.

Interested in other marketing legal issues? Jump this way.

Are you a supplement marketer in need of a compliance review? Get in touch.

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Luxury Counterfeit Law: Kering v. Alibaba

luxury counterfeit lawsuitAlibaba.com and a behemoth fashion company are entangled in a luxury counterfeit lawsuit. Let’s take a look.

The Cast: A Luxury Brand to Rule Them All v. Online Retail Giant

Before we get to the lawsuit, let’s establish the players.

Kering

Kering is a huge fashion holding company for sport and luxury brands like Yves Saint Lauren, Gucci, McQueen, Brioni, and Puma. (Fun Fact: Kering’s CEO, François-Henri Pinault, is married to actress Salma Hayek.)

Alibaba.com

Alibaba.com (at the time of writing) is the #2 tech company in China and a major online retail hub. Almost everybody in the product marketing industry interacts with Alibaba.com in some capacity. Like Amazon.com, Alibaba.com is an expanding Borg-like force.

Kering v. Alibaba.com: The Clash of The Retailers

Product Marketing Legal Overview

Let’s be blunt: More often than not, especially lately, items bearing luxury tags are made in China. Why? You know the answer: cheaper labor. “Then how come luxury items cost so much?” Again, you know the answer: brand status is commerce’s co-pilot. “So, then, where does all that luxury money go if not to the people making the products?” Bingo! Back to the luxury companies who are  trading mostly in marketing, not manufacturing.

A retail revolution Is afoot: Asian factories are growing frustrated with the disparity. After all, who appreciates doing most of the work and reaping the least amount of profits? Nobody. So, Chinese manufacturers began a “Quality Made in China” initiative in an attempt to bypass luxury marketing middlemen, like Kering. Let’s put it this way: if “Made in the USA” is about patriotism, the Chinese effort is about globalism.

Luxury Counterfeit Law Claim

So, back to the lawsuit.

In an attempt to knockout knockoffs, Kering sued Alibaba, claiming various intellectual property infringements and — rather dramatically — racketeering.

Racketeering, you ask? Here’s the argument: Alibaba allegedly collaborated with fourteen counterfeiters, by allowing vendors to sell phony products on its site, over an extended period, to deliberately cheat Kering of profits.

Alibaba insists the claims are baseless. So much so that Jack Ma, the online retailer’s founder, vowed to lose in court rather than settle. Why isn’t Ma compromising? Only he knows; but to wager a guess, it’s probably because a settlement would thrust Alibaba into an extremely vulnerable cash flow position — which could also effect U.S. online retail companies. Moreover, a racketeering conviction, in a case like this, has the power to hamstring the global market — top to bottom.

Judge Shuts Down Luxury Goods Racketeering Claim

Theoretically, the racketeering assertion is plausible; but is it practical? No way. Why? It could crush the multi-billion online retail industry — and jump-start another global recession.

The presiding judge did side-eye the racketeering claim, and ultimately dismissed the charge, explaining:

“[M]erchants weren’t aware of each other or were in intentional cahoots w/ Alibaba, required by U.S. racketeering laws. […] The fraud perpetrated by each merchant defendant could be accomplished without any assistance from any other merchant defendant.”

The Case Is Not Over: Yes, in this luxury counterfeit law case, the judged axed a racketeering charge — but the intellectual property claims persist; Jack Ma and co. aren’t out of the woods just yet.

An Attorney Who Understands Luxury Counterfeit Law

Need help sorting an Internet business issue? If so, get in touch.

Cybersquatting Cases and Lawyer Contact

cybersquatting cases
Cybersquatting Cases Round Up

You can’t hold famous domains hostage for cash. That get-rich-quick scheme left the station in 1999 when Congress “yea’d” the Anticybersquatting Consumer Protection Act into law.

Below are two summaries of recent cybersquatting cases. If you’re ready to speak with a domain dispute lawyer, go here.

Wiz Khalifa Won A Cybersquatting Lawsuit

Domain marketer Anthony Lynch recently found himself in a legal tangle with Cameron Thomaz – a.k.a., Wiz Khalifa. Lynch scooped up eight domain names featuring the rapper’s trademarks.

