Eastman Chemical Company v. PlastiPure, Incorporat , 775 F.3d 230 ( 2014 )

Case: 13-51087 Document: 00512879044 Page: 1 Date Filed: 12/22/2014
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 13-51087 United States Court of Appeals
Fifth Circuit
FILED
EASTMAN CHEMICAL COMPANY, December 22, 2014
Lyle W. Cayce
Plaintiff – Appellee, Clerk
v.
PLASTIPURE, INCORPORATED; CERTICHEM, INCORPORATED,
Defendants – Appellants.
Appeal from the United States District Court
for the Western District of Texas
Before REAVLEY, ELROD, and SOUTHWICK, Circuit Judges.
JENNIFER WALKER ELROD, Circuit Judge:
After a jury found that PlastiPure, Inc. and CertiChem, Inc. violated the
Lanham Act by making false statements of fact about their competitor’s
product, the district court entered an injunction against both companies. On
appeal, PlastiPure and CertiChem challenge the jury verdict and the
injunction on various grounds, including that their statements constituted
non-actionable scientific opinions rather than actionable statements of fact.
Because the Lanham Act prohibits false commercial speech even when that
speech makes scientific claims, and because Appellants’ other contentions lack
merit, we AFFIRM.
Case: 13-51087 Document: 00512879044 Page: 2 Date Filed: 12/22/2014
No. 13-51087
I.
Eastman Chemical Company (Eastman) manufactures a plastic resin
called Tritan and sells it to manufacturers of water bottles, baby bottles, food
containers, and other consumer products. Eastman launched Tritan
commercially in 2007 as an alternative to polycarbonate, which at that point
was the primary plastic used in food contact applications. Shortly after
Tritan’s launch, consumers became concerned that an ingredient in
polycarbonate, bisphenol A (BPA), could be harmful to humans. The concerns
about BPA were premised on scientific studies purporting to show that BPA
could activate estrogen receptors in the human body. Chemicals that mimic
estrogen are said to possess estrogenic activity (EA), and they can trigger
hormone-dependent cancers, reproductive abnormalities, and other negative
health conditions. Eastman recognized that consumer fears about
polycarbonate could be a boon to its sales of Tritan, provided that it could
assure potential clients that Tritan does not exhibit EA. To that end, Eastman
conducted a battery of tests on Tritan which, according to Eastman, showed
that Tritan does not exhibit EA.
PlastiPure and CertiChem also hoped to seize on the opportunity created
by the public’s desire for BPA-free plastics. PlastiPure and CertiChem are
companies founded by Dr. George Bittner, a professor of neurobiology at the
University of Texas at Austin. PlastiPure developed a plastic resin that it
claims does not exhibit EA and, like Eastman, PlastiPure sells its plastic resin
to product manufacturers. CertiChem’s primary focus is on testing materials
for various sorts of hormonal activity.
In 2011, CertiChem published an article summarizing the results of its
testing of more than 500 commercially available plastic products. The article
was published in Environmental Health Perspectives, a peer-reviewed journal
published by the National Institutes of Health. Although products made with
2
Case: 13-51087 Document: 00512879044 Page: 3 Date Filed: 12/22/2014
No. 13-51087
Tritan were among the products tested, Tritan was not mentioned by name in
the article.
After research on the article was completed, but prior to the article’s
publication, PlastiPure published a three-page sales brochure entitled “EA-
Free Plastic Products: Beyond BPA-Free” and distributed the brochure at trade
shows and directly to potential customers. The brochure contains a chart that
depicts products containing “Eastman’s Tritan” as having significant levels of
EA. The caption to the chart states: “Examples of test results of products
claiming to be EA-free or made from materials claiming to be EA-free are given
in the figure to the right. Most examples are made from Eastman’s Tritan™
resin.”
