Serbin v. Ziebart Intern. Corp., Inc., s. 92-3689

CourtUnited States Courts of Appeals. United States Court of Appeals (3rd Circuit)
Citation11 F.3d 1163
Docket NumberNos. 92-3689,93-5321,s. 92-3689
Parties, 1993-2 Trade Cases P 70,442, 28 U.S.P.Q.2d 1881 Sara G. SERBIN and George Baker, individually, and on behalf of all others similarly situated, Appellants, v. ZIEBART INTERNATIONAL CORPORATION, INC. and Ziebart Corporation, Appellees. Sheilah GUARINO, Appellant, v. SUN COMPANY, INC., Sun Refining & Marketing Company, Robert McClements, Jr., David Zebley and Wells, Rich, and Greene, Inc., Appellees.
Decision Date24 June 1993

Samuel J. Cordes, Andrew G. Sykes, Nancy A. Walker (argued), Ogg, Jones, DeSimone & Ignelzi, Pittsburgh, PA, for appellants in No. 92-3689.

Gary P. Hunt, Richard B. Tucker, III (argued), Tucker Arensberg, P.C., Pittsburgh, PA, for appellees in No. 92-3689.

John F. Innelli, Rudolph, Seidner, Goldstein, Rochestie, Salmon & Dorian, Philadelphia, PA, Joseph J. Baldassari, Heaney, Kilcoyne & Furey, Pennsauken, NJ, for appellant in No. 93-5321.

James M. Beck, Jon A. Baughman, Pepper, Hamilton & Scheetz, Philadelphia, PA, for appellees in No. 93-5321.

Before: STAPLETON and ALITO, Circuit Judges and POLLAK, District Judge *.

OPINION OF THE COURT

POLLAK, District Judge:

These two cases have been consolidated on appeal because, in challenging dismissal of their respective claims, plaintiff-appellants present the same question of law. The question of law is whether consumers of goods or services in interstate commerce who allege that, to their detriment, they purchased such goods or services in reliance on the advertising claims of the vendor, have a federal cause of action under subsection 1 of Section 43(a) of the Lanham Act, 15 U.S.C. Sec. 1125(a)(1), against the vendor.

Taken as a whole, the Lanham Act, enacted in 1946 and overhauled in 1988, is primarily intended to provide a statutory framework for the registration and protection of trademarks for goods and services, and, to that end, "to regulate commerce within the control of Congress by making actionable the deceptive and misleading use of marks in such commerce." 15 U.S.C. Sec. 1127. But trademarks are not the Lanham Act's only concern. An important cognate statutory purpose is "to protect persons engaged in such commerce against unfair competition." Ibid.

With a view to aiding in the achievement of these statutory goals, Section 43(a) of the Lanham Act as enacted in 1946 provided as follows:

Any person who shall affix, apply, or annex, or use in connection with any goods or services, or any container or containers for goods, a false designation of origin, or any false description or representation, including words or other symbols tending falsely to describe or represent the same, and shall cause such goods or services to enter into commerce, and any person who shall with knowledge of the falsity of such designation of origin or description or representation cause or procure the same to be transported or used in commerce or deliver the same to any carrier to be transported or used, shall be liable to a civil action by any person doing business in the locality falsely indicated as that of origin or in the region in which said locality is situated, or by any person who believes that he is or is likely to be damaged by the use of any such false description or representation.

15 U.S.C.A. Sec. 1125(a) (1982) (emphasis added). Section 39 of the Lanham Act vested subject-matter jurisdiction in the federal courts over causes of action created by the Lanham Act: "The district and territorial courts of the United States shall have original jurisdiction and the courts of appeal of the United States shall have appellate jurisdiction, of all actions arising under this chapter, without regard to the amount in controversy or to diversity or lack of diversity of the citizenship of the parties." 15 U.S.C.A. Sec. 1121 (1982).

As recast in 1988, Section 43(a) was broken down into two subsections: subsection 1 authorizes "any person who believes that he or she is or is likely to be damaged by such acts" to bring a civil action against anyone who:

... on or in connection with any goods or services, or any container for goods, uses in commerce any term, name, symbol or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of facts, which

(1) is likely to cause confusion ... as to the affiliation ... of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or

(2) in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or another person's goods, services, or commercial activities....

