Opinion for the court filed by Circuit Judge THOMAS.
In this case, Ralston Purina Co. and ALPO Petfoods, Inc., two of the leading dog food producers in the United States, have sued each other under section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) (1982) (amended 1988), 1 alleging false advertising. ALPO asserts that Ralston has violated section 43(a) by claiming that its Puppy Chow products can lessen the severity of canine hip dysplasia (CHD), a crippling joint condition. Ralston, for its part, attacks ALPO’s claims that ALPO Puppy Food contains “the formula preferred by responding vets two to one over the leading puppy food.”
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After a sixty-one-day bench trial, the district court decided that Ralston’s CHD-related advertising and ALPO’s veterinarian preference advertising both violated section 43(a).
ALPO Petfoods, Inc. v. Ralston Purina Co.,
Ralston appeals the district court’s judgment, focusing on the court’s determination that the CHD-related advertising claims were false, as well as the court’s monetary award to ALPO, its refusal to award similar relief to Ralston, and its broad and expansively implemented injunction.
2
Convinced that the court properly applied section 43(a) and found facts that are not clearly erroneous, we affirm the court’s conclusion that both Ralston and ALPO have violated section 43(a). On several issues concerning remedies, however, we vacate and remand. The monetary award to ALPO is an award of Ralston’s profits, rather than ALPO’s actual damages, yet we do not see in Ralston’s conduct willful, targeted wrongdoing, which is what an award of profits requires.
See Foxtrap, Inc. v. Foxtrap, Inc.,
I. Background 3
A. Ralston’s CHD-related Advertising
Ralston manufactures and sells Puppy Chow, which, in its two versions (dry and Chewy Morsels), is the leading puppy food sold in the United States. In September 1985, Ralston changed the formula for Puppy Chow. At the same time, it began running print ads stating that the new Puppy Chow formula could reduce the laxity of (i.e., extra space in) dogs’ hip joints and improve the fit of those hip joints, thereby lessening the severity of CHD.
See ALPO,
Ralston’s claims had a weak empirical basis. The hypothesis behind Ralston’s CHD-related product change and advertising was the “anion gap theory” of Dr. Richard Kealy, a Ralston nutritionist. This theory holds that the smaller the difference between the chlorine content and the combined sodium and potassium content of a dog’s diet, the more snugly the dog’s hip joints will tend to fit. Beginning in 1980, Dr. Kealy conducted a series of studies exploring the effect of a low-anion-gap diet on dogs’ hip joint fit. In 1984, results of Dr. Kealy’s first four studies (Trials I through IV) 4 led Dr. Kealy to prepare a monograph that reported a connection between a low-anion-gap diet and reduced hip joint laxity. At about the same time, Dr. Kealy briefed Ralston’s marketing executives on his findings, eventually leading Ralston to reformulate Puppy Chow and make its CHD-related advertising claims. In mid-1985, however, Dr. Kealy began Trial V, his first long-term study of the effects of a low-anion-gap diet. Although the parties now dispute whether the results of Trial V were statistically significant, these results undermined Ralston’s CHD-related claims so much that Dr. Kealy ended the study, which he had projected would last for almost three years, after only thirty-three weeks. After reviewing Ralston’s research findings and the conflicting expert opinions on those findings’ statistical significance, the district court found that the anion gap theory lacked empirical support. Id. at 205 & n. 12, 208-09. It therefore held that the CHD-related advertising claims were false and deceptive. Id. at 213.
At trial, the district court also heard conflicting evidence on the market effect of Ralston’s CHD-related advertising. This evidence included surveys of veterinarians and consumers, Ralston officials’ own assessments of the advertising campaign, and several expert witnesses’ interpretations of data on puppy food sales and market shares. The court concluded that the challenged ads materially increased Ralston’s sales and profits, and that, given the vigorous interbrand competition during the period at issue, the increases came at the expense of ALPO and other competitors of Ralston.
