GOLO, LLC v. HIGHYA, LLC
2:17-cv-02714
E.D. Pa.May 4, 2018Background
- GOLO, LLC sells a weight-loss program online; HighYa, LLC and BrightReviews, LLC operate consumer-review websites that publish editorial reviews and third-party user comments but do not sell competing products.
- Defendants derive revenue primarily from website advertising (e.g., Google AdSense) and disclose some affiliate relationships; they publish reviews based largely on publicly available information and may revise or remove content.
- HighYa published a critical editorial review of GOLO in March 2016 (later revised after GOLO complained); BrightReviews published a similar critical review in January 2017 (later removed).
- GOLO sued under the Lanham Act (false advertising and false association) and Pennsylvania law (unfair competition and trade libel), alleging the reviews contained false statements and harmed its sales and reputation.
- Defendants moved to dismiss; the court evaluated whether the reviews constitute commercial speech (a Lanham Act threshold) and whether trade libel elements were pleaded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether defendants' reviews are "commercial speech" under the Lanham Act | Reviews aimed to influence consumer purchases and to generate ad revenue; sites may be covertly serving competitors | Reviews do not propose transactions or promote competing products; any ad revenue is incidental | Not commercial speech; Lanham Act and Pennsylvania unfair competition claims dismissed |
| Whether GOLO pleaded direct commercial injury sufficient for Lanham Act relief | Negative reviews and low star ratings caused pecuniary harm (lost customers) | Plaintiff failed to plead a causal commercial injury traceable to defendant's commercial conduct | Court dismissed on commercial-speech threshold without finding direct injury satisfied |
| Whether BrightReviews' statements were false (trade libel element) | Statements about studies, peer-review, and insulin linkage were factually wrong | Statements were presented as observations/opinions based on GOLO’s website and were not plausibly false as pleaded | Plaintiff failed to adequately plead falsity; trade libel claim against BrightReviews dismissed |
| Whether HighYa's trade libel claim is timely | The revised article within one year revived claim; social posts republished content within limitations period | Original publication occurred over a year before suit; revised article resolved complained-of content; social posts cited pre-date filing | HighYa trade-libel claims time-barred and dismissed |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (pleading must state plausible claim to survive Rule 12(b)(6))
- Ashcroft v. Iqbal, 556 U.S. 662 (courts need not accept legal conclusions as true for pleading standard)
- Lexmark Int’l, Inc. v. Static Control Components, Inc., 134 S. Ct. 1377 (Lanham Act protects against certain commercial false statements and false associations)
- Facenda v. N.F.L. Films, Inc., 542 F.3d 1007 (Third Circuit commercial-speech test: ad, specific product, economic motivation)
- Tobinick v. Novella, 848 F.3d 935 (articles on ad-supported sites may be noncommercial if they do not propose transactions and revenue is incidental)