In arguments this morning before the Supreme Court, Coca-Cola said that the label for its Minute Maid “Pomegranate Blueberry” juice (with “flavored blend of 5 juices” in smaller type below) complied with rules laid down by the FDA. Thus, Coca-Cola argued, the company could not be sued by POM for being “misleading” under the Lanham Act, which is designed to protect trademarks.
Chief Justice John Roberts appeared to disagree: “I don’t know why it’s impossible to have a label that fully complies with the FDA regulations and also happens to be misleading on the entirely different question of commercial competition, consumer confusion that has nothing to do with health.”
Justice Anthony Kennedy also disagreed with Coca-Cola’s assertion that consumers were sophisticated enough to know that other juices would be in the bottle because the food label contained the word “flavored” (a term of significance under FDA regulations): “Don’t make me feel bad because I thought that was pomegranate juice.”
Kennedy said pointedly at another instance: “I think it’s relevant for us to ask whether people are cheated in buying this product.”
And when Coca-Cola’s attorney disputed that the label was misleading, Justice Ruth Bader Ginsburg asserted, “Suppose that the reality is that consumers are misled.”
Please also see the Washington Post’s excellent article on the oral argument.
On Monday, April 21st, the Supreme Court will hear argument in POM Wonderful v. Coca-Cola, which I recently wrote about here. The question before the high court is whether a company may bring deceptive advertising claims under Federal Law with respect to a statement specifically allowed under FDA regulations. In this case, POM alleged that Coke’s marketing of its Minute Maid “Pomegranate Blueberry” juice violated the Lanham Act because consumers are misled to believe that the drink consists primarily of pomegranate and blueberry juices. The lower courts resolved case in Coke’s favor on preemption grounds because the product’s label was in full compliance with FDA guidelines.
If the Supreme Court sides with POM, it will significantly alter the existing legal landscape. Presently, the Lanham Act yields to FDA regulations on preemption grounds when the two are in conflict. In other words, potentially deceptive labels are allowed if the relevant statements have been specifically approved by the FDA. A ruling in POM’s favor would effectively nullify this safe harbor with the result that anything on a label could be a potential target in litigation.
Sazerac Co., the owner of the Buffalo Trace Distillery and its flagship BUFFALO TRACE bourbon, has filed suit against Crosby Lakes Spirits, Co. in the Western District of Kentucky for federal trademark and trade dress infringement and unfair competition. Sazerac complains that Crosby Lakes Spirits’ BISON RIDGE Canadian Whiskey is a competing product with a confusingly similar trademark and product packaging.
Each of the BISON RIDGE bottles prominently feature a sketched rendering of a standing, forward-facing buffalo, similar to the Buffalo Logo displayed on Sazerac’s BUFFALO TRACE product packaging. As with Sazerac’s BUFFALO TRACE whiskey, BISON RIDGE whisky is golden brown in color and both of its products (BISON RIDGE BLENDED CANADIAN WHISKY and BISON RIDGE SPECIAL RESERVE CANADIAN WHISKY) are marketed in clear bottles featuring the same color combination of brown, white, and gold. In addition, as with Sazerac’s BUFFALO TRACE product packaging, the neck label on the 1.0 Liter and 1.5 Liter BISON RIDGE BLENDED CANADIAN WHISKY products incorporate an image of a forward-facing buffalo in gold situated in between and immediately above the words “BISON” and “RIDGE,” which are displayed in white font.
The defendant has responded to the Complaint with a motion to dismiss for improper venue, arguing that the case should have been brought in Minnesota.
This case highlights that owners of well-known brands (and if you know bourbon then you know Buffalo Trace) must vigilantly police their trademark and trade dress rights. Here, even if a reasonable consumer might not mistakenly purchase the BISON RIDGE product believing it was BUFFALO TRACE bourbon, there is a solid argument that a reasonable consumer would believe the BISON RIDGE product is sponsored by, approved by, or otherwise associated with Sazerac and its Buffalo Trace product. And if Sazerac did not take action, then its trade mark and trade dress would be somewhat weakened since there would multiple buffalo / bison marks in the same product category, i.e., whiskey.