Avoid Truthful But Misleading Advertising

Street Advertising - Misleading Advertising

Avoid truthful but misleading advertising. Be careful what you say, especially about your competitors. As expected, competitors are sensitive to any negative allegations made about their products or services, since it may likely have an effect on the business’s sales and reputation. Some competitors may even file a lawsuit to enjoin the use of such statements, even if the statements are technically true.

On March 21, 2019, MillerCoors, LLC (“MillerCoors”), which sells Miller Lite and Coors Light, filed a complaint against Anheuser-Busch Companies, LLC (“AB”), which sells Bud Light, after the Bud Light commercials shown during Super Bowl LIII and thereafter focused on the use of corn syrup in Miller Lite and Coors Light’s brewing process and the lack of corn syrup used in Bud Light’s brewing process. In the complaint, MillerCoors is alleging Lanham Act claims of false advertising and federal trademark dilution and requesting injunctive and other relief.

The Lanham Act’s false advertising provision not only prohibits advertising that is outright false, but it also protects businesses against the unfair competition of misleading advertising, which is the focus of MillerCoors’s contention with AB.

AB’s commercials state that both Miller Lite and Coors Light are brewed with or made with corn syrup, which are true statements. MillerCoors itself confirms that corn syrup is used in the fermentation process. While the statements are literally true, there may be a violation if the statements are found to be misleading. MillerCoors alleges that these statements in the commercials are misleading because the context in which they are stated creates an implication that consumers of Miller Lite and Coors Light are drinking corn syrup, when in fact no corn syrup exists in the final product consumed by consumers. MillerCoors additionally alleges that since AB had conducted a consumer survey that illustrated that most consumers do not know the difference between corn syrup and the highly avoided high fructose corn syrup, and also prefer not to consume corn syrup if they do not have to, the commercials were purposefully “designed to prey on consumers’ fears associated with sugar generally, and corn syrup specifically.” To support this allegation, the complaint includes tweets that illustrate that at least some consumers have interpreted the commercials to state that the Miller Lite and Coors Light beers contain corn syrup.

MillerCoors also asserts a cause of action for trademark dilution, where it states that the COORS LIGHT and MILLER LITE trademarks are famous and AB’s use of them in its commercials has diluted and damaged the quality and goodwill of these trademarks by falsely leading consumers to view the beers as inferior or undesirable products.

AB’s intensive advertising has seemingly affected MillerCoors’s business and we shall see if the court will grant MillerCoors the requested preliminary injunction that will prevent AB from running the commercials at issue during this litigation. In the meantime, as emphasized by this litigation, business owners need to be aware that in promoting their own products and services, if they choose to distinguish themselves from their competitors, they need to also consider whether any statements made may be construed as misleading. Even true statements in advertising may be found to violate the Lanham Act if they create false implications because the statements may mislead or deceive consumers.