The INTERMOUNTAIN STROKE CENTER, INC., a Utah corporation; Nancy Futrell, an individual, Plaintiffs-Appellants, v. INTERMOUNTAIN HEALTH CARE, INC., a Utah non-profit corporation; IHC Health Services, Inc., a Utah non-profit corporation; SelectHealth, Inc., a Utah non-profit corporation, Defendants-Appellees.
No. 14-4045.
United States Court of Appeals, Tenth Circuit.
Feb. 9, 2016.
638 F. App‘x 778
JEROME A. HOLMES, Circuit Judge.
Amber M. Mettler, Alan L. Sullivan, Snell & Wilmer, Salt Lake City, UT, for Defendant-Appellee.
Before TYMKOVICH, Chief Judge, and HOLMES, and BACHARACH, Circuit Judges.
ORDER AND JUDGMENT*
JEROME A. HOLMES, Circuit Judge.
Plaintiffs-Appellants Dr. Nancy Futrell and the Intermountain Stroke Center
I
A
Intermountain Health Care is a large network of hospitals, clinics, surgery centers, and physicians. Within its ambit are wholly-owned subsidiaries IHC Health Services, which operates medical facilities throughout the State of Utah, and SelectHealth, a health-maintenance organization. All of these entities (hereinafter collectively “Intermountain“) are Utah not-for-profit corporations.
Before closing its doors in 2013, the Stroke Center was a Utah corporation principally conducting business in Salt Lake City. It provided “same-day and next-day treatment” to patients presenting with strokes and transient ischemic attacks (“TIAs“).1 Aplt.App. at 260 (First Am. Compl., filed Oct. 7, 2013). One of its staff members was Dr. Nancy Futrell, a Utah-licensed neurologist who holds herself out as a “speciali[st] in the treatment of stroke.” Id. at 251. According to Dr. Futrell, the Stroke Center was “the only outpatient, non-emergency facility in Utah to provide non-emergency, same-day and next-day stroke and TIA treatment by . . . a stroke specialist” and the “only” facility in the state that offered these services at rates significantly lower than prevailing hospital rates. Id. at 260.
On March 24, 2013, the Stroke Center discontinued operations. Believing that Intermountain‘s conduct was the impetus for the Stroke Center‘s cessation of business, Dr. Futrell and the Stroke Center (hereinafter collectively “Plaintiffs“) filed a lawsuit against Intermountain in Utah state court on June 4, 2013. Plaintiffs originally alleged violations of Utah‘s Truth in Advertising Act (“UTIAA“) and other state-law claims sounding in tort. After Plaintiffs added a Lanham Act claim to their complaint, Intermountain removed the action to the United States District Court for the District of Utah.
The amended complaint alleges that Intermountain misled prospective consumers regarding the nature and quality of its stroke and TIA services. Plaintiffs’ claims focus on certain statements included in Intermountain‘s advertising and marketing materials: specifically, (1) general representations made “[t]hrough [Intermountain‘s] marketing efforts” that Intermountain follows “best medical practices,” provides the “best possible care,” and has a mission of “[p]roviding excellent care of the highest quality at an affordable cost,” id. at 269-70; and (2) three more specific representations made through Intermountain‘s (a) website and “Annual Stroke Report,” (b) institutional code of ethics (“Ethics Code“), and (c)
Intermountain moved to dismiss Plaintiffs’ complaint pursuant to
B
On March 31, 2014, the district court issued a memorandum decision and order granting Intermountain‘s motion to dismiss. The district court‘s principal conclusion was that Plaintiffs had failed to state a plausible claim for relief under the Lanham Act. In so ruling, the court observed that “[m]any of [Intermountain‘s] statements are not assertions of fact for which [Intermountain] may be held liable under the Lanham Act. With respect to the remaining statements, Plaintiffs have . . . not adequately alleged that the statements are misleading. . . .” Id. at 15 (Mem. Decision & Order, filed Mar. 31, 2014).
More specifically, the district court rejected Plaintiffs’ contention that Intermountain‘s general marketing statements—notably, those pertaining to “best medical practices“—could serve as the predicate for a Lanham Act claim. Id. It determined that these statements were “not statements of fact” and likened them to “[e]xpressions of sales ‘puffery.‘” Id. at 16. In fact, the court expressly classified these marketing claims as “paradigmatic puffery,” id. at 20, and stated that its view of them would not change “even if [the statements were] linked to a particular product or service and even if false,” id. at 18. At bottom, the court was convinced that no reasonable consumer would have relied upon Intermountain‘s general statements when choosing a stroke or TIA provider.
