Proskauer on Advertising Law
Proskauer on Advertising Law

Ninth Circuit Drowns Out Alkaline Water Suit

The Ninth Circuit recently affirmed the dismissal of a putative class action alleging Trader Joe’s misled consumers by representing its Alkaline Water product as “ionized to achieve the perfect balance.”  In rejecting plaintiff’ allegations that the advertising referred to balancing the consumer’s internal pH rather than the balanced pH of the product itself, the Court recognized “a reasonable consumer does not check her common sense at the door of a store.”  Weiss v. Trader Joe’s, No. 19-55841 (9th Cir. Mar. 3, 2021).

The Alkaline Water product label states the water is “ionized to pH 9.5+,” will “refresh & hydrate,” and depicts “hundreds of plus symbols.”  An advertisement for the water in Trader Joe’s store newsletter likewise touted that the water was purified and charged through electrolysis, changing the structure of the water and raising the pH to 9.5+, making the product “water and then some.” Plaintiff alleged these representations were misleading because they implied that the water would “balance” a consumer’s internal pH after he or she has eaten acidic foods and would provide superior hydration as compared to other water.

The district court found several of these representations (including “water and then some,” “a drink that can satisfy,” and “refresh”) constituted non-actionable puffery.  The remaining challenged statements concerning the drink’s pH and ionization, the court found, would not mislead a reasonable consumer.

Agreeing with the district court’s analysis, the Ninth Circuit likewise found a reasonable consumer would not misinterpret these representations as suggesting internal pH balancing benefits or superior hydration.  When considered in the context of the package as a whole, the Court found the phrase “ionized to achieve the perfect balance” clearly referred to the water itself being balanced – rather than to balance within the body.

The Ninth Circuit also rejected plaintiff’s allegation that the term “hydrate” would mislead consumers into believing the water provided better hydration than other water. Plaintiff did not dispute that the water does, in fact, “hydrate.”  Finding this statement about the water’s hydrating capability true and undisputed, the Ninth Circuit agreed with the district court that it would not plausibly deceive a reasonable consumer.

The Court also affirmed the district court’s dismissal of plaintiffs’ breach of warranty claims based on the same advertising. The Court noted that though the reasonable consumer standard technically does not apply to warranty claims, those claims still require some sort of actionable representation. No such misrepresentation existed here because nothing in the challenged labeling promised health benefits or superior hydration.

This case serves as a reminder that allegations founded on fanciful interpretations of advertising claims may cause a “splash” when filed, but courts exercising common sense will not hesitate to dispose of them at the pleading stage.  While the Ninth Circuit’s decision in Weiss is unpublished, it is consistent with other precedential decisions from the court.  See for example Ebner v. Fresh, 838 F.3d 958 (9th Cir. 2016) – a case we have previously blogged about.


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Supreme Court “Unfriends” Ninth Circuit Decision Applying TCPA to Facebook

In a unanimous decision, the Supreme Court today held that Facebook’s “login notification” text messages (sent to users when an attempt is made to access their Facebook account from an unknown device or browser) did not constitute an “automatic telephone dialing system” within the meaning of the federal Telephone Consumer Protection Act (“TCPA”).  In so holding, the Court narrowly construed the statute’s prohibition on automatic telephone dialing systems as applying only to devices that send calls and texts to randomly generated or sequential numbers.  Facebook, Inc. v. Duguid, No. 19-511, slip op. (Apr. 1, 2021).

The TCPA aims to prevent abusive telemarketing practices by restricting communications made through “automatic telephone dialing systems.”  The statute defines autodialers as equipment with the capacity “to store or produce telephone numbers to be called, using a random or sequential number generator,” and to dial those numbers.  Plaintiff alleged Facebook violated the TCPA’s prohibition on autodialers by sending him login notification text messages using equipment that maintained a database of stored phone numbers. Plaintiff alleged Facebook’s system sent automated text messages to the stored numbers each time the associated account was accessed by an unrecognized device or browser.  Facebook moved to dismiss, arguing it did not use an autodialer as defined by the statute because it did not text numbers that were randomly or sequentially generated.  The Ninth Circuit was unpersuaded by Facebook’s reading of the statute, holding that an autodialer need only have the capacity to “store numbers to be called” and “to dial such numbers automatically” to fall within the ambit of the TCPA.