Since Khalifa’s claim was straightforward, only one UDRP panelist sat for the case, who ruled in favor of the musician. Why? Because Khalifa used and registered the trademarks before Lynch purchased the domain names. The panelist also pontificated that Lynch probably bought the URLS with the “express intention to target” Wiz Khalifa.

The final verdict: all eight domains need to be transferred back to Wiz Khalifa’s company, at no cost to him.

Case: Thomaz et al v. Lynch, No. D2015-0166

Amazon.com and Kellogg: High Profile Cybersquatting Cases

Amazon.com and Kellogg Inc. can both add cybersquatting lawsuit victor to their virtual trophy cases.

After a protracted dispute, the Internet’s largest online retailer won back amazonprom.com, amazonpromdresses.com and amazondresses.org. The panelists ultimately ruled in favor of Amazon because the defendant lacked a legitimate interest in domains that included Amazon’s trademark.

All you cereal enthusiasts out there, you’ll be happy to learn that Kellogg’s won back kelloggs.buzz – for the same reasons Amazon won.

“Bad Faith Intent to Profit”

Both parties won their cybersquatting claims because the defendant demonstrated a “bad faith intent to profit”. Plus, the names under review were “confusingly similar” to trademarked brands.

Cybersquatting is still a big legal issue. Though federal officials passed the Anticybersquatting Consumer Protection Act, people still run typosquatting and cybersquatting schemes. But there are ways for trademark holders to regain control of their domains, without shelling out much money.

Speak To A Lawyer Who Has Dealt With Cybersquatting Cases

Kelly / Warner helps trademark holders regain control of domains. An Internet law firm with a cybersquatting law division, we know all the ins-and-outs to reclaim your domain promptly.

Contact us to take back your URL.

Source Article 1

Source Article 2

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Got Cybersquatting Questions?
Talk To A Cybersquatting Lawyer »

Internet Governance & International Internet Law Case Study

online harassment Internet governance
Kelly / Warner Law Helped Crack An International Internet Harassment Case.

*Kelly / Warner was one of the U.S. firms that helped win the International Internet defamation case discussed in this post. A pioneer in Internet governance law, Kelly / Warner partners with overseas legal practices to resolve cross-border libel, harassment and unfair competition cases. If you’d like to speak with Kelly / Warner about a domestic or transnational Internet law issue, please contact us.*

A web developer may spend some time in jail over a $300 invoice.

“But how could that be!?,” you protest.

When someone opts to criminally harass a former client, instead of legally handling an invoice disagreement, they sometimes find themselves behind bars.

Web Developer Created Harassing Websites About Former Client

Web developers and clients often clash over expectations and invoice amounts. When serious conflicts arise, professionals typically seek the assistance of an attorney with Internet governance and arbitration experience.

But some web developers choose a more dastardly path: they create disparaging –often harassing – websites about former clients.

Paul Britton, of Origin Design, falls into the latter group. Because of a  £200 (~$300) invoice dispute, Britton created several websites with the express purpose of humiliating his former client, and falsely labeled his foe a pedophile.

U.K.-based Britton thought using false credentials and U.S. companies to register and pay for the domains would sufficiently mask his identity.

But Britton didn’t do his Internet law homework.

If he had, Britton would’ve known that it’s possible to force Internet service providers and websites to fork over identifying information in criminal cases. Just because you use a fake name to register and set up a website doesn’t mean the “real you” can’t be unmasked – especially in service of a lawsuit.

How Kelly / Warner Law Helped Win This International Online Defamation Lawsuit

What The UK Team Needed to Prove

Due to the severity and nature of the accusations, the plaintiff’s legal team accused Britton of online harassment — a criminal charge in the United Kingdom. As such, the lawyers had to present evidence that satisfied “beyond reasonable doubt” standards. A simple IP address would not suffice, because, technically, IP addresses only represent computers, not people.