Id.
at 209;
see also id.
at 214 (supplementing “the court’s earlier finding that Ralston’s claims were material in fact” with a presumption, drawn from
PPX Enterprises v. Audiofidelity Enterprises,
B. ALPO’s Veterinarian Preference Advertising
Over roughly the same period covered by Ralston’s CHD-related advertising, ALPO claimed in several media that veterinarians preferred “the formula” of ALPO Puppy Food over that of “the leading puppy food,” Puppy Chow. The district court found no basis for this assertion, or for the additional claim, appearing on ALPO Puppy Food bags and in other media, that the veterinarian preference was “2 to 1.” See id. at 209-11. The court therefore held that ALPO’s advertising was false, material, and aimed at Ralston. ALPO has not appealed. 5
*963 C. District Court’s Findings and Conclusions
Relying on its findings of fact concerning Ralston’s and ALPO’s advertising and the effects of that advertising, the court held that both companies had made material, false claims about goods in interstate commerce, in violation of section 43(a). The court found that the likelihood of deception and injury from each company’s advertising justified a permanent injunction against each company under section 34(a) of the Lanham Act, 15 U.S.C. § 1116(a) (1982 & Supp. V 1987) (amended 1988).
See ALPO,
II. Discussion
A. Holding That Ralston’s CHD-related Advertising Violated Section 43(a)
Since ALPO has not appealed, we review only half of the district court’s conclusion that Ralston and ALPO both violated section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) (1982).
6
As the district
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court correctly stated, to prevail in a false advertising suit under section 43(a), a plaintiff must prove that the defendant’s ads were false or misleading,
7
actually or likely deceptive, material in their effects on buying decisions, connected with interstate commerce, and actually or likely injurious to the plaintiff.
ALPO,
In reviewing the district court’s findings on the elements of ALPO’s section 43(a) claim, we have no authority to weigh the evidence anew.
See
Fed.R.Civ.P. 52(a) (“Findings of fact, whether based on oral or documentary evidence, shall not be set
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aside unless clearly erroneous_ ). In
Anderson v. City of Bessemer City,
Documents or objective evidence may contradict the witness’ story; or the story itself may be so internally inconsistent or implausible on its face that a reasonable factfinder would not credit it.... But when a trial judge’s finding is based on his decision to credit the testimony of one of two or more witnesses, each of whom has told a coherent and facially plausible story that is not contradicted by extrinsic evidence, that finding, if not internally inconsistent, can virtually never be clear error.
Id.,
The above passage from
Bessemer City
squarely applies. The district court heard weeks of conflicting expert testimony on the basis for and effectiveness of Ralston’s CHD-related advertising. In finding that advertising false, deceptive, material, and injurious, the court cited specific experts’ testimony, sometimes crediting that testimony over other evidence.
See, e.g., ALPO,
In only one respect do we disturb the district court’s analysis of ALPO’s section 43(a) claim. As we discuss in sections (B) and (D) below, the court granted ALPO certain remedies that would be proper only in a case involving actions that evince willfulness or bad faith, such as passing off a product as another seller’s product.
See, e.g., W.E. Bassett Co. v. Revlon, Inc.,
None of the district court’s observations that amount to a finding of willfulness or bad faith relate to Ralston’s intentions at the time that it violated section 43(a). For example, the opinion stresses that Ralston has not recanted its CHD-related claims or shown remorse for having made them.
Id.
at 214-15, 216. Although
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these considerations can affect the propriety of a permanent injunction by showing whether a defendant is likely to cause future harm,
see, e.g., SEC v. First City Fin. Corp.,
The district court also condemns Ralston for its efforts to control regulators’ and potential litigants’ access to its CHD research — efforts that reportedly included destroying some documents.
ALPO,
Lastly, the court’s finding that Ralston carried out its CHD-related research, product change, and advertising with its competitors in mind,
see ALPO,
To summarize, we affirm the district court’s holding that Ralston violated section 43(a), but reverse its finding that the violation was willful or in bad faith.