At the heart of the dispute was a question of statutory interpretation: whether the clause “using a random or sequential number generator” (in the phrase “store or produce telephone numbers to be called, using a random or sequential number generator”) modified both “store” and “produce,” or whether it applied only to the closest verb, “produce.”  Applying the series-qualifier canon of interpretation, which instructs that a modifier at the end of a series applies to the entire series, the Court decided the “random or sequential number generator” clause modified both “store” and “produce.”  The Court noted that applying this canon also reflects the most natural reading of the sentence: in a series of nouns or verbs, a modifier at the end of the list normally applies to the entire series.  The Court gave the example of the statement “students must not complete or check any homework to be turned in for a grade, using online homework-help websites.” The Court observed it would be “strange” to read that statement as prohibiting students from completing homework altogether, with or without online support, which would be the outcome if the final modifier did not apply to all the verbs in the series.

Moreover, the Court noted that the statutory context confirmed the autodialer prohibition was intended to apply only to equipment using a random or sequential number generator.  Congress was motivated to enact the TCPA in order to prevent telemarketing robocalls from dialing emergency lines and tying up sequentially numbered lines at a single entity.  Technology like Facebook’s simply did not pose that risk.  The Court noted plaintiff’s interpretation of “autodialer” would, “capture virtually all modern cell phones . . . .  The TCPA’s liability provisions, then, could affect ordinary cell phone owners in the course of commonplace usage, such as speed dialing or sending automated text message responses.”

The Court thus held that a necessary feature of an autodialer under the TCPA is the capacity to use a random or sequential number generator to either store or produce phone numbers to be called.  This decision is expected to considerably decrease the number of class actions that have been brought under the statute.  Watch this space for further developments.


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A Dose of Relief: Federal Judge Dismisses Walgreens Infant Acetaminophen Class Action

Judge Edward Davila of the U.S. District Court for the Northern District of California recently dismissed with prejudice a putative class action alleging Walgreens misled consumers into believing its store-brand Infants’ Pain & Fever Acetaminophen is specially formulated for infants.  In dismissing the suit, the court found the product’s labeling would not be likely to confuse reasonable consumers. Eidmann v. Walgreen Co., No. 20-cv-04805-EJD (N.D. Cal. Feb. 26, 2021).

The court noted that in 2011, in an industry-wide effort to prevent accidental infant overdoses, acetaminophen manufacturers reduced the concentration of liquid acetaminophen in infants’ products to conform to that in children’s products. As a result, Walgreens’ store brand Infants’ Pain & Fever Acetaminophen (the “Infants’ Product”) and Children’s Pain & Fever Acetaminophen (the “Children’s Product”) both contain, and disclose, a concentration of 160 mg acetaminophen per 5 mL of product. The products are distinguished by depictions of the dosing mechanism; while the Infants’ Product displays a drawing of a syringe with the instruction to “Use only with enclosed syringe,” the Children’s Product displays a dosing cup. The Infants’ Product displays an age range of 2-3 years, while the Children’s Product states it is for ages 2-11.

According to plaintiff, by selling the Infants’ Product and Children’s Product as two separate products, ­Walgreens misled consumers into believing the Infants’ Product is specially formulated for infants. Plaintiff alleged this deceived consumers into paying a price premium, even though the products have the same concentration of active ingredient. Based on these allegations, plaintiff asserted Walgreens violated California’s FAL, CLRA and UCL.

The court dismissed plaintiff’s claims based on its finding that no reasonable consumer would understand the Infants’ Product to be specially formulated for infants. In reaching this conclusion, Judge Davila relied heavily on another recent case out of the Northern District, Lokey v. CVS Pharmacy, Inc. In Lokey, the plaintiff alleged CVS’s store-brand infant acetaminophen deceives reasonable consumers into believing that the product is specially formulated for children under two, as compared to its children’s product. The Lokey court assessed the two products’ packaging, noting that the front labels clearly disclose that the medicines are compositionally the same. Because of these clear disclosures, depictions of differing dosing mechanisms and images of children of differing ages could not plausibly suggest different formulations. The Lokey court therefore found that the labels were not likely to mislead a reasonable consumer.

