Dyson, Inc. v. Sharkninja Operating LLC, Case No. 1:14-cv-09442

• Decision Date: 09 July 2018
• Docket Number: Case No. 1:14-cv-09442
• Parties: DYSON, INC., Plaintiff, v. SHARKNINJA OPERATING LLC and SHARKNINJA SALES COMPANY, Defendants.
• Court: U.S. District Court — Northern District of Illinois

DYSON, INC., Plaintiff,
v.
SHARKNINJA OPERATING LLC and
SHARKNINJA SALES COMPANY, Defendants.

Case No. 1:14-cv-09442

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

July 9, 2018

Judge: Honorable Gary Feinerman

DEFENDANTS' RENEWED MOTION FOR JUDGMENT AS A MATTER OF LAW

Page 2

TABLE OF CONTENTS

Page

LEGAL STANDARD .................................................................................................................... 1

ARGUMENT ................................................................................................................................. 1

I. SHARKNINJA'S STATEMENTS WERE NOT LITERALLY FALSE .......................... 2

A. No Reasonable Jury Could Conclude That SharkNinja's Representation of Independent Testing Was Literally False .............................................................. 3

B. No Reasonable Jury Could Conclude That SharkNinja's Representation That Testing Was Done In Compliance With ASTM Standards Was Literally False ........................................................................................................ 5

II. THE GRAMS GRAPHIC IS NOT LITERALLY FALSE AS A MATTER OF LAW .................................................................................................................................. 8

A. Because the Grams Graphic Is (At Worst) Ambiguous, No Reasonable Jury Could Have Found It Literally False .............................................................. 8

B. Dyson Proved No Injury As A Result Of The Grams Graphic ............................ 10

III. DYSON IS NOT ENTITLED TO ANY RECOVERY OF DAMAGES ........................ 11

A. SharkNinja Proved Its Incremental Profits For The Relevant Time Period Were Less Than Zero, And Dyson Failed To Rebut That Evidence ................... 11

B. No Rational Jury Could Have Returned A Damage Verdict Of $16,410,681 .......................................................................................................... 13

CONCLUSION ............................................................................................................................ 15

Page 3

TABLE OF AUTHORITIES

Page

CASES

BASF Corp. v Old World Trading Co., 41 F.3d 1081 (7th Cir. 1994) ............................................................................................. 2, 3, 6

Borden, Inc. v. Kraft, Inc., 1984 WL 1458 (N.D. Ill. Sept. 28, 1984) ................................................................................ 10

Boyle v. United Techs. Corp., 487 U.S. 500 (1988) ................................................................................................................... 1

Castrol, Inc. v. Quaker State Corp., 977 F.2d 57 (2d Cir. 1992) ................................................................................................. 3, 6, 9

Cream Records, Inc. v. Jos. Schlitz Brewing Co., 754 F.2d 826 (9th Cir. 1985) ................................................................................................... 15

Edge Games, LLC v. Houghton Mifflin Harcourt Publ'g Co., 2015 WL 3498607 (C.D. Cal. June 2, 2015) ..................................................................... 12, 13

In re Century 21-Re/MAX Real Estate Advertising Litig., 882 F.Supp. 915 (C.D. Cal. 1994) ........................................................................................... 10

Johnson & Johnson Vision Care, Inc. v. 1-800 Contacts, Inc., 299 F.3d 1242 (11th Cir. 2002) ................................................................................................. 6

Kempner Mobile Elecs., Inc. v. Sw. Bell Mobile Sys., 428 F.3d 706 (7th Cir. 2005) ................................................................................................. 3, 8

L&F Prods. v. Procter & Gamble Co., 845 F. Supp. 984 (S.D.N.Y. 1994) ............................................................................................ 6

Not Dead Yet Mfg. Inc. v. Pride Solns., LLC, 265 F. Supp. 3d 811 (N.D. Ill. 2017) ....................................................................................... 10

Novartis Consumer Health, Inc. v. Johnson & Johnson—Merck Consumer Pharms. Co., 290 F.3d 578 (3d Cir. 2002) ............................................................................................... 3, 8, 9

Page 4

Roulo v. Russ Berrie & Co., 886 F.2d 931 (7th Cir. 1989) ............................................................................................. 11, 15

S.C. Johnson & Son, Inc. v. Clorox Co., 930 F. Supp. 753 (E.D.N.Y. 1996) ............................................................................................ 6

Schering-Plough Healthcare Prods. Inc. v. Schwarz Pharma, Inc., 586 F.3d 500 (7th Cir. 2013) ........................................................................................... passim

Scotts Co. v. United Indus. Corp., 315 F.3d 264 (4th Cir. 2002) ............................................................................................. 2, 8, 9