15 U.S.C. Sec. 1125(a) (emphasis added). Section 39--the jurisdictional provision--remained essentially unchanged.

In dismissing plaintiff-appellants' claims, the two district courts did not challenge the submission--which seems, indeed, indisputable--that the underscored portion of the quoted language of the current version of Section 43(a) is, as a matter of syntax, sufficiently In part I of this opinion, we describe in somewhat more detail the claims made and proceedings had in the district courts. In part II of this opinion we identify and discuss the relevant precedents. In part III we explain why, in our judgment, the rulings of the two district courts were correct.

broad to accommodate consumer claims. Rather, the district courts concluded, on the basis of case law with which the meager legislative history was not in disaccord, that the false advertising aspects of Section 43(a)--as originally framed in 1946 and as revised in 1988--were calculated to protect competitors or others with a comparably integral commercial interest but did not include ultimate consumers within the scope of protected interest. Since we agree with the holdings of the district courts, we will affirm their judgments.

I. Serbin v. Ziebart, No. 92-3689

Plaintiffs Sara G. Serbin and George Baker brought suit in the United States District Court for the Western District of Pennsylvania against Ziebart International Corporation and Ziebart Corporation. Ms. Serbin and Mr. Baker alleged in their joint complaint that, each of them, in 1990, contemporaneously with buying a new automobile, bought from the defendants (hereinafter collectively referred to as "Ziebart") Ziebart's so-called "Super Rust Protection" policy which insured against the rusting of newly purchased automobiles. The plaintiffs further alleged that Ziebart's advertisements of the "Super Rust Protection" policy contained representations that the Ziebart policy provided lifelong protection substantially more comprehensive than that contained in standard new-automobile manufacturers' warranties. These representations, according to the complaint, were false and known by Ziebart to be so. Plaintiffs alleged that, at least since 1988, standard warranties covering automobiles of the type purchased by the plaintiffs and similar warranties covering other brands of automobiles, American and foreign, sold in the United States, have provided multi-year, or 100,000 mile, protection against rusting fully as comprehensive as that provided by the lifelong Ziebart policy. Also, plaintiffs alleged that the Ziebart advertisements described the Ziebart policy in more expansive terms than the actual recitals of coverage set forth in the text of the policy.

Contending that they had been misled by Ziebart's advertisements into spending money on a policy "duplicative" of the protection afforded at no additional cost by automobile manufacturers during the life of the factory warranties, plaintiffs pleaded two causes of action--a federal claim under Section 43(a) of the Lanham Act, and a pendent state claim under the Pennsylvania Consumer Protection Act, 73 P.S. Secs. 201-2(4)(v-vii). Plaintiffs also sought class certification on behalf of "all persons ... who purchased Ziebart 'Super Rust Protection' in connection with the purchase of a new motor vehicle...."

Ziebart moved to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). Judge Bloch granted the motion. In a thoughtful opinion which reviewed the case law of Section 43(a) in some detail, Judge Bloch held that plaintiffs had failed to state a claim under the Lanham Act. Moreover, since the complaint did not state a valid federal claim, Judge Bloch concluded that the proper course was to dismiss the state claim as well, without prejudice to its reassertion in a state court.

Judge Bloch's dismissal of the Lanham Act claim rested on his conclusion that the injuries complained of by plaintiffs were not within the zone of interests sought to be protected by Section 43(a)'s ban on false advertising:

Although a consumer may bring an action under Sec. 43(a) of the Lanham Act, that consumer must show a commercial interest which is subject to an injury because of the Lanham Act violation. See Ditri v. Coldwell Banker, 954 F.2d 860 872 (3d Cir.1992) ("In an action under Sec. 43(a), plaintiffs must allege in their complaint ... that there is a likelihood of injury to the plaintiff in terms of declining sales, loss of goodwill, etc."). That commercial interest which is subject to injury need not be in direct competition with the alleged perpetrator's commercial interest, [Thorn

v. Reliance Van Co., Inc., 736 F.2d 929, 933 (3d Cir.1984) ], but there must be some reasonable and cognizable commercial interest which has been or potentially will be injured by the Lanham Act violation, Ditri, 954 F.2d at 872 (footnote omitted).

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