Verdict in baby formula false advertising case
Your baby is priceless. Her formula’s advertising just cost $13.5 million in damages.
Yesterday, after a multi-day trial before Chief Judge James R. Spencer, the jury returned a verdict in favor of plaintiffs in PBM Products, LLC v. Mead Johnson Nutrition Company, et al., no. 3:09-cv-269 (E.D. Va., Richmond Div.).
The defendant, Mead Johnson, is the maker of one of the two Goliaths of baby formula brands – Enfamil. PBM makes store-brand formulas. This case was the third legal tangle between PBM and Mead Johnson over claims made in advertising for Enfamil, in an effort to entice parents to choose it over store brands.
In this case, PBM took aim at ad claims that “Only Enfamil has LIPIL®, our blend of DHA and ARA, important nutrients found in breast milk” and that it was an “En-Fact” that “Enfamil LIPIL’s unique formulation is not available in any store brand.” (DHA and ARA are lipids, types of fatty acids highly-touted for brain development and other nutritional value. LIPIL is Mead Johnson’s registered trademark for its blend of those lipids.)
As Judge Spencer explained in his May 7, 2009 Memorandum Opinion denying a TRO and preliminary injunction, Mead Johnson’s mailer goes on to say, “It may be tempting to try a less expensive store brand, but only Enfamil LIPIL is clinically proven to improve brain and eye development.” In noticeably smaller type, the footnote to that statement reads: “vs prior formulation of the same product without DHA and ARA, measured at 12 months for eye and 18 months for brain.” The mailer also has a graphic labeled “Visual acuity at 12 months.” The graphic is divided down the middle and contains a picture of a duck. One side of the picture looks blurry, while the other appears clear. Next to the blurry side are the words “without LIPIL®,” while the caption next to the clear side reads “with LIPIL®”.
The parties agreed that PBM’s formulas use the same level of the lipids and get them from the same supplier as Mead Johnson.
PBM sued for violations of the Lanham Act (15 U.S.C. 1125(a)(1)(A) & (B)) and commercial disparagement. Mead Johnson counterclaimed for breach of the settlement agreement in a prior lawsuit; defamation, trade libel, and product disparagement; violations of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B), in PBM’s advertisements for its store brand formulas (which invite comparison to Enfamil); and civil contempt for violation of the sealing order in the prior lawsuit.
In his May opinion, Judge Spencer found that the statements at issue were not literally false. Certain counts on both sides later were dismissed, and the case went to trial, leading to the $13.5 million verdict for PBM. Mead Johnson can take some solace, however, in the fact that PBM had been seeking $60 million.
Stay tuned as the big business and litigation over feeding the littlest people continues.
