Vаcated and remanded by published opinion. Judge TRAXLER wrote the opinion, in which Judge KING and Judge GREGORY joined.
OPINION
The Scotts Company sued Pursell Industries and United Industries (together, the “defendants”), claiming that the packaging of the defendants’ “Vigoro” brand crabgrass-control product conveyed certain false messages to consumers. The district court granted a preliminary injunction in favor of Scotts. This court granted the defendants’ motion for a stay of the injunction pending appeal and expedited the appeal. We now vacate the district court’s grant of a preliminary injunction and remand for further proceedings on Scotts’ request for a permanent injunction.
I.
Generally speaking, chemical crabgrass-control products are most effective when applied to “pre-emergent” crabgrass— crabgrass that has yet to sprout. The products are also effective on early “post-emergent” crabgrass, but are ineffective when applied to mature crabgrass plants. Vigoro, the defendants’ product, and Scotts’ product (“Halts”) offer some level of post-emergence control, if applied no later than about four weeks after germinatiоn. Scotts, however, contends that the Vigoro package misleads consumers into believing that Vigoro can kill mature crabgrass.
In 1999, Scotts filed a Lanham Act false advertising claim against Pursell based on the Vigoro package. At that time, the Vigoro package included what the parties refer to as the “crabgrass buster” logo — a cartoon of a crabgrass plant with a sinister face, surrounded by the familiar red circle with a slash through it. This graphic was located directly above a text block that stated (in all capital letters) “pre & post emergence control of crabgrass.” The parties settled the 1999 action and entered into a settlement agreement under which Pursell admitted no liability but agreed not to use the crabgrass buster logo or a similar logo in close proximity to any claim that Vigoro controls or suppresses post-emergent crabgrass.
In March 2000, Scotts filed another action against Pursell. In that action, Scotts contended that Pursell breached the 1999 settlement agreement by including the crabgrass buster logo in its promotional materials. Scotts also asserted a new false advertising claim based on a time-line graphic included in those promotional materials which suggested that Vigoro was the only product with any post-emergence effect on crabgrass. The district court concluded that Pursell had breached the 1999 settlement agreement by using the crabgrass buster logo and that the time-line graphic was false because it wrongly suggested that Scotts’ product had no post-emergence effect. The court therefore entered a preliminary injunction requiring Pursell to remove the offending logo and time-line from the promotional materials. The parties entered into another settlement agreement under which Pur-sell again admitted no liability.
In December 2001, United Industries purchased the Vigoro product line from Pursell. Pursuant to their agreement, Pursell continues to manufacture the product, and United distributes it exclusively to Home Depot stores.
VIGORO
ULTRA TURF PRE-EMERGENT Crabgrass Control plus Fertilizer 30-3-4
Centеred on a bright blue background below this text and the lush-lawn picture is the following (again, with some attempt to show the relative font size):
Greens in 72 HOURS
Promotes Thick, Green Growth and Stops Crabgrass and Many Other Grassy & Broadleaf Weeds Before They Start.
To the left of this text block is the graphic at issue in this case: a realistic rendering of a mature crabgrass plant positioned directly above the following text:
Prevents Crabgrass up to
4 WEEKS
After Germination
A small white cross by the crabgrass illustration leads to a disclaimer on the bottom of the front of the package, printed in dark blue or black ink and in very small type, which states, “Crabgrass image for illustration only as this product is for pre- and early post emergent control and does not control mature plants.”
The crabgrass illustration on the Vigoro package is not unlike that used by Scotts on its Halts packages, and the Halts packages likewise claim some post-emergent effect. Scotts’ post-emergent claim (“Delivers pre- and early post-emergent crabgrass control”) is the first of three “bullet points” in a vertical column on the lower left side of the package front; the crabgrass illustration is placed just beside this column, in the middle of the lower part of the package. A disclaimer on the back of the Scotts’ product states that “This product controls crabgrass in its early stages of growth. This product does not control mature crabgrass and other existing weeds.”
Not satisfied by the revisions to the Vigoro packaging, Scotts filed this action in the Eastern District of Virginia, where both the 1999 and the 2000 actions had been filed. Scotts asserted false advertising claims under the Lanham Act, see 15 U.S.C.A. § 1125(a)(1)(B) (West 1998), claiming that the revamped packaging, by using the illustration of a mature crabgrass plant, falsely suggested that Vigoro could kill mature crabgrass.
