claim to cure addiction can be false advertising, as can hidden bias

Grasshopper House, LLC v. Clean and Sober Media LLC, 2018 WL
6133710, No. 18-cv-00923-SVW-RAO (C.D. Cal. Oct. 18, 2018)
This is a dispute about addiction treatment. Counterclaim plaintiff
Cliffside alleged that counterdefendant Passages violated the Lanham Act (1) by
maintaining and operating websites with the appearance of neutrality or
independence that actually promote Passages’ services without disclosing the
affiliation to Passages, and (2) by representing that Passages possesses a
“cure” for addiction via its treatment program and that a specific person was
fully “cured” of addiction after completing the treatment program. Passages
moved to dismiss and invoked California’s anti-SLAPP law, but both measures failed.
The court held that “websites violate the Lanham Act when
they take advantage of their purported lack of bias to disseminate false or
misleading information,” and that the “failure to disclose bias can be
actionable under the Lanham Act ‘where that failure renders some other
affirmative statement false or misleading.’ ” Cliffside sufficiently alleged
that Passages operated websites that conveyed a lack of bias in order to
disseminate information promoting Passages’ services, including direct links to
Passages’ website.
Anti-SLAPP motion: “While Passages’ statements generally
proclaiming that addiction can be ‘cured’ could be considered to be an issue of
public interest,” those statements were part of its advertising.  Passages’ website repeatedly promised a cure,
e.g., “we want to help you identify why you are using so that you can be cured
of addiction, forever,” and
Our team of highly skilled
therapists will show you or your loved one how to completely cure your
dependency. I want you to notice that I do not mince words. I do not say
“however,” “maybe,” “although,” “perhaps,” or use other qualifying terms or
conditions. We will show you how to bring about a cure. That statement is based
on the results we achieve at Passages, the world’s most effective center for
the treatment of substance abuse, where our success rate at the time of this
writing is 84.4%.
A “promotional book” claims that, through Passages’
treatment plan as detailed in the book, “[o]nce the underlying problems are
discovered and cured, the need for drugs, alcohol, or addictive behavior will
disappear—along with the craving.” And Passages repeatedly made statements that
a specific person had been cured of addiction through Passages’ treatment
program, e.g., “Pax has come out the other side whole, healed, and cured …”
These statements were commercial speech and thus not covered
by the anti-SLAPP law. The statements weren’t simply informative; they
pertained to Passages’ specific “product”—addiction treatment programs at
Passages’ facilities—and were made for the purpose of promoting Passages’
product and soliciting new clients. Even if Passages’ statements advertising
its services were “intermingled with noncommercial speech” regarding the
general curability of addiction, Passages “may not immunize false or misleading
product information … simply by including references to public issues.” Kasky
v. Nike, Inc., 27 Cal. 4th 939, 966 (2002). Somewhat confusingly, the court
says that “Passages’ ‘opinion’ that addiction is curable is merely an ‘opinion’
about the nature of Passages’ own product, which is sufficient to constitute
commercial speech exempt from anti-SLAPP analysis,” conflating the fact/opinion
divide with the commercial/noncommercial divide.  Apparently Passages also argued that addiction
could be cured, probably contributing
to the court’s mashup of issues: Passages submitted a declaration and purported expert report that
the court thought “further bolsters Cliffside’s argument of false advertising.”
Along with other problems, the report’s definition of a “cure” was that the
former addict no longer consumes substances for the foreseeable future, even if
the former addict “might still think about the substance, desire it, or dream
about it.” This definition directly contradicted Passages’ statements that,
following the completion of Passages’ treatment program, “[o]nce the underlying
problems are discovered and cured, the need for drugs, alcohol, or addictive
behavior will disappear—along with the craving.”

Even without the commercial speech exemption, Cliffside sufficiently
demonstrated a probability of success on its false advertising claims against
Passages. In a related case, another judge found that statements that a
facility possesses a “cure” to addiction through its treatment program were
clearly actionable as distinct from statements about “treatment” of addiction.
See Grasshopper House, LLC v. Accelerated Recovery Ctrs., LLC, No. CV 09-08128
DMG (PLAx), 2010 WL 11549437, at *5-7 (C.D. Cal. Mar. 23, 2010).  The court here agreed.

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