The court then assessed the three sets of specific statements and deemed them inadequate for purposes of a Lanham Act claim. It found the challenged statements concerning the number of stroke specialists “true and not misleading,” id. at 21, because Intermountain had truthfully represented how many of its physicians were competent in stroke and TIA treatment and explained that “subspecialists [were] available to assist stroke patients with ongoing medical needs,” id. at 22. Similarly, the court found “true and not misleading” Intermountain‘s Ethics Code standard pertaining to compliance with federal physician-referral laws. Id. at 23. It further determined that Plaintiffs had not “allege[d] a competitive injury associated with th[e] statements” in the Ethics Code. Id. at 27. Lastly, the district court concluded that the statements at issue in the Stroke Pamphlet—which very generally explained stroke and post-stroke concerns—were “not misleading as to the nature, characteristics, or qualities of [Intermountain‘s] services.” Id. Indeed, the court opined, the Stroke Pamphlet could
After disposing of Plaintiffs’ single federal claim, the district court explained that “[j]urisdiction over Plaintiffs’ state law claims [had been] proper only because they [were] appropriately related to Plaintiffs’ Lanham Act claim,” and that state court was the proper place to litigate Plaintiffs’ UTIAA and Utah tort-law claims. Id. Accordingly, the court remanded these claims to state court and entered final judgment reflecting a with-prejudice dismissal of Plaintiffs’ Lanham Act claim.
Plaintiffs have timely appealed from the district court‘s dismissal of their Lanham Act claim.2
II
By way of overview, we affirm the district court‘s with-prejudice dismissal of Plaintiffs’ Lanham Act claim against Intermountain. We rest this affirmance on our determination that the district court correctly decided that Intermountain made no materially false or misleading representations of fact in advertising its stroke and TIA services—a conclusion that ineluctably sounds the death knell for Plaintiffs’ Lanham Act claim.
A
We begin by providing an overview of the relevant legal terrain—i.e., the basic principles governing
1
a
Our standard of review in the
As the Supreme Court has explained, “[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); accord Al-Owhali v. Holder, 687 F.3d 1236, 1239-40 (10th Cir. 2012). Courts “are not bound to accept as true a legal conclusion couched as a factual allegation.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555); accord Wood v. Moss, 572 U.S. 744, 134 S.Ct. 2056, 2065 n. 5 (2014).
b
Before proceeding to discuss the substantive standards of the Lanham Act, we address Plaintiffs’ argument that the district court committed error by “alter[ing] the federal pleading standard by making it more stringent for plaintiffs.” Aplt. Opening Br. at 34. Plaintiffs contend in conclusory fashion that “the District Court acted as a ‘savvy judge that actual proof of those facts is improbable.‘” Id. at 37. This language emanates from the Supreme Court‘s Twombly decision. See Twombly, 550 U.S. at 556 (“[A] well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable. . . .“).
Considering Plaintiffs’ allusion to Twombly, we understand their position to be that the district court erred by dismissing their action on the ground that they failed to demonstrate that their claims were “likely to be true.” Aplt. Opening Br. at 37 (quoting Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir. 2008)). Because we have held that ” ‘plausible’ cannot mean ‘likely to be true,‘” Robbins, 519 F.3d at 1247, if the district court had in fact resolved Plaintiffs’ claims under a likely-to-be-true standard, then it would have legally erred. However, that cannot be said of the court‘s reasoning.
We find it beyond peradventure that the district court carefully and properly assessed the sufficiency of the complaint under the well-settled facial-plausibility standard. The court did not err by saying that “[i]f the factual allegations of the complaint are accepted as true, it must be plausible, not merely possible, that the plaintiff is entitled to the relief requested.” Aplt. App. at 15. Indeed, the Supreme Court has clearly signaled to lower courts that they should draw a “line between possibility and plausibility” in assessing the legal sufficiency of complaints. Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557). In this regard, Iqbal instructs that “[t]he plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted unlawfully.” 556 U.S. at 678 (emphasis added). And Iqbal further explicates that a complaint cannot pass muster under
2
“The Lanham Act creates a cause of action for unfair competition through misleading advertising or labeling.” POM Wonderful LLC v. Coca-Cola Co., 573 U.S. 102, 134 S.Ct. 2228, 2234 (2014); see World Wide Ass‘n of Specialty Programs v. Pure, Inc., 450 F.3d 1132, 1140 (10th Cir. 2006) (“[U]nder the Lanham Act, it was required to demonstrate . . . ‘that the defendant made material false or misleading representations of fact in con-
Only the second basis for imposing Lanham Act liability—false advertising—has been argued in this case. Relevant to our assessment of the false-advertising theory, the statute provides that liability in a civil action attaches to:
Any person who, on or in connection with any goods or services[] . . . uses in commerce any . . . false or misleading description of fact, or false or misleading representation of fact, which—
. . .