The U.K. legal team faced another challenge: Britton had done all his digital dirty work via U.S. companies. As an overseas practice, the prosecuting firm needed to partner with state-side practices that could obtain court orders compelling the U.S. ISP’s to hand over information in service of the lawsuit.

What Kelly Warner Did To Help Win This International Internet Law Caper

Our firm, Kelly / Warner, was one of the practices that partnered with the prosecuting U.K. legal team. Since Britton used U.S.-based ISPs to carry out his online revenge scheme, the plaintiff’s lawyers had a digital discovery challenge on their hands. In order to crack the case, they needed court orders, from U.S. judges, compelling parties – like PayPal.com and GoDaddy – to hand over user information.

We helped get those court orders.

Once in hand, the plaintiff’s U.K. lawyers were able to craft an unimpeachable case that included telephone recordings and password evidence.

Defense Argument That Didn’t Work In This International Internet Law Case

In this case, Britton’s defense attorneys used a decidedly 21st century legal argument [Paraphrasing]:

Since Britton’s disparaging sites didn’t appear in the first few pages of SERPs (search engine result pages), no harm was done, because nobody pays attention to SERP results past page three.

Some might call this the “twinkie defense” of Internet defamation law, but the argument isn’t completely baseless. At least under U.S. law, which requires nearly all* defamation plaintiffs to prove material harm. If a defendant can successfully argue that few people saw the material in question, case law precedence demands that even though a false statement of fact was made, the lack of material damage fails to meet the required preponderance of evidence for a successful libel claim.

(*Note: This statement doesn’t account for defamation per se. Defamation per se is a classification of slander or libel in which the accusation is recognized as inherently damaging. In such cases, the plaintiff doesn’t need to prove material harm, as it is inferred. Calling someone a pedophile would undoubtedly be considered defamatory per se in most jurisdictions that recognize the standard.)

Kelly / Warner: International Internet Governance Law

Due to the mounds of evidence, Britton had no choice but to plead guilty to criminal online harassment charges. No trial needed.

Kelly / Warner has considerable experience with international online defamation litigation. Frequently, we partner with overseas firms to close cross-border cases. Our attorneys and support staff know how to maneuver for a successful court order in online defamation and harassment cases.

Contact Kelly / Warner to learn more about our digital discovery,Internet governance and Internet law litigation services.

Yelp Lawsuit Case Study: Finance Firm v. Yelp Reviewer

Yelp lawsuit case and attorneyA brokerage firm filed a Yelp lawsuit against an unknown reviewer. Yelp doesn’t want to hand over the user information, but case law may not be on the review website’s side.

Another Yelp defamation lawsuit has hit the courts. This time, a brokerage firm wants to sue a semi-anonymous reviewer for online defamation.

The Rhodes Team (“Rhodes”), a Texas brokerage firm, filed a defamation lawsuit against a Yelp! (“Yelp”) reviewer named “Lin L.” for typing on its page:

“[B]y far the worst deceitful and money greedy sales agent you would ever deal with.”

Previously, Rhodes enjoyed mostly 5-star ratings. Lin L.’s missive was a noticeable stain on Rhodes’ otherwise glowing Yelp profile.

Yelp Lawsuit Basis: “We’ve Never Had A Customer By That Name”

But team Rhodes is suspect of Lin L’s aspersions. Because according to company executives, no Lin L. has ever used their services. As such, Rhodes believes the disparaging comment was the handy work of a competitor – a little “hate us because they ain’t us” (TM “The Interview”) action, if you will.

So, Rhodes initiated a “John Doe” Yelp lawsuit.

Yelp Doesn’t Want To Hand Over Information In Yelp Defamation Case

But Yelp doesn’t want to hand over Lin L.’s information, and has filed a motion in protest. The online review company, however, may be forced to give up the goods. Last year, a court forced Yelp to hand over identifying information in another anonymous defamation case involving a carpet store. Similar to this suit, the plaintiff in the carpet case was able to prove temporal incongruity between Yelp allegations and company records.

That said, just because the plaintiff emerged victorious in the carpet case does not mean this court will automatically side with the claimant. Internet defamation is still a fairly new phenomenon, and precedent setting case law varies from state to state.