Based on the sales brochure and other marketing materials, Eastman
filed suit against PlastiPure and CertiChem, alleging false advertising under
the Lanham Act, business disparagement, tortious interference, unfair
competition, and conspiracy. At trial, both sides offered expert testimony
about the proper definition of EA, the proper way to test for EA, and whether
Tritan exhibits EA. After a jury verdict in favor of Eastman, the district court
entered judgment against PlastiPure and CertiChem, ruling that both
companies willfully violated Section 43(a) of the Lanham Act, 15 U.S.C.
§ 1125(a), engaged in unfair competition under Texas common law, and
conspired with one another in connection with these violations. The district
court, after denying their motion for judgment as a matter of law, enjoined
PlastiPure and CertiChem from distributing the above-referenced sales
brochure and from:
making any verbal or written statement, expressly or by
implication, to any third party in connection with any advertising,
promotion, offering for sale, or sale of goods or services or in any
other commercial manner that:
3
Case: 13-51087 Document: 00512879044 Page: 4 Date Filed: 12/22/2014
No. 13-51087
(1) Tritan resins and products leach chemicals having
significant estrogenic activity; (2) Tritan, or products
made with Tritan, are dangerous to human health
because they exhibit estrogenic activity; or (3) Tritan
resins and products leach chemicals having significant
estrogenic activity after common-use stresses.
PlastiPure and CertiChem make three arguments on appeal. First, they
argue that the district court’s injunction is improper because their statements
were scientific opinions rather than actionable facts. Second, they argue that
the jury verdict is based on legally insufficient evidence. Third, they argue
that the district court’s jury instructions and verdict form contain errors
warranting reversal.
II.
Appellants contend that the district court should not have entered its
injunction because Appellants’ statements about Tritan are not actionable
statements of fact under the Lanham Act. We review the grant of a permanent
injunction for abuse of discretion. Abraham v. Alpha Chi Omega, 708 F.3d 614,
620 (5th Cir. 2013). An abuse of discretion may be found where the trial court
“(1) relies on clearly erroneous factual findings when deciding to grant or deny
the permanent injunction, (2) relies on erroneous conclusions of law when
deciding to grant or deny the permanent injunction, or (3) misapplies the
factual or legal conclusions when fashioning its injunctive relief.” Schlotzsky’s,
Ltd. v. Sterling Purchasing & Nat’l Distribution Co., 520 F.3d 393, 402 (5th
Cir. 2008) (internal quotation marks omitted).
Section 43(a) of the Lanham Act prohibits false advertising. 15 U.S.C.
§ 1125(a). It provides a civil cause of action against any person who, in
connection with goods or services, uses any “false or misleading description of
fact, or false or misleading representation of fact . . . .” Id. § 1125(a)(1).
“Essential to any claim under section 43(a) of the Lanham Act is a
4
Case: 13-51087 Document: 00512879044 Page: 5 Date Filed: 12/22/2014
No. 13-51087
determination of whether the challenged statement is one of fact—actionable
under section 43(a)—or one of general opinion—not actionable under section
43(a).” Pizza Hut, Inc. v. Papa John’s Int’l, Inc., 227 F.3d 489, 495–96 (5th Cir.
2000).
We have held that “[a] statement of fact is one that (1) admits of being
adjudged true or false in a way that (2) admits of empirical verification.”
Presidio Enters., Inc. v. Warner Bros. Distrib. Corp., 784 F.2d 674, 679 (5th Cir.
1986). Similarly, we have said that the challenged statement must make a
“‘specific and measurable claim, capable of being proved false or of being
reasonably interpreted as a statement of objective fact.’” Pizza Hut, 227 F.3d
at 496 (quoting Coastal Abstract Serv., Inc. v. First Am. Title Ins. Co., 173 F.3d
725, 731 (9th Cir. 1999)); see also Southland Sod Farms v. Stover Seed Co., 108
F.3d 1134, 1145 (9th Cir. 1997) (stating that a statement of fact is one that
makes “a specific and measurable advertisement claim of product superiority”).