*967 B. Monetary Award in Favor of ALPO
Besides challenging the district court’s conclusion that its CHD-related advertising violated section 43(a), Ralston attacks the monetary remedy for that violation: a $10.4 million judgment in favor of ALPO under section 35(a) of the Lanham Act, 15 U.S.C. § 1117(a) (1982 & Supp. V 1987).
8
Ralston concentrates its attack on the court’s decision to use Ralston’s advertising costs as a measure of monetary relief, a method derived from
U-Haul Int’l, Inc. v. Jartran, Inc.,
The district court’s opinion states that Ralston’s false advertising caused ALPO financial harm, and describes the $10.4 million award to ALPO as damages.
See, e.g., ALPO,
Leaving aside whether the
U-Haul
standard
9
or the district court’s alternative calculation
10
accurately measures the profits that Ralston derived from its false advertising, we hold that this case does not justify an award of profits. Section 35(a) authorizes courts to award to an aggrieved plaintiff both plaintiff’s damages and defendant’s profits, but, as this court noted in
Foxtrap,
In
Conservative Digest
we “left open the possibility that a court could properly award damages to a plaintiff when the defendant has been unjustly enriched.”
Relying on
W.E. Bassett,
Since this case lacks the elements required to support the court’s award of Ral-ston’s profits, we vacate the $10.4 million judgment in favor of ALPO. We do not mean, however, to deny ALPO all monetary relief for Ralston’s false advertising. Because the district court has so far focused on awarding Ralston’s profits, it has not yet decided what actual damages ALPO has proved. On remand, the court should award ALPO its actual damages, bearing in mind the requirement that any amount awarded have support in the record,
see Foxtrap,
In a false-advertising case such as this one, actual damages under section 35(a) can include:
—profits lost by the plaintiff on sales actually diverted to the false advertiser, see, e.g., Foxtrap,671 F.2d at 642 (trademark case);
—profits lost by the plaintiff on sales made at prices reduced as a demonstrated result of the false advertising, see, e.g., Burndy Corp. v. Teledyne Indus.,748 F.2d 767 , 773 (2d Cir.1984);
—the costs of any completed advertising that actually and reasonably responds to the defendant’s offending ads, see, e.g., Cuisinarts, Inc. v. Robot-Coupe Int’l Corp.,580 F.Supp. 634 , 640-41 (S.D.N.Y.1984); 11 and
—quantifiable harm to the plaintiff’s good will, to the extent that completed corrective advertising has not repaired that harm, see, e.g., Engineered Mech. Servs., Inc. v. Applied Mech. Technology, Inc.,591 F.Supp. 962 , 966 (M.D.La.1984); see also Comment, 55 U.Chi.L.Rev. at 650-57 (discussing how courts might directly measure good will).
See generally
Koelemay,
When assessing these actual damages, the district court may take into account the difficulty of proving an exact amount of damages from false advertising, as well as the maxim that “ ‘the wrongdoer shall bear the risk of the uncertainty which his own wrong has created.’ ”
Otis Clapp & Son v. Filmore Vitamin Co.,
Section 35(a) also authorizes the court to “enter judgment, according to the circumstances of the case, for any sum above the amount found as actual damages, not exceeding three times such amount.” Lanham Act § 35(a), 15 U.S.C. § 1117(a) (1982 & Supp. V 1987) (amended 1988). This provision gives the court discretion to enhance damages, as long as the ultimate award qualifies as “compensation and not [as] a penalty.”
Id.; see
Koelemay,
C. Denial of Monetary Relief in Favor of Ralston
The foregoing comments on actual damages apply as well to the monetary remedy for ALPO’s false advertising. As noted above, the district court held that ALPO’s veterinarian preference advertising violated section 43(a).
