Crocs sues for Patent Infringement
(Seattle, WA) Don’t lie about your products. (We need to be reminded about this, apparently.) More specifically, if something isn’t patented … don’t say that it’s patented.
Crocs sued several footwear distributors Double Diamond Distribution, Ltd.; U.S.A. Dawgs, Inc.; and Mojave Desert Holdings, LLC (collectively, “Dawgs”) (collectively “Dawgs”) for patent infringement. Dawgs counterclaimed under Section 43(a) of the Lanham Act regarding certain statements made by Crocs.
Dawgs says Crocs’ Patent is a Croc
According to Dawgs, Crocs’ website falsely described Croslite as “patented,” “proprietary,” and “exclusive” (collectively, “patented”). Dawgs alleged that by promoting Croslite as “patented,” Crocs misled current and potential customers to believe that “Crocs’ molded footwear is made of a material that is different than any other footwear.” The company alleges that Crocs’ statements deceived consumers into believing that its competitors’ molded footwear products are “made of inferior material compared to Crocs’ molded footwear.”
Judge: “That’s a no for me Dawgs.”
The district court ruled against Dawgs on Crocs’ motion for summary judgment, stating that that the terms “patented,” “proprietary,” and “exclusive” were claims of false designation of authorship of the shoe products and not “the nature, characteristics, or qualities” of Crocs’ products.
Court of Appeals: “That’s a yes for me Dawgs”
On October 3, the Court of Appeals for the Federal Circuit (CAFC) agreed with Dawgs. (Full opinion here.) Dawgs argued it has stated a cause of action because the falsehood that Croslite is “patented” was used by Crocs to ascribe characteristics that go to the nature and qualities of Croslite. It alleges that “Crocs’ statements referring to the closed-cell resin that [it] call[s] ‘Croslite’ as ‘exclusive,’ ‘proprietary,’ and/or ‘patented’” causes customers to believe that “Crocs’ molded footwear is made of a material that is different than any other footwear.”
Dawgs further insists that Crocs’ promotional materials “deceive consumers and potential consumers into believing that all other molded footwear . . . is made of inferior material compared to Crocs’ molded footwear.”
The CAFC held that Dawgs’ allegations about Crocs’ advertisement statements are directed to the nature, characteristics, or qualities of Crocs’ shoes.
Conclusion
A cause of action arises from Section 43(a)(1)(B) where a party falsely claims that it possesses a patent on a product feature and advertises that product feature in “a manner that causes consumers to be misled about the nature, characteristics, or qualities of its product.”
In Other Words…
If you don’t have a patent on a feature, don’t say that it’s exclusive or proprietary. You will open yourself up to liability under Section 43(a) of the Lanham Act.
