Hey Jude, WTH? Competitor plaintiff fails despite falsity and presumed harm

Berken v. Jude, No. 12–cv–02555, 2013 WL 6152347 (D. Colo. Nov. 22, 2013)

Berken alleged that Jude and his law firm, Jude Law, LLC (really?), falsely advertised in violation of the Lanham Act and the Colorado Consumer Protection Act (CCPA).  In a decision that seems to misconstrue the meaning of “presumption,” the court denied Berken any relief despite the apparently clear false advertising.

The parties compete as consumer bankruptcy attorneys in Denver.  Jude’s ads appeared “whenever someone googled information on Denver bankruptcy” (note use of “googled” as verb):

$500 Flat Fee Bankruptcy—No Hidden Fees—BBB Accredited

On the firm’s home page appeared this ad:

A similar ad ran in a local newspaper.

Berken lost several customers to Jude’s lower prices, though each testified by affidavit that they weren’t influenced by the pricing ad.  Berken established falsity and materiality, but the court held that he failed to show likely injury.  Recovering damages requires showing actual injury, and the consumer affidavits stated that the ads had nothing to do with their decision to defect from Berken, but rather they were dissatisfied with his rates and persuaded by Jude’s positive reviews.  So much for the damages claims.

But injunctive relief doesn’t require actual damages, only likely injury.  Courts may presume injury when the parties are “obvious competitors” with respect to the service being misrepresented.  Because they provided the same services in the same market, and because consumers use only one bankruptcy attorney at a time, Berken was entitled to a presumption of injury.  “However, Plaintiff has failed to support that presumption with any evidence of injury.”  He didn’t show that he lost specific clients or that he lost revenues generally, or show any consumer testimony, surveys, or market studies showing how Jude’s ads affect consumer behavior.  Thus, he failed to establish a reasonable basis for his claim of likely injury. This also killed the state-law false advertising claim.

Comment: buh?  I thought that those entitled to a presumption could rely on it, in the absence of rebuttal. Otherwise, what’s a presumption for?
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