C.B. Fleet Co., Inc. v. SmithKline Beecham Consumer Healthcare, L.P.

• Decision Date: 10 December 1997
• Docket Number: No. 96-2606,96-2606
• Citation: 45 U.S.P.Q.2d 1119,131 F.3d 430
• Parties: 1997-2 Trade Cases P 71,998, 45 U.S.P.Q.2d 1119 C.B. FLEET COMPANY, INCORPORATED, A Virginia corporation, Plaintiff-Appellant, v. SMITHKLINE BEECHAM CONSUMER HEALTHCARE, L.P., A Delaware limited partnership, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 430

131 F.3d 430

1997-2 Trade Cases P 71,998, 45 U.S.P.Q.2d 1119

C.B. FLEET COMPANY, INCORPORATED, A Virginia corporation Plaintiff-Appellant, v. SMITHKLINE BEECHAM CONSUMER HEALTHCARE, L.P., A Delaware limited partnership, Defendant-Appellee.

No. 96-2606.

United States Court of Appeals Fourth Circuit.

Argued June 5, 1997.

Decided Dec. 10, 1997.

ARGUED: Rodney F. Page, Arent, Fox, Kintner, Plotkin & Kahn, Washington, DC, for Appellant. Kenneth Allen Plevan, Skadden, Arps, Slate, Meagher & Flom, L.L.P., New York City, for Appellee. ON BRIEF: Peter S. Reichertz, Arent, Fox, Kintner, Plotkin & Kahn, Washington, DC, for Appellant. Bruce J. Goldner, Skadden, Arps, Slate, Meagher & Flom, L.L.P., New York City; William B. Poff, Sara B. Winn, Woods, Rogers & Hazlegrove, P.L.C., Roanoke, VA, for Appellee.

Before WILKINS and MICHAEL, Circuit Judges, and PHILLIPS, Senior Circuit Judge.

Affirmed by published opinion. Senior Judge PHILLIPS wrote the opinion, in which Judge WILKINS and Judge MICHAEL joined.

OPINION

PHILLIPS, Senior Circuit Judge:

This is an appeal by C.B. Fleet Company, Inc. (Fleet), a manufacturer of feminine hygiene products, from a judgment dismissing for failure of proof its Lanham Act false advertising claims against a competitor, SmithKline Beecham Consumer Healthcare, L.P. (SmithKline). We affirm.

I.

The events leading to this litigation began in 1991 when SmithKline, concerned about a declining market for its principal douche product, hired a marketing consultant to devise ways to truly differentiate its product from competing brands and so improve its market position. As a result of this consultation, SmithKline planned two projects. First, it would re-design and seek to patent a new nozzle for its Massengill douche in order to make its copying more difficult. Then it would directly attack its principal competition, Fleet's Summer's Eve douche, by an advertising campaign designed to persuade consumers that Massengill douches cleansed better than did the Summer's Eve douche.

In 1995, after the douche nozzle had been redesigned by Human Factors, an ergonomics engineering firm, SmithKline began circulating with its product a freestanding advertising insert coupon which claimed that the Massengill douche was "Now Designed for Better Cleansing." No testing of the redesigned douche for specific cleansing properties preceded its marketing with the advertising insert.

In preparation for its follow-up direct attack upon Fleet's Summer's Eve douche, SmithKline employed Product Investigation, an independent testing laboratory, to devise a means of testing the specific cleansing properties of douches. At the time, no such test generally recognized for its efficacy had been developed for use in the industry. Product Investigations came up with a testing procedure using a blue-dye marker which was then used in tests involving SmithKline's old-nozzle douche, its new-nozzle model, and the Summer's Eve douche. In quite general terms, the human-subject tests ultimately used involved a preparatory cleansing process, followed by the insertion of a blue-dye marker, after which the test douches were used and their relative efficacies in removing the marker-fluid measured. The ultimate test used employed as the specific cleansing agents the "extra cleansing vinegar and water" solutions used respectively in the Massengill (SmithKline) and Summer's Eve (Fleet) disposable douches. The results, as reported by the Product Investigations testers, showed that in terms of their relative efficacies in removing quantities of the test marker fluids, both the old and new Massengill douches outperformed the Summer's Eve douche, though the old Massengill outperformed the new-nozzle model.

Following completion of these tests, SmithKline ran a television advertisement claiming that "Massengill cleanses better than Summer's Eve." This was later withdrawn in conjunction with SmithKline's consent to withholding both advertising claims pending final decision in this litigation. Instead, SmithKline proposed to use the more specific advertising claim that "Massengill Extra Cleansing Vinegar and Water Douche Cleanses Better than Summer's Eve Extra Cleansing Vinegar and Water Douche."