In contrast, “[b]ald assertions of superiority” and “exaggerated, blustering, and
boasting statement[s]” are non-actionable opinions. Pizza Hut, 227 F.3d at
496–97. Predictions of future events are also non-actionable expressions of
opinion. Presidio Enters., 784 F.2d at 680.
Appellants argue that commercial statements relating to live scientific
controversies should be treated as opinions for Lanham Act purposes.
According to Appellants, enjoining statements that embrace one side of an open
scientific debate would stifle academic freedom and inhibit the free flow of
scientific ideas, contrary to the principles undergirding the First Amendment.
Accordingly, they urge us to classify their statements about Tritan’s EA
content as opinions rather than actionable facts.
As primary support for their argument, Appellants offer the Second
Circuit’s opinion in ONY, Inc. v. Cornerstone Therapeutics, Inc., 720 F.3d 490
(2d Cir. 2013). In ONY, the parties were rival producers of non-human
5
Case: 13-51087 Document: 00512879044 Page: 6 Date Filed: 12/22/2014
No. 13-51087
surfactants, which are biological substances used to treat respiratory
conditions in infants. The defendants conducted a study of the relative efficacy
of different surfactants, concluding that their own surfactant was associated
with a lower mortality rate and a shorter length of hospital stay than the
plaintiff’s surfactant. The defendants hired several physicians to present the
study’s findings at pediatric society meetings, and those physicians published
the study’s findings in an article in a peer-reviewed journal. After the article’s
publication, the defendants “issued a press release touting its conclusions and
distributed promotional materials that cited the article’s findings.” Id. at 495.
The plaintiff in ONY filed a complaint alleging, inter alia, tortious
interference and violations of the Lanham Act. According to the ONY plaintiff,
the published article contained “five distinct incorrect statements of fact about
the relative effectiveness” of the companies’ surfactants. Id. at 494. The
district court dismissed the complaint and the Second Circuit affirmed. The
Second Circuit began its analysis by noting that “[s]cientific academic
discourse poses several problems for the fact-opinion paradigm of First
Amendment jurisprudence.” Id. at 496. Although scientific articles typically
make specific and measurable claims that can be reasonably interpreted as
statements of objective fact, “it is the essence of the scientific method that the
conclusions of empirical research are tentative and subject to revision, because
they represent inferences about the nature of reality based on the results of
experimentation and observation.” Id. After a thorough analysis, the Second
Circuit concluded that the First Amendment places scientific debates
unfolding within the scientific community beyond the reach of the Lanham Act.
According to the Second Circuit, statements in scientific literature “are more
closely akin to matters of opinion, and are so understood by the relevant
scientific communities.” Id. at 497.
6
Case: 13-51087 Document: 00512879044 Page: 7 Date Filed: 12/22/2014
No. 13-51087
Appellants insist that the present case is on “all fours” with ONY. We
disagree. The plaintiff in ONY sought to enjoin statements made within the
academic literature and directed at the scientific community. In that context,
the Second Circuit concluded that the defendants’ statements should be
treated as opinions, else the prospect of defamation liability would stifle
academic debate and trench upon First Amendment values. See id. at 497
(“[T]he trial of ideas plays out in the pages of peer-reviewed journals, and the
scientific public sits as the jury.”). Here, in contrast, Eastman did not sue
Appellants for publishing an article in a scientific journal. Rather, Eastman
sought to enjoin statements made in commercial advertisements and directed
at customers. As the district court aptly summarized:
This lawsuit is not about Dr. Bittner’s scientific paper. It is
about statements made in commercial advertisements or
promotions, not statements made in a peer-reviewed journal. It is
about statements made to consumers, not scientists. It is about
statements made without the necessary context presented by a full
scientific study, such as a description of the data, the experimental
methodology, the potential conflicts of interest, and the differences
between raw data and the conclusions drawn by the researcher.
Eastman Chem. Co. v. PlastiPure, Inc., 969 F. Supp. 2d 756, 764 (W.D. Tex.
