ORDER
THIS CAUSE comes before the Court for consideration of Defendant Warner Bros. Picture’s Motion to Dismiss (Dkt. 89), to which Plaintiff Incarcerated Entertainment, LLC has responded in opposition (Dkt. 99). Defendant submits twenty-two exhibits in support of its motion to
I. BACKGROUND
According to the Amended Complaint, Plaintiff Incarcerated Entertainment, LLC owns the rights to the life story of Efraim Diveroli. (Dkt. 78 at ¶3) In this action, Plaintiff sues Defendant Warner Bros. Pictures (“Warner”) for false advertising and unfair competition, based on Warner’s promotion of the movie War Dogs as the “true story” of Diveroli’s path to becoming an international arms dealer.
As alleged, at age 18, Diveroli started a small business specializing in arms, ammunition trading, and bidding on U.S. Government defense contracts. (Id. at ¶ 12) By 2007, Diveroli’s company, AEY, Inc., outbid established defense contractors Northrop Grumman and Lockheed Martin and was awarded a $298 million contract to supply arms and ammunition to support the United States’ war effort in Afghanistan. (Id. at ¶¶ 14-15) Diveroli relied on select lower-level employees to assist his business, including David Packouz, a neighborhood acquaintance. (Id. at ¶ 15)
In March 2008, the U.S. Government suspended AEY Inc.’s contracts based on allegations that the company had violated pre-existing arms embargos. (Id. at ¶ 16) At age 22, Diveroli was indicted by a federal grand jury in Miami and ultimately accepted a four-year plea deal. (Id at ¶¶ 16-17) Diveroli’s associate, Packouz, was sentenced to house arrest. (Id at ¶ 22)
During his incarceration, Diveroli was contacted by Guy Lawson, a well-known journalist and author who wanted to write an article about Diveroli’s story. (Id. at ¶ 19) In March 2011, Rolling-Stone magazine published Lawson’s article, The Stoner Arms Dealers: How Two American Kids Became Big-Time Weapons Traders. (Id. at ¶ 22) The article featured accounts by both Diveroli and Packouz. (Id.) In August 2011, Lawson optioned the movie rights for the article to Warner. (Id. at ¶¶ 23-24) Lawson later expanded the article into a book, Arms and the Dudes. (Id. ati42)
By February 2014, Diveroli’s own manuscript, Once a Gun Runner, was sufficiently complete for Plaintiff to market the movie rights. (Id. at ¶¶ 29-30) Diveroli’s business partner, Ross Reback, contacted a number of producers and studios, including Warner. (Id. at ¶¶ 31-33) Although Warner considered the proposal, Warner eventually declined to pursue a consulting arrangement with Diveroli. (Id. at ¶¶ 34-35) Instead, Warner retained David Packouz as a consultant and enlisted Guy Lawson as a producer. (Id. at ¶¶ 41-44)
The gravamen of the Amended Complaint is that Warner grossed more than $85 million by promoting War Dogs as Diveroli’s “true story” when it was not the true story. (Id. at ¶¶ 1-2, 78) As the owner of the rights to Diveroli’s story, Plaintiff alleges that it has been effectively shut out of the marketplace because consumers are more likely to purchase a ticket to War Dogs than to purchase Diveroli’s memoir, Once a Gun Runner. (Id. at ¶¶ 3, 72, 75)
The Amended Complaint identifies a number of allegedly false advertisements, including statements in movie trailers, social media posts, and promotional interviews with War Dogs' director, Todd Phil
In Counts I and III of the Amended Complaint, Plaintiff asserts' violations of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B), which creates a civil cause of action against “[a]ny person who ,.; uses in commerce any ,.. false or misleading. representation of fact, which ,,in commercial advertising or promotion, misrepresents the nature; characteristics, qualities, or geographic origin of his or her or another person’s go'ods, services, or commercial activities.” In Counts II and IV, Plaintiff. brings state-law claims for unfair competition pursuant to Florida’s Deceptive and Unfair Trade Practices Act (FDUTPA), Fla. Stat. § 501.204(1), which prohibits “unfair methods of competition, unconscionable acts or practices, and unr fair or deceptive acts or practices in the conduct of any trade or commerce.”
In the instant motion to dismiss, Warner argues that the challenged statements are riot actionable because "they include protected artistic or political speech under the First Amendment. In the alternative, Warner argues that the Amended Complaint fails to allege the necessary facts in support of Plaintiffs claims. With the limited exceptions outlined below, the Court holds that Plaintiff states plausible claims for relief.