ALPO,
The Lanham Act does not authorize courts to deny monetary relief for these reasons. Once a party establishes a violation of section 43(a), section 35(a) “entitle[s]” that party to monetary relief, subject only to the statutes referred to in the section and to the principles of equity. Lanham Act § 35(a), 15 U.S.C. § 1117(a);
cf. ALPO,
At more than one point in this case, Ralston came close to admitting that it cannot prove lost profits. See Brief of Appellee at 47 & app. B (citing Ralston’s statement, in a proposed finding of fact, -that none of its regression analyses proved diverted sales); Reply Brief of Appellant at 18-19 (“Ralston’s position ... is that under a proper construction of the Lanham Act, neither party can quantify lost profits sufficiently to recover damages.”). In this appeal, however, Ralston has shown that it still considers its lost profits a live issue. See id. at 18 & n. 40 (citing evidence, other than regressions, of lost sales). Since Ral-ston has some evidence of lost sales, and since, more importantly, section 35(a) en *971 titles Ralston to damages other than lost profits, see supra p. 969, the district court should on remand award Ralston whatever actual damages it has proved. In this connection, as with ALPO’s damages, the court should decide whether the parties have already had a sufficient opportunity to prove the types of damages outlined above, or whether further hearings are necessary.
D.Attorneys’ Fees
The court awarded each company the attorneys’ fees associated with its successful false-advertising claim.
ALPO,
Section 35(a) entitles prevailing parties to attorneys’ fees “in exceptional cases.” This court’s decision in
Conservative Digest,
In announcing its fee awards, the district court did not expressly find that Ralston had acted willfully or in bad faith. Indeed, it made no finding that this case is “exceptional” in any respect.
See ALPO,
E. Scope of Injunction Against Ralston
In addition to awarding monetary relief, the district court enjoined both parties to prepare, secure court approval of, and disseminate corrective releases, and it enjoined both parties from renewing their false advertising. In the only challenge leveled at these injunctions, Ralston asserts that the prohibitory injunction against it is overbroad, both on its face and as implemented by the district court. We agree, and remand the relevant orders for entry and implementation of a narrower injunction.
The injunction at issue permanently bars Ralston and its associates “from making any advertising or other related claims that are false, misleading, deceptive or made without substantiation in fact concerning the effects of Ralston Dog food products on hip joint formation, hip joint laxity, Canine Hip Dysplasia, Degenerative Joint Disease and similar conditions.”
ALPO,
Since the district court originally entered its injunctions, it has decided that the prohibitory injunction applies to Ralston and non-Ralston scientists’ scholarly articles on the anion gap theory, even when those articles do not refer to Ralston products. See Transcript of Motions Hearing at 20-22 (Sept. 18, 1989) (scientists who publish any such articles without getting court’s advance approval “do it at their risk,” id. at 22); see also id. at 22, 25-26 (suggesting that scientists could secure court’s approval by referring in article to court’s fact findings). In addition, a few weeks before the court approved the compliance procedures, it threatened Ralston with contempt for stating, in response to a veterinary journal’s inquiry, that Ralston disagreed with the district court’s ruling and planned to appeal. See Transcript of Status Call at 19-21 (Sept. 22, 1989); see also Reotutar, Pet Food Makers Found Guilty of False Advertising Claims, 195 J. Am. Veterinary Med. Ass’n 873 (1989) (reporting Ralston’s statement, which Ralston unsuccessfully tried to retract after court demanded immediate retraction).
The law requires that courts closely tailor injunctions to the harm that they address.
Gulf Oil Corp. v. Brock,
We remand the prohibitory injunction against Ralston,
III. CONCLUSION
We affirm the district court’s decision that both Ralston and ALPO have violated section 43(a) of the Lanham Act. We vacate the judgment in favor of ALPO, and reverse the district court’s decision to award ALPO attorneys’ fees. We remand the case to the district court so that it may redetermine the damages to which each party is entitled under section 35(a) of the Lanham Act and modify the prohibitory injunction against Ralston.
It is so ordered.