To learn more about the basics of defamation law, and what you must prove to win a slander or libel lawsuit, head here. To read more about other anonymous online defamation cases, go here. If you’re ready to speak with an Internet defamation attorney, get in touch here.

Speak With A Lawyer Who Has Successfully Litigated Yelp Lawsuits and Solved Online Review Disputes

Kelly / Warner is a top-rated law firm with a respected Internet defamation practice. Our attorneys are skilled at discovery for – and deconstructing of – online trade libel and professional defamation cases. Our experience means we’re able to resolve most situations quickly and cost effectively.

The statute of limitation for defamation isn’t long; between 1 and 3 years depending on jurisdiction. Don’t delay. Get in touch with Kelly / Warner to consult more about a potential Yelp lawsuit or pending litigation.

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Trade Libel Example: Parigi v. Puma Lawsuit

trade libel example lawsuit and lawyer
Summary of an unfair competition lawsuit involving trade secret and trade libel claims.

In This Blog Post:

Defamation lawsuits aren’t exclusively matters of personal scorn and trash-talk. More often than not, libel and slander suits are nuanced, business law battles.

A recent legal tussle between Puma SE (“Puma”) and the Parigi Group Ltd. (“Parigi”) illustrates how defamation and trade secret torts can be leveraged in unfair competition lawsuits.

Background: Longstanding Licensing Agreement

The backbone of this trade libel example lawsuit is a longstanding licensing agreement.

For over ten years, Puma and Parigi enjoyed an amicable business relationship. A mutually beneficial agreement, Puma licensed its marks to Parigi, who then manufactured child-sized versions of Puma’s tracksuits and sportswear.

The Breakup: Longstanding Licensing Deal Broken Without Much Notice

The proverbial $#!+ hit the legal fan when Puma allegedly started *cheating* with United Legwear and Apparel Co. (“United”) behind Parigi’s back. According to Parigi, not only did Puma initiate clandestine talks with United, but executives from the fashion conglomerate supposedly bad-mouthed Parigi to several influential department stores. According to reports:

“’Puma intentionally and fraudulently made repeated misrepresentations to Parigi that Puma intended to renew the parties’ more than 10-year-long license agreement.’ It also alleges that Puma disclosed trade secrets and proprietary business information to United Legwear & Apparel Co. and tried to discredit Parigi among retailers such as Bloomingdale’s and Macy’s.”

Puma spokespeople swear that company representatives did nothing untoward, and the company is looking “forward to presenting [their] case.”

Trade Libel Example Case: Licensing Partner Problems

Full disclosure, we’ve not yet read the entire Parigi v. Puma filing. But judging from available reports, the crux of the lawsuit appears to be binary, in that the suit addresses both trade libel and trade secret issues.

Generally speaking, trade libel is the unfair disparagement of a product, service or business. (Read more about trade libel here.) Conversely, trade secrets are confidential, quasi-intellectual property holdings. (Read more about trade secrets here.)

In this case, Parigi is arguing:

Trade Secret Claim: Puma violated a trade secret agreement with Parigi by sharing information with United, before formally inking the deal.

Trade Libel / Defamation Claim: Puma executives purposefully and negligently spoke disparagingly of Parigi to executives at several department stores.

In Parigi v. Puma, the former insists the latter wasn’t forthcoming about its intentions to terminate a contract. Puma’s alleged reticence to renew the contract, however, isn’t the legal issue anchoring this case; it’s simply the branch on which the actual unfair competition claims — trade libel and trade secret misappropriation — were hung.

Puma and Parigi are two big business players in the fashion world. So, expect this lawsuit to be well-fought and long-lasting. In the words of Parigi spokesperson:

“We will see some very ugly things. Puma’s a major name in the industry, and my client’s a major name in the industry, and they’re going to war.”

Questions For A Business Defamation Lawyer?

Kelly / Warner handles all manners of business law issues, including trade libel and business defamation. If you need an attorney to review documents, we can. Need startup legal counsel? We’ve got the answers. Are you interested in pursuing a lawsuit? We go the extra mile — which is why we win.

