Vidal Sassoon, Inc. v. Bristol-Myers Co.

• Decision Date: 07 October 1981
• Docket Number: No. 226,D,BRISTOL-MYERS,226
• Citation: 661 F.2d 272
• Parties: VIDAL SASSOON, INC., Appellee, v.COMPANY, Appellant. ocket 81-7483.
• Court: U.S. Court of Appeals — Second Circuit

Page 272

661 F.2d 272

213 U.S.P.Q. 24

VIDAL SASSOON, INC., Appellee, v. BRISTOL-MYERS COMPANY, Appellant.

No. 226, Docket 81-7483.

United States Court of Appeals, Second Circuit.

Argued Sept. 18, 1981.

Decided Oct. 7, 1981.

Gilbert H. Weil, Weil, Gutman & Davis, New York City, for appellant.

Richard L. Bond, Marshall, Bratter, Greene, Allison & Tucker, New York City, for appellee.

Before LUMBARD and KAUFMAN, Circuit Judges, and PIERCE, District Judge. ^*

IRVING R. KAUFMAN, Circuit Judge:

One of the most delicate tasks a court faces is the application of the legislative mandate of a prior generation to novel circumstances created by a culture grown more complex. In the instant case, we must determine whether statutory language derived from a 1920 prohibition against false advertising embraces misrepresentations regarding the results and methods of tests purporting to reflect consumer preferences for one named brand over another, a relatively new development in the burgeoning advertising and marketing fields. The district court preliminarily enjoined the dissemination of the shampoo advertisements at issue. Because we believe that the Lanham Trademark Act addresses the misrepresentations alleged here, relating to a consumer preference test, we affirm the court's order.

I

A brief review of the facts will facilitate an understanding of the legal issues raised on this appeal. In the spring of 1980, appellant Bristol-Myers Co. ("Bristol"), a pharmaceutical manufacturer, decided to wage an aggressive, new advertising campaign on behalf of its shampoo product, "Body on Tap," so named because of its high beer content. Accordingly, Bristol began in June to broadcast on national television a commercial "starring" the high fashion model Cristina Ferrare. The commercial depicts a turbaned Miss Ferrare, apparently fresh from shampooing her hair, holding a bottle of Body on Tap. She claims: "(I)n shampoo tests with over nine hundred women like me, Body on Tap got higher ratings than Prell for body. Higher than Flex for conditioning. Higher than Sassoon for strong, healthy looking hair." As is well known to the consuming public, Prell, Flex, and Sassoon are shampoo competitors of Body on Tap. Sassoon is the product of appellee Vidal Sassoon, Inc. ("Sassoon"). As Miss Ferrare refers in turn to each of the shampoos, the product is flashed on the television screen. The commercial ends as Miss Ferrare, now brushing her dry hair, states: "Now I use Body on Tap for fuller body and for clean, strong, beautifully conditioned hair. Body on Tap. It's a great shampoo."

The "Ferrare-900 Women" commercial, although the prototype, was only the first in a series developed for a complex sales campaign. Bristol played variations on the same theme in newspaper advertisements and in brochures which it intended to mail to over ten million households. ¹

The shampoo tests mentioned in all the advertisements were conducted for Bristol in 1978 and 1980 by an independent market research firm, Marketing Information Systems, Inc. ("MISI"). It is undisputed that 900 women did not, after trying both shampoos, make product-to-product comparisons between Body on Tap and Sassoon, or, for that matter, between Body on Tap and any of the other shampoos mentioned in the advertisements. Rather, groups of approximately 200 women, ² in what the advertising trade terms "blind monadic testing," each tested one shampoo and rated it on a qualitative scale ("outstanding," "excellent," "very good," "good," "fair," or "poor") with respect to 27 attributes, such as body and conditioning. Thus, no woman tried more than one shampoo. The data for an attribute of a particular shampoo were combined by category of qualitative rating, so that a percentage figure for each qualitative rating could be derived. The "outstanding" and "excellent" ratings were then added, and the lower four ratings were discarded. Following this procedure, MISI determined that 36% of the women who tested Body on Tap found it "outstanding" or "excellent" with relation to "strong, healthy looking hair," whereas only 24% of the separate group of women who tested Sassoon gave it such ratings. These results are the basis of Bristol's advertising claim that the women preferred Body on Tap to Sassoon. When the "very good" and "good" ratings are combined with the "outstanding" and "excellent" ratings, however, there is only a statistically insignificant difference of 1% between the ratings of the two shampoos respecting "strong, healthy looking hair." ³

The propriety of blind monadic testing for the purpose of comparative advertising claims is in some doubt. Dr. Edwin N. Berdy, President of MISI, stated by deposition that such testing is typically employed "where one would like an absolute response to the product ... without reference to another specific product." In his affidavit, Dr. Ben Kajioka, Sassoon's Vice President of Research and Development, stated that blind monadic testing cannot support comparative advertising claims. And indeed, Bristol initially conducted the 1978 tests not with the intention of using their results in comparative advertising, but to determine consumer reaction to the recent national introduction of Body on Tap. On the other hand, Dr. Berdy testified that blind monadic testing had been used in connection with comparative advertising in the past.