Scotts moved for a preliminary injunction and supported its motion with evidence of consumer confusion derived from two focus group discussions and face-to-face interviews with 40 shoppers selected from a shopping mall in Richmond. Although the district court questioned the persuasiveness of some of Scotts’ evidence,
II.
In this circuit, the entry of a preliminary injunction is governed by the four-part test set forth in Blackwelder Furniture Co. of Statesville, Inc. v. Seilig Mfg. Co., Inc.,
When deciding whether to grant a preliminary injunction, the court must first determine whether the plaintiff has made a strong showing of irreparable harm if the injunction is denied; if such a showing is made, the court must then balance the likelihood of harm to the plaintiff against the likelihood of harm to the defendant. See Safety-Kleen, Inc. (Pinewood) v. Wyche,
We begin by considering whether the district court errеd when concluding that Scotts would suffer irreparable harm if an injunction were not issued. In this case, however, that inquiry is bound up with an inquiry into the likelihood that Scotts will prevail on its false advertising claims. By virtue of certain intricacies in the law governing Lanham Act claims, some courts apply a presumption of irreparable harm if the plaintiff has made a threshold showing as to the merits of his Lanham Act claim, and the district court here relied on such a presumption when concluding that Scotts would be irreparably harmed if the injunction were denied. See J.A. 698 (“Scotts need only demonstrate that the advertising at issue confuses consumers in order to satisfy the irreparable harm prong of the analysis.”). Thus, because the balance-of-the-hardship question is intertwined with questions about the merits, our analysis of the balance-of-the-hardship question will first require a detour into the substance of Scotts’ Lanham Act claims.
A.
The Lanham Act prohibits the “false or misleading description of fact, or 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 goods, services, or commercial activities.” 15 U.S.C.A. § 1125(a)(1)(B) (West 1998). Thus, a plaintiff asserting a false advertising claim under the Lanham Act must establish that:
(1) the defendant made a false or misleading description of fact or representation of fact in a commercial advertisement about his own or another’s product; (2) the misrepresentation is material, in that it is likely to influence the purchasing decision; (3) the misrepresentation actually deceives or has the tendency to deceive a substantial segment of its audience; (4) the defendant placed the false or misleading statement in interstate commerce; and (5) the plaintiff has been or is likely to be injured as a result of the misrepresentation, either by direct diversion of sales or by a lessening of goodwill associated with its products.
Cashmere & Camel Hair Mfrs. Inst. v. Saks Fifth Ave.,
For liability to arise under the false advertising provisions of the Lanham
In Lanham Act cases involving trademark infringement, a presumption of irreparable injury is generally applied once the plaintiff has demonstrated a likelihood of confusion, the key element in an infringement case. See, e.g., Eli Lilly & Co. v. Natural Answers, Inc.,
This court has never spoken directly to the applicability of such a presumption of harm in Lanham Act cases.
B.
As previously noted, the evidence required of a false-advertising plaintiff is dependent upon whether the case involves advertising that is literally false or advertising that is only impliedly false. If the advertising is literally false, no evidence of consumer confusion is required. But if the advertising is impliedly false, the plaintiff must present extrinsic evidence of consumer confusion.
“In analyzing whether an advertisement ... is literally false, a court must determine, first, the unambiguous claims made by the advertisement ..., and second, whether those claims are false.” Novartis,
Here, the only claim explicitly made on the Vigoro package is that the product prevents crabgrass up to four weeks after germination, and Scotts concedes that this message, standing alone, is true. Scotts, however, contends that the falsity springs not from the text standing alone, but from the juxtaposition of the mature crabgrass illustration directly above this text, which creates what Scotts describes as a “unitary graphic.” According to Scotts, the placement of the mature crabgrass illustration so close to the phrase “prevents crabgrass up to 4 weeks after germination” necessarily leads consumers to believe that the picture shows what crabgrass looks like four weeks after germination. That message, in turn, leads consumers to believe that if they applied Vigoro to crabgrass that looked like the illustration, the product would kill the crabgrass, or at least prevent it from spreading. At four weeks after germination, however, crabgrass does not look like the illustration, but instead appears as small shoots. Thus, Scotts contends that the unitary graphic conveys the literally false message that Vigoro is capable of killing mature crabgrass.
