American Italian v. New World Pasta Co. ( 2004 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 03-2065
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American Italian Pasta Company, *
*
Appellee, *
* Appeal from the United States
v. * District Court for the
* Western District of Missouri.
New World Pasta Company, *
*
Appellant. *
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Submitted: November 17, 2003
Filed: June 7, 2004
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Before RILEY, RICHARD S. ARNOLD, and MELLOY, Circuit Judges.
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RILEY, Circuit Judge.
“America’s Favorite Pasta”–Commercial puffery or factual claim?
American Italian Pasta Company (American) sued New World Pasta Company
(New World), seeking a declaratory judgment that American’s use of the phrase
“America’s Favorite Pasta” does not constitute false or misleading advertising under
section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B) (2000). New World
counterclaimed, asserting American’s use of “America’s Favorite Pasta” violated the
Lanham Act and many states’ unfair competition laws. On summary judgment, the
district court1 concluded American’s use of “America’s Favorite Pasta” did not
violate the Lanham Act, dismissing New World’s counterclaims and declining to
exercise jurisdiction over New World’s state law claims. We affirm.
I. BACKGROUND
From 1997 to 2000, American2 manufactured Mueller’s brand (Mueller’s) dried
pasta for Best Foods. In the fall of 2000, American purchased Mueller’s and assumed
all packaging, distributing, pricing, and marketing for the brand. Since purchasing
Mueller’s, American has placed the phrase “America’s Favorite Pasta” on Mueller’s
packaging. On various packages, the phrases “Quality Since 1867,” “Made from
100% Semolina,” or “Made with Semolina” accompany the phrase “America’s
Favorite Pasta.” The packaging also contains a paragraph in which the phrase
“America’s Favorite Pasta” appears. The paragraph states (1) pasta lovers have
enjoyed Mueller’s pasta for 130 years; (2) claims Mueller’s “pasta cooks to perfect
tenderness every time,” because Mueller’s uses “100% pure semolina milled from the
highest quality durum wheat;” and (3) encourages consumers to “[t]aste why
Mueller’s is America’s favorite pasta.”
New World3 sent American a letter demanding American cease and desist using
the phrase “America’s Favorite Pasta.” Consequently, American filed this suit,
requesting a declaration that its use of the phrase “America’s Favorite Pasta” does not
constitute false or misleading advertising under the Lanham Act. In its federal
1
The Honorable Scott O. Wright, United States District Judge for the Western
District of Missouri.
2
American sells dried pasta under the brand names Mueller’s, Golden Grain,
Mrs. Grass, Ronco, Luxury, R & F, Global A1, Pennsylvania Dutch, and Anthony’s.
3
New World sells dried pasta under the brand names Ronzoni, San Giorgio,
Skinner, American Beauty, Light n’ Fluffy, Goodman, Mrs. Weiss, Prince, Creamette,
Monder, Albadoro, Catelli, Lancia, and Ronzoni Canada.
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counterclaim, New World asserted American’s use of “America’s Favorite Pasta”
violated the Lanham Act. New World claims American’s use of the phrase is false
or misleading advertising, because, according to New World’s consumer survey, the
phrase conveys Mueller’s is a national pasta brand or the nation’s number one selling
pasta. American and New World agree Barilla sells the most dried pasta in the United
States and American’s brands are regional.
American moved to dismiss New World’s counterclaims, arguing the phrase
“America’s Favorite Pasta” constituted non-actionable puffery. New World resisted
American’s motion and filed a motion for partial summary judgment. The district
court denied American’s motion, concluding it would have to consider facts outside
the pleadings to determine if the phrase “America’s Favorite Pasta” constituted
puffery. Two weeks later, the district court denied New World’s motion for partial
summary judgment, dismissed New World’s Lanham Act counterclaim, and declined
to exercise jurisdiction over New World’s state law counterclaims. The district court
concluded the phrase “America’s Favorite Pasta” constitutes non-actionable puffery
as a matter of law, and the phrase is not actionable under the Lanham Act. New
World appeals, contending the phrase “America’s Favorite Pasta” is not puffery, but
is a deceptive factual claim.
