                                                                                                                           Opinions of the United
2000 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


2-8-2000

Warner-Lambert Co. v. Breath Asure Inc.
Precedential or Non-Precedential:

Docket 98-6502




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Filed February 8, 2000

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

No. 98-6502

WARNER-LAMBERT COMPANY,

       Appellant,

v.

BREATHASURE, INC.,

ON APPEAL FROM THE
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
Civil No.: 98-cv-01940
District Court Judge: Honorable John W. Bissell

Argued: May 21, 1999

Before: McKEE, RENDELL, Circuit Judges and GARTH,
Senior Circuit Judge

(Filed: February 8, 2000)

       Thomas C. Morrison, Esq. (Argued)
       Eugene M. Gelernter, Esq.
       Kathleen H. Dooley, Esq.
       Shanley & Fisher, P.C.
       Patterson, Belknap, Webb &
        Tyler, LLP
       1133 Avenue of the Americas
       New York, NY 10036

        Attorneys for Appellant




       Joel M. Wolosky, Esq. (Argued)
       Sharon H. Stern, Esq.
       Parker, Chapin, Flattau &
        Klimpl, LLP
       1211 Avenue of the Americas
       New York, NY 10036

       Mark I. Peroff
       Trademark and Patent Counselors of
        America, P.C.
       915 Broadway
       New York, NY 10010
        Attorneys for Appellee

OPINION OF THE COURT

McKEE, Circuit Judge.

Warner-Lambert Company sued BreathAsure, Inc. under
S 43(a) of the Lanham Act based upon Warner-Lambert's
belief that the trade names, "BreathAsure" and
"BreathAsure-D," for certain of defendant's breath
fresheners constituted a false and misleading claim that
gave BreathAsure an unfair advantage in the sale of those
products, and injured Warner-Lambert in the sale of its
breath freshening products. On the third day of the ensuing
trial, BreathAsure stipulated that scientific evidence
established that its "BreathAsure" products were not
effective against bad breath. As a result, the District Court
permanently enjoined BreathAsure from continuing to
advertise that those products were effective. However, the
court refused to enjoin use of the trade names
"BreathAsure" or "BreathAsure-D" because the court
concluded that Warner-Lambert had not demonstrated that
it was likely to be harmed by the continued use of those
product names. This appeal followed.1 For the reasons that
follow, we will reverse.
_________________________________________________________________

1. "We review the District Court's conclusions of law in a plenary
fashion, its findings of fact under a clearly erroneous standard, and its
decision to grant or deny an injunction for abuse of discretion." American
Telephone & Telegraph Co. v. Winback and Conserve Program, Inc., 42
F.3d 1421, 1427 (3d Cir. 1994), cert. denied, 514 U.S. 1103 (1995)
(quoting Johnson & Johnson-Merck Consumer Pharmaceuticals, Inc. v.
Rhone-Polenc Rorer Pharmaceuticals, Inc., 19 F.3d 125, 127 (3d Cir.
1994)).

                                 2


I.

Warner-Lambert is a leading manufacturer of several
well-known breath freshening products, including Certs,
Clorets, Listerine, and Dentyne. Those products are in the
form of gum, mints, and mouthwash. BreathAsure, Inc.
also markets several breath freshening products, including
BreathAsure and BreathAsure-D, which are the subjects of
this dispute. BreathAsure's breath freshening products are
capsules that are swallowed. For several years prior to this
lawsuit, BreathAsure, heavily promoted its BreathAsure
products as being effective against bad breath. The theme
of much of the advertising was that the capsules worked
effectively at the source of bad breath and were, therefore,
superior to products that simply masked or covered bad
breath such as gum, mints and mouthwash. One such ad
contained a series of photographs depicting food, a couple
appearing to share a tender moment, and a package of
BreathAsure. The following captions appear beneath those
images: "if you eat and we all do," "and you want to get
close," "you need BreathAsure the internal breath
freshener," "BreathAsure for the confidence of clean fresh
breath." The label on the package of BreathAsure in this ad
read: "The internal Breath Freshener All-Natural", and a
banner across the front of the packaging proclaimed:"lasts
& lasts & lasts." Much of defendant's advertising tells the
reader to "stop masking bad breath" with products that
"just cover-up bad breath." Another of defendant's
advertisements contained an image of a woman with the
bottom of her sweater pulled up over her navel and the
legend: "Fight the problem at its source" with a dotted
arrow pointing to the woman's stomach. Plaintiff's Exhibit
101J.