That 900 "women like" Cristina Ferrare had tried the shampoos might suggest, at the very least, that 900 adult women participated in the test. In actuality, approximately one-third of the "women" were ages 13-18. This fact is noteworthy in light of the testimony of Alfred Lowman, the advertising executive who created the "Ferrare-900 Women" campaign, that the commercial was designed to attract a larger portion of the adult women's shampoo market to Body on Tap. Sassoon had always fared well among adult women, whereas Body on Tap had appealed disproportionately to teenagers. Bristol's marketing studies have revealed that the advertisements were successful in increasing usage and awareness of Body on Tap among adult women.

There is also some question concerning the methodology of the tests. Dr. Kajioka stated that Bristol instructed the women who tested Sassoon to use it contrary to Sassoon's own instructions. Bristol also allowed the women to use other brands while they were testing Sassoon. Thus, the women's responses may not accurately reflect their reaction to Sassoon as distinct from other shampoos.

In September, 1980 Sassoon commenced this action, claiming that the several "Ferrare-900 Women" advertisements violated the prohibition of § 43(a) of the Lanham Trademark Act, 15 U.S.C. § 1125(a), against false and misleading advertising. ⁴ Sassoon charged that Bristol had made false and misleading representations since, inter alia: (a) only about 200 women, not "over 900 women," tested each shampoo; (b) the women tested only one shampoo, without making product-to-product comparisons; (c) only two-thirds of the test participants were adult women; (d) the advertisements failed to portray the test results accurately, because Bristol used only the top two qualitative rating categories; and (e) the methodology of the tests was flawed. Sassoon sought damages and a permanent injunction forbidding the broadcast or publication of the advertisements.

Following pretrial discovery Sassoon requested a preliminary injunction prohibiting the dissemination of the advertisements. Although the parties waived an evidentiary hearing, both submitted deposition testimony and affidavits.

Sassoon submitted, together with other evidence, a consumer perception study prepared for it by ASI Market Research, Inc. ("ASI"). Participants in the ASI test were asked to view the "Ferrare-900 Women" commercial twice, following a screening of entertainment and other advertisement materials. Members of the test group ⁵ were then asked to answer one multiple-choice and three open-ended questions. The multiple-choice question was "How many different brands mentioned in the commercial did each of the 900 women try?" (emphasis in original). A choice of five responses followed "one," "two," "three," "four," or "five or more." Ninety-five percent of those who answered the question said that each of the 900 women had tried two or more brands. ⁶ Answering the open-ended question, "This commercial described the results of shampoo tests. What did these tests show?", 62% of the participants indicated that the tests showed that Body on Tap was competitively superior, either in a general way (38%), or as specifically compared with one or more other brands (24%). In answer to another question, 53% stated that the primary message of the commercial was Body on Tap's competitive superiority.

On the basis of the evidence submitted to him, Judge Stewart concluded that Sassoon had demonstrated a probability of success on the merits and a possibility of irreparable injury if the dissemination of the advertisements did not cease. Accordingly, he granted Sassoon's motion for a preliminary injunction. ⁷

II

Turning now to the legal issues, we conclude that Judge Stewart properly ruled that Sassoon had met its burden for the issuance of a preliminary injunction by showing "probable success on the merits and possible irreparable injury," Sonesta Int'l Hotels Corp. v. Wellington Associates, 483 F.2d 247, 250 (2d Cir. 1973). ⁸ Viewing the "entire mosaic" of the advertisements rather than "each tile separately," FTC v. Sterling Drug, Inc., 317 F.2d 669, 674 (2d Cir. 1963), we find that Judge Stewart did not err, nor did he abuse his discretion, ⁹ see Triebwasser & Katz v. AT&T, 535 F.2d 1356, 1358 (2d Cir. 1976), in concluding that the advertisements were ambiguous and misleading in violation of § 43(a) of the Lanham Act.

We have previously endorsed the ASI format as probative of the meaning consumers derive from commercial advertising. American Home Products Corp. v. Johnson &...