Order entered dismissing remaining issues in Molson Coors (MillerCoors) v. Anheuser false advertising case… yes, that one about the corn syrup ads from 2019.
It’s finally over. Back in 2020, the 7th Circuit reversed an injunction that then MillerCoors obtained against Anheuser keeping Anheuser from using certain forms of advertising related to an ad campaign asserting that corn syrup was used in Miller Lite and Coors Light – the implications of a relationship to “high fructose corn syrup” and corn syrup remaining in the beer as opposed to aiding in fermentation drove the district court’s decision. The 7th Circuit rejected the notions of foul play because MillerCoors (now Molson Coors) had listed corn syrup as an “ingredient” on its website.
On appeal, however, the Seventh Circuit vacated the preliminary injunction because Molson had listed corn syrup as an “ingredient” on websites for Miller Lite and Coors Light products:
By choosing a word such as “ingredients” with multiple possible meanings, Molson Coors brought this problem on itself. It is enough for us to hold that it is not “false or misleading” (§ 1125(a)(1)) for a seller to say or imply, of a business rival, something that the rival says about itself.
Molson Coors Beverage Co. USA LLC v. Anheuser-Busch Cos., LLC, 957 F.3d 837, 839 (7th Cir. 2020).
The 7th Circuit remanded the case to the district court with instructions for the district court to determine if there were any remaining issues.
You might have reasonably thought that would be an end to the matter, but both parties had good counsel and they pointed out that there might be continuing advertising based on the corn syrup ingredient notation even though Molson Coors has removed that ingredient from the website. There were also counterclaimed trade secret assertions by Anheuser.
However, finding no evidence that Anheuser continued to, or plans to, use the advertising campaign and that Anheuser was never given leave to file counterclaims, the district court has finally ruled on motions by the parties and terminated the matter. (I say finally not as an implication that the court took its time, it didn’t the parties took their time in briefing issues, and the opinion terminating this case is an excellent example of analysis and instruction). Here is a link to this final order disposing of the pending claims and motions.
Here are some highlights from the court’s final determinations:
- On the issue of whether an injunction for “potential” future advertising against Anheuser could stand:
Plaintiff Molson Coors contends that it is still entitled to a permanent injunction on its Lanham Act claims because its “webpage has now been changed to clarify that while corn syrup is used as an adjunct to aid fermentation, it is consumed by yeast during that process, and is not present in the final products.” (Pl.’s Br. (dkt. #316) 11.) Fair enough, but this change made after the Seventh Circuit’s decision does not provide an opening to seek a permanent injunction based on ads that ran before February 2019. Considered in light of plaintiff’s own statements as to the “ingredients” in its Miller Lite and Coors Light products at that time, the Seventh Circuit’s opinion leaves little room for argument. Nor has plaintiff advanced sufficient changed facts to make applicable the “changed-circumstances” cases cited by plaintiff.
Instead, plaintiff appears to be arguing a right to a permanent injunction because ads that defendant may run in the future would no longer be supported by plaintiff’s recent changes to its website. Unfortunately for plaintiff, this possibility does not provide an opening for entering a permanent injunction for a variety of reasons. First, injunctive relief is warranted only in the face of “an actual and imminent injury in fact.” Goldhamer v. Nagode, 621 F.3d 581, 585 (7th Cir. 2010). The record before the court does not permit such a finding, since defendant Anheuser-Busch discontinued use of the offending language in response to this court’s preliminary injunction, and plaintiff has not shown that defendant has renewed doing so since that injunction was lifted by the Seventh Circuit. Second, whether a correct reading of the language of the Lanham Act or not, the Seventh Circuit’s opinion leaves little to no room for this lower court to conclude defendant may not rely on plaintiff’s own, albeit now past, ingredients disclosure for at least some period of time given that only the ingredients list, and not the brewing process itself, has changed. Accordingly, the court will apply the law of the case, grant defendant’s motion for summary judgment, and direct entry of judgment in defendant’s favor on plaintiff’s Lanham Act false advertisement claim.
2. In an footnote regarding whether any part of this ruling might preclude Molson Coors from bringing future actions if the advertising campaign is revived:
Specifically, although the court agrees with defendant that the Seventh Circuit’s opinion is law of this case, and includes such sweeping language as to preclude looking behind its “simpl[icity]” at defendant’s motive, the court would be remiss not to note that plaintiff has now unearthed overwhelming documentation of defendant’s intent to mislead consumers as to the presence of corn syrup in the finished products despite it knowing that none or virtually none were present. Although the Seventh Circuit has concluded in this case, whether such “false or misleading” statements are “good” or “bad” is “for consumers rather than the judiciary to decide” in “competition in the market,” hopefully that ruling will be limited to the narrow facts of this case and not act as an anchor to historical assumptions about the “rational consumer” that decades of economic and psychological research, and hundreds of billions (if not trillions) of dollars of advertising, has demonstrated is largely a myth (or at minimum, far more complicated) when it comes to the snap judgments of a typical consumer of food or drink in this and other free market economies. See Steven M. Sheffrin, Behavioral Law and Economics Is Not Just a Refinement of Law and Economics, Oeconomia, 7-3 (2017), available at https://journals.openedition.org/oeconomia/2640.
3. Some academic bona fides in citing Thaler and Sunstein and poking fun at the advertising profession in reaching the conclusion that future claims are not precluded given Molson Coors amendments to its website in removing corn syrup as an ingredient and holding that truth is not an absolute defense to a “truly misleading or false advertising claim”:
Finally, 50 years of behavioral economics and 100 years of marketing would strongly support the traditional interpretation of the language of the Lanham Act to preclude truth from being an absolute defense, even setting aside the incredible waste of economic resources on cross-advertising intended falsely to sway consumers during the five to ten seconds most spend before choosing a product, as well as the need for sufficient statutory or ethical constraints to limit what Richard Thaler and others refer to as notorious or dark images. See Richard H. Thaler & Cass R. Sunstein, Nudge: Improving Decisions About Health, Wealth and Happiness (2008); Russell S. Winer & Ravi Dhar, Marketing Management (4th ed. 2010).
Happy to see this one resolved and to know we will hopefully cease contributing to the countless sums in free advertising that coverage of this dispute has given both parties.