The National Advertising Division of the Better Business
Bureau investigated defendant's advertising and concluded
that defendant's claim that BreathAsure and BreathAsure-
D were effective breath fresheners was not supported by
any reliable scientific evidence. Accordingly, it
recommended that defendant discontinue or substantially
modify its ads for its breath fresheners.2 App. 133, A.138-
39, A.185, A.189.
_________________________________________________________________

2. Warner-Lambert now represents without contradiction that the
scientist whose studies defendant relied upon in opposing the National

                               3


Based upon the unsupported claims made in advertising
that BreathAsure and BreathAsure-D were effective breath
fresheners, Warner-Lambert filed the instant complaint
under S 43(a) of the Lanham Act, 15 U.S.C.S 1125(a),
seeking to permanently enjoin BreathAsure from
advertising that its BreathAsure products are effective
breath fresheners. Warner-Lambert also sought a
permanent injunction against use of the name
"BreathAsure" based upon its contention that the name
itself communicates a false and misleading message.
Warner-Lambert did not seek monetary damages. Despite
BreathAsure's claims that its capsules are superior to
products that merely mask bad breath, evidence produced
during the instant litigation established that bad breath
originates in the mouth, not in the stomach. Therefore,
Warner-Lambert maintains that effective breath freshening
products must either mask offensive oral odors, or attack
bacteria in the mouth. A.180.
On the third day of the bench trial on Warner-Lambert's
complaint, BreathAsure stipulated that "[s]cientific studies
presented in this case demonstrate that BreathAsure and
BreathAsure-D are not effective in reducing bad breath
. . . ." BreathAsure also consented to an injunction
prohibiting it from advertising that its capsules were
effective breath fresheners. However, BreathAsure
continued to resist any injunction against the use of the
trade names "BreathAsure" and "BreathAsure-D," and
insisted that those names did not violate the Lanham Act.

At the completion of the bench trial, the District Court
issued an oral opinion in which it held that the trade
names misrepresented the products' qualities. The court
stated:

        The Court determines that the name Breath Asure,
       particularly given its contemplated future use for
       defendant's products, is indeed deceptive and a
_________________________________________________________________

Advertising Division's recommendation that the advertising be modified
or discontinued has since disavowed his own studies insofar as they
supported defendant's claim that an ingestible capsule could combat
offensive breath odor. See Br. for Appellant at 9.

                               4


       misrepresentation of the products' qualities. It implies
       assurance where there is no basis for it. It relates to
       breath; and, together with a residuum of past ads,
       although discontinued, will inform the market and
       prospective consumers that it is designed to enhance
       breath quality and limit offensive odors. While
       discontinuance of the ads that are the subject of the
       consent injunction here is and will be significant,
       particularly in terms of any likelihood of future injury
       to the plaintiff, that residual impact will be enough to
       generate product recognition, particularly when the
       name Breath Asure continues to be used.

        Said somewhat otherwise, I do not accept the
       testimony of [defendant's main witness] that in all
       likelihood the future use of Breath Asure, alone or in
       connection with otherwise benign descriptions, could
       itself lead to a multiple number of conclusions as to
       what the product is . . . . Breath Asure's campaign over
       the last six years has been successful in producing
       sufficient recognition for the term Breath Asure that its
       continued use in the market will present to the public
       once again a product with assurance of breath quality.
       Accordingly, Breath Asure is deceptive, advising the
       consumer that there is a sound basis for assurance
       that this product will freshen or destroy odors in ones
       breath when there is inadequate support for such a
       claim. That element of the claim remaining in this case
       by the plaintiff has been established.