II. DISCUSSION
We review the district court’s summary judgment decision de novo. Interstate
Cleaning Corp. v. Commercial Underwriters Ins. Co., 325 F.3d 1024, 1027 (8th Cir.
2003). A purpose of the Lanham Act is “to protect persons engaged in commerce
against false advertising and unfair competition.” United Indus. Corp. v. Clorox Co.,
140 F.3d 1175, 1179 (8th Cir. 1998). To establish a false or deceptively misleading
advertising claim under section 43(a) of the Lanham Act,4 New World must establish:
4
Section 43(a) of the Lanham Act states, in pertinent part:
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(1) a false statement of fact by [American on its packaging] about its
own or another’s product; (2) the statement actually deceived or has the
tendency to deceive a substantial segment of its audience; (3) the
deception is material, in that it is likely to influence the purchasing
decision; (4) the defendant caused its false statement to enter interstate
commerce; and (5) the plaintiff has been or is likely to be injured as a
result of the false statement.
Id. at 1180 (emphasis added). The failure to establish any element of the prima facie
case is fatal. Pizza Hut, Inc. v. Papa John’s Int’l, Inc., 227 F.3d 489, 495 (5th Cir.
2000).
Under section 43(a), two categories of actionable statements exist: (1) literally
false factual commercial claims; and (2) literally true or ambiguous factual claims
“which implicitly convey a false impression, are misleading in context, or [are] likely
to deceive consumers.” United Indus., 140 F.3d at 1180. Besides actionable
statements, a category of non-actionable statements exists. Id. Many statements fall
into this category, popularly known as puffery. Id. Puffery exists in two general
(1) Any person who, on or in connection with any goods . . . uses in
commerce any . . . false or misleading description of fact, or false or
misleading representation of fact, which –
...
(B) in commercial advertising or promotion, misrepresents the
nature, characteristics, qualities, or geographic origin of his or her
or another person’s goods, services, or commercial activities,
shall be liable in a civil action by any person who believes that he or she
is or is likely to be damaged by such act.
15 U.S.C. § 1125(a) (emphasis added).
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forms: (1) exaggerated statements of bluster or boast upon which no reasonable
consumer would rely; and (2) vague or highly subjective claims of product
superiority, including bald assertions of superiority. Pizza Hut, 227 F.3d at 496-97;
United Indus., 140 F.3d at 1180.
Juxtaposed to puffery is a factual claim. A factual claim is a statement that “(1)
admits of being adjudged true or false in a way that (2) admits of empirical
verification.” Pizza Hut, 227 F.3d at 496 (quoting Presidio Enters., Inc. v. Warner
Bros. Distrib. Corp., 784 F.2d 674, 679 (5th Cir. 1986)). To be actionable, the
statement must be a “specific and measurable claim, capable of being proved false or
of being reasonably interpreted as a statement of objective fact.” Coastal Abstract
Serv., Inc. v. First Am. Title Ins. Co., 173 F.3d 725, 731 (9th Cir. 1999); cf. United
Indus., 140 F.3d at 1180 (noting puffery does not include “false descriptions of
specific or absolute characteristics of a product and specific, measurable claims of
product superiority”). Generally, opinions are not actionable. Coastal Abstract, 173
F.3d at 731.
Puffery and statements of fact are mutually exclusive. If a statement is a
specific, measurable claim or can be reasonably interpreted as being a factual claim,
i.e., one capable of verification, the statement is one of fact. Conversely, if the
statement is not specific and measurable, and cannot be reasonably interpreted as
providing a benchmark by which the veracity of the statement can be ascertained, the
statement constitutes puffery. Defining puffery broadly provides advertisers and
manufacturers considerable leeway to craft their statements, allowing the free market
to hold advertisers and manufacturers accountable for their statements, ensuring
vigorous competition, and protecting legitimate commercial speech.