Notes
. Ralston and ALPO also made claims based on the common law of unfair competition. Because the court granted both parties relief under the Lanham Act, it did not analyze these common-law claims.
ALPO Petfoods, Inc. v. Ralston Purina Co.,
. No. 89-7181 is Ralston’s main appeal, covering the court’s decision of July 28, 1989 and the associated judgment. No. 89-7264, filed three months after No. 89-7181, covers later orders implementing the injunctions against both parties. On January 4, 1990, this court granted Ralston’s motion to consolidate these two appeals.
. A more detailed statement of the facts appears in the district court’s opinion,
. The district court found that none of these studies, taken alone, was statistically significant at the five percent level.
. Several other claims ruled on below are not before us. In the district court, each company attacked its opponent’s statements that its puppy food was "more digestible." See id. at 211. In addition, ALPO challenged Ralston’s claim that Puppy Chow is “recommended 8 to 1 over any other puppy food by veterinarians.” Id. The district court rejected all of these Lanham Act claims, and neither party has appealed this part of the decision. Finally, Ralston has not appeal *963 ed the district court's rejection of its claim that ALPO's publicity and lobbying efforts constituted common-law defamation. See id. at 211-12.
. When the conduct in question occurred, the pertinent parts of section 43(a) read:
Any person who shall affix, apply, or annex, or use in connection with any goods or services, or any container or containers for goods, ... any false description or representation, including words or other symbols tending falsely to describe or represent the same, and shall cause such goods or services to enter into commerce, and any person who shall with knowledge of the falsity of such designation of origin or description or representation cause or procure the same to be transported or used in commerce ... shall be liable to a civil action ... by any person who believes that he is or is likely to be damaged by the use of any such false description or representation.
15 U.S.C. § 1125(a) (1982). While the case was pending before the district court, however, Congress redrafted section 43(a), sharpening the section’s focus on false and deceptive advertising:
Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which—
(2) in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities,
shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.
Trademark Law Revision Act of 1988 (1988 Act), Pub.L. No. 100-667, sec. 132, § 43(a), 102 Stat. 3935, 3946 (amending 15 U.S.C. § 1125(a)).
Revised section 43(a) took effect on November 16, 1989, more than two years after the end of the conduct challenged in this case, and more than four months after the district court issued its opinion.
See id.
sec. 136,
At least from 1974 to 1989, courts presumed that "a court is to apply the law in effect at the time it renders its decision, unless doing so would result in manifest injustice or there is statutory direction or legislative history to the contrary.”
Bradley v. School Bd.,
The 1988 Act says only when the Lanham Act amendments "become effective”; it does not say whether they apply to conduct preceding the specified date or to litigation pending on that date. 15 U.S.C. § 1051 note. This ambiguous provision does not
require
us to apply amended section 43(a) in this case.
Cf. Eldon Indus. v. Rubbermaid, Inc.,
That the recent changes to section 43(a) have little relevance to this case vindicates the parties' decision not to address retroactivity. Congress intended that the section 43(a) amendments largely codify pre-1988 case law.
See
S.Rep. No. 515, 100th Cong., 2d Sess. 40,
reprinted in
1988 U.S.Code Cong. & Admin.News 5577, 5603; 134 Cong.Rec. S16,972-73 (daily ed. Oct. 20, 1988) (statement of Sen. DeConcini);
id.
at H10.422 (daily ed. Oct. 19, 1988) (statement of Rep. Moorhead). According to the legislative history, the only substantive change intended was "to make clear that misrepresentations about another’s products are as actionable as misrepresentations about one’s own.” S.Rep. No. 515,
supra,
at 40,
reprinted in
1988 U.S.Code Cong. & Admin.News at 5603;
accord
134 Cong. Rec. at H10,420-21 (statement of Rep. Kasten-meier). Yet Ralston, the sole appellant here, is accused of making misrepresentations only about its own products.