(B) 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[] . . . .
Thus, to state a false-advertising claim under § 43(a) of the Lanham Act, a plaintiff must plausibly allege:
(1) that [the] defendant made material false or misleading representations of fact in connection with the commercial advertising or promotion of its product; (2) in commerce; (3) that are either likely to cause confusion or mistake as to (a) the origin, association or approval of the product with or by another, or (b) the characteristics of the goods or services; and (4) injure the plaintiff.
Cottrell, 191 F.3d at 1252 (citations omitted); accord La Resolana Architects, PA v. Reno, Inc., 555 F.3d 1171, 1181 (10th Cir. 2009). Each of the foregoing elements must be demonstrated by a preponderance of the evidence. See World Wide Ass‘n of Specialty Programs, 450 F.3d at 1140 (“[I]n order for World Wide to succeed on [a] claim under the Lanham Act, it was required to demonstrate the . . . elements by a preponderance of the evidence[] . . . .“).
Delving into the threshold component of a Lanham Act claim (i.e., advertising representations attributed to the defendant), panels of this court have explained that ” ‘Section 43(a) . . . encompasses more than literal falsehoods,’ because otherwise, ‘clever use of innuendo, indirect intimations, and ambiguous suggestions could shield the advertisement from scrutiny precisely when protection against such sophisticated deception is most needed.’ ” Cottrell, 191 F.3d at 1252 (quoting Am. Home Prods. Corp. v. Johnson & Johnson, 577 F.2d 160, 165 (2d Cir. 1978)); see also Zoller Labs., LLC v. NBTY, Inc., 111 Fed. Appx. 978, 982 (10th Cir. 2004) (unpublished) (“To demonstrate falsity within the meaning of the Lanham Act, a plaintiff may show that the statement was literally false, either on its face or by necessary implication, or that the statement was literally true but likely to mislead or confuse consumers.” (emphases added) (quoting Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134, 1139 (9th Cir. 1997))). More specifically, the Lanham Act contemplates two variants of actionable advertising representations: (1) those that are literally false, and (2) those that, while literally true, are likely to mislead and confuse consumers. See La Resolana Architects, 555 F.3d at 1181-82 (holding there was “no basis” for a Lanham Act claim, given the district court‘s factual findings that “neither [of the defendants] made any false or misleading oral or written statements or representations“); see also Hutchinson v. Pfeil, 211 F.3d 515, 522 (10th Cir. 2000) (noting the two different categories and collecting cases).
B
Having set out the essential legal principles underlying this appeal, we proceed to the merits of Plaintiffs’ Lanham Act claim. As noted, the district court deemed this claim legally infirm due to Plaintiffs’ failure to plausibly allege that Intermountain made any materially false or misleading representations concerning the quality of
1
First, we address Plaintiffs’ endeavor to forge a Lanham Act claim by invoking Intermountain‘s general advertising and marketing representations concerning quality of care. At the motion-to-dismiss stage, the district court determined that none of the vague declarations that Plaintiffs identified were “statements of fact for which [Intermountain] c[ould] be held liable under the Lanham Act“; to the contrary, they were expressions of sales “puffery.” Aplt. App. at 16. We, too, conclude that the marketing representations at issue are merely expressions of Intermountain‘s opinion. This leads inexorably to the conclusion that, as a matter of law, these general statements cannot be “material false or misleading representations of fact.” Cottrell, 191 F.3d at 1252 (emphasis added). As such, they cannot
Intermountain‘s public-relations efforts involved a publicly accessible, comprehensive website. On the website‘s home page, Intermountain held itself out as “an internationally recognized, nonprofit system of 22 hospitals, a Medical Group with more than 185 physician clinics, and an affiliated health insurance company.” Aplt. App. at 308 (Website Home Page, dated Sept. 5, 2013). The home page indicated that Intermountain “offer[s] a full range of services” and that “[p]roviding excellent care of the highest quality at an affordable cost is at the heart of [its] mission.” Id. Similarly, the website section focusing on Intermountain‘s clinics declared, “Our network of experienced doctors, surgeons and caregivers strive[s] to provide clinically excellent healthcare through a wide range of services in a setting where patient needs come first.” Id. at 311 (Clinics Subpage, dated Sept. 5, 2013).