II. STANDARD
The threshold for surviving a motion to dismiss for failure to state a claim, under Fed. R. Civ. P. 12(b)(6) is a low one. Quality Foods de Centro Am., S.A., v. Latin Am. Agribusiness Dev. Corp., S.A., et al.,
Warner briefly asserts that Plaintiffs claims must be pleaded with specificity under Fed. R. Civ. P. 9(b) because the claims are “grounded in fraud.” (Dkt. 89 at 9). In the Eleventh Circuit, the weight of authority holds that a Lanham Act claim for false advertising and a state-law claim for unfair competition need not be pleaded with specificity. USA Nutraceuticals Grp., Inc, v. BPI Sports, LLC, No. 15-CIV-80352-BLOOM/Valle,
Courts are split on the question of whether a FDUTPA claim must meet Rule 9(b) pleading requirements. See Finerman v. Marriott Vacations Worldwide Corp., No. 3:14-CV-1154-J-32MCR,
III. DISCUSSION
The parties analyze the Lanham Act claims and state-law claims under the same rubric, consistent with Eleventh Circuit law. (Dkt. 89 at 11 n.4, 23; Dkt. 99); Sovereign Military Hospitaller Order v. Fla. Priory of Knights Hospitallers,
A. Commercial Speech
The Lanham Act prohibits false advertising in connection with “commercial advertising or promotion.” 15 U.S,C. § 1125(a)(1)(B) (emphasis added). The Eleventh Circuit defines “commercial advertising or promotion” as encompassing four elements:
(1) commercial speech; (2) by a defendant who is in commercial competition with plaintiff; (3) for the purpose of influencing consumers to buy defendant’s goods or services; - and (4) the representations ... must be disseminated sufficiently to the relevant purchasing public to constitute ‘advertising’ or ‘promotion’ within that industry.
Edward Lewis Tobinick, MD v. Novella,
The concept of commercial speech-under the Lanham Act mirrors the commercial speech doctrine under the First Amendment. Proctor & Gamble Co. v. Haugen,
In a recent decision, the Eleventh Circuit applied the Bolger factors to assess whether challenged communications were “commercial speech” for the purposes of a false-advertising claim under the Lanham Act. Edward Lewis Tobinick, MD,
Applying the Bolger factors here, the Amended Complaint plausibly alleges that the challenged communications are “commercial speech.” As to the first factor, the Amended Complaint alleges—and Warner concedes in the motion to dismiss (Dkt. 89 at 10-11)—that the challenged statements were used for promotional purposes. (See Dkt. 78 at ¶50) As to the second factor, the Amended Complaint alleges that the challenged communications refer to a specific product, the movie War Dogs. (Id. at ¶¶ 51, 59, 60, 62, 63, 65-70; Dkts. 91-15, 91-16, 91-17, 91-18, 91-20, 91-21) With respect to the third factor, the Amended Complaint alleges that Warner possessed an economic motivation for making the statements: Warner knew that representing the story as “true” would induce consumers to see War Dogs. (Id. at ¶¶ 68-71)
Perhaps recognizing that its challenge fails under the Bolger test, Warner omits discussion of the relevant factors. (See Dkt. 89 at 9-11) Instead, Warner proposes two bright-line rules. First, Warner contends that the promotions are “intertwined” with non-commercial speech, including political and artistic commentary, and therefore qualify as non-commercial speech. Second, Warner asserts that because the promotions relate to a movie, which is a protected expressive work, the communications are themselves protected.
Warner’s second theory is unavailing. Although movies are works of artistic expression and must be protected, “they are also sold in the commercial marketplace like other more utilitarian products, making the danger of consumer deception a legitimate concern that warrants some government regulation.” Rogers v. Grimaldi,
Warner’s primary theory is not amenable to resolution on this motion to dismiss. Warner asserts that because some of the promotions, such as interviews with the cast and crew of War Dogs, are “intertwined” with political or artistic commentary, the entire promotion is exempt from regulation. In response, Plaintiff correctly points out that the case law requires a more nuanced analysis.
In Rogers, the Second Circuit addressed whether a Lanham Act claim could be based on a movie title, which the court observed “may be both an integral element of the filmmaker’s expression as well as a significant means of marketing the film to the public,” such that the artistic and commercial elements are “inextricably intertwined.”
We believe that in general the [Lanham] Act should be construed to apply to artistic works only where the public interest in avoiding consumer confusion outweighs the public interest in free expression. In the context of allegedly misleading titles using a celebrity’s name, that balance will normally not support application of the Act unless the title has no artistic relevance to the underlying work whatsoever, or, if it has some artistic relevance, unless the title explicitly misleads as to the source or the content of the work.
Id. at 999.