Pick up the phone or shoot us a message. Let’s start solving your Internet and business law needs.

More trade libel example lawsuits? Head over here.

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Professional Defamation Case Study: Mogul v. Mogul

professional defamation case study
A judge tossed a professional defamation lawsuit between two moguls.

In This Article You’ll Find:

  • Explanation of a professional defamation lawsuit between two high-profile moguls;
  • Explanation of what one must prove to win a slander or libel lawsuit; and
  • Contact information for a defamation lawyer.

Casino mogul Steve Wynn lost round one of his professional defamation lawsuit against financier James “Jim” Chanos. Wynn has till January 15, 2015 to appeal – and according to all reports, he plans to do just that.

The Wynn v. Chanos slander lawsuit is a good one to review because it touches on the important crux of American defamation case law – the all-mighty First Amendment.

Why Did Wynn Sue Chanos For Professional Defamation?

At A Lecture: “The SEC investigated Wynn.”

A lecture circuit veteran, earlier in the year, Chanos gave a talk at the University of California at Berkley. During the event, Chanos mentioned a since abandoned federal investigation of Wynn’s operation for violations of the Foreign Corrupt Practices Act. Ultimately, the investigation went nowhere, as officials didn’t find “reliable evidence of FCPA violations.”

At the Berkley lecture, Chanos did note that the SEC’s investigation didn’t illuminate any evidence against Wynn Resorts Ltd and related parties.

Wynn Filed Lawsuit

Regardless, Wynn wasn’t pleased with Chanos’ lecture – and opinions therein; so, in September 2014, the casino king filed a professional defamation lawsuit against the money man.

But it doesn’t look like Wynn will win this slander case.

Judge Sides With Chanos Because Wynn Made Too Big Of A Leap

District Judge William Orrick explained his ruling in favor of Chanos thusly:

“It takes a significant inferential leap to conclude that Chanos’s general uncertainty about the questionable business methods in Macau equates to an assertion that Wynn violated the FCPA.”

Did Judge Orrick slyly and subtly insinuate: “doth protest too much, maybe, Mr. Wynn?”

No False Statement of Fact

The most important thing to remember about professional defamation law in the US: In order to win, your claim must be centered on a false statement of fact, not an opinion nor speculation. If it were against the law to speculate about businesses, politics or people, the news and entertainment industries would be forced closed by way of excessive litigation.

Defamation law in the U.S. is defendant-friendly: In 98% of cases, to win, a plaintiff must prove the defendant made an unprivileged, false statement of fact. Negative opinions or critiques do not a valid defamation case make.

What must a plaintiff prove to win a defamation of character lawsuit in the United States?

Generally speaking, in every U.S. jurisdiction, in order to win a defamation of character lawsuit – whether personal or professional – the plaintiff must prove, at the very least, that the defendant:

  • Published, broadcast or otherwise distributed the false statement of fact;
  • Was talking about the plaintiff;
  • Through the statement, caused material harm to the plaintiff;
  • Acted with reckless disregard for the truth or actual malice.

Don’t be discouraged by America’s defendant-friendly defamation laws. Every year, many businesses and professionals win slander and libel lawsuits. Yes, free speech trumps an awful lot, but it doesn’t give anybody the right to spread lies about a person, place, organization or business.

If you’re the target of a highly inflammatory review, a ruined online reputation, or if you’re simply interested in getting content removed from the Internet, get in touch with Kelly / Warner Law.

Speak With An Attorney About Your Professional Defamation Situation

Our legal practice maintains a perfect rating on review website AVVO.com, in addition to a preeminent standing on venerated lawyer review service, Martindale-Hubbell. Since Kelly / Warner’s inception, our lawyers have focused on Internet libel issues. We know the niche well and have guided –step-by-step – hundreds of individuals and businesses to successful resolutions of their professional defamation hiccups.