2013). In this commercial context, the First Amendment is no obstacle to
enforcement of the Lanham Act. See Zauderer v. Office of Disciplinary Counsel
of Supreme Court of Ohio, 471 U.S. 626, 638 (1985) (“The States and the
Federal Government are free to prevent the dissemination of commercial
speech that is false, deceptive, or misleading . . . .”); see also Cent. Hudson Gas
& Elec. Corp. v. Pub. Serv. Comm’n of New York, 447 U.S. 557, 562–63 (1980)
7
Case: 13-51087 Document: 00512879044 Page: 8 Date Filed: 12/22/2014
No. 13-51087
(“The Constitution therefore accords a lesser protection to commercial speech
than to other constitutionally guaranteed expression.”). 1
Given the applicable binding precedent, it is of no moment that the
commercial speech in this case concerned a topic of scientific debate.
Advertisements do not become immune from Lanham Act scrutiny simply
because their claims are open to scientific or public debate. Otherwise, the
Lanham Act would hardly ever be enforceable—“many, if not most, products
may be tied to public concerns with the environment, energy, economic policy,
or individual health and safety.” Cent. Hudson, 447 U.S. at 563 n.5. The
Supreme Court has “made clear that advertising which links a product to a
current public debate is not thereby entitled to the constitutional protection
afforded noncommercial speech.” Bolger v. Youngs Drug Products Corp., 463
U.S. 60, 68 (1983) (internal quotation marks omitted); see also Recent Case,
127 Harv. L. Rev. 1815, 1819 (2014) (“Dissemination of a scientific article as
part of a company’s marketing campaign is for promotional purposes and
therefore qualifies as commercial speech.”). The First Amendment ensures a
robust discourse in the pages of academic journals, but it does not immunize
false or misleading commercial claims. See, e.g., Church & Dwight Co. v.
Clorox Co., 840 F. Supp. 2d 717, 722–23 (S.D.N.Y. 2012) (enjoining commercial
1 Jurists and commentators have urged the Supreme Court to abandon the distinction
between commercial and non-commercial speech. See, e.g., 44 Liquormart, Inc. v. Rhode
Island, 517 U.S. 484, 518–28 (1996) (Thomas, J., concurring in part and concurring in
judgment); Alex Kozinski & Stuart Banner, Who’s Afraid of Commercial Speech?, 76 Va. L.
Rev. 627 (1990); see also Martin H. Redish, Product Health Claims and the First Amendment:
Scientific Expression and the Twilight Zone of Commercial Speech, 43 Vand. L. Rev. 1433
(1990) (acknowledging that “the Court has allowed certain forms of regulation for commercial
speech that clearly would be impermissible for more traditional subjects of expression,” but
arguing that commercial-scientific speech should be “viewed not as commercial, but rather
as fully protected scientific expression. To hold otherwise would be to penalize traditionally
protected expression for no reason other than the communicator’s personal motivation for
making that expression. Motivation never has influenced the level of protection given to
speech in other contexts and its use cannot be rationalized under first amendment theory.”).
8
Case: 13-51087 Document: 00512879044 Page: 9 Date Filed: 12/22/2014
No. 13-51087
claims as literally false because tests supporting those claims were unreliable);
Castrol Inc. v. Pennzoil Co., 987 F.2d 939, 944 (3d Cir. 1993) (enjoining claims
that Pennzoil motor oil outperformed Castrol motor oil with respect to viscosity
breakdown); McNeil-P.C.C., Inc. v. Bristol-Myers Squibb Co., 938 F.2d 1544,
1549 (2d Cir. 1991) (enjoining claims that Excedrin was scientifically superior
to Tylenol at relieving pain).
Appellants make much of the fact that the Second Circuit in ONY also
dismissed a tortious interference claim regarding the defendants’ “touting and
distributing the article’s findings for promotional purposes.” Id. at 498–99.