A.13-14.

The court also found that "[t]he [Warner-Lambert and
BreathAsure] products are in competition in a general
sense in the breath freshener market." App. at A-25.
However, despite finding that defendant's claims for its
products were misleading, the court refused to enjoin the
use of the two trade names. The court based its refusal
upon two cases decided by the Court of Appeals for the
Second Circuit: Johnson & Johnson v. Carter-Wallace, 631
F.2d 186 (2d Cir. 1994), and Ortho Pharmaceutical
Corporation v. Cosprophar, Inc., 32 F.3d 690 (2d Cir. 1994).
The court refused to presume injury to Warner-Lambert
based upon defendant's deceptive product name and its

                               5


finding that Warner-Lambert and BreathAsure were in
"competition in a general sense." Instead, the court
concluded that Warner-Lambert had not met its burden of
establishing the likelihood of future injury from continued
use of the product name. The court reasoned that
BreathAsure and BreathAsure-D

       are in competition [with Warner-Lambert's products] in
       a general sense in the breath freshener market. But
       BreathAsure, in this Court's view and as established in
       this record, I determine is essentially a niche
       production in light of the manner in which it's
       consumed and the problems which it is supposed to
       address. It's in a niche essentially where the plaintiff's
       products don't go both physically and otherwise.

        This continues to support the Court's determination
       that the greater likelihood of the side by side marketing
       of BreathAsure and the plaintiff's products is that
       consumers will, as they have in the past, add
       BreathAsure as a compliment to the plaintiff's
       products, not a substitute, thereby lessening any
       injury to the plaintiff.

A.25-6.

The court relied upon the following in reaching its
findings: (i) sales trends for the BreathAsure products had
decreased in recent years; (ii) Warner-Lambert's sales of
Listerine, Certs, and Dentyne had increased; (iii) Warner-
Lambert had not called any consumer witnesses to testify
that they had switched from using Warner-Lambert's
breath-freshening products to BreathAsure's products; (iv)
Warner-Lambert had not presented consumer surveys
indicating the future impact of BreathAsure products on
Warner-Lambert's sales; and (v) inasmuch as BreathAsure's
products were "niche products" that were not used in the
same manner as Warner-Lambert's products, there was no
basis to conclude that consumers were likely to switch
products rather than simply use "BreathAsure" to
supplement Warner-Lambert's products.

On appeal, Warner-Lambert contends that the District
Court was clearly erroneous in its findings, and that it

                                6


erred in not satisfying the necessary burden to enjoin use
of those trade names.

II.

Our analysis must necessarily begin with Section
43(a)(1)(B) of the Lanham Act which provides in relevant
part:

       (a)(1) Any person who, on or in connection with any
       goods or services . . . uses in commerce any
       word, term, name, symbol, or device, or any
       combination thereof, or any . . . false or
       misleading description of fact, or false or
       misleading representation of fact, which --

       . . . (B) in commercial advertising or promotion,
       misrepresents the nature, characteristics,
       qualities, or geographic origin of his or her
       . . . goods, services, or commercial activities,

       shall be liable in a civil action by any person who
       believes that he or she is or is likely to be damaged by
       such act.

15 U.S.C. S 1125(a)(1)(B). To establish a Lanham Act claim
based on a false or misleading representation of a product
the plaintiff must show:

       1) that the defendant has made false or misleading
       statements as to his own product [or another's];

       2) that there is actual deception or at least a te ndency
       to deceive a substantial portion of the intended
       audience;
       3) that the deception is material in that it is li kely to
       influence purchasing decisions;

       4) that the advertised goods traveled in interstat e
       commerce; and

       5) that there is a likelihood of injury to the pla intiff in
       terms of declining sales, loss of good will, etc.

