Speech in study would be commercial if knowingly false, court rules

Crossfit, Inc. v. National Strength & Conditioning Ass’n,
2016 WL 5118530,  No. 14cv1191 (S.D. Cal.
Sept. 21, 2016)
CrossFit generates revenue by credentialing and certifying
fitness trainers for a fee and through licensing the CrossFit trademark and
other intellectual property to affiliate gyms. The NSCA is a nonprofit
corporation that is “dedicated to the educational and professional exchange of
ideas in the areas of strength development, athletic performance, and fitness.”
It offers educational publications and also certifies fitness professionals for
a fee. One of the NSCA’s publications is its “flagship journal,” the Journal of
Strength and Conditioning Research (JSCR).
In November 2013, the JSCR published “Crossfit-based high
intensity power training improves maximal aerobic fitness and body composition.”
Though much of the article praised CrossFit’s effectiveness, one passage says:
Out of the original 54
participants, a total of 43 (23 males, 20 females) fully completed the training
program and returned for follow up testing. Of the 11 subjects who dropped out
of the training program, two cited time concerns with the remaining nine
subjects (16% of total recruited subjects) citing overuse or injury for failing
to complete the program and finish follow up testing.
Revisiting the point, the article says, “[a] unique concern
with any high intensity training programs such as HIPT or other similar
programs is the risk of overuse injury. In spite of a deliberate periodization
and supervision of our Crossfit-based training program by certified fitness
professionals, a notable percentage of our subjects (16%) did not complete the
training program and return for follow-up testing.”  The study received attention in social media
outlets and from news media.
CrossFit identified the individuals who purportedly did not
complete the study because of “overuse or injury,” and many of these
individuals provided declarations explaining their actual reasons for not
completing the challenge, which weren’t based on overuse or injury. The initial
manuscript submitted to the JSCR did not include any injury data, and the study’s
author said that he only included them after “the peer reviewers and JSCR
editors requested information about why 11 participants failed to test out.”
CrossFit argued that the inclusion of these data at the JSCR editorial staff’s
direction was evidence of the NSCA’s desire to “manufacture a ‘scientific’
study concluding CrossFit training was unsafe.” JSCR’s Managing Editor wrote: “You
also need to caution readers as to the context of your findings due to the fact
many people do get injured doing these types of workouts,” directing the study’s
author to another study finding CrossFit to be dangerous, authored by the
Managing Editor himself.
The JSCR published an erratum stating:
After the article was published, 10
of the 11 participants who did not complete the study have provided their
reasons for not finishing, with only 2 mentioning injury or health conditions
that prevented them from completing follow-up testing. In light of this
information, injury rate should not be considered a factor in this study. This
change does not affect the overall conclusion of the article.
CrossFit submitted a consumer survey on materiality. Some
participants saw the original statement reporting a 16% injury rate and others saw
a modified version with the language “CrossFit’s programs injury rates are very
much in line with injury rates for the physical fitness industry as a whole.”
Respondents exposed to the former “[w[ere 2.4 times as likely to rate CrossFit
training as dangerous,” and were “twice as unlikely to say they would purchase
a 12 month trial membership for CrossFit training.”
The court granted summary judgment on literal falsity,
though other elements of CrossFit’s claims remained.  In particular, the NSCA argued that the
journal article was noncommercial speech fully protected by the First Amendment
and not subject to the Lanham Act.
The court noted that speech can be commercial even when it
contains “discussions of important public issues.” Further, courts must be
particularly careful when reviewing causes of action directed toward academic
works, “because academic freedom is ‘a special concern of the First Amendment.’
“ ONY, Inc. v. Cornerstone Therapeutics, Inc., 720 F.3d 490 (2d Cir. 2013).  However, ONY
was careful to limit its scope to cases in which “a speaker or author draws
conclusions from non-fraudulent data, based on accurate descriptions of the
data and methodology underlying those conclusions, on subjects about which
there is legitimate ongoing scientific disagreement.”  ONY
noted that “it is relevant that plaintiff does not allege that the data
presented in the article were fabricated or fraudulently created.”  Query: Why does falsity of data bear on the
classification of the article as commercial or noncommercial speech?  ONY actually
doesn’t present itself as a commercial speech case—defendants were allowed to
make their claims, as long as they were accurate descriptions of the data and
methodology, in classic ads too. 
Nonetheless, the court here held:
a reasonable fact finder could
conclude that the NSCA fabricated the injury data and published them in the
JSCR knowing they were false with the intention of protecting its market share
in the fitness industry and diminishing the burgeoning popularity of the
CrossFit program. If the trier of fact were to draw that conclusion from the
evidence, the injury data would be commercial speech.
Analytically speaking, this puts the cart before the horse—you
only know if it’s commercial speech once you know it’s false.  (Next query: what if this wasn’t knowing
falsity, just falsity, which is generally sufficient under the Lanham Act and
which the court has already found to exist? 
Why would state of mind be relevant to whether this is commercial
speech?)  It might be a reasonable
practical compromise, however, especially given that I’m no great fan of ONY.
The court here continued that the paper as a whole was far
more than a proposed commercial transaction, “but the excerpts based on
potentially fabricated data about a competitor’s product may nonetheless be
commercial speech.” A reasonable fact finder
could conclude that the NSCA
pressured the authors to include data disparaging CrossFit’s exercise regimen,
and the editor-in-chief’s admonition—“[r]emember the paper can still be
rejected if the reviewers are not impressed with the sophistication of the
revisions made”—could be construed as a veiled threat that the JSCR would not
be interested in publishing the Devor Study if it did not include information
showing “the fact many people do get injured doing these types of workouts,”
whether or not that “fact” was true in this qualitative study.
However, a reasonable factfinder could also conclude that “the
editor-in-chief was simply bringing his knowledge of the fitness industry to
bear and sincerely believed (or for that matter still believes) that CrossFit
has a high injury rate, as opposed to an attempt to denigrate CrossFit for the
NSCA’s benefit.”
Under the Bolger
factors, the study didn’t explicitly promote the NSCA’s products or services, and
wasn’t typical advertising content. The factor dealing with reference to a
specific product, though typically geared to self-promotion, could also apply
to disparagement of another’s product, especially given that the Lanham Act
explicitly reaches such disparagement. 
And NSCA had an economic motive for publishing the data.  Nor were the noncommercial elements of the
study inextricably intertwined with commercial speech:
[A]ssuming the injury data were
false and injected into the article to deride CrossFit’s product, it would have
been easy enough to publish an article with data that were not made up, and one
could easily imagine the Devor Study without the statements premised on these
false data. In fact, the Erratum shows that the parts of the article that may
constitute commercial speech are not inextricably intertwined with the
remainder of the article.

The court also allowed California FAL and trade libel claims
to proceed.  Though trade libel usually
requires a showing of special damages, some cases have allowed plaintiffs to
show instead a “general loss of custom[ers],” by “showing an established
business, the amount of sales for a substantial period preceding the
publication, the amount of sales subsequent to the publication, [and] facts
showing that such loss in sales were the natural and probable result of such
publication.”  CrossFit might be able to
satisfy that standard.

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