Elsewhere on its website—on a subpage denominated “For Intermountain Healthcare Trustees“—Intermountain described its business model as “[a]n [i]ntegrated [h]ealthcare [s]ystem“; by virtue of such amalgamation, it was said to offer its clientele “[c]linical quality,” “[s]ervice quality,” “[l]ower costs,” “[p]revention,” and “a relatively seamless continuum of care.” Id. at 313 (Trustee Subpage, dated Sept. 5, 2013). There, Intermountain claimed that being a vertically-integrated network enabled it to “contribute in essential ways to the sharing of best medical practices, and raising the standards of clinical excellence.” Id. It further asserted that, “[b]y identifying and implementing best medical practices[,] . . . Intermountain not only provides quality healthcare; it often achieves lasting improvement in cost structures.” Id.
Plaintiffs contend that all of the foregoing representations—that is, Intermountain‘s “claims to identify and implement best medical practices at the lowest available cost“—are “literally false statement[s]” upon which a legitimate Lanham Act false-advertising claim may be predicated. Aplt. Opening Br. at 58-59; see id. at 31 (alluding to Intermountain‘s purported “literally false general advertisements of best medical practices, exceeding the standard of care, delivering the best possible care and . . . delivering high quality care in all services at affordable costs” (footnotes omitted)). We reject Plaintiffs’ position. We conclude that Intermountain‘s general quality-of-care declarations are emblematic of sales puffery; for that reason, we cannot classify these declarations as statements of fact, much less literally false ones.
a
Intermountain‘s general advertising statements fall short of our Lanham Act standard because they constitute sales puffery and, as such, cannot be deemed statements of fact, let alone literally false ones.
i
In a well-known Lanham Act case, the Fifth Circuit has helpfully laid the groundwork for a discussion of puffery:
Essential to any claim under section 43(a) of the Lanham Act is a determination of whether the challenged statement is one of fact—actionable under section 43(a)—or one of general opinion—not actionable under section 43(a). Bald assertions of superiority or general statements of opinion cannot form the basis of Lanham Act liability.
Pizza Hut, Inc. v. Papa John‘s Int‘l, Inc., 227 F.3d 489, 495-96 (5th Cir. 2000).
“Puffery” is a term of art “used to characterize those vague generalities that no
As the Third Circuit has explained (in a Lanham Act lawsuit), a statement of puffery “is considered to be offered and understood as an expression of the seller‘s opinion only, which is to be discounted as such by the buyer.” Castrol Inc. v. Pennzoil Co., 987 F.2d 939, 945 (3d Cir. 1993) (quoting W. Page Keeton et al., Prosser and Keeton on the Law of Torts § 109, at 756-57 (5th ed. 1984)). The hallmarks of puffery are “broad, vague, and commendatory language,” id., as well as “[s]ubjective claims . . . which cannot be proven either true or false,” Time Warner Cable, Inc. v. DIRECTV, Inc., 497 F.3d 144, 159 (2d Cir. 2007) (alteration in original) (quoting Lipton v. Nature Co., 71 F.3d 464, 474 (2d Cir. 1995)).
We recognize that the Tenth Circuit has not yet defined the precise contours of puffery in a false-advertising Lanham Act case. However, our caselaw involving puffery in other causes of action makes clear to us that Intermountain‘s general advertising claims of best practices and high-quality customer service fit the bill (i.e., constitute puffery). See, e.g., MHC Mut. Conversion Fund, L.P. v. Sandler O‘Neill & Partners, L.P., 761 F.3d 1109, 1114 (10th Cir. 2014) (accepting securities treatise‘s statement that puffing is not actionable as an “untrue statement of a material fact” under
Our decision in Alpine Bank helpfully reinforces the conclusion that Intermountain‘s general advertising declarations constitute puffery. In Alpine Bank, the cause of action was negligent misrepresentation under Colorado law. Succeeding on that claim would have required the plaintiffs to establish, inter alia, justifiable reliance on false business information supplied by their bank, the defendant. See Campbell v. Summit Plaza Assocs., 192 P.3d 465, 477 (Colo. App. 2008) (“To prevail on a claim for negligent misrepresentation . . . [the plaintiff] was required to prove that . . . [the defendant] supplied false information in a business transaction[ ] . . . .“). We rejected the plaintiffs’ argument that the
Analyzing the Alpine Bank plaintiffs’ claims within the construct of puffery, we intimated that the concept of sales puffery “has not changed that much in the last century.” Id. We alluded to the importance of context in determining whether a transactional representation constitutes puffery:
What is said to a particular person may take on meaning that would not be present if made to a large group. Thus, mass advertising expressed in vague terms . . . is not relied on by rational adults. For example, the slogan “You‘re in good hands with Allstate” was held to be puffery. . . . One reason such statements are not to be relied on is that they could not possibly mean everything that might be implied.
