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Ameritox, Ltd v. Millennium Laboratories

January 6, 2012

AMERITOX, LTD., PLAINTIFF,
v.
MILLENNIUM LABORATORIES, INC., DEFENDANT.



ORDER

This cause comes before the Court on Defendant Millennium Laboratories, Inc.'s ("Millennium") Motion to Dismiss (Doc. No. 20). Plaintiff Ameritox, Ltd. ("Ameritox") filed a Response in Opposition (Doc. No. 22), and Millennium filed a Reply (Doc. No. 26).

In this unfair competition dispute, Millennium moves the Court to dismiss Counts I and IV pursuant to Federal Rule of Civil Procedure 12(b)(6). For the following reasons, the Court grants the motion and dismisses Counts I and IV without prejudice.

I. Standard of Review

In deciding a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), the Court must consider whether the complaint satisfies the pleading standard of Federal Rule of Civil Procedure 8(a)(2). Federal Rule of Civil Procedure 8(a)(2) requires that a pleading must contain a short and plain statement of the claim showing the pleader is entitled to relief in order to give the defendant fair notice of what the claim is and the grounds upon which it rests. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). Although Rule 8 does not require a claimant to set out in detail the facts upon which he bases his claim, "it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009).

To survive a motion to dismiss, a complaint must allege sufficient facts, accepted as true, to state a plausible claim for relief. Id. Where a complaint contains well-pleaded facts, if those facts "do not permit the court to infer more than the mere possibility of misconduct," the complaint stops short of plausibility and does not show the plaintiff is entitled to relief. Id. at 1950. Furthermore, while a court must assume that all of the factual allegations in the complaint are true, this assumption is inapplicable to legal conclusions. Id. at 1949. The door to discovery will not open for a plaintiff "armed with nothing more than conclusions." Id. at 1950.

II. Analysis

In its Amended Complaint, Ameritox asserts four counts against Millennium. (Doc. No. 15). In Count I, Ameritox alleges that Millennium has engaged in false advertising in violation of the Lanham Act, 15 U.S.C. § 1125. (Doc. No. 15, ¶ 50.) In Counts II and III, Ameritox alleges that Millennium violated the Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. § 501.201, et seq. (See Doc. No. 15, ¶¶ 57--59, 67--69.) In Count IV, Ameritox submits that Millennium has engaged in unfair competition. (Doc. No. 15, ¶ 78.) Millennium moves the Court to dismiss Counts I and IV. (Doc. No. 20, ¶ 2.)

A. Count I: False Advertising

Millennium argues the Court should dismiss Ameritox's claim for false advertising under the Lanham Act because Ameritox "does not allege sufficiently a false or misleading advertisement that has materially deceived, or had the tendency to materially deceive, customers." (Doc. No. 20 at 6). Under the Lanham Act, 15 U.S.C. § 1125(a), to state a claim for false advertising, a plaintiff must allege:

(1) the advertisements of the opposing party are false or misleading as to the party's own product o[r] another's; (2) the advertisements actually deceived customers or had the tendency to deceive a substantial portion of the targeted audience; (3) the deception is material, meaning it is likely to influence purchasing decisions; (4) the defendant's advertised products traveled in interstate commerce; and (5) the plaintiff has been or is likely to be injured as a result of the false or misleading advertisements by [causally] related declining sales or loss of goodwill.

Third Party Verification, Inc. v. Signaturelink, Inc., 492 F. Supp. 2d 1314, 1324 (M.D. Fla. 2007) (citing Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256, 1260--61 (11th Cir. 2004)). Millennium makes a number of arguments that it contends support dismissal of Ameritox's false advertising claim.

1. Whether Ameritox Sufficiently Alleged that the Millennium Billing Letter is Commercial Advertising or Promotion?

First, Millennium contends that the Millennium Billing Letter is not actionable under the Lanham Act because it is not commercial advertising or promotion. (Doc. No. 20 at 6). "'To be actionable under the Lanham Act, the speech at issue must be commercial in nature.'" VG Innovations, Inc. v. Minsurg Corp., 2011 WL 1466181 at *5 (M.D. Fla. Apr. 18, 2011) (quoting Futuristic Fences, Inc. v. Illusion Fence, Corp., 558 F. Supp. 2d 1270, 1279 (S.D. Fla. 2008)). Speech constitutes commercial advertising or promotion when it is:

(1) commercial speech; (2) by a defendant who is in commercial competition with plaintiff; (3) for the purpose of influencing consumers to buy defendant's goods or services. While the representations need not be made in a "classical advertising campaign," but may consist instead of more informal types of "promotion," the representations (4) must be disseminated sufficiently ...


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