A few weeks ago, the Supreme Court decided a case that clarifies the pleading requirements for a plaintiff who makes a claim for false advertising under the Lanham Act. As the guardians of your company's intellectual property, knowing the new standard is paramount. Here's a breakdown of the Supreme Court's decision so you can determine whether to pursue, or defend, any federal false advertising claims.
Lexmark manufactures laser printers, and they are made to work only with Lexmark toner cartridges. An aftermarket has developed where third parties acquire, refurbish and resell Lexmark cartridges. To combat this, Lexmark developed a prebate program giving customers a discount up front, for the promise to return the cartridge to Lexmark, rather than a remanufacturer.
To ensure this, it created a microchip for the cartridges that would disable the cartridge once it was emptied. Static Control developed a microchip that mimicked Lexmark's; Lexmark distributed a letter to its customers saying that they were legally bound to return the cartridges to Lexmark, and sent a letter to remanufacturers saying it was illegal to sell refurbished cartridges, and that it was illegal to use Static Control's microchip.