Johnson & Johnson-Merck Consumer Pharmaceuticals Co. v.
Rhone-Poulenc Rorer Pharmaceuticals, Inc., 19 F.3d 125,

                               7


129 (3d Cir. 1994)(quoting U.S. Healthcare, Inc. v. Blue
Cross of Greater Philadelphia, 898 F.2d 914, 922-23 (3d
Cir. 1990)). However, "[i]f a plaintiff proves a challenged
claim is literally false, a court may grant relief without
considering whether the buying public was misled."
Johnson & Johnson-Merck, 19 F.3d at 129. See also Castrol,
Inc. v. Pennzoil Co., 987 F.2d 939, 943 (3d Cir. 1992).

In Parkway Baking Co. v. Freihofer Baking, Co., 255 F.2d
641, 649 (3d Cir. 1958) we held that a plaintiff seeking
damages under S 43(a) must establish customer reliance
but need not quantify loss of sales as that goes to the
measure of damages, not plaintiff's cause of action. 255
F.2d at 648. Significantly for our purposes here, we also
stated:

       [i]n cases of injunction, however, there seems to be no
       requirement that purchasers actually be deceived, but
       only that the false advertisements have a tendency to
       deceive. This seems to be the result desired by
       Congress in that Section 43(a) confers a right of action
       upon any person who `believes that he is or is likely to
       be damaged' by defendant's practices. While it would
       be going too far to read the requirement of customer
       reliance out of this section so far as damages are
       concerned, we believe that this is a recognition that, as
       with most equitable relief by way of injunction, Section
       43(a) may be asserted upon a showing of likelihood of
       damage without awaiting the actuality.

Parkway Baking Co., 255 F.2d at 649 (emphasis added).

Here, Warner-Lambert first argued that the District Court
applied the wrong standard of proof in determining if it had
established the necessary "likelihood of injury." Warner-
Lambert argues that, having found that the "BreathAsure"
product name was deceptive and that the parties' products
compete, the District Court necessarily should have
concluded that Warner-Lambert had a reasonable basis to
believe that it was likely to be injured if the defendant
continued referring to its products as "BreathAsure." The
District Court refused to infer a likelihood of injury, and
instead required the plaintiff to present "some persuasive
evidence" of likely damage.

                               8


The District Court compared the proof presented by
Warner-Lambert here with the proof presented by the
plaintiffs in Ortho and Carter-Wallace and concluded that
Warner-Lambert's failure to produce evidence of declining
market share, consumer surveys or evidence of consumers
using defendant's products instead of Warner-Lambert's,
was fatal to Warner-Lambert's claim insofar as Warner-
Lambert sought to enjoin defendant's use of its trade
names. See A.22-24. The court stated:

       [l]et us take a look at some of the methods of proof
       employed in Johnson & Johnson.3 Now, surely they're
       not exclusive and the mere failure of all or some of
       them to be present in the case at bar is not itself fatal.
       But they are indicative at least of the type of evidence
       upon which this claim might be sustained that are
       absent here.

A.22. The court then referred to the consumer surveys, and
consumer testimony that was introduced in Johnson &
Johnson v. Carter-Wallace. The court concluded,"[t]here is
no probative, certainly not adequate probative, evidence of
consumer surveys once again to indicate a likely damage or
impact upon either the sales or market shares of the
plaintiff's products by the continuation of the defendant's
product merely aided by the trade name Breath Asure."
A.24.

Similarly, the court referred to Ortho as follows:

       The Ortho case also emphasized such things as the
       absence of market studies and direct competitive
       advertising, and the conclusion that people would not
       necessarily switch as opposed to merely supplementing
       their repertoire of products. So those similarities
       between the deficient proofs in Ortho and the
       deficiencies of the present proofs exist.
_________________________________________________________________

3. The District Court referred to Johnson & Johnson v. Carter-Wallace,
631 F.2d 186 (2d Cir. 1980) as "Johnson & Johnson," and "J&J."
However, we refer to it here as "Johnson & Johnson v. Carter-Wallace" or
"Carter-Wallace" so as to distinguish it from our holding in Johnson &
Johnson-Merck v. Rhone-Poulenc Rorer Pharmaceuticals, 19 F.3d 1125 (3d
Cir. 1994).
                                9


A.24-5. Inasmuch as the District Court based its analysis
on Johnson & Johnson v. Carter-Wallace and Ortho, rather
than our holding in Parkway Baking, we will discuss those
two opinions of the Second Circuit Court of Appeals. We
believe the District Court misconstrued the import of the
analysis in both of those cases.

