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POM Wonderful LLC v. Coca-Cola Co. - 573 U.S. 102, 134 S. Ct. 2228 (2014)

Rule:

The Lanham Act, 15 U.S.C.S. § 1125(a), creates a cause of action for unfair competition through misleading advertising or labeling. Though in the end consumers also benefit from the Lanham Act’s proper enforcement, the cause of action is for competitors, not consumers. Competitors are within the class that may invoke the Lanham Act because they may suffer an injury to a commercial interest in sales or business reputation proximately caused by a defendant’s misrepresentations.

Facts:

The case involved the intersection of two federal statutes. Under the Lanham Act, one competitor is permitted to sue another for unfair competition arising from false or misleading product descriptions. On the other hand, the Federal Food, Drug, and Cosmetic Act (FDCA) prohibits the misbranding of food and drink. To implement the FDCA's provisions, the Food and Drug Administration (FDA) has promulgated regulations regarding food and beverage labeling, including one concerning juice blends. Unlike the Lanham Act, which relies in large part for its enforcement on private suits brought by injured competitors, the FDCA and its regulations gave the United States nearly exclusive enforcement authority and did not permit private enforcement suits. The FDCA also pre-empted certain state misbranding laws. Petitioner POM Wonderful LLC (POM), which produces, markets, and sells, inter alia, a pomegranate-blueberry juice blend, filed a Lanham Act suit against respondent Coca-Cola Company, alleging that the name, label, marketing, and advertising of one of Coca-Cola's juice blends mislead consumers into believing the product consisted predominantly of pomegranate and blueberry juice when it in fact consisted of predominantly of less expensive apple and grape juices, and that the ensuing confusion caused POM to lose sales. The District Court granted partial summary judgment to Coca-Cola, ruling that the FDCA and its regulations preclude Lanham Act challenges to the name and label of Coca-Cola's juice blend. The Ninth Circuit affirmed in relevant part. The United States Supreme Court granted POM's petition for certiorari review.

Issue:

Did the FDCA, and its regulations, preclude Lanham Act challenges to the name and label of Coca-Cola’s juice blend?

Answer:

No.

Conclusion:

The Court held that POM was entitled to bring its Lanham Act claim challenging Coca-Cola’s beverage labeling, which was regulated by the FDCA, since the statutes were complementary in scope and purpose. According to the Court, neither statute expressly precluded nor limited claims challenging labels regulated by the FDCA, and federal oversight of labeling under the FDCA for the protection of consumers was not in conflict with actions between competitors under the Lanham Act for the protection of competition. Further, the statutory remedies were also complementary in that enforcement of the FDCA was largely committed to a federal agency, while the Lanham Act empowered private parties to sue competitors to protect their interests on a case-by-case basis.

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