Groupe SEB USA, Inc. v. Euro-Pro Operating LLC
774 F.3d 192
| 3rd Cir. | 2014Background
- SEB (Rowenta) sells higher-priced Rowenta steam irons; Euro-Pro (Shark) sold lower-priced Shark 405 and 505 irons whose packaging claimed “MORE POWERFUL STEAM vs. Rowenta” and “#1 MOST POWERFUL STEAM” with fine-print references defining steam power in grams/shot or grams/minute under IEC 60311 testing.
- SEB tested the models and commissioned independent SLG tests; those tests measured grams/shot and grams/minute and showed Rowenta equaled or outperformed Shark on those metrics.
- Euro‑Pro submitted an expert (Kemal) whose analysis measured steam power differently (kinetic‑energy/duration) and a consumer survey (Ford) showing divergent consumer interpretations of “more powerful steam.”
- District Court held an evidentiary hearing, found the Shark claims literally false (because Shark’s packaging defined the claim in grams/shot or grams/minute and testing contradicted superiority), and enjoined Euro‑Pro from using the claims (stickers over packaging and removal of hang tags).
- Euro‑Pro appealed, arguing (1) courts should consider consumer surveys when claim meaning is disputed, (2) the factual record did not show irreparable harm, and (3) the injunction violated the First Amendment and was overbroad.
- The Third Circuit affirmed, endorsing the rule that an express, unambiguous definition on packaging controls the claim’s meaning and that literal falsity shown by tests warranted the preliminary injunction.
Issues
| Issue | Plaintiff's Argument (SEB) | Defendant's Argument (Euro‑Pro) | Held |
|---|---|---|---|
| Whether the advertising claims conveyed an unambiguous message | Packaging explicitly defined “steam power” in grams/shot or grams/minute, so message is unambiguous | Consumer surveys show varied consumer understandings; thus claim ambiguous | Packaging’s explicit definition governs; claim unambiguous |
| Whether claims were literally false | Independent tests (SEB and SLG) measuring grams/shot and grams/minute contradicted Shark’s superiority | Expert Kemal used different metric (kinetic energy/duration) and argued Shark superior under that measure | Literal falsity found because Shark’s own defined metrics (grams/shot, grams/min) were disproved |
| Role of consumer survey evidence in literal falsity analysis | Not required for literal falsity; irrelevant when advertiser defines term unambiguously | Survey shows ambiguity and should be considered to avoid literal‑falsity finding | Surveys may be disregarded where packaging unambiguously defines the term; court properly ignored Ford Survey |
| Irreparable harm and scope/First Amendment challenge to injunction | Literally false comparative claims harming Rowenta’s reputation and goodwill; injunction narrowly targets false claims | District Court applied relaxed standard; injunction overbroad and restricts protected speech | SEB showed likelihood of irreparable harm based on reputation/goodwill; injunction not overbroad and does not violate First Amendment |
Key Cases Cited
- Pernod Ricard USA, LLC v. Bacardi U.S.A., Inc., 653 F.3d 241 (3d Cir. 2011) (labels with accurate, prominent disclosures can render survey evidence immaterial)
- Novartis Consumer Health, Inc. v. Johnson & Johnson–Merck Consumer Pharm. Co., 290 F.3d 578 (3d Cir. 2002) (literal falsity analysis and exception allowing per se finding when claim is unsubstantiated)
- Ferring Pharm., Inc. v. Watson Pharm., Inc., 765 F.3d 205 (3d Cir. 2014) (no presumption of irreparable harm in Lanham Act injunctions; equitable discretion required)
- Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7 (2008) (standard for preliminary injunctions: likelihood of success, irreparable harm, balance of harms, public interest)
- eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006) (rejecting categorical rules for injunctive relief; equitable discretion)
- Castrol Inc. v. Pennzoil Co., 987 F.2d 939 (3d Cir. 1993) (injunctions must be limited to speech that is literally false)
- Meese v. Keene, 481 U.S. 465 (1987) (author-provided definitions control meaning)
- Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (patentee’s lexicography governs term meaning when explicitly defined)