Like in Lokey, Judge Davila observed that the acetaminophen concentration on both the Infants’ Product and Children’s Product was prominently listed in bolded lettering as “160 mg per 5mL” on the front of both packages. The concentration was also listed in bold lettering and in highlighted text in the “Drug Facts” section on the back of the products.  In light of the clearly disclosed concentrations, the court found the depictions of differing dosing mechanisms on the product packaging would not mislead a reasonable consumer into believing the products have different formulations. Instead, Judge Davila found the infant-specific branding “more reasonably pertains to the infant-specific dosing mechanism included to administer the product.”

The court also noted that the labeling for Walgreens’ Infant Product and Children’s Product displayed overlapping age ranges (2-3 years and 2-11 years) – allowing a consumer to readily compare the products and find not only that they contain the same acetaminophen concentration, but also that they can be used by children of identical ages.

This case serves as an important reminder that theories of deception grounded only in a plaintiff’s unsupported assumptions are ripe for dismissal – especially when directly contradicted by reasonably prominent disclosures in the advertising itself.  This case also highlights how advertisers seeking to reformulate products—often to improve them or make them safer for consumers—need to consider carefully whether doing so could somehow spur a class action from an overreaching plaintiff.


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Top Dog: Champion Petfoods Wins Dismissal of Dog Food Suit

Minnesota federal district court Judge Patrick J. Schiltz recently dismissed with prejudice an alleged class action claiming that Champion Petfoods misrepresented the quality of its dog food and ingredients by failing to disclose traces of heavy metals and barbiturates. In dismissing the suit, Judge Schiltz found no reasonable consumer was likely to interpret the contested claims as plaintiffs did, and plaintiffs’ attempt to “construct[] a hypothetical ‘reasonable consumer’ with highly artificial, detailed expectations about a product” did not make their allegations plausible. Song & Wertkin, et al. v. Champion Petfoods USA,No. 18-CV-3205 (PJS/KMM) (D. Minn. Dec. 22, 2020).

Plaintiffs alleged the advertised claims “Biologically Appropriate”; “Fresh Regional Ingredients”; “Nourish as Nature Intended”; and “Delivering Nutrients Naturally” on Champion’s dog food were false and misleading because they did not reflect that the food contained or had a risk of containing heavy metals, BPA, pentobarbital, and non-fresh, non-regional ingredients. The court, however, found it implausible that a reasonable consumer would interpret “Biologically Appropriate” as a guarantee that the food contained no trace of heavy metals whatsoever—especially since the package makes clear that it contains meat and fish. As the court observed, plaintiffs “[did] not dispute that heavy metals occur naturally in meat and fish,” and in fact “plead as much” in their complaint, making their allegations all the more implausible. Instead, the court found a reasonable consumer would merely understand “biologically appropriate” to mean the food does not contain ingredients that would make it unfit for a dog to consume. Plaintiffs did not allege this was false. Nor did Plaintiffs allege the food contained heavy metals in amounts that were dangerous (or “biologically inappropriate”) for dogs, or that the food harmed their dogs.

The court likewise dispensed with plaintiffs’ allegations that reasonable consumers understand “biologically appropriate” to mean Champion’s dog food is manufactured in a way that eliminates any risk of BPA contamination. The court noted “biologically appropriate” is clearly a representation about the dog food, not about the processes followed at the manufacturing plant. According to the court, plaintiffs’ allegations about how a reasonable consumer would interpret “biologically appropriate” was “an interpretation contrived by lawyers…not an interpretation that would occur to a reasonable consumer as she stood reading a dog food package in the aisle of a pet-food store.”

The court also rejected plaintiffs’ alleged understanding of the claim “Fresh Regional Ingredients.” Citing Sarr v. BEF and Harris v. Mondelez Global (two cases we previously blogged about), the court concluded that a representation highlighting a certain ingredient does not mislead consumers into believing the ingredient has not been mixed with others. In Sarr, the court found claims that mashed potatoes were made with “real butter” did not imply that the only fat used was real butter.  In Harris, the court found claims that cookies were “Made With Real Cocoa” did not suggest the cocoa had not been refined through an alkalization process. Similarly, here, “Fresh Regional Ingredients” did not imply that the dog food was composed only of ingredients that were fresh and regional.