In Carter-Wallace, plaintiff manufacturer of Baby Oil and
Baby Lotion sued defendant manufacturer of "NAIR" - a
depilatory product that was aggressively advertised as
containing "baby oil." The District Court granted a defense
motion to dismiss following a bench trial based upon its
conclusion that plaintiff had failed to prove "damage or the
likelihood of damage." 631 F.2d at 189. On appeal, the
Court of Appeals for the Second Circuit had to decide "[j]ust
what that burden is and what evidence will satisfy it. . . ."
Id. The court began by analyzing the historical background
of the Lanham Act and Congress' intent to broaden the
scope of liability that had previously existed for commercial
torts. The court concluded that the language of the statute
requires, both as a matter of standing, and as an element
of the substantive offense, that a plaintiff seeking only
injunctive relief establish something more than a "mere
subjective belief that he is . . . likely to be damaged," but
that the plaintiff "need not quantify the losses actually
borne." Id. Rather, the court reasoned that the burden
under S 43(a) actually lay "between those two extremes." Id.
The court's analysis was based upon the language of the
Lanham Act, which provides a cause of action for "any
person who believes that he or she is or is likely to be
damaged" by the forbidden act. 15 U.S.C. S 1125(a). The
court held that,

       despite the use of the word `believes,' something more
       than a plaintiff 's mere subjective belief that he is
       injured or likely to be damaged is required before he
       will be entitled even to injunctive relief . . . . The
       statute demands only proof providing a reasonable
       basis for the belief that the plaintiff is likely to be
       damaged as a result of the false advertising.

Carter-Wallace, 631 F.2d at 189-90.

Thus, under Carter-Wallace, a plaintiff must prove that it
has a reasonable basis for believing that it is likely to suffer

                                10


injury, and that a causal nexus between the injury and the
false name or advertisement. The court in Carter-Wallace
concluded that the District Court had set the bar too high
by requiring the plaintiff " `to prove the existence of some
injury caused by' the defendant" as that demands"proof of
actual loss and specific evidence of causation." The court
reasoned that "[p]erhaps a competitor in an open market
could meet this standard with proof short of quantified
sales loss, but it is not required to do so." Id. at 190. The
Court of Appeals concluded "[t]he correct standard is
whether it is likely that Carter's advertising has caused or
will cause a loss of [plaintiff's] sales, not whether [plaintiff]
has come forward with specific evidence that [defendant's]
ads actually resulted in some definite loss of sales." Id.

However, in Carter-Wallace, the plaintiff was contending
that the defendant's representation that NAIR contained
baby oil improperly suggested that NAIR was a Johnson &
Johnson product. Johnson & Johnson also claimed that
the defendant's claims that NAIR could moisturize and
soften skin was false, and that those false claims were
impacting on the sale of Baby Oil. However, since Baby Oil
was not a hair removal product there was an issue as to
whether the defendant's product adversely impacted the
sale of plaintiff 's Baby Oil. Johnson & Johnson attempted
to address that concern by introducing consumer testimony
to establish that users of NAIR relied upon that product's
purported skin moisturizing qualities in refraining from
using Baby Oil. Thus, the contest there was between a hair
removal product with baby oil as an additive that purported
to moisturize skin, and the manufacturer of Baby Oil -
which was clearly not a hair removal product. That is not
analogous to our situation because the plaintiff and
defendant here both manufacture purported breath
freshening products.4
_________________________________________________________________

4. Moreover, the procedural posture in Carter-Wallace is different from
that in the present case. In Carter-Wallace, the District Court had not
yet

considered whether defendant's advertising was false or misleading, as
that was an issue to be resolved on remand. Instead, the District Court's
dismissal was "granted on the ground that (Johnson) failed to carry its
burden of proving damages or the likelihood of damage." Carter-Wallace,
631 F.2d at 188-89. By contrast, in the instant case the District Court
had already found BreathAsure's advertising to be misleading.