The district court concluded that the Vigoro packaging made no literally false claims, a factual finding that is entitled to deference. See C.B. Fleet,
Preliminarily, the sheer complexity of Scotts’ explanation as to why this case involves a literal falsity seems to undercut the argument. See United Indus., 140 F.8d at 1181 (“The greater the degree to which a message relies upon the viewer or consumer to integrate its components and draw the apparent conclusion, however, the less likely it is that a finding of literal falsity will be supported.”). Moreover, the illustration is teamed with a claim that Vigoro “prevents” crabgrass, a word that generally is used in the stopping-from-
Scotts, however, contends that even though the stopping-crabgrass-before-it-starts message would be unobjectionable standing alone, the packaging conveys another message that is literally false. Scotts points out that while “prevent” is often used in the sense of stopping something from happening, it can also mean hindering, impeding, or eliminating something, or stopping something from existing. And according to Scotts, the defendants have exploited this secondary meaning of the word “[b]y juxtaposing a picture of mature crabgrass with the words ‘prevents after germination,’ ” which suggests that Vigoro “can stop, retard, and eliminate mature crabgrass once growth has occurred.” Brief of Appellee at 25. That is, “[t]o say that the product is capable of preventing crabgrass after crabgrass has occurred is to say that the product eliminates crabgrass after the fact and after it has reached maturity.” Brief of Appellee at 26.
We agree that “prevent” does carry the secondary message to which Scotts refers and that the Vigoro packaging conveys the message that Vigoro can stop or eliminate crabgrass once growth has occurred. But the packaging states that it can prevent (i.e., eliminatе) crabgrass up to four weeks after it has emerged, a message which is true and which is a far cry from Scotts’ assertion that the packaging claims that Vigoro eliminates crabgrass after maturity. Scotts’ literal falsity argument is thus dependent on the claim that the placement of the crabgrass illustration so close to the “4 weeks after germination” text necessarily conveys to consumers that the illustration is of a crabgrass plant four weeks after germination. That argument, however, is untenable when the graphic is viewed in context, as it must be. See United Indus.,
If the illustration were positioned over text claiming that Vigoro kills crabgrass, we might be more sympathetic to Scotts’ claim. But the graphic is simply one part of a package that focuses primarily on controlling pre-emergent crabgrass. The most obvious part of the package is the lush-lawn photo upon which the product is referred to (in very large letters) as “Ultra Turf Pre-Emergent Crabgrass Control.” And beside the crabgrass graphic, in the center of the bottom third of the package front, is the large-letter statement thаt Vigoro “Stops Crabgrass and Many Other Grassy & Broadleaf Weeds Before They Start.” Under these circumstances, we simply cannot agree with Scotts that the meaning it attaches to the unitary graphic is the one necessarily conveyed by the graphic. While it is possible that some consumers would interpret the graphic in the manner Scotts suggests, it is likewise possible that consumers would understand the illustration as showing mature crabgrass for identification purposes only, so that they can determine whether the weed that is vexing them is crabgrass or some other backyard pest. Because the graphic can reasonably be understood as conveying different messages, Scotts’ literal falsity argument must fail. See Novartis,
C.
Because we cannot conclude that the Vigoro packaging makes any literally false claims, the question is whether Scotts can establish that the packaging makes any impliedly false claims. See Clorox Co. Puerto Rico v. Proctor & Gamble Commercial Co.,
Consumer confusion “is most often proved by consumer survey data,” Clorox Co.,
To show consumer confusion, Scotts presented evidence of two focus group discussions and the results of a survey of forty consumers. We consider each type of evidence separately.
1.
Scotts’ focus groups consisted of a small number of Richmond-area consumers who owned their homes and performed their own lawn care. A moderator led each of the group discussions. Dr. Kiecker, Scotts’ marketing expert, summarized the results of the focus group sessions and concluded that “[m]ost participants felt that [the] purpose of the image of the
Scotts asserts that this focus group evidence satisfies its burden of showing consumer confusion through extrinsic evidence. The defendants, however, contend that focus group evidence is inherently unscientific and thus inadmissible under Rule 702 of the Federal Rules of Evidence or Daubert v. Merrell Dow Pharmaceuticals, Inc