The court noted that this was especially true here in light of prominent disclosures on the packaging clarifying that not all of the ingredients are fresh. For example, the court pointed to a large-print panel on the packaging indicating it contained not only ingredients that were fresh, but also ingredients that were raw, dried, and in the form of oils.

Under the same theory, the court found that the term “regional” in this context did not suggest anything more to a reasonable consumer than that the product contained some ingredients from regional sources—a statement that was literally true.

This ruling serves as a reminder that the most important factor in assessing allegations of false advertising is often a healthy dose of common sense. Far-fetched interpretations of advertising claims are not sufficient to sustain a false advertising claim. And as the court recognized here, the “reasonable consumer” means the average purchaser standing in a store aisle, not their lawyer.


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Fourth Circuit La(t)ches On to Timeliness of § 43(a) Lanham Act Claims

The Fourth Circuit recently overturned a district court’s decision to apply an analogous state law statute of limitations to bar a claim for false advertising under § 43(a) of the Lanham Act.  In doing so, the Court held that because § 43(a) claims are “equitable in nature,” laches is the applicable timeliness rule, rather than a state law’s statute of limitations.  Belmora LLC v. Bayer Consumer Care AG, No. 18-2183 (4th Cir. Feb 2, 2021).

Plaintiff Bayer owns a Mexican registration for the mark “Flanax” and sells naproxen pain relievers under that name in Mexico and various parts of Latin America. After Bayer registered the “Flanax” mark in Latin America, defendant Belmora began selling naproxen pain relievers under the same name in the United States. Following a 7-year battle before the U.S. Trademark Trial and Appeal Board (TTAB), Bayer successfully blocked Belmora’s registration of the trademark FLANAX in the United States.

Two months later, Bayer sued Belmora for false advertising and false association under § 43(a) of the Lanham Act based on Belmora’s use of the “Flanax” name in the United States. The district court granted summary judgment in favor of Belmora, concluding Bayer’s claims were barred by the analogous state law statute of limitations.

On appeal, the Fourth Circuit held the district court erred in applying a statute of limitations analysis to Bayer’s § 43(a) claim.  The Court observed that the Lanham Act does not expressly incorporate a limitations period. In the absence of express limitations periods, it would normally be appropriate for courts to apply the most closely analogous statute of limitations under state law. However, because § 43(a) claims are equitable in nature, the Court found a state statute of limitations would be “an unsatisfactory vehicle for enforcement.” Instead, the Court held the equitable defense of laches was more appropriate. This holding is consistent with the laws of the Third, Seventh, and Ninth Circuits, which also apply laches to § 43(a) claims.

However, this ruling does not render state statutes of limitations irrelevant to § 43(a).  Rather, they “continue to play an important role” in the laches analyses because § 43(a) claims filed outside the limitations period are presumed to be barred by laches. To determine whether this presumption has been overcome courts must look at several factors—as applied to this case, “(1) whether Bayer knew of Belmora’s adverse use of the FLANAX mark, (2) whether Bayer’s delay in challenging the use was inexcusable or unreasonable,” and (3) whether Belmora “has been unduly prejudiced” by Bayer’s delay.

The Fourth Circuit’s decision brings it in line with other Circuits that have held that, under certain circumstances, a false advertising or trademark plaintiff may not be barred from asserting its claims under § 43(a), despite lengthy delays in filing suit. Watch this space for further developments.


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Ninth Circuit Claws Back “Krab Mix” Class Action Dismissal

A split Ninth Circuit panel recently reversed the dismissal of claims against P.F. Chang’s regarding the chain’s use of the term “krab mix” in the ingredients list for certain sushi rolls. Kang v. P.F. Chang’s China Bistro, No. 20-55138 (9th Cir. Feb. 9, 2021).

Plaintiff claimed he purchased P.F. Chang’s “krab mix” sushi rolls because the term “krab mix” led him to believe the rolls contained at least some real crab meat, when in fact they contained none.  P.F. Chang’s countered that reasonable consumers would be tipped off by the fanciful spelling of “krab,” as well as the fact that other items on the same page of the P.F. Chang’s menu listed “crab” (spelled correctly) in their ingredients. Accordingly, P.F. Chang’s argued, a consumer confronted with both “crab” and “krab mix” on the same page would not be misled into believing they are the same. The district court agreed, and dismissed plaintiff’s claims as implausible on their face. In doing so, the court analogized to a prior decision finding no reasonable consumer would be misled into believing “Froot Loops” contain “Fruit.” McKinnis v. Kellogg, 2007 U.S. Dist. LEXIS 96106 (C.D. Cal. 2007).