                               11


Moreover, BreathAsure's advertisements implicitly aimed
at Warner-Lambert's products. Although BreathAsure's ads
never mentioned Warner-Lambert's products by name, they
implicitly told consumers to stop "masking" bad breath with
plaintiff 's products and start "attacking it at its source"
with defendant's products. See Castrol, 987 F.2d at 946
("there need not be a direct comparison to a competitor for
a statement to be actionable under the Lanham Act").
Accordingly, the District Court's conclusion that consumers
were equally as likely to adopt a belt and suspenders
approach and use BreathAsure's products to supplement
Warner-Lambert's is misplaced and is not supported by the
analysis in Carter-Wallace. There, the court was careful to
note that, although "likelihood of injury and causation will
not be presumed, but must be demonstrated," plaintiff can
demonstrate it with "proof providing a reasonable basis for
the belief that the plaintiff is likely to be damaged as a
result of the false advertising." Carter-Wallace, 631 F.2d at
190. Thus, Carter-Wallace does not support the District
Court's refusal to enjoin use of the product name.

Similarly, we do not think the District Court's analysis is
supported by the decision in Ortho. There, the plaintiff
manufactured two products designed to relieve the effects
of sun-induced aging of human skin, and plaintiff sued to
enjoin defendant from advertising that the defendant's
products had an "anti-aging effect." Plaintiff 's products
were prescription drugs, and defendant manufactured over-
the-counter cosmetics. Following a bench trial, the District
Court granted defendant's motion to dismiss based upon
the court's conclusion that the plaintiff lacked standing
under the Lanham Act. The court held that plaintiff had not
established a protectable interest in the ingredients of those
of its own products that were purportedly threatened by
defendant's products. Thus, plaintiff had not established
that defendant's advertising was likely to cause injury. See
Ortho, 32 F.3d at 693. The Court of Appeals for the Second
Circuit affirmed stating:

       We hold that since [plaintiff's] products are not
       obviously in competition with [defendant's] [plaintiff]
       was required to submit proof demonstrating that
       consumers view [defendant's] cosmetics as a

                               12


       comparable substitute for [plaintiff's] drugs. Because
       [plaintiff] failed to do so . . . we affirm the judgment of
       the District Court.

Id. at 692. It was in that context that the court explained
that a plaintiff 's subjective belief of injury was not
sufficient to confer standing under the statute. However,
the court also explained that the plaintiff need not establish
direct competition or lost sales. The court also stated:

       "[t]he likelihood of injury and causation will not be
       presumed, but must be demonstrated in some
       manner." The type and quantity of proof required to
       show injury and causation has varied from one case to
       another depending on the particular circumstances. On
       the whole, we have tended to require a more
       substantial showing where the plaintiff's products are
       not obviously in competition with defendant's products,
       or the defendant's advertisements do not draw direct
       comparisons between the two.

Id. at 694 (internal citations omitted). Since defendant's
over-the-counter cosmetics were not in direct competition
with plaintiff 's prescription drugs, the court concluded that
plaintiff 's subjective belief of injury was not sufficient for
standing purposes because there was no evidence that
consumers would view defendant's cosmetics as a
substitute for plaintiff's prescription drugs. The court
concluded, "[t]he missing link in [plaintiff's] proof is
evidence that [defendant's] advertising will have the effect
on consumers that [plaintiff] says it will -- in other words,
that consumers will see [defendant's] cosmetics as
substitutes for [plaintiff 's] drugs. In other cases, this link
has been supplied by consumer surveys or consumer
witnesses." Id. at 695. "Without such proof, it would be just
as reasonable to believe that consumers who buy
[defendant's] products will also buy [plaintiff's] drugs or,
alternatively, that the type of consumer who buys
[defendant's] over-the-counter cosmetics is not the type who
would seek out a prescription drug." Id. at 697. The District
Court here found this language in Ortho persuasive in
concluding that Warner-Lambert had to come forward with
similar evidence to establish that BreathAsure products

                               13


competed with its products and did not merely supplement
them.