Id. at 1107 (emphasis added) (citation omitted). Then, placing the bank‘s averments in proper context, we found it patent that a prospective homeowner seeking a loan from his bank would not reasonably expect the bank to shepherd him through the entire process of “build[ing] the home, choos[ing] a site, select[ing] the builder, [and] supervis[ing] construction.” Id. We thus held that “[a] reasonable person desiring [a defendant] to perform in a particular way would need a more specific assurance” than a simple claim of superior quality, such as the one presented in the bank‘s advertising materials. Id. (emphasis added).
We discern no cogent reason to disregard these broadly applicable lessons from Alpine Bank in the context of this case—i.e., a false-advertising Lanham Act claim against a defendant hospital network. Healthcare is fraught with unpredictability, and a healthcare-delivery system hardly strikes us as the species of business from which a particular objectively-superior result (e.g., with respect to certain stroke and TIA treatments) could reasonably be expected by a consumer without at least some modicum of specificity being provided by the business in its representations (or, as Alpine Bank put it, in its “assurance“). Accordingly, though Alpine Bank did not resolve a Lanham Act claim, we consider its guidance in reaching our conclusion that Intermountain, through its general marketing declarations, did not “ma[k]e material false or misleading representations of fact . . . that [we]re . . . likely to cause confusion or mistake as to . . . the characteristics of the goods or services.” Cottrell, 191 F.3d at 1252 (citations omitted).
In any event, even without the benefit of Alpine Bank, we would conclude that advertising declarations about “best medical practices, exceeding the standard of care, delivering the best possible care and . . . delivering high quality care in all services,” Aplt. Opening Br. at 31 (footnotes omitted)—all of which speak generically to the caliber of the Intermountain brand—are classic puffery. Our sibling circuits have regularly reached similar conclusions when reviewing such statements—that is, they have concluded that analogous statements are incapable of objective verification and constitute puffery.4 The Fifth Circuit‘s
Pizza Hut‘s false-advertising Lanham Act dispute centered around the slogan of Papa John‘s Pizza: “Better Ingredients. Better Pizza.” 227 F.3d at 491. After a jury found that this catchphrase, standing alone, was a false statement of fact, the district court enjoined its use. But the Fifth Circuit disagreed, concluding that both sentences in the slogan fit the definition of puffery by “epitomiz[ing] the exaggerated advertising, blustering, and boasting by a manufacturer upon which no consumer would reasonably rely.” Id. at 498. The court expressly referenced leading unfair-competition and tort-law treatises, noting that these well-regarded authorities had defined puffery in the foregoing manner and had persuaded the court that Papa John‘s vague slogan “c[ould] be understood as nothing more than a mere expression of opinion.” Id. at 497. More specifically, the court reasoned, an adjective like “better” could not be factual in nature because it was “unquantifiable” and thus, “without further description, [wa]s wholly a matter of individual taste or preference not subject to scientific quantification . . . [and consequently] not actionable under the Lanham Act.” Id. at 499 (citation omitted).
Drawing guidance from the Fifth Circuit‘s decision in Pizza Hut, we consider Intermountain‘s general declarations concerning best practices and high-quality care to be merely sales puffery that cannot form the basis of a Lanham Act claim.5
ii
Generously construing Plaintiffs’ contrary arguments, we reject them:
First, in attacking the district court‘s puffery determination, Plaintiffs repeatedly refer to puffery as “a defense.” Aplt. Opening Br. at 31. They appear to contend that it is an affirmative defense that must be shouldered by Intermountain and, therefore, has no bearing on the question of whether Plaintiffs have pleaded a plausible Lanham Act claim (that is, successfully averred sufficient facts to legally support such a claim). Plaintiffs are wrong. We are aware of no legal authority that validates this proposition, and Plaintiffs offer none. To be sure, in this connection, they do cite Pizza Hut; however, there is nothing in that case that even remotely validates their characterization of puffery as an affirmative defense. Indeed, the Fifth Circuit made clear in Pizza Hut that the concept of puffery pertains to whether the statements that plaintiffs identify are actually actionable. See Pizza Hut, 227 F.3d at 496 (“One form of non-actionable statements of general opinion under section 43(a) of the Lanham Act has been referred to as ‘puffery.’ “). Accordingly, we reject Plaintiffs’ characterization of puffery as a defense.
