Antitrust Law Daily Wrap Up, ADVERTISING—D. Del.: Med tech company denied injunction against competitor’s use of marketing videos, (Jun 7, 2016)

By Michael Menzhuber, J.D., LL.M.

The federal district court in Wilmington, Delaware denied a medical technology company’s request for a preliminary injunction barring a competitor’s use of marketing videos allegedly disparaging one of its medical devices (Hologic, Inc. v. Minerva Surgical, Inc., June 2, 2016, Robinson, S.).

After being sued by Hologic, Inc. and Cytyc Surgical Products, LLC (collectively, "Hologic") for patent infringement, Minerva Surgical, Inc. counterclaimed for false advertising under the Lanham Act, violation of Delaware deceptive trade practices law, unfair competition, and trade libel. Minerva also filed a motion for a preliminary injunction to enjoin the use of a two videos created by Hologic in the late 1990s. One video showed a controlled ablation of a liver using a prototype NovaSure device, developed by Hologic, to apply suction to the cavity of the liver. The other video showed an uneven ablation, as a consequence of using a "without suction" procedure associated with a product developed by Minerva.

The court noted that a plaintiff seeking a preliminary injunction must establish: (1) a likelihood of success on the merits; (2) irreparable harm; (3) the balance of equities is in favor of the plaintiff; and (4) injunctive relief is in the interest of the public. The court determined, however, that there was no a likelihood that Minerva would succeed on the merits. As an initial matter, it noted that liability under the Lanham Act arises if an advertisement is literally false or literally true but, nevertheless, likely to mislead and confuse customers.

Minerva asserted that Hologic’s sales representatives explained or implied that the "without suction" video embodied Minerva’s technology and methods. The court determined that the video was not literally false because it was 15 years old and, therefore, a sales representative would not assert that the video depicted an ablation performed by Minerva’s newly created product, Minerva EAS. It determined that video was not impliedly false because even Hologic’s "talk track" statements, when analyzed in conjunction with the fact that NovaSure used suction, did not impliedly confer that the video represented Minerva EAS.

Minerva also alleged that Hologic was making misrepresentations to physicians regarding the safety of Minerva EAS. Because any data provided to the physicians was taken from a public FDA database, the court determined that Minerva did not establish that such data was misleading or confusing to physicians.

The court determined that Minerva would not suffer irreparable harm if its preliminary injunction was denied because: (1) it did not establish that the alleged misrepresentations were responsible for its alleged lost sales; and (2) money damages would compensate Minerva for any lost sales if it ultimately succeeded on the merits of its counterclaims.

The court also determined that the balance of equities was neutral and that Minerva’s vague allegation about Hologic’s statements regarding the safety of Minerva EAS was insufficient to show that injunctive relief was in the interest of the public.

The case is No. 15-1031-SLR.

Attorneys: Karen L. Pascale (Young, Conaway, Stargatt & Taylor LLP) and Amie L. Medley (Arnold & Porter) for Hologic, Inc. and Cytyc Surgical Products, LLC. Benjamin J. Schladweiler (Ross Aronstam & Moritz LLP) for Minerva Surgical, Inc.

Companies: Hologic, Inc.; Cytyc Surgical Products, LLC; Minerva Surgical, Inc.

Cases: Advertising StateUnfairTradePractices DelawareNews