Even if it were binding on us, that portion of the Second Circuit’s holding would
not affect the analysis here, for two reasons. First, the Second Circuit
addressed secondary distribution of the article in the context of a state law
tortious interference claim—not in the context of the Lanham Act. The Second
Circuit did not hold that promotional materials embracing one side of a
scientific debate are opinions under the Lanham Act; rather, it held that the
act of distributing those statements did not give rise to liability for tortious
interference. Second, the nature of the secondary distribution in ONY is
dissimilar to that which occurred in this case. In ONY, the secondary
distribution was limited to the issuance of a press release summarizing the
article’s findings and dissemination of the article itself. Here, the secondary
distribution did not include any dissemination of the article; in fact, the sales
brochure was distributed prior to the article’s publication. Nor did the sales
brochure simply tout the article’s findings—the sales brochure specifically
highlights the alleged EA content of Tritan, but the article never even
mentions Tritan by name. As the district court recognized, the different results
in ONY and in this case reflect the difference between presenting an article’s
conclusions and “transform[ing] snippets of . . . a paper which never mentions
9
Case: 13-51087 Document: 00512879044 Page: 10 Date Filed: 12/22/2014
No. 13-51087
Tritan or Eastman by name . . . into commercial advertisements claiming
Tritan is harmful.” Eastman Chem. Co., 969 F. Supp. 2d at 764.
Application of the Lanham Act to Appellants’ promotional statements
will not stifle academic freedom or intrude on First Amendment values. By its
terms, the injunction only applies to statements made “in connection with any
advertising, promotion, offering for sale, or sale of goods or services.”
Appellants may continue to pursue their research and publish their results;
they simply may not push their product by making the claims the jury found
to be false and misleading. 2
III.
Appellants argue that the jury’s verdict must be reversed because “there
is no legally sufficient evidence demonstrating that Tritan does not have EA.”
According to Appellants, the jury had no basis on which to conclude that
Appellants’ statements about Tritan’s EA were false. In response, Eastman
contends that “substantial trial evidence” showed that Tritan is free of EA, and
that “the jury reasonably concluded that Defendants’ statements to the
contrary were affirmatively false.” Eastman also points out that Appellants
2 The district court’s injunction permits Appellants to “seek relief from the injunction”
if new research proves “the statements the jury found to be false and misleading are no longer
false and misleading . . . .” According to Appellants, the nature of the district court’s
injunction reveals that Appellants’ statements are not statements of objective fact: “a
statement of historical fact (e.g., ‘Tritan has EA’) cannot be false on one day, and true on the
next.” The fact that Appellants might be able someday to prove that their statements are
true does not make the injunction improper. If it did, companies could make all sorts of
unsupported claims and then avoid liability by arguing that they might be able to prove the
truth of the claims at some point in the future. Instead, when a jury finds statements to be
false, an injunction properly issues and then can be modified or dissolved if factual
circumstances change. See ICEE Distribs., Inc. v. J&J Snack Foods Corp., 445 F.3d 841, 850
(5th Cir. 2006) (“Modification of an injunction is appropriate when the legal or factual
circumstances justifying the injunction have changed.”); see also Basic Research, L.L.C. v.
Cytodyne Technologies, Inc., No. 2:99-CV-343K, 2000 WL 33363261, at *11 (D. Utah Dec. 20,
2000) (vacating injunction in Lanham Act case after defendants conducted additional tests
that supported defendants’ scientific claims).
10
Case: 13-51087 Document: 00512879044 Page: 11 Date Filed: 12/22/2014
No. 13-51087
fail to challenge the jury’s finding that the statements were misleading, which
serves as an independent basis of liability under the Lanham Act.