Second, we cannot accept Plaintiffs’ contention that the statements concerning best practices and high-quality care are not puffery because they are not “forward-looking.” Aplt. Opening Br. at 61. In this regard, Plaintiffs are seemingly relying on our Grossman decision. See 120 F.3d at 1119. However, such reliance is misguided. In Grossman, a securities-fraud case, the statements alleged to be “false and
Specifically, that sentence reads: “Statements classified as ‘corporate optimism’ or ‘mere puffing’ are typically forward-looking statements, or are generalized statements of optimism that are not capable of objective verification.” Id. (emphasis added). That Grossman “employs disjunctive terminology,” Ellis v. J.R.‘s Country Stores, Inc., 779 F.3d 1184, 1204 (10th Cir. 2015), is significant. We certainly did not hold in Grossman, as Plaintiffs appear to suggest, that only “forward-looking” statements can be puffery. To the contrary, we immediately indicated that “vague statements of corporate optimism” also qualify, and we referenced numerous cases wherein hopeful language—some remarkably similar to the marketing statements identified in this lawsuit—was deemed to be puffery. See Grossman, 120 F.3d at 1119-20 (collecting cases). For this reason, we are satisfied that Grossman‘s “forward-looking” language does not control whether a statement may be properly considered puffery. Grossman does not alter our view that Intermountain‘s general claims regarding brand quality are classic puffery.
And, third, we reject Plaintiffs’ suggestion that the Supreme Court‘s holding in Lexmark somehow changed the legal framework that the district court should have applied. Plaintiffs urge, somewhat enigmatically, that:
[i]ncluding a requirement for a plaintiff to establish that a literally false advertisement is “likely to cause confusion or mistake” was rejected in [Lexmark] . . . . If the “likely to cause confusion or mistake” phrase is not found in Section 43(a)(1)(B) of the Lanham Act, and is not an element of a false advertising claim, for the purposes of a puffery defense, what a reasonable consumer would believe is irrelevant.
Aplt. Opening Br. at 30-31.
We deem this undeveloped argument unpersuasive. The central issue in Lexmark was standing vel non to assert a Lanham Act claim, not whether the proposed claim, if entertained at all, should be rebuffed as sales puffery. See Lexmark, 134 S.Ct. at 1385 (“We granted certiorari to decide ‘the appropriate analytical framework for determining a party‘s standing to maintain an action for false advertising under the Lanham Act.‘” (quoting Pet. for Cert.)). That is, Lexmark did not endeavor to craft a rule concerning puffery. Rather, its holding—“that a plaintiff suing under § 1125(a) ordinarily must show economic or reputational injury flowing directly from the deception wrought by the defendant‘s advertising, [which] occurs when deception of consumers causes them to withhold trade from the plaintiff,” id. at 1391—squarely implicates whether “the plaintiff is [even] entitled to an opportunity
In sum, we agree with the district court‘s ruling insofar as the court deemed Intermountain‘s general advertising declarations puffing statements that cannot give rise to a Lanham Act false-advertising claim.
2
Turning to the three sets of specific averments Plaintiffs challenge, we likewise conclude that they do not rise to the level of actionable Lanham Act conduct. We conclude that each of the three sets of particularized statements fails to state a Lanham Act false-advertising claim and that they indisputably founder on the first element of such a claim because they are true and not misleading. Stated otherwise, we hold that the statements discussed below are not “false or misleading” within the meaning of the statute.
a
First, Plaintiffs assert that Intermountain inappropriately and misleadingly communicates on its website, and in its Annual Stroke Report, that it employs more physicians for stroke and TIA care than it actually does. They claim that these materials contain at least two varieties of actionable Lanham Act representations: (1) misleading suggestions that Intermountain‘s heart and vascular surgeons specialize in stroke and TIA care, and (2) misleading suggestions that neurologists at Intermountain‘s Outpatient Neuroscience Clinic are stroke and TIA “subspecialists.” Plaintiffs contend that the website and Annual Stroke Report deceive consumers about Intermountain‘s capacity to provide care when Intermountain purportedly “does not have the physicians needed to provide timely treatment for approximately 800 to 900 stroke patients per year.” Aplt. Opening Br. at 22. We disagree: because these statements are true and not misleading, as a matter of law, we cannot accept them as the predicate for a Lanham Act claim.
According to Plaintiffs, Intermountain‘s listing of stroke on its website “under ‘Heart and Vascular Services.’ . . . is apt to confuse stroke and TIA patients into believing that cardiologists and other heart specialists specialize in the treatment of stroke and TIA, which is not accurate.” Id. at 18-19. Plaintiffs similarly aver that “the ‘Find a Doctor’ link from the [Intermountain] website . . . lists heart and vascular surgeons . . . as stroke treatment providers,” which “is calculated to mislead or confuse [Intermountain] stroke and TIA patients into believing that a wide range of physicians are available to treat them for stroke and TIA.” Id. at 19-20. Both contentions lack merit.
