False Advertising

Had Hormel won its claim against Henson, three remedies would have been available to it: injunctive relief, corrective advertising, and damages.

Injunctive Relief Injunctive relief is granted by the courts upon the satisfaction of two requirements. First, a plaintiff must demonstrate a "likelihood of deception or confusion on the part of the buying public caused by a product's false or misleading description or advertising" (Alpo). Second, a plaintiff must demonstrate that an "irreparable harm" has been inflicted, even if such harm is a decrease in sales that cannot be completely attributed to a defendant's false advertising. It is virtually impossible to prove that sales can or will be damaged; therefore, the plaintiff only has to establish that there exists a causal relationship between a decline in its sales and a competitor's false advertising. Furthermore, if a competitor specifically names the plaintiff's product in a false or misleading advertisement, the harm will be presumed (McNeilab, Inc. v. American Home Products Corp., 848 F.2d 34 [2nd. Cir. 1988]).

Corrective Advertising Corrective advertising can be ruled in two different ways. First, and most commonly, the court can require a defendant to launch a corrective advertising campaign and to make an affirmative, correcting statement in that campaign. For example, in Alpo, the court required Purina to distribute a corrective release to all of those who had received the initial, false information.

Second, the courts can award a plaintiff monetary damages so that the plaintiff can conduct a corrective advertising campaign to counter the defendant's false advertisements. For example, in U-Haul International v. Jartran, Inc., 793 F.2d 1034 (9th Cir. 1986), the plaintiff, U-Haul International, was awarded $13.6 million— the cost of its corrective advertising campaign.

Damages To collect damages, the plaintiff generally has to show either that some consumers were actually deceived or that the defendant used the false advertising in bad faith. Four types of damages are awarded for false advertising: profits the plaintiff loses when sales are diverted to the false advertiser; profits lost by the plaintiff on sales made at prices reduced as a demonstrated result of the false advertising; the cost of any advertising that actually and reasonably responds to the defendant's offending advertisements; and quantifiable harm to the plaintiff's good will to the extent that complete and corrective advertising has not repaired that harm (Alpo).