“[O]ur standard of review with respect to a jury verdict is especially
deferential.” SMI Owen Steel Co., Inc. v. Marsh U.S.A., Inc., 520 F.3d 432, 437
(5th Cir. 2008) (internal quotation marks omitted). “Although we review the
denial of a motion for judgment as a matter of law de novo, we apply the same
legal standard as the district court.” E.E.O.C. v. Boh Bros. Constr. Co., 731
F.3d 444, 451 (5th Cir. 2013) (en banc). “Under that standard, a litigant cannot
obtain judgment as a matter of law ‘unless the facts and inferences point so
strongly and overwhelmingly in the movant’s favor that reasonable jurors
could not reach a contrary conclusion.’” Id. (quoting Baisden v. I’m Ready
Prods., Inc., 693 F.3d 491, 498 (5th Cir. 2012), cert. denied, ––– U.S. –––, 133
S. Ct. 1585 (2013)). In conducting our review, we must draw all reasonable
inferences in the light most favorable to the verdict and cannot substitute other
inferences that we might regard as more reasonable. Westlake Petrochems.,
L.L.C. v. United Polychem, Inc., 688 F.3d 232, 239 (5th Cir. 2012). For “‘it is
the function of the jury as the traditional finder of the facts, and not for the
Court, to weigh conflicting evidence and inferences, and determine the
credibility of witnesses.’” Roman v. W. Mfg., Inc., 691 F.3d 686, 692 (5th Cir.
2012) (quoting Mosley v. Excel Corp., 109 F.3d 1006, 1009 (5th Cir. 1997)).
A reasonable jury could have concluded that Appellants’ statements
were false. Eastman introduced evidence of tests conducted by four separate
laboratories that found no evidence of estrogenic activity in Tritan. Eastman’s
expert witnesses testified that Tritan was non-harmful and was EA-free.
Eastman’s experts also testified that most of Appellants’ tests were not
scientifically reliable, and that the few reliable tests actually showed no
evidence of EA. No expert on either side ever testified that Tritan is harmful
to humans. Of course, Appellants offered their own evidence. Dr. Bittner
11
Case: 13-51087 Document: 00512879044 Page: 12 Date Filed: 12/22/2014
No. 13-51087
testified extensively about his expertise and about the reliability of Appellants’
testing methods. Multiple expert witnesses testified that Appellants’ tests
were scientifically reliable and could accurately detect the presence of EA.
After hearing this evidence, the jury was free to, and apparently did, credit
Eastman’s evidence that Tritan was EA-free over the contrary evidence
presented by Appellants. 3 See Boh Bros. Constr. Co., 731 F.3d at 452 (“‘We are
not to tamper lightly with the considered judgment of those drawn together at
one point in time to render a judgment that is representative of the good
common sense of the American people.’” (quoting Stacey v. Allied Stores Corp.,
768 F.2d 402, 406 (D.C. Cir. 1985)); see also Eastman Chem. Co., 969 F. Supp.
2d at 761 (noting “the capability of juries to understand scientific evidence and
weigh the credibility of the competing experts, notwithstanding their
contradictory conclusions and dogmatic assertions” (internal quotation marks
omitted)).
In any event, the jury also found that Appellants’ statements were
misleading, and Appellants do not challenge the sufficiency of the evidence on
that point. The jury’s finding that the statements were misleading serves as
an independent basis for the district court’s injunction. See 15 U.S.C.
§ 1125(a)(1) (imposing liability for any “false or misleading description of fact,
or false or misleading representation of fact” (emphases added)). The district
court properly instructed the jury that it could find the challenged statements
“misleading” even if they were not literally false, and that liability for
misleading statements would only attach with additional findings of
“deception” and “materiality.” Sure enough, the jury found that the statements
3 The parties debate whether our circuit should adopt the “tests-prove” standard of
liability, see Osmose, Inc. v. Viance, LLC, 612 F.3d 1298, 1309 (11th Cir. 2010), and whether
the district court should have submitted a “tests-prove” instruction to the jury. We need not
address this question because the jury, by finding that Tritan does not have EA, necessarily
also found that Appellants’ tests did not prove that Tritan has EA.
12
Case: 13-51087 Document: 00512879044 Page: 13 Date Filed: 12/22/2014
No. 13-51087
were misleading, that they “deceived, or had the capacity to deceive a
substantial segment of potential customers,” and that the deception was “likely
to influence the purchasing decisions of consumers.” Accordingly, Appellants
would be liable under the Lanham Act even if the evidence did not support a
finding of actual falsity.