The District Court synthesized the holdings of Carter-
Wallace and Ortho as follows:

       How then in a nutshell do the rulings and principles of
       such cases as J&J and Ortho become translated into a
       standard or analysis to be applied to the case at bar?
       The Court determines that in this matter the plaintiff
       was required to show by at least some persuasive
       evidence that Breath Asure alone in the future, even
       with the residual impact of prior ads to some extent,
       will likely damage or injure the plaintiff in the breath
       freshener market. And as mentioned before, the
       plaintiff has not carried that burden.

A.22. However, as noted above, Ortho's discussion of
consumer surveys was in the context of an inquiry into
whether plaintiff had standing to sue under S 43(a). The
standing inquiry was necessary because defendant's
products and the plaintiff 's products were not in obvious
competition in the marketplace.

Moreover, Parkway Baking establishes the standard for
the present appeal inasmuch as Warner-Lambert sought
only an injunction. As noted above, Carter-Wallace is
distinguishable from the instant litigation. However, the
analysis there is consistent with Parkway Baking insofar as
it applies to our inquiry. In Carter-Wallace the Court of
Appeals stated: "the statute demands only proof providing
a reasonable basis for the belief that the plaintiff is likely to
be damaged as a result of the false advertising." Carter-
Wallace, 631 F.2d at 190.

A showing of a reasonable belief of injury will usually be
sufficient to establish a reasonable likelihood of injury
under S 43(a). Clearly, if a plaintiff can not establish that its
subjective belief of future injury from the challenged
conduct is reasonable, plaintiff can hardly claim to have
shown a reasonable likelihood of injury. There must be
some basis for the subjective belief in order to establish the
reasonableness of that belief, and that basis will usually

                                14


equate with a showing of reasonable likelihood of future
harm under the statute.5

It is uncontested that BreathAsure's claim regarding the
efficacy of its ingestible capsules is without any scientific
foundation. The District Court correctly concluded that
claim was a deceptive misrepresentation that "implies
assurance where there is no basis for it." A.13. The
permanent injunction that the District Court entered states
in part that: "Defendant BreathAsure, Inc. is permanently
enjoined from claiming, either directly or by implication, . . .
with respect to BreathAsure or BreathAsure-D . . . that . . .
it works. . . " (emphasis added). A.1. It did so because
defendant's claims of breath assurance were literally false.
Castrol, 987 F.2d at 944. ("If a defendant's claim is untrue,
it must be deemed literally false"). The court also concluded
that BreathAsure's breath freshener does compete with
Warner-Lambert's breath fresheners "in general." That
should have been sufficient to enjoin use of the misleading
trade names under S 43(A), and the District Court should
not have required Warner-Lambert to produce the kind of
consumer surveys required in Carter-Wallace and Ortho.
See Johnson & Johnson v. Rhone-Poulenc Rorer, 19 F.3d
125 (3d Cir. 1994). In Rhone-Poulenc we stated:
       If a plaintiff proves a challenged claim is literally false,
       a court may grant relief without considering whether
       the buying public was mislead . . . . If a plaintiff does
       not prove the claim is literally false, he must prove that
       it is deceptive or misleading, which depends on the
       message that is conveyed to consumers . . . . Public
       reaction is the measure of a commercial's impact . ..
_________________________________________________________________

5. We need not now decide if a reasonable belief will always equate with
a reasonable likelihood of injury as it is clear that, under the
circumstances before us now, Warner-Lambert established the
reasonableness of its belief of future injury if defendant continued to be
able to represent, through the use of its name, that its products provided
purchasers with some assurance of fresher breath. The circumstances
that establish the reasonableness of that belief also establish the
likelihood of future harm from the defendant continuing to use its name,
thereby representing its products as effective breath fresheners in the
"side by side marketing of BreathAsure and the plaintiff 's products. . .
"

Dist. Ct. at A.26.

