Antitrust Law Daily Wrap Up, ADVERTISING—DSC: Grass Seller Not Liable for False “New Variety” Claims Without Proof of Materiality and Causation of Injury, (Mar 18, 2013)

By William Zale, J.D.

Grass seller Carolina Fresh Farms could not be held liable on summary judgment for falsely advertising common centipede grass as a “new variety” after the termination of an agreement that had authorized Carolina Fresh to sell TifBlair, a certified variety of centipede grass (The Turfgrass Group, Inc. v. Carolina Fresh Farms, Inc., March 11, 2013, Childs, J.). There remained genuine disputes of fact on other elements of the Lanham Act claim brought by TifBlair sublicensee Turfgrass Group and the University of Georgia Research Foundation, which held the TifBlair license issued by the United States Department of Agriculture’s Agricultural Research Service.

In the late 1990s, Turfgrass entered into an agreement with Carolina Fresh that allowed Carolina Fresh to grow, market, and sale TifBlair grass under certain conditions. The agreement remained in place until it was terminated by Turfgrass in November 2006.

The false advertising claims centered on Carolina Fresh’s continued use of marketing materials describing TifBlair grass by simply changing the name of the grass to “Carolina green.” The plaintiffs contended that the descriptions used in the marketing materials for TifBlair through 2006 are particular to the properties of TifBlair grass and, by using the exact language and marketing materials for Carolina Green, Carolina Fresh violated the Lanham Act causing confusion in the marketplace regarding the attributes and quality of TifBlair versus Carolina Green grasses.

The plaintiffs presented an admission that Carolina Fresh did not develop any new variety of centipede grass and that Carolina Green was merely Carolina Fresh’s branding name for common centipede. While this testimony arguably eliminates any factual dispute as to the falsity of the statement in Carolina Fresh’s brochures, many of the other elements required to establish a Lanham Act violation remain disputed when viewed in the light most favorable to Carolina Fresh, the court observed. For example, there are genuine disputes of fact regarding the materiality of the representations, whether the representations were actually deceptive or tended to be deceptive, and whether the plaintiffs’ injuries resulted from the representations. Particularly, there was a genuine dispute concerning whether the language used in the marketing materials were unique to the properties of TifBlair such that the use of those terms would create confusion in the marketplace as compared to common centipede, the court said.

The case is No. 5:10-cv-00849-JMC.

Attorneys: Damon C. Wlodarczyk (Riley Pope and Laney) for Turfgrass Group, Inc. Christian E. Boesl (Collins and Lacy) for Carolina Fresh Farms, Inc.

Companies: Turfgrass Group, Inc.; Carolina Fresh Farms, Inc.; University of Georgia Research Foundation

Cases: Advertising SouthCarolinaNews