See supra
pp. 961-63;
cf. U.S. Healthcare, Inc. v. Blue Cross,
. In its challenge to Ralston’s CHD-related ads, ALPO did not call Ralston’s claims literally false; rather, it asserted that the test data supporting the claims "were not sufficiently reliable to permit a reasonable conclusion that the research established the claim[s] made.”
ALPO,
. The present version of section 35(a) states: When a violation of any right of the registrant of a mark registered in the Patent and Trademark Office, or a violation under section 1125(a) of this title, shall have been established in any civil action arising under this chapter, the plaintiff shall be entitled, subject to [limitations on remedies in favor of trademark registrants who have not given notice of registration, and on remedies against innocent infringers of trademarks], and subject to the principles of equity, to recover (1) defendant's profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action.... In assessing profits the plaintiff shall be required to prove defendant's sales only; defendant must prove all elements of cost or deduction claimed. In assessing damages the court may enter judgment, according to the circumstances of the case, for any sum above the amount found as actual damages, not exceeding three times such amount. If the court shall find that the amount of the
recovery based on profits is either inadequate or excessive the court may in its discretion enter judgment for such sum as the court shall find to be just, according to the circumstances of the case. Such sum in either of the above circumstances shall constitute compensation and not a penalty. The court in exceptional cases may award reasonable attorney fees to the prevailing party.
Lanham Act § 35(a), 15 U.S.C. § 1117(a) (1988) (emphasis added) (italicized language added by 1988 Act, Pub.L. No. 100-667, sec. 129,
. The Ninth Circuit has already noted the limitations of the
U-Haul
rule.
See Harper House,
Ralston asserts that ALPO has waived reliance on U-Haul. See Brief of Appellant at 39 (claiming that ALPO expressly abandoned its U-Haul theory in arguments before the district court); Reply Brief of Appellant at 11 (same). Because we hold that U-Haul states a surrogate measure of profits and that ALPO cannot recover profits in this case, we decline to decide whether waiver has occurred, or whether any such waiver could have bound the district court.
. As Ralston points out, the alternative calculation "assumes that (1) all of Ralston’s Puppy Chow profits were attributable solely to its advertising and (2) all the profits attributable to advertising were due to the CHD claims." Brief of Appellant at 47 (emphasis deleted).
. See also Best, 49 U.Pitt.L.Rev. at 23 ("For this approach to be effective, the plaintiff's responsive marketing campaign must be found to have been a reasonable response to the defendant's conduct.”); Comment, 55 U.Chi.L.Rev. at 633 ("Although courts should make available the defense that the counter-advertising performed was unreasonable or wasteful, most courts are willing to accept counter-advertising costs as recoverable business losses.”).
. The thin body of case law on actual damages for successful false-advertising claims reflects the fact that litigants, who best understand their real losses, almost always settle these cases once a court has given its view of the merits. See Comment, 55 U.Chi.L.Rev. at 631.
.Section 35(a)’s antipenalty clause applies to "[s]uch sum in either of the above circumstances." Lanham Act § 35(a), 15 U.S.C. § 1117(a). ALPO argues that the two “above circumstances” are the sentences in section 35(a) empowering courts to enhance damages and to adjust profits, and that, as a result, the antipenalty clause does not apply to awards of
*970
unenhanced damages or unadjusted profits.
See
Brief of Appellee at 45-46. Since this case does not present an antipenalty clause attack on such an award, we leave the issue for later.
Cf. Foxtrap,
. Because ALPO has failed to challenge the district court’s award of attorneys’ fees to Ral-ston, we do not disturb the award.
See, e.g., Smith v. Nixon,
. The procedures, which ALPO has not appealed, subject "any advertising or other related claim concerning a veterinarian preference for ALPO dog or puppy food products" to the same pre-clearance process. Procedures for Assuring Compliance para. 5(a).
. When it implements the modified injunction, the district court should not define “advertising" as narrowly as, for example, "commercial speech” in the first amendment sense.
See Virginia State Bd. of Pharmacy v. Virginia Citizens Consumer Council, Inc.,