The Ninth Circuit reversed, relying primarily on Williams v. Gerber Prods. Co., 552 F.3d 934 (9th Cir. 2008).  In Williams, the defendant sold products labeled “Fruit Juice Snacks” with images of fruits on the front label. The ingredients list on the side of the box disclosed that the product did not actually contain juice from any fruits pictured on the packaging. The Williams Court found the defendant could not immunize itself against prominent, misleading front-label claims by disclosing the truth about the product’s ingredients elsewhere. The majority held the same to be true in this case—just as the Williams court believed a consumer might not look beyond representations on the front of a box to discover an ingredients list displayed elsewhere on the packaging, the majority here concluded a P.F. Chang’s customer might not look beyond the phrase “krab mix” to discover the term “crab” used elsewhere on the same menu.

In a persuasive dissent, Judge Bennett criticized the majority for failing to give the ordinary California consumer enough—or any—credit.  Importantly, Judge Bennett pointed out that the standard for misrepresentation is not whether the “least sophisticated” or “most gullible” consumer would be misled. According to Judge Bennett, reasonable consumers in the food industry are prudent enough to know that fanciful spellings materially change the meaning of a word, since this kind of advertising is now commonplace in the food industry.  For instance, “cavi-art” is not caviar, “Froot Loops” are not fruit, and “tofurky” is not turkey.  Judge Bennett concluded “nothing about ‘krab mix’ suggests that the sushi rolls will contain real crab,” and “wishful thinking on the plaintiff’s part” does not make for a plausible claim. Judge Bennett also reiterated the district court’s finding that the context in which “krab mix” appeared (i.e., in close proximity to other items labeled “crab”) should clue consumers in.

P.F. Chang’s joins the ranks of Williams and Bell v. Publix Super Markets, 982 F.3d 468 (2020) as decisions likely to be embraced by the advertising class action plaintiffs’ bar.  However, this decision will not change the status quo that it is both common and entirely appropriate for courts to dismiss as a matter of law complaints alleging unreasonable understandings of advertising claims which are cured by disclosures elsewhere on the advertising. There are several recent and notable decisions from the Second and Ninth Circuits recognizing this principle. For example:

  • In Fink v. Time Warner, the Second Circuit affirmed the dismissal of plaintiffs’ false advertising complaint, acknowledging that it is “well settled that a court may determine as a matter of law that an allegedly deceptive advertisement would not have misled a reasonable consumer,” and that “the presence of a disclaimer or similar clarifying language may defeat a claim of deception.” 714 F.3d 739, 741-42 (2d Cir. 2013).
  • In Jessani v. Monini North America, the Second Circuit affirmed the dismissal with prejudice of plaintiffs’ complaint alleging that reasonable consumers would take away the false message that a flavored olive oil truthfully described as “truffle flavored” contains real truffles. 744 F. App’x 18 (2d Cir. 2018). The Court agreed with Monini, who Proskauer represented, that this was simply not a reasonable takeaway in the overall context of its label, and given the absence of truffles on the ingredient list.
  • In Ebner v. Fresh, the Ninth Circuit explained that Williams merely “stands for the proposition that if the defendant commits an act of deception, the presence of fine print revealing the truth is insufficient to dispel that deception.” 838 F.3d 958, 966 (9th Cir. 2016) (emphasis in original). In Ebner, the Ninth Circuit found it was not plausible that reasonable consumers would be deceived as to how much lip balm the defendant’s product contained where the label accurately stated its net weight.
  • In Razo v. Ashley Furniture Industries, the Ninth Circuit held that the “district court properly granted summary judgment on Razo’s claims because a reasonable consumer would have read the unambiguous and truthful disclosures placed on the front and back of Ashley’s DuraBlend hangtag.” 782 Fed. Appx. 632, 633 (9th Cir. 2019).
  • In numerous recent lawsuits against confection makers, federal district courts have dismissed claims alleging defendants’ “white”-labeled sugary goods deceived reasonable consumers into thinking the products contain white chocolate, when they do not. In dismissing these claims, courts noted that the ingredients list on the packaging clearly did not include any mention of “white chocolate.” See our prior coverage of such cases involving Nestle Tollhouse and Ghirardelli.

