Antitrust Law Daily Wrap Up, ADVERTISING—D. Minn.: Mattress retailer was enjoined from making representations regarding competitor’s bedding products, (Dec 27, 2013)

By Linda O’Brien, J.D., LL.M.

A mattress retailer was enjoined from making representations to consumers regarding its competitor’s bedding products pending resolution of a bedding manufacturer’s claims against it for false advertising and trademark infringement under the Lanham Act and Minnesota False Statement in Advertising Act, the federal district court in St. Paul, Minnesota has ruled (Select Comfort Corporation v. Tempur Sealy International, d/b/a Tempur-Pedic, December 23, 2013, Frank, D.). An injunction with respect to its claims for trademark infringement was denied as premature.

Select Comfort Corporation is a designer, manufacturer, and marketer of mattresses and bedding products. Select Comfort sells bedding products under the Sleep Number brand and owns the registered trademark, Select Comfort. Its products are sold in Select Comfort retail stores, through direct marketing operations, and on the Select Comfort website. Mattress Firm Holding Corp., a retail seller of mattresses, sells a number of different brands, such as Tempur-Pedic, Sealy, and Serta. Mattress Firm sold Select Comfort products in its retail stores from 2005 to 2009, pursuant to a retail partner agreement, which Select Comfort terminated in 2009 as part of its strategy to focus its business on Select Comfort-owned stores. Select Comfort filed suit against Mattress Firm, alleging that Mattress Firm engaged in false and deceptive conduct by routinely disseminating false statements to consumers about Sleep Number beds and improperly using Select Comfort trademarks, in violation of the Lanham Act and Minnesota False Statement in Advertising Act. Select Comfort moved for a preliminary injunction, asserting that Mattress Firm’s ongoing activities were harming its sales, reputation, and goodwill.

False advertising. In granting Select Comfort’s motion for preliminary injunction regarding the false advertising claims, the court found that Select Comfort established a likelihood of success with respect to its false advertising claim. Its evidence of advertising flyers allegedly disseminated by Mattress Firm nationwide, containing false statements about Select Number beds, and false and disparaging statements routinely made by Mattress Firm employees created a reasonable inference that the statements constituted commercial advertising or promotion. The comparative flyers and sales associate representations could also diminish the product’s value in consumers’ minds and cause Select Comfort irreparable harm by the loss of goodwill and reputation. Additionally, it was in the public interest to enjoin any false advertising or comparisons.

Trademark infringement. Select Comfort did not establish a likelihood of success regarding its claim for trademark infringement. Consumer searches using Internet search engines and third-party websites did not cause confusion and results clearly indicated that Mattress Firm did not sell Select Comfort products. The possibility that a consumer search for Select Comfort products would be redirected to the Mattress Firm website was also insufficient to show irreparable harm. Moreover, to require Mattress Firm to control all websites with possible trademark issues was premature and did not serve the public interest. Since Select Comfort’s evidence was insufficient to show confusion or irreparable harm, the motion for a preliminary injunction with respect to the claim for trademark infringement was denied.

The case is No. 13-2451.

Attorneys: Andrew S. Hansen (Oppenheimer Wolff & Donnelly LLP) for Select Comfort Corporation. Arthur S. Beeman (Arent Fox LLP) for Tempur Sealy International, Inc. Brian D. Roche (Reed Smith LP) for Mattress Firm Holding Corp.

Companies: Select Comfort Corporation; Tempur-Sealy International, Inc.; Mattress Firm Holding Corp.

Cases: Advertising MinnesotaNews