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Supreme Court Rules on Standing In False Advertising Cases

By Tiffany R. Brown

Until the Supreme Court's recent decision in Lexmark International v. Static Control Components, Inc., 134 S.Ct. 1377, 2014 WL 1168967 (2014), courts were divided regarding the proper test to determine whether a plaintiff has standing to bring a false advertising claim under 15 U.S.C. '1125(a). Three separate approaches were previously applied among the circuits, the narrowest of which permitted only actual competitors to bring claims of false advertising, an approach that would have automatically barred Static Control from bringing a false advertising claim in this case, regardless of Lexmark's allegedly wrongful actions. The Supreme Court resolved the circuit split by rejecting the previously applied standards, and created a new, uniform “zone of interests” test for determining standing in false advertising cases brought under the Lanham Act.

In Lexmark, the Supreme Court granted certiorari to decide “the appropriate analytical framework for determining a party's standing to maintain an action for false advertisement under the Lanham Act.” The Supreme Court affirmed the Sixth Circuit's reversal of a district court's dismissal of Static Control's false advertising claim under the Lanham Act. In affirming the Sixth Circuit, the Supreme Court concluded that Static Control was within the class of plaintiffs authorized to sue under '1125(a) because: 1) its alleged injuries ' lost sales and damage to business reputation ' are the exact injuries and the sorts of commercial interests that the Lanham Act is designed to protect; and 2) Static Control adequately pleaded both that it had a commercial injury covered by the Act, and that such injury was proximately caused by Lexmark's misrepresentations.

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