Appellants attempt to clear this hurdle by asserting: “a jury that has
been wrongfully allowed, based on incorrect instructions, to determine that a
statement is literally false cannot then be asked whether the same statement
is misleading without the taint of the first answer destroying the reliability of
the second.” Appellants offer no authority for this proposition, and we fail to
grasp its logic. A jury’s view of whether a statement is misleading is not
“tainted” simply because the jury is also asked whether that statement is false.
To be sure, a jury that finds a statement to be false likely will find the same
statement to be misleading. But the jury’s conclusion would not result from
any “taint”—it would result from the jury’s assessment of the evidence. The
jury in this case heard the evidence and was asked whether the Appellants’
statements were false or misleading, and the jury answered both questions in
the affirmative. The jury’s finding that the statements were misleading serves
as an independent basis for the district court’s injunction, and we therefore
find no reversible error on this point.
IV.
Appellants argue that the jury’s verdict cannot stand because of three
purported errors in the jury instructions and verdict form. We review
challenges to jury instructions for abuse of discretion and afford the trial court
great latitude in the framing and structure of jury instructions. United States
v. Carrillo, 660 F.3d 914, 925–26 (5th Cir. 2011). In order to demonstrate
reversible error, the party challenging the instruction must show that the
charge “creates substantial and ineradicable doubt whether the jury has been
13
Case: 13-51087 Document: 00512879044 Page: 14 Date Filed: 12/22/2014
No. 13-51087
properly guided in its deliberations.” Taita Chem. Co. v. Westlake Styrene, LP,
351 F.3d 663, 667 (5th Cir. 2003) (internal quotation marks omitted). “The
instructions need not be perfect in every respect provided that the charge in
general correctly instructs the jury, and any injury resulting from the
erroneous instruction is harmless.” Rogers v. Eagle Offshore Drilling Servs.,
Inc., 764 F.2d 300, 303 (5th Cir. 1985). We do not reverse on the grounds of an
erroneous instruction if the error “could not have affected the outcome of the
case.” F.D.I.C. v. Mijalis, 15 F.3d 1314, 1318 (5th Cir. 1994).
Appellants’ first argument is based on the district court’s jury
instructions. The jury instructions advised the jury that it would be asked
whether any of three statements were false or misleading. After listing the
three statements, the instructions advised that the first statement could be
found in Exhibit P108 and that the second statement could be found in Exhibit
P110. Both of those exhibits are press releases describing the litigation
between Eastman and Appellants. Appellants claim that the district court
erred by allowing the jury to base its findings of falsity on statements
Appellants made in press releases, because statements made in press releases
are not commercial speech. The district court rejected this argument when it
ruled on Appellants’ Motion for Judgment, reasoning that the press
releases were commercial speech because they “were clearly designed to bolster
[Appellants’] image and reaffirm [Appellants’] primary business strategy; in
other words, to ‘influenc[e] consumers to buy [Appellants’] goods or
services . . . .’” Eastman Chem. Co., 969 F. Supp. 2d at 763 (quoting Seven-Up
Co. v. Coca-Cola Co., 86 F.3d 1379, 1384 (5th Cir. 1996)). We need not
determine whether the press releases were commercial speech because
Appellants failed to object during the charge conference to this aspect of the
district court’s jury instructions. As a result, Appellants have waived this
argument. Texas Beef Grp. v. Winfrey, 201 F.3d 680, 689 (5th Cir. 2000) (“If a
14
Case: 13-51087 Document: 00512879044 Page: 15 Date Filed: 12/22/2014
No. 13-51087
party fails to object with specificity to a proposed instruction, the right to
challenge the instruction on appeal is waived.”); see Fed. R. Civ. P. 51. 4
Appellants’ second argument concerns the district court’s instruction
that “[a] false statement may be either literally false, or false by necessary
implication.” 5 Appellants contend that the Fifth Circuit has not adopted the
“false by necessary implication” doctrine, and that it should not do so here.