A. “America’s Favorite Pasta” Standing Alone
The phrase “America’s Favorite Pasta,” standing alone, is not a statement of
fact as a matter of law. The key term in the phrase “America’s Favorite Pasta” is
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“favorite.” Used in this context, “favorite” is defined as “markedly popular especially
over an extended period of time.” Webster’s Third New International Dictionary 830
(unabridged 1961). Webster’s definition of “favorite” begs the question of how
“popular” is defined. In this context, “popular” is defined as “well liked or admired
by a particular group or circle.” Id. at 1766. By combining the term “favorite” with
“America’s,” American claims Mueller’s pasta has been well liked or admired over
time by America, a non-definitive person.5
“America’s Favorite Pasta” is not a specific, measurable claim and cannot be
reasonably interpreted as an objective fact. “Well liked” and “admired” are entirely
subjective and vague. Neither the words “well liked” nor “admired” provide an
empirical benchmark by which the claim can be measured. “Well liked” and
“admired” do not convey a quantifiable threshold in sheer number, percentage, or
place in a series. A product may be well liked or admired, but the product may not
dominate in sales or market share. For example, assume a consumer’s favorite cut of
meat is beef tenderloin. If we were to look at the sheer amount of beef tenderloin our
hypothetical consumer buys relative to other cuts of meat, beef tenderloin may not
have a sizable market share or account for a significant percentage of the amount of
money spent on meat. Therefore, we could not accurately determine whether beef
tenderloin was the consumer’s favorite cut of beef based on those benchmarks. The
fact is, the consumer may admire beef tenderloin and like it best among beef cuts, but
beef tenderloin is too expensive for our consumer to eat often. Likewise, sales
volume and total dollars spent on particular pasta brands in the United States may not
uncover America’s favorite pasta.
5
We note the outcome of this case might be different if American claimed
Mueller’s pasta was the favorite pasta of a specific person or an identifiable group.
Such a claim might be a statement of fact. For example, the claim that Mueller’s is
Judge Michael Melloy’s favorite pasta would not be puffery. Such a statement is a
factual statement that could be verified by simply asking Judge Melloy which pasta
brand is his favorite.
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“America’s Favorite Pasta” also does not imply Mueller’s is a national brand.
First, “America’s” is vague, and “America’s,” as well as “America” and “American”
used in a similar context, is a broad, general reference. Second, a brand, chain, or
product could be America’s favorite without being national. For example, an
individual restaurant or restaurant chain may be America’s favorite, but may be
located only in one or a few states. Although the restaurant chain may not be
available nationally, consumers may prefer the restaurant because of its quality of
food, quality of service, atmosphere, or some other attribute. Because “America’s
Favorite” depends on numerous characteristics, many of which may be intrinsic, a
product (be it a restaurant, grits, or pasta) need not be sold nationally to be America’s
favorite.
B. “America’s Favorite Pasta” Viewed In Context
Having decided the phrase “America’s Favorite Pasta,” standing alone, is not
a statement of fact, we consider whether the context in which the phrase is used by
American transforms it into a statement of fact. See Pizza Hut, 227 F.3d at 495 n.5
(noting the context in which a statement appears can be used to determine if the
statement is actionable under the Lanham Act). “America’s Favorite Pasta” appears
on Mueller’s packaging in two places. First, Mueller’s packaging contains the phrase
“America’s Favorite Pasta” in the following paragraph (Paragraph):
For over 130 years, pasta lovers have enjoyed the great taste of
Mueller’s. Our pasta cooks to perfect tenderness every time because it’s
made from 100% pure semolina milled from the highest quality durum
wheat. Taste why Mueller’s is America’s favorite pasta.
Second, “America’s Favorite Pasta” appears directly above “Quality Since 1867” on
some packaging, and directly above “Made from 100% Semolina” or “Made with
Semolina” on other packaging (Phrases).
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The Paragraph and the Phrases fail to transform “America’s Favorite Pasta”
into a statement of fact. The Paragraph does not suggest a benchmark by which the
veracity of American’s statement can be verified. The Paragraph generally declares
the brand has existed for 130 years, Mueller’s tastes great, cooks to perfect
tenderness, and is manufactured from high quality grain. We assume, arguendo, the
sentence “Taste why Mueller’s is America’s favorite pasta” incorporates the attributes
listed in the Paragraph into American’s claim. Two attributes listed in the Paragraph
are subject to verification: Mueller’s is made from 100% pure semolina, and the
brand is more than 130 years old. New World does not contend these claims are
false. The remaining attributes listed in the Paragraph are unquantifiable and subject
to an individual’s fancy.