Sheehan v. Donlen Corp., 173 F.3d 1039 (7th Cir. 1999) ................................................................................................... 1

Sheldon v. Metro-Goldwyn Pictures Corp., 106 F.2d 45 (2d Cir. 1939), aff'd, 309 U.S. 390 (1940) .................................................... 14, 15

Skil Corp. v. Rockwell Int'l Corp., 375 F. Supp. 777 (N.D. Ill. 1974) .............................................................................................. 8

United Indus. Corp. v. Clorox Co., 140 F.3d 1175 (8th Cir. 1998) ............................................................................................. 9, 10

OTHER AUTHORITY

Fed. R. Civ. P. 50 ................................................................................................................... passim

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EXHIBIT CROSS-REFERENCE

Bradley Declaration Exhibit No.	Trial Exhibit No.
A	Cited Pages from Trial Transcripts ("Tr.")
B	9
C	13
D	89
E	110
F	127
G	128
H	129
I	149
J	316
K	327
L	334
M	519
N	523
O	525
P	529
Q	530
R	531
S	532
T	549
U	562
V	661
W	680
X	688
Y	690
Z	694
AA	701
AB	705
AC	722
AD	727b
AE	759
AF	768
AG	784
AH	809

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In this Lanham Act case, where liability is premised strictly on a claim of "literal falsity"—defined by the Seventh Circuit as "a bald-faced, egregious, undeniable, over the top" lie, Schering-Plough Healthcare Prods. Inc. v. Schwarz Pharma, Inc., 586 F.3d 500, 513 (7th Cir. 2009)—defendants ("SharkNinja") move for judgment as a matter of law, or "JMOL." Dyson failed to present sufficient evidence from which a reasonable jury could find that the challenged establishment claim was literally false: The undisputed trial evidence shows that the Intertek tests were conducted both in an independent manner, and in compliance with the ASTM F608 standard. Moreover, the combination of two literally true statements (here, the literally true voiceover based on the Intertek testing, and the literally true "Grams Graphic" based on internal testing) cannot yield a "literally false" statement, as a matter of law. Finally, Dyson is not entitled to any disgorgement of profits because SharkNinja proved its incremental profits for the liability period were zero. Therefore, SharkNinja requests that the Court issue judgment as a matter of law that SharkNinja did not violate § 43(a) of the Lanham Act, and that Dyson is not entitled to any damages.

LEGAL STANDARD

The role of the Court on Rule 50(b) is to test "whether the evidence presented, combined with all reasonable inferences permissibly drawn therefrom, is sufficient to support the verdict" as a matter of law. Sheehan v. Donlen Corp., 173 F.3d 1039, 1043-44 (7th Cir. 1999). The Court is obligated to apply the correct law, and in so doing is not limited by the law as given in the jury's instructions. Boyle v. United Techs. Corp., 487 U.S. 500, 514 (1988).

ARGUMENT

None of the evidence in this case—none of it—proves a case of "literal falsity" under the Lanham Act. Indeed, Dyson's theory of the case has long sought to flip the Lanham Act on its head. Here, the statement that "independent tests show that the NV650 cleans carpets better than the Dyson DC65" is not literally false, and the Court so held when it granted summary judgment in SharkNinja's favor that the Intertek testing was both independent and valid for the period beginning December 15, 2014. (Dkt. No. 424 at 27, 30-31.)

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That statement was also literally true for the period prior to that, because Intertek's July-August 2014 tests (Exs. F-H) (and the settings used therein, which were identified in Ms. Medler's July 2014 responsive e-mails (Exs. AG, AA) and memorialized in the December 15 manual change (Dkt. 359-6, p. 7 note)) confirm that the challenged statements were indeed accurate—and certainly not "literally false."¹ It would defy logic, the Congressional intent behind the Lanham Act, and First Amendment principles if the same Intertek tests that were not literally false post-December 2014 could sustain this jury verdict of literal falsity. Shark Ninja's statements were not literally false then; they are not literally false now; and they provide no basis for multimillion-dollar liability. The verdict should be set aside, and JMOL for SharkNinja granted.

I. SHARKNINJA'S STATEMENTS WERE NOT LITERALLY FALSE

The Court need not be reminded that this case went to the jury strictly on a theory of literal falsity. As this Court instructed the jury, the challenged statements could be found "literally false" only if the tests SharkNinja relied upon were not conducted "in an independent manner" or not "in compliance with the ASTM F608 standard." (Tr. 2616:21-2617:5.) See also BASF Corp. v Old World Trading Co., 41 F.3d 1081, 1091 (7th Cir. 1994) ("If the challenged advertisement makes implicit or explicit references...