Under the “false by necessary implication” doctrine—which has been adopted
by the First, Second, Third, Fourth, Ninth, and Federal Circuits—a statement
may be false when, “considering the advertisement in its entirety, the audience
would recognize the claim as readily as if it had been explicitly stated.” Clorox
Co. Puerto Rico v. Proctor & Gamble Commercial Co., 228 F.3d 24, 35 (1st Cir.
2000). We need not decide whether to adopt the “false by necessary
implication” doctrine because, as already discussed, the jury found all of
Appellants’ statements to be both literally false and misleading. The jury’s
finding that the statements were misleading serves as an independent basis
for the district court’s injunction, regardless of whether the instruction about
falsity was proper.
Appellants’ third argument relates to the second statement submitted to
the jury. The district court, instead of enumerating actual statements
Appellants made about Tritan, asked the jury whether “statements to the
effect that Tritan, or products made with Tritan, are dangerous to human
health because they exhibit estrogenic activity” would be false or misleading.
4If error is not preserved, we may review for plain error. Taita Chem. Co. v. Westlake
Styrene, LP, 351 F.3d 663, 668 (5th Cir. 2003). Appellants have not argued, much less
demonstrated, that the district court’s instruction constituted plain error.
5 Appellants objected in the district court to the false by necessary implication
instruction “on the grounds that the doctrine of falsity by necessary implication has not been
adopted by any court in the Fifth Circuit and nor should it.”
15
Case: 13-51087 Document: 00512879044 Page: 16 Date Filed: 12/22/2014
No. 13-51087
In the district court, Appellants argued that the statement could not be
“literally false” because Appellants never actually made the statement.
Counsel for Appellants stated:
[The second statement] is not a statement that’s actually
made. And so, we would argue that to the extent that it’s not
actually made, it’s only properly something that can be misleading,
because something that’s not actually made can’t be literally false.
The district court explained that it was using this amalgamated
statement because the alternative was to enumerate eighteen separate
statements, and the court asked counsel for Appellants if he preferred that
alternative. Counsel for Appellants responded: “No. If that’s the alternative,
then no.” The district court then opined that enumerating such a large number
of statements would be prejudicial to the defendant and burdensome on the
jury, and counsel for Appellants responded that he preferred the amalgamated
statement. On appeal, Appellants argue that the amalgamated statement
cannot form the basis of Lanham Act liability because Appellants never made
that particular statement.
As an initial matter, Appellants failed to preserve their argument. To
preserve a jury instruction error, a party must make “a specific, formal, on-the-
record objection . . . .” Jimenez v. Wood Cnty., Tex., 660 F.3d 841, 845 (5th Cir.
2011) (en banc). Although Appellants expressed concern about the
amalgamated statement, they quickly backtracked from their objection when
presented with an alternative option. Appellants never proposed an
alternative solution of their own. As a result, Appellants failed to make their
position “sufficiently clear to the court to satisfy Rule 51’s objection
16
Case: 13-51087 Document: 00512879044 Page: 17 Date Filed: 12/22/2014
No. 13-51087
requirement.” Kelly v. Boeing Petroleum Servs., Inc., 61 F.3d 350, 361 (5th Cir.
1995).
Even assuming arguendo that the objection was preserved, Appellants
have not explained how the instruction affected the outcome of the case.
Appellants argued in the district court that the amalgamated statement could
not be literally false, but they conceded that the amalgamated statement could
be misleading. Because the jury found the statement to be both false and
misleading, Appellants were not harmed by any error. Moreover, Appellants
do not deny that the amalgamated statement accurately summarizes
statements Appellants made, and the injunction goes no further than to enjoin
statements matching the amalgamated statement. Accordingly, any error was
harmless.
For the foregoing reasons, we AFFIRM.
17