                               15


       the success of the claim usually turns on the
       persuasiveness of a consumer survey. The factfinder
       must determine whether the public was, in fact,
       misled.

19 F.3d at 129.

In Sandoz Pharmaceuticals v. Richardson-Vicks, Inc., 902
F.2d 222, 227 (3d Cir. 1990) we explained that a plaintiff
under the Lanham Act need not establish that a
competitor's claims are false or misleading when that is
apparent from the advertising itself. Here, the District
Court required Warner-Lambert to introduce the same kind
of evidence that would have been required if BreathAsure's
claims were not literally false. However, inasmuch as
BreathAsure's claim that its capsules could assure fresh
breath was literally false, Warner-Lambert did not have to
introduce consumer testimony, marketing surveys or proof
of lost profits to enjoin use of the BreathAsure trade name.

As noted above, the District Court found that
BreathAsure and Warner-Lambert "are in competition in a
general sense in the breath freshener market." A.25.
However, the court then seemed to eviscerate thatfinding
by also concluding that BreathAsure was a "niche product"
that was as likely to be used to compliment or supplement
Warner-Lambert's products as to replace them. However,
we do not interpret the District Court's conclusion that
BreathAsure products are "niche products" as afinding
that those products do not compete with other breath-
freshening products.6 Rather, we conclude that the District
Court correctly found that the parties' products do compete
inasmuch as both are promoted as breath fresheners; the
Warner-Lambert and BreathAsure products appear in close
proximity to each other in stores; and BreathAsure's own
advertisements implicitly promoted BreathAsure as a
superior alternative to Warner-Lambert's products.

We also conclude that the District Court's finding that
the BreathAsure product name is "deceptive and a
misrepresentation of the products' qualities" was not clearly
_________________________________________________________________

6. Indeed, the court here noted that plaintiff 's breath fresheners and
defendant's are marketed "side by side." See A.26.

                               16


erroneous. The District Court recognized that the
defendant's deceptive ads were likely to injure Warner-
Lambert and properly enjoined defendant from continuing
to claim that its products were effective. The District Court,
as previously noted, enjoined the defendant from making
those claims "either directly or by implication." However,
the court then embroidered a loop hole into the fabric of the
injunction by allowing the defendant to continue to refer to
its products as "BreathAsure."

Inasmuch as the defendant's products compete with
plaintiff 's products we can not reconcile the District Court's
finding that the advertisements were likely to injure
Warner-Lambert with that court's concomitant refusal to
enjoin use of these deceptive trade names based upon a
belief that Warner-Lambert had not shown a reasonable
likelihood of injury from their continued use. Under
Parkway Baking, there "seems to be no requirement that
purchasers actually be deceived, but only that the false
advertisements have a tendency to deceive." 255 F.2d at
649. That tendency is evident here. Indeed, it is surely not
coincidence that defendant selected trade names suggesting
that those who use the products have assurance of fresh
breath.

Warner-Lambert demonstrated a reasonable likelihood of
injury from the advertising that conveyed BreathAsure's
message, and Warner-Lambert's belief that it would be
harmed if the defendant continued to refer to its products
as "BreathAsure" is just as reasonable. The name falsely
tells the consumer that he or she has assurance of fresher
breath when ingesting one of the defendant's capsules.
That is not true. We therefore hold that the District Court
erred in concluding that the plaintiff failed to establish the
likelihood of injury necessary to enjoin use of BreathAsure's
trade names, and that the District Court abused its
discretion in refusing to enjoin use of those names.

III.

Accordingly, we will reverse the order of the District
Court insofar as it denies Warner-Lambert's request to
enjoin defendant from using "BreathAsure" or

                               17


"BreathAsure-D" or any similarly misleading trade name,
and remand for the District Court to enter order consistent
with this opinion.

A True Copy:
Teste:

       Clerk of the United States Court of Appeals
       for the Third Circuit

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