Journalism about investment isn’t commercial speech

Proof Retirement, LLC v. Price, 2021 WL 1387501, No. 2:20-cv-05906-JDW (E.D.
Pa. Apr. 13, 2021)

in the marketplace of ideas can ground a defamation claim, but not a false
advertising claim. Crash Proof, which offers retirement planning counseling,
alleged, inter alia, that Price violated the Lanham Act by writing an article
that criticized Crash Proof’s investment strategy. “But the Lanham Act does not
regulate critical speech. It regulates commercial speech, which Mr. Price’s
article is not.”

is a former stockbroker who continues to write and give investment seminars. TheStreet
published an article by Price titled, “If It Sounds Too Good to be True, It
Will Probably Cost You.” About half the article criticizes Crash Proof and
questioning how it could offer a risk-free investment opportunity with a 5% to
8% interest rates with “no fees whatsoever.” He wrote: “if you believe Crash
Proof’s claims, there’s a bridge in Brooklyn I’d like to sell to you.” He
challenged Crash Proof’s claims “that there are no fees attached to [its]
services” because “[w]ho do you know who works for free?” He speculated “that
Crash Proof was taking a huge cut of the principal for themselves right off the
top.” In summary, he called Crash Proof a scam that preys on desperate people
who plunge “huge pieces of their life savings into products with no chance of

other half of the article described an alternative investment strategy for
those who “seek reasonable total returns while accepting a very small degree of
risk….” He didn’t refer to any specific product. It is, in Crash Proof’s
words, “an unoriginal, oft-written about, stock-based investment strategy of
owning blue-chip stocks while selling in-the-money call options….”

Proof sued Price for violations of the Lanham Act and the Pennsylvania Unfair
Competition statute, as well as common law claims for commercial disparagement
and tortious interference with business relations.

As the
description of the article indicates, this is an easy case: the article doesn’t
propose a commercial transation. It doesn’t promote any product or service.
Nothing in the article, or in the complaint, suggested that Price was
trying to get consumers to buy a service that he sold instead of Crash Proof’s.
Under the allegations of the complaint, he was retired, and an unoriginal
strategy disclosed in the article itself “could not even be a veiled attempt to
steer customers to a single competitor.” It didn’t matter whether or not TheStreet
paid Mr. Price for the article.

court declined to exercise supplemental jurisdiction over the state claims (but
I can’t imagine the statutory unfair competition claims do any better on a
First Amendment analysis).

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