Challenging materiality when literal falsity is conceded

Smart Vent, Inc. v. USA Floodair Vents, Ltd., 193 F.Supp.3d
395 (D.N.J. 2016)
Smart Vent alleged patent infringement and false advertising
related to competitor Floodair’s flood vents, which it allegedly falsely
claimed to be certified by various bodies. 
The regulations at issue, however, requried only certification, not
certification by specific parties; the real question was whether Floodair falsely
or misleadingly described its product as certified in accordance with a
standard known as TB-1. 
As a matter of law, the court determined that TB-1 called
for an individual certification different from that provided by Floodair. Thus,
the court granted partial summary judgment on falsity, but refused to find materiality
or harm to Smart Vent without further evidence. 
“While there is a reasonable inference that USA Floodair’s
misrepresentation that its product complies with TB-1 led to increasing its
sales and decreasing Smart Vent’s sales, that inference is unavailable to Smart
Vent as the movant in its summary judgment motion.”  The parties also agreed that appropriate
certification decreases flood insurance premiums, which “creates at least the
impression that certification-related statements would influence purchasing
decisions,” but that still left a triable issue.  Floodair provided some evidence that other
aspects of its product, such as cost effectiveness and ease of maintenance,
could also drive sales. 

from Blogger

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