Tuesday, June 06, 2017

Copyright v. false advertising in medical devices

Healthmate Int’l, LLC v. French, 2017 WL 2389715, No. 15-0761 (W.D. Mo. Jun. 1, 2017)

The parties (including defendant Rampant Lion) compete to sell TENS units, which administer electrical current to portions of the body in order to relieve pain. Healthmate registered three copyrights for graphical displays on TENS units. The displays have a series of picture-based icons that symbolize the TENS unit’s various functions and a battery-shaped icon with hashmarks meant to symbolize the amount of energy remaining in the TENS unit. Some of the displays also include icons that represent parts of the body, a clock or timer, or an “intensity” meter (a bar with hashmarks intended to indicate the current’s intensity). Healthmate alleged that defendants infringed by using substantially similar displays on their own TENS units.

comment: um, no

Defendants attempted to rebut the presumption of copyrightability by arguing that the claimed matter (1) was an uncopyrightable “method of operation” or (2) was not original. The court refused to grant summary judgment on these theories.  Even assuming that Lotus v. Borland was the correct framework, Healthmate was claiming the pictures it put on the TENS units’ buttons, not the buttons themselves.  (Well, that “derivative work” claim looks more like the latter to me.)  The pictures weren’t themselves the method of operation, even if they were physically placed on the buttons, and thus were copyrightable.  On originality, there was conflicting testimony about whether the icons were copied from a competitor and therefore not original.  There were also factual issues precluding summary judgment on infringement.

Rampant Lion counterclaimed for violation of the Lanham Act and other torts.  Healthmate’s website indicated that some of the products were “FDA approved.” “However, to the FDA, ‘approved’ technically means that each individual device is inspected, like the USDA inspects all meat sold in the United States, which they [Plaintiff’s products] are not.” A product that is “FDA cleared” means (to the FDA and others who know the technical meaning to be attached to the phrase) that the product in question is substantially similar to another device that is already legally marketed for the same use. Here, Healthmate’s products were “FDA cleared” but not “FDA approved.” Some of Healthmate’s product descriptions used “FDA cleared,” and some used both phrases.  (I would have gone with literal falsity here: there’s a specific meaning in the industry, and Healthmate’s own use of the two phrases indicates that it recognized and presumably intended people to rely on the difference.)

Healthmate argued that its statement was mere puffery, or merely ambiguous.  The court disagreed with the former—“FDA approval” isn’t merely boasting or exaggeration, nor is it a general claim of superiority. It alleges a specific historical, falsifiable fact.  Healthmate argued that lots of people in the industry used “FDA approved” in a way common in the TENS unit industry, but there was no support for the proposition that falsity becomes puffery just because others in the industry make the same false statement.

However, “FDA approved” was not literally false.  The FDA’s distinction between approval and clearance wasn’t the test, but rather whether “the false message will necessarily and unavoidably be received by the consumer.”  The court reasoned that the process necessary for the FDA to “clear” TENS units—which did occur for Healthmate’s units—qualified under the dictionary definition of “approval” even if there was a regulatory or technical difference between “clearance” and “approval.”  “Considerable context (namely, the FDA regulations) is required to understand why the phrase ‘FDA approved’ was inaccurate, so the false impression will not be necessarily and unavoidably received by consumers.”  (Who are the usual customers to whom the website is directed? How much do they know? This might be a case where health professionals would be more likely to be deceived than ordinary patients.)

Without literal falsity, Rampant Lion needed evidence of consumer reaction, which it did not have.  Bad faith and willfulness, even if shown, couldn’t substitute for a showing of actual or potential deception because such a presumption only applies to false comparative advertising, not at issue here.  Summary judgment on the Lanham Act counterclaim for Healthmate.

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