Antitrust Law Daily Wrap Up, ADVERTISING—3d Cir.: ‘Official website’ misrepresentation not enough to support Lanham Act suit, (Dec 23, 2015)

By Jeffrey May, J.D.

Websites maintained by a condominium owner that contained critical and inflammatory remarks about the condominium's board of directors did not amount to false advertising in violation of the Lanham Act, the U.S. Court of Appeals in Philadelphia has decided. Judgment in favor of the condo owner was affirmed, even though one of the condo owner's websites made the false claim that it was the “Official Website” for the condominium complex (Board of Directors of Sapphire Bay Condominiums West v. Simpson, December 21, 2015, McKee, T.).

The complaining condo board did not meet its burden of proving that the statements were literally false or actually deceptive under the Lanham Act. The federal district court in St. Thomas, Virgin Islands, held that the condo owner’s “gripe” websites were not commercial in nature and that, taken in their full context, contained ambiguous or possibly true statements that the condo board failed to prove actually deceived consumers. The appellate court did not address whether the websites were commercial in nature, but agreed that the condo board did not establish its Lanham Act claims.

Only one of the three websites contained a false statement that it was the “Official Website” for the condominium complex. The condo was not involved in creating or maintaining the website. The rest of the contents of the first website, as well as the contents of the other two websites, contained either ambiguous or true statements. According to the appellate court, the ownership representation was arguably deceptive text. Thus, without evidence of actual deception, the condo board did not meet its burden.

Attorney fees and damages. The defending condo owner's request for attorney fees and damages from lost business opportunities were denied. The defendant claimed entitlement to attorney fees for his pro se representation and compensation for the business opportunities he was forced to forgo in order to defend himself against the condo board's claims. However, attorney fees were only properly awarded to attorneys, and the defendant failed to offer any evidence to support the claim that he lost business opportunities.

The cases are Nos. 14-3922 & 14-3999.

Attorneys: Alan R. Feuerstein (Feuerstein & Smith) for Board of Directors of Sapphire Bay Condominiums West.

Companies: Board of Directors of Sapphire Bay Condominiums West

Cases: Advertising DelawareNews NewJerseyNews PennsylvaniaNews