Antitrust Law Daily Wrap Up, ADVERTISING—NDOkla: Wrap Maker’s False Depiction of Competitor’s Product as Its Own Brand Violates Federal, Oklahoma Trade Laws, (Feb 6, 2013)

By E. Darius Sturmer, J.D.

A manufacturer of composite wrap products used to repair leaking or corroded piping systems, CTI Services, L.L.C., was entitled to judgment in its favor on Lanham Act and Oklahoma Deceptive Trade Practices Act claims it brought against a competitor for several literally false statements the competitor made in brochures and on its website, the federal district court in Tulsa has ruled (CTI Services, L.L.C. v. Energy Maintenance Services Group I, L.L.C., February 4, 2013, Frizzell, G.).

The court rejected an argument by the competitor—Energy Maintenance Services Group I, L.L.C. (EMS)—that summary judgment on liability would be “inappropriate because it did not make the misrepresentations intentionally or maliciously.” CTI’s motion for partial summary judgment was granted.

EMS’s predecessor entity, Energy Facility Services, Inc. (EFSI), which was a distributor of CTI’s Diamond Wrap and other products, was alleged to have reverse engineered Diamond Wrap to develop a similar product, I-Wrap, then removed from advertising materials references to the Citadel name under which CTI did business and converted Diamond Wrap users to I-Wrap. EMS conceded that two different EFSI brochures, and twenty-four different EFSI websites, contained literally false representations of Citadel’s Diamond Wrap as “EFS’s Diamond Wrap.”

Because neither the ODTPA nor the Lanham Act required a showing of intent to establish a violation, and EMS had conceded that its conduct violated both laws, CTI was entitled to summary judgment as to liability.

The case is: No. 9-CV-144-GKF-TLW.

Companies: CTI Services, L.L.C.; Energy Maintenance Services Group I, L.L.C.; Energy Facility Services, Inc.

Cases: Advertising StateUnfairTradePractices OklahomaNews