Further, the dissent warns against the inevitable harm that stems from allowing such implausible claims to proceed further down the litigation path—the cost of defending these claims is not inconsequential, and is ultimately passed onto consumers. It remains to be seen if the Ninth Circuit will come to better appreciate this fact and reverse course as this line of decisions spawns increasing numbers of food labeling suits.


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Not a Kernel of Standing: Ninth Circuit Affirms Dismissal of Complaint Against Pop Secret

The Ninth Circuit recently affirmed the dismissal of a putative class action alleging Diamond Foods engaged in unfair practices, created a nuisance, and breached the warranty of merchantability by including partially hydrogenated oils as an ingredient in Pop Secret popcorn.  McGee v. S-L Snacks Nat’l, Case No. 17-55577 (9th Cir. December 4, 2020).

Plaintiff Jacquelyn McGee alleged Pop Secret contains partially hydrogenated oil, “a food additive banned in many parts of the world because it is the only dietary source of artificial trans fat,” which (according to McGee) “causes cardiovascular heart disease, diabetes, cancer and Alzheimer’s disease.”  Plaintiff claimed she was injured by this in three ways: the amount of trans fat she consumed in Pop Secret (1) “caused her economic injury because she believed she was purchasing a safe product when she was not”; (2) “caused her physical injury by harming her heart and blood vessels”; and (3) substantially increased her “risk of heart disease, diabetes, cancer, and death.”  Based on these allegations, Plaintiff’s Complaint asserted several claims including violations of California’s Unfair Competition Law, nuisance, and breach of the implied warranty of merchantability, and sought, among other things, restitution, disgorgement, and injunctive relief.

The district court granted Diamond Foods’s motion to dismiss for lack of standing because it found McGee alleged no economic injury when “she purchased a product that was less healthy than expected.”  The district court concluded McGee’s theory of economic injury was untenable because “the existence of [artificial trans fat] in the . . . popcorn was included in the nutritional label on the product box and Plaintiff d[id] not allege that Defendant’s popcorn labels were misleading.”    The district court also rejected McGee’s claims of present and future physical injury as “speculative” because there were no reasonable inferences to be drawn from the allegations in the complaint or the studies it cited to suggest McGee’s limited consumption of the popcorn substantially increased her risk of physical harm.

The Ninth Circuit affirmed. As to economic injury, the Court cautioned that a plaintiff “must do more than allege that she did not receive the benefit she thought she was obtaining.”  Fatal to plaintiff’s claim, the court reiterated that Diamond Foods did not make any representations about Pop Secret’s safety, and “[a]lthough she may have assumed that Pop Secret contained only safe and healthy ingredients, her assumptions were not included in the bargain, particularly given the labeling disclosure that the product contained artificial trans fat.”

Importantly, McGee conceded that “Pop Secret’s nutritional label disclosed the presence of artificial trans fat, and the health risks of consuming artificial trans fat were firmly established by the time of McGee’s purchases.”  Accordingly, the court concluded McGee did not allege that Pop Secret contained a hidden defect, or that it was worth less than she paid for it.

Finally, the Court found plaintiff failed to plausibly allege injury-in-fact sufficient to satisfy Article III standing. McGee alleged she suffered damage to vital organs and permanent degradation of cognitive abilities. The Court agreed such injuries would be sufficient for standing, if plausibly alleged. However, it found McGee’s allegations rested on the implausible contention that consuming a small amount of trans fat over the course of several years would invariably lead to those injuries. McGee did not allege she underwent medical testing or examination to confirm she suffered those injuries. And the studies she provided did not make that inference any more plausible. Though they showed some link between the consumption of trans fatty acids and systemic inflammation, they associated serious health risks only with significantly greater levels of consumption than plaintiff alleged.

This case serves as a reminder that a complaint alleging injury as a result of purported advertising misrepresentations must be grounded in the text of the advertising, not on a consumer’s unsupported assumptions.  And hypothetical or farfetched injuries do not entitle a would-be plaintiff to a day in court (aside from maybe an oral argument or two on defendant’s motion to dismiss).


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