Notwithstanding the incorporation of these claims into “America’s Favorite
Pasta,” the unverifiable attributes attenuate verifiable, and accurate, claims. “Taste
why Mueller’s is America’s favorite pasta” suggests all of the attributes listed in the
Paragraph are the reason Mueller’s is “America’s Favorite Pasta” and suggests each
carries equal weight. The unquantifiable attributes coupled with two verifiable
attributes do not render the phrase “America’s Favorite Pasta” subject to verification.
Similarly, the Phrases do not convey a benchmark for “America’s Favorite
Pasta.” The term “quality” is vague, entirely subjective, and a bare assertion of
product superiority. In the context used, “quality” means “inherent or intrinsic
excellence of character or type” or “superiority in kind.” Webster’s Third New
International Dictionary 1858 (unabridged 1961). The only portion of “Quality Since
1867” that can be verified is “Since 1867,” but “Since 1867” does not provide a
methodology or a reason why Mueller’s is America’s favorite. The words simply
state, accurately, when the brand was founded. Likewise, while presenting factual
claims, the phrases “Made from 100% Semolina” and “Made with Semolina” do not
define a methodology by which to ascertain the veracity of American’s claim that
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Mueller’s is “America’s Favorite Pasta.” The two phrases simply, and correctly, list
characteristics of the pasta.
C. Consumer Surveys
We now consider whether the results of New World’s consumer survey
transform the phrase “America’s Favorite Pasta” into a specific, measurable claim.
In its survey, New World asked consumers if the phrase “America’s Favorite Pasta”
conveyed a meaning. According to New World, thirty-three percent of those
surveyed allegedly perceived the phrase “America’s Favorite Pasta” to mean
Mueller’s is the number one brand. Fifty percent of those surveyed allegedly
perceived the phrase “America’s Favorite Pasta” to mean Mueller’s is a national
brand.
The Seventh Circuit confronted a similar question in Mead Johnson & Co. v.
Abbott Laboratories, 201 F.3d 883 (7th Cir.), opinion amended on denial of reh’g,
209 F.3d 1032 (7th Cir. 2000). Having concluded the phrase “1st Choice of Doctors”
conveyed more doctors prefer this product over its rivals, the Seventh Circuit
considered whether a consumer survey can assign a different meaning to a phrase.
Id. at 883-84. Mead Johnson’s survey indicated consumers perceived the phrase “1st
Choice of Doctors” to mean a majority of doctors. Concluding the district court erred
in using the survey to assign such a meaning, the Seventh Circuit noted, “never before
has survey research been used to determine the meaning of words, or to set the
standard to which objectively verifiable claims must be held.” Id. at 886. While
acknowledging dictionaries are surveys by people who devote their entire lives to
discovering the usage of words, the Seventh Circuit cogitated “[i]t would be a bad
idea to replace the work of these professionals with the first impressions of people on
the street.” Id. The Seventh Circuit reasoned that using consumer surveys to
determine the benchmark by which a claim is measured would remove otherwise
useful words from products and would reduce ads and packaging to puffery. Id. at
886-87.
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We agree with the Seventh Circuit. To allow a consumer survey to determine
a claim’s benchmark would subject any advertisement or promotional statement to
numerous variables, often unpredictable, and would introduce even more uncertainty
into the market place. A manufacturer or advertiser who expended significant
resources to substantiate a statement or forge a puffing statement could be blind-sided
by a consumer survey that defines the advertising statement differently, subjecting the
advertiser or manufacturer to unintended liability for a wholly unanticipated claim the
advertisement’s plain language would not support. The resulting unpredictability
could chill commercial speech, eliminating useful claims from packaging and
advertisements. As the Seventh Circuit noted, the Lanham Act protects against
misleading and false statements of fact, not misunderstood statements. Id. at 886.
III. CONCLUSION
For the foregoing reasons, we affirm.
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