Having explored Intermountain‘s website via the parties’ record submissions, we strongly doubt that reasonable healthcare consumers would be deceived in the manner described by Plaintiffs. Plaintiffs’ own evidence supports our conclusion that any association of stroke and TIA with “heart and vascular” services is proper. See, e.g., Aplt. App. at 318-19 (medical study discussing stroke and TIA in the context of various cardiovascular indications). It is apparent to us that Intermountain‘s choice
It likewise strikes us as obvious that Intermountain‘s website‘s “Find a Doctor” tool contains no misleading information. At all times relevant to this lawsuit, clicking on the “Find a Doctor” link, which was accessible from Intermountain‘s “Heart and Vascular Services” webpage, would produce a list of physicians. See id. at 394. Selecting any physician-specific link would bring up information regarding that physician‘s educational background, certifications, and clinical interests. After perusing the list of physicians presented, we are not persuaded that it contains any untrue statements when judged in the context of Plaintiffs’ Lanham Act claim. Notably, none of the “primary specialty” notations explicitly include a particular physician‘s claim of expertise in stroke and TIA treatment. Therefore, the most that can be said of these online representations is that they indicate that certain physicians possess the core competencies to treat cerebrovascular diseases. And that appears to be true.
Importantly, at no point during these proceedings have Plaintiffs explained how consumers might infer that the physicians identified by Intermountain were in fact “specialists . . . in the treatment of stroke and TIA.” Aplt. Opening Br. at 19. Perhaps Plaintiffs wish that Intermountain had included some sort of disclaimer—such as “Dr. X is not a stroke specialist“—but they have never argued or briefed such a proposition. We suspect that this is so because the sparse extant caselaw would not support it. Cf., e.g., Alfred Dunhill Ltd. v. Interstate Cigar Co., 499 F.2d 232, 235, 238 (2d Cir. 1974) (rejecting attempt to shoehorn a Lanham Act claim from allegations of selling tobacco “without taking effective steps to warn their customers that the tobacco had been subjected to possible water damage“); Wellnx Life Scis. Inc. v. Iovate Health Scis. Research Inc., 516 F. Supp. 2d 270, 286 (S.D.N.Y. 2007) (noting the unavailability of a viable action under § 43(a) of the Lanham Act for not disclosing facts).
In addition, Plaintiffs direct our attention to Intermountain‘s Annual Stroke Report, which states in relevant part: “The Stroke Program also offers resources for patients with ongoing medical needs after hospitalization. The Outpatient Neuroscience Clinic[] . . . is home to subspecialists including epileptologists, general neurologists, physical medicine and rehabilitation physicians, and neuropsychologists.” Aplt. App. at 349 (Annual Stroke Report, dated 2011). Plaintiffs seemingly take issue with Intermountain‘s description of staff neurologists as “subspecialists,” despite the fact that those physicians held themselves out as focusing on specified brain disorders. Without more explication from Plaintiffs, we cannot seriously entertain this argument. In our view, no misleading message can be gleaned from these statements. A straightforward interpretation of the foregoing Annual Stroke Report passage is that Intermountain employs staff physicians whose own subspecialties may be of particular benefit to patients assessing “ongoing medical needs” after a stroke. That language is certainly not an explicit or implicit representation that Intermountain‘s Outpatient Neuroscience Clinic is a “resource[],” id., solely pertaining to stroke and TIA.
At bottom, all of the challenged statements regarding Intermountain‘s cadre of physicians contain true information that is
b
Plaintiffs also insist that Intermountain falsely claims in its Ethics Code to “carefully review financial relationships with physicians and other Health Care Practitioners for compliance with the antikickback and Stark laws.” Aplt. App. at 888. In this regard, Plaintiffs note that Intermountain reached a settlement with regulators regarding certain of its compensation arrangements that appeared to contravene the federal healthcare-fraud statutes. However, we echo the district court‘s view that “the [Ethics Code] claims are true and not misleading.” Id. at 23.
From our perspective, Intermountain‘s announcement of its intent to behave ethically falls entirely outside the purview of a Lanham Act false-advertising claim. A district court opinion from within our circuit offers convincing reasons to support this conclusion:
Plaintiff‘s Consolidated Complaint alleges that the Board‘s announcement of its adoption of a code of ethics in its third quarter 2004 Form 10-Q was false and misleading, because the Company failed to reveal ongoing significant breaches of the Code by [specified individuals]. . . . [T]he Code of Ethics essentially reaffirms state law fiduciary duties of the Company‘s officers[] . . . . A company‘s essentially mandatory adoption of a code of ethics simply does not imply that all of its directors and officers are following that code of ethics. . . . Further, a code of ethics is inherently aspirational; it simply cannot be that every time a violation of that code occurs, a company is liable under federal law for having chosen to adopt the code at all, particularly when the adoption of such a code is effectively mandatory.