Fleet then brought this action against SmithKline alleging violations of § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), by the use of false advertising claims. ¹ Specifically challenged were the earlier "Now Designed for Better Cleansing" ("improved design") claim and the later proposed "Massengill Extra Cleansing Vinegar and Water Douche Cleanses Better than Summer's Eve Extra Cleansing Vinegar and Water Douche" ("comparative superiority") claim.

The action was tried to the district court sitting with an advisory jury pursuant to Rule 39(c), Fed.R.Civ.P. The three-day trial that ensued was mainly devoted to the parties' conflicting expert opinion testimony and extensive documentary evidence respecting the claimed falsity of the two challenged claims.

Fleet's evidence consisted essentially of the testimony of two expert witnesses who, with supporting documentary evidence, challenged the scientific reliability of the blue-dye testing procedures upon which SmithKline concededly based its "comparative superiority" advertising claim, and the essential truth of the "improved design" claim.

Dr. Frank Dorsey, a statistician, made a number of criticisms of the blue-dye test methodology used by SmithKline's testers. On that basis, he questioned the reliability of the test results it produced.

Sarah Post, a Vice President and Director of Administration of Fleet, testified to the conduct by Fleet of two tests--a "bovine mucus" test and a "detergency study"--which, she opined, drew in question SmithKline's blue-dye test results. The detergency study, performed in 1985, consisted of dipping cloths stained in blood in douche solutions then in use by the two competitors. The bovine mucus test, from 1991, consisted of spinning bovine cervical mucus in douche solutions then in use by the competitors. Neither test used the vinegar and water solutions which were the subject of the "superior product" claim at issue.

As to the "improved design" claim, Fleet's witnesses pointed out that it was first made by SmithKline before any clinical tests were made of the Massengill douche's performance with the redesigned nozzle, and that the later blue-dye studies actually revealed that the later model did not cleanse as efficiently in terms of material removal as did the older model. This, they opined, indicated that the new Massengill douche was not, as claimed, "now designed for better cleansing."

SmithKline, in defense, presented the testimony of four expert witnesses: Dr. Morris Shelanski, who as director of Products Investigation, had developed and performed the blue-dye studies; Dr. Paul Starkey, SmithKline's Medical Director; Dr. Donald Pittaway, a gynecologist on the faculty of the Bowman Gray Medical Center; and Dr. James Leyden, a medical doctor on the faculty of the University of Pennsylvania School of Medicine. Both of the last two witnesses were paid consultants to SmithKline.

As to the "comparative superiority" claim, Dr. Shelanski, who developed and supervised conduct of the blue-dye studies, described the test methodology's design, purpose, and use, and gave as his opinion that the reported results showing that the Massengill douche cleansed better than did the Summer's Eve douche were scientifically reliable. His opinion was supported by those of Drs. Pittaway and Leyden based upon their studies of the test's methodology, conduct, and reported results. The test's reliability was also supported by the testimony of Dr. Starkey in refuting Dr. Dorsey's specific criticisms of the Shelanski methodology.

As to the "improved-design" claim, SmithKline witnesses described the new nozzle design, emphasizing those features that improved its mechanical performance over that of the old model. Specifically, they noted that it has deeper side channels which improved outflow, a more rounded tip which made insertion easier, and improved flow dynamics which made the douching process more gentle and, possibly, safer. As to its actual cleansing properties, as measured by the blue-dye studies, they conceded that it did not perform better than did the earlier design (as they had hoped it would) though, per those studies, it did still outperform the Summer's Eve douche in this respect.

Following conclusion of the evidence, the advisory jury returned a verdict in favor of Fleet, finding false both of the advertising claims. The district court, however, did not accept the verdict, as was its conceded prerogative, see 9 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2335 at 211-12 (2d ed.1994), and, instead, found for SmithKline as to both of the advertising claims.

In a brief memorandum opinion, the court concluded that Fleet had failed to carry its burden to prove that either advertising claim was false in violation of § 43(a) of the Lanham Act.

As to the "comparative superiority" claim, the court expressly credited the expert opinions of SmithKline's witnesses over those of Fleet's expert as to the reliability of the blue-dye studies in demonstrating the superior cleansing efficacy of the Massengill douche. The court found "not only that the tests ... were solid, even exceptional, clinical studies, but also that they clearly supported SmithKline's advertised claim."

As to the "improved design" claim, the court found, concentrating on evidence that the redesigned nozzle had mechanical features which "changed the flow dynamics ... to make the douching process more gentle and effective," that the "now designed for better cleansing" claim had not been proven false.

Having found against Fleet on the merits, the court denied its claim that as "prevailing party" in an "exceptional case," it was entitled under 15 U.S.C. § 1117(a) (1997), to...