Courts typically apply the Rogers balancing test only to titles or to other expressive works. See Facenda v. N.F.L. Films, Inc.,
Warner does not address whether the Rogers balancing test applies to the challenged movie trailers, social media posts, and interviews. For instance, Warner does not contend that the challenged communications are themselves artistic works, and the Amended Complaint at least plausibly alleges that, similar to the documentary in Facenda, the communications are separate promotions for War Dogs. As explained above, the Amended Complaint also plausibly alleges that the promotions are “commercial speech” under the Bolger factors.
Absent a more focused challenge and at this early stage in the litigation, Warner fails to call into question the plausibility of Plaintiffs allegations related to the threshold element of “commercial speech.”
B. False Advertising
Warner next argues that the Amended Complaint fails to allege facts
(1) the advertisements of the opposing party were false or misleading; (2) the advertisements deceived, or had the capacity to deceive, consumers; (3) the deception had a material effect on purchasing decisions; (4) the misrepresented product or service affects interstate commerce; tpd (5) the movant has been—or is likely to be—injured as a result of the false advertising.
Hickson Corp. v. N. Crossarm Co.,
1. False or misleading statement
The Lanham Act applies to two types,of advertisements: (1) a statement that is “literally false as a factual matter” and (2) a “misleading” statement that may be literally true or ambiguous, but that “implicitly convey[s] a false impression, [is] misleading in context, or [is] likely to deceive consumers.” Id. , at 1261 (quoting United Industries Corp, v. Clorox Co,,
The majority of Warner’s arguments are not well-suited to a motion to dismiss. With respect to the movie trailers, Warner contends that the phrase “based on a true story” is not actionable because it conveys that the movie “is obviously fictionalized in part.” (Dkt. 89 at 12) The cases cited by Warner do not support such a clear-cut rule;
With respect to- interviews by Jonah Hill, Miles Teller, Todd Phillips, and Stephen Chin, Warner accurately insists that the challenged statements must be read in their full context. (Dkt. 89 at 17-18; see Dkt. 78 at ¶¶ 59, 62, 65-70) But apart from advancing that argument, Warner neglects to address the relevant question: whether the statements, read in their full context, falsely or misleadingly portray War Dogs as a true story. Warner implies that they do not, but that conclusion calls for a fact-intensive inquiry and that the Court draw inferences in Warner’s favor, neither of which is appropriate on a motion to dismiss.
With respect to statements by journalist Guy Lawson and Diveroli’s former associate, David Packouz, Warner first argues that the Amended Complaint does not establish that they made statements as agents of Warner. (Dkt. 89 at 14-15); see Procter & Gamble Co. v. Haugen,
Warner further argues that statements by Packouz and Lawson are opinion or puffery. (Dkt. 89) Although “[statements of opinion are generally not actionable under the Lanham Act,” an opinion may be actionable “if it fairly implies a factual basis.” Duty Free Americas, Inc. v. Estee Lauder Cos., Inc.,
Warner more successfully challenges other discrete allegations in the Amended Complaint. Warner observes that allegations regarding the War Dogs website and the War Dogs Facebook page do not allege any false or misleading statement. (Dkt. 89 at 13, 16; see Dkt. 78 at ¶ 52) Warner contends that the publication of Diveroli’s photograph in Rolling Stone is not actionable, absent some allegation that Warner controlled Rolling Stone. (Dkt. 89 at 13; see Dkt. 78 at ¶ 54) Warner argues that a loosely-translated Argentinian Facebook post is not actionable. (Dkt. 89 at 16; see Dkt. 78 at ¶ 64). Warner maintains that Guy Lawson’s statements promoting his own book are not actionable
Plaintiff disputes none of these points. (See generally Dkt. 99 at 13-15) Accordingly, the Court finds that the allegations in Paragraphs 52, 54, 55, 56, 61, and 64 of the Amended Complaint are not, in and of themselves, actionable. This finding, however,. does not warrant the granting of a motion to dismiss. With respect to the remaining statements, Warner may renew its arguments in a proper dispositive motion.
2. Consumer deception and materiality
In order to establish consumer deception and materiality, in addition to alleging a false or misleading advertisement, Plaintiff must allege that “the advertisements deceived, or had the capacity to deceive, consumers” and that “the deception had a material effect on purchasing decisions.” Hickson Corp.,
With respect to the element of “deception,” Warner contends that Plaintiff can only survive the motion to dismiss by identifying specific statements and showing how the statements actually deceived specific consumer’s. (Dkt. 89 at 18-19) In support of that argument, Warner relies on case law addressing Lanham Act claims on the merits, rather than on a motion to dismiss. (Dkt. 89 at 19-20); see Johnson & Johnson Vision Care, Inc.,
A plaintiff may plead the “materiality” element by alleging that “the defendants misrepresented an inherent quality or characteristic of the product.” Johnson & Johnson Vision Care, Inc.,
Warner also argues that Plaintiff fails to allege materiality because the movie accurately represents Diveroli as unethical and dangerous. (Dkt. 89 at 20-22) As an initial matter, Warner’s argument that War Dogs
3. Zone of interests and proximate causation
Warner next argues that the Amended Complaint omits the necessary allegations of injury and causation. (Dkt. 89 at 22-23) In Lexmark International, Inc. v. Static Control Components, Inc., the Supreme Court held that, in order to state a false-advertising claim under the Lanham Act, a plaintiff “ordinarily must show economic or reputational injury flowing directly from the deception wrought by the defendant’s advertising....” — U.S. -,
With respect to causation, Lexmark instructs that the necessary showing is present when “deception of consumers causes them to withhold trade from the plaintiff.” Lexmark, 134 S.Ct.- at 1391. In contrast to the facts at issue in Lexmark, which involved a claim by a downstream supplier, Plaintiff alleges that it is a direct victim of Warner’s advertising because War Dogs diverted book sales from Plaintiff. In particular, the Amended Complaint alleges that “consumers who desire to learn the true story are most likely to purchase a ticket to the movie, after being bombarded with promotional material, rather'" than purchasing Diveroli’s memoir.” (Dkt. 78 at ¶ 75) Accordingly, Plaintiff plausibly alleges that its injuries “flow[] directly” from Warner’s advertising. Lexmark,
C. Florida’s Anti-SLAPP Statute
At the conclusion of the motion to dismiss, Warner asserts that Plaintiffs complaint falls within Florida’s anti-SLAPP (Strategic Lawsuits Against Public Participation) statute, Fla. Stat. § 768.295. (Dkt. 89 at 24-25) As a result, Warner contends that “if and when” the Court grants its motion to dismiss, Warner will file a motion for an award of fees and costs. (Id. at 25); see Fla. Stat. § 768.295(4) (“The court shall award the prevailing party reasonable attorney fees and costs incurred in connection with a claim that an action was filed in violation of this section.”).
Currently, Warner does not appear to ask for any relief under the anti-SLAPP statute. For instance, Warner does not contend that resolution of this motion is evaluated under a summary-judgment standard and it does not request an expedited hearing. See Fla. Stat. § 768.295(4) (providing that a defendant may file a
D. Consideration of Exhibits
Warner filed a separate request for the Court to consider twenty-two exhibits in support of its motion to dismiss, which are designated as Exhibits A through V. (Dkts. 90, 91) After the parties conferred, Warner withdrew its .request as to Exhibits F through H, and Plaintiff stipulated to the Court’s consideration of Exhibits A and N through V (Dkt. 96), which are referred to, excerpted in, or attached to the Amended Complaint or original complaint, and which are central to Plaintiffs claims. (Dkt. 91 at ¶¶ 4, 17-25; Dkt. 78 at ¶¶ 29-30, 55, 60, 62-67, 70); see Day v. Taylor,
The remaining exhibits—Exhibits B through E and I through M—include documents from Diveroli’s criminal and civil cases, a U.S. Congressional committee report about Diveroli’s company, and a related news article. (See Dkt. 91 at ¶¶ 5-8, 12-16) Although Warner asserts that these exhibits are relevant to Diveroli’s “misconduct and notoriety” (Dkt. 90 at 5), the Court declines to consider the documents because Diveroli’s misconduct and notoriety are not relevant to the motion to dismiss.
For its part, Plaintiff submits screenshots from four websites that offer movies on-demand and in which War Dogs is described as a “true story.” (Dkt. 98) Plaintiff contends that these descriptions were “located after filing the Amended Complaint,” and that they underscore why its claims should not be dismissed. (Dkt. 99 at 3-4) Warner objects to the submission of the screenshots because, among other things, the statements on the websites are not challenged in the Amended Complaint. (Dkt. 100 at 1) The Court determines that the screenshot exhibits should not be considered in the resolution of the motion to dismiss.
IV. CONCLUSION
Based on the foregoing, it is ORDERED that Defendant’s Motion to Dismiss (Dkt. 89) is DENIED.
DONE and ORDERED in Tampa, Florida, this 10th day of May, 2017.
Notes
. In Tobinick, the district court questioned whether the second prong of this test remains good law, in light of the Supreme Court's decision in Lexmark International, Inc. v. Static Control Components, Inc., — U.S. -,
. Warner requested leave to file a reply to Plaintiffs response in opposition, arguing that
. See Tyne v. Time Warner Entm't Co., L.P.,