Andropolis v. Red Robin Gourmet Burgers, Inc., 505 F. Supp. 2d 662, 685-86 (D. Colo. 2007) (emphases added) (citations omitted).
Most relevant here, the notion that Intermountain‘s Ethics Code is “inherently aspirational,” id. at 686, finds support in the record. The Ethics Code begins with a statement of purpose that sets behavioral expectations for Intermountain employees. See Aplt. App. at 409 (stating that “employees[] . . . must accept personal responsibility to act with the utmost integrity” and that “[c]opies of Intermountain‘s Code of Ethics are provided to ensure that we all clearly understand our responsibilities“). It contemplates “consequences of misconduct” as well. Id. By doing so, the Ethics Code (at least tacitly) acknowledges that Intermountain‘s standards are sometimes violated; such violations trigger corrective action. This is precisely what happened when Intermountain became aware of and responded to compensation arrangements that appeared to contravene the federal healthcare-fraud statutes, entering into a settlement agreement with federal regulators. See id. at 438-48 (Settlement Agreement, dated Mar. 28, 2013) (representing Intermountain‘s disclosure to the Department of Health and Human Services that it submitted claims for payment “that may have been unlawful” and its agreement to repay the United States over $25 million). Indeed, the very existence of the resulting settlement agreement evinces the truthful spirit underlying Intermountain‘s Ethics Code. Cf. id. at 410 (“[W]e report observed and suspected violations of laws or policies[] . . . .“).
Quite simply, we consider nothing false or misleading about Intermountain‘s Ethics Code in the context of the false-advertising section of the Lanham Act.
c
The last challenged set of specific advertising averments stems from Intermountain‘s Stroke Pamphlet. The target audience for this thirty-six-page document includes stroke and TIA patients who have been admitted to an Intermountain facility, as well as their family members and friends. See Aplt. App. at 357 (Stroke Pamphlet, filed Oct. 7, 2013) (“After a stroke, you and your loved ones may feel uncertain. . . . This booklet can help.“). It contains background material on strokes and TIAs, a “Stroke Recovery Checklist,” an index of stroke resources, and other general information concerning “aftercare.” Id. (emphasis omitted).
According to Plaintiffs, page ten of the Stroke Pamphlet—an “Aftercare” chart—contains the legally actionable language for their Lanham Act claim. That page indicates that “an appointment with” a patient‘s primary care provider “is usually recommended 1 to 7 days after [leaving] to go home” and, similarly, that visiting a neurologist “is usually recommended” “4 to 6 weeks after [leaving] to go home.” Id. at 364 (capitalization altered) (emphases added). Plaintiffs insist that these statements constitute false advertising because “[e]ven if these guidelines apply[,] . . . a TIA patient who reads this pamphlet is likely to be under the mistaken impression that he or she can safely wait 4 to 6 weeks before following up with a neurologist.” Aplt. Opening Br. at 17. Once again, we disagree.
From our perspective, the “Aftercare” chart in the Stroke Pamphlet cannot be legally actionable under the Lanham Act for one simple, yet crucial, reason: it nowhere purports to stake a position on “the nature, characteristics, [or] qualities[] . . . of [Intermountain‘s] . . . services.”
Moreover, we would be hard-pressed to determine that this particular “Aftercare” chart upon which Plaintiffs focus could mislead anyone about the scope of Intermountain‘s services. Indeed, we conclude that it could not mislead a reasonable consumer about Intermountain‘s overarching medical services or its more specific stroke
In sum, we conclude that the statements identified in the Stroke Pamphlet cannot form the basis of a cognizable Lanham Act claim because they are not misleading. Most importantly, for purposes of a Lanham Act claim, we discern no expression in the Stroke Pamphlet‘s statements related to the nature, characteristics, or qualities of Intermountain‘s healthcare services, and we therefore see nothing misleading about those statements. Thus, we consider the district court‘s rejection of this aspect of Plaintiffs’ claim unassailable.
Accordingly, we uphold the district court‘s rulings wherein the court concluded that none of the “specific” advertising statements could serve as the predicate for a Lanham Act false-advertising claim.
3
Because we have explicated in detail why the district court properly dismissed Plaintiffs’ Lanham Act claim for insufficient averments concerning the first element of such a claim, we need not (and thus do not) opine upon whether Plaintiffs sufficiently alleged a legally actionable injury under the statute. We are content to affirm the district court‘s order on the first element, without addressing any other aspects of the district court‘s order.
III
The district court properly denied both motions to remand and dismissed the amended complaint against Defendants. For the foregoing reasons, we AFFIRM the judgment of the district court.
JEROME A. HOLMES
Circuit Judge