Professional Defamation Case Study: Resigned CFO v. Executives

professional defamation
A professional defamation case study

Walgreen Co.’s former Chief Financial Officer, Wade Miquelon, filed a libel lawsuit against the pharmacy conglomerate. Miquelon insists that both Walgreen’s CEO and the company’s top shareholder illegally besmirched his character via a pair of Wall Street Journal articles and a handful of emails.

We know we’re behind “breaking” on this case, but since our firm focuses on professional defamation litigation, for blogging purposes, we wanted to take a close look at the lawsuit. Specifically, we want to consider the question: Can Miquelon win?

Professional Defamation Case Study: Walgreen’s CFO v. Walgreen’s

Things Were Already Tense At The Office

According to Miquelon, the seed of this professional defamation saga took root last year. At the time a beleaguered entity, Walgreen was stuck between a tax-inversion inconvenience and activist investors. Then a bad 2013 morphed into a worse 2014, when a $1 billion mistake stained the company’s August financial disclosure.

CFO Says, “See Ya”

In the midst of the turmoil, Walgreen’s CFO – Wade Miquelon – resigned. He cited family and further opportunities as reasons for departure. But the financial books were less-than-ideal, and the search was on for a scapegoat. To some people, it seemed like Miquelon’s leaving provided a convenient, public fall guy for extant Walgreen executives.

Executives’ Disparaging Comments Published In The WSJ

Cue a pair of Wall Street Journal articles wherein Walgreen CEO, Gregory Wasson, and the company’s largest shareholder, Stefano Pessina, are quoted as holding Miquelon “personally responsible” for the corporation’s $1 billion mistake.

Additionally, at least according to Miquelon’s lawsuit, Walgreen executives were also regaling investors with disparaging tales of ex-CFO Miquelon during this same period.

Frustrated by the finger pointing – and worried it might affect future employment opportunities – Miquelon filed a defamation of character lawsuit against Walgreen Co. – specifically Wasson and Pessina.

Miquelon’s Business-Related Defamation of Character Lawsuit Claims: Truth & Financial Disclosures

Miquelon swears he warned Walgreen brass of impending financial disquiet. He says he urged them to “publicly report the truth.” Miquelon also suggests that Wesson and Pessina counselled him to “tamper with the earnings forecast.”

The lawsuit also highlights instances wherein Wasson and Pessina allegedly implicated or insinuated Miquelon as the cause of Walgreen’s “bungled” bottom line. And to bolster his defamation argument, Miquelon included emails, text messages and corporate documents wherein Wasson and Pessina praised his competence.

What Miquelon Must Prove To Win This Professional Defamation Lawsuit

To win a defamation lawsuit in the U.S., plaintiffs must prove at least the following:

  • The defendant made a false, unprivileged statement of fact about the plaintiff;
  • The statement caused either reputational or material harm to the plaintiff; and
  • The defendant acted either negligently or with actual malice.

To wit, in this case, Miquelon must prove:

  • He was not responsible for Walgreen’s financial predicament. He’s already started building this argument by including praising messages from Wesson and Pessina in his filing. But in order to win, Miquelon needs more.
  • As for proving harm or loss, Miquelon’s lawyer elaborated:

“The unanswered articles have had the inevitable negative impact on Miquelon…Miquelon has gone from being a 49-year-old former CFO of a Fortune 30 company … who had Chief Operating Officer … and CFO opportunities in the marketplace, to being a man with no such options and no recourse other than this lawsuit.”

Can Walgreen Co. Get The Records Sealed To Prevent Proceedings From Affecting Current Business Deals?

When Miquelon’s lawsuit landed, Walgreen attorneys quickly moved to get the proceedings sealed. Unfortunately for the corporation, the judge didn’t grant the request right away, instead opting to delay a decision until November 6th in order to carefully consider the motion. [UPDATE: Walgreen did get the gag order at the beginning of November.]

It’s still anybody’s guess who will win this professional defamation lawsuit. It’s a case that will stand or fall on the strength of lawyers’ arguments. If it gets past the first set of dismissal motions, discovery will undoubtedly play a significant role in this suit.

The case is Miquelon v. Walgreen Co., 14-ch-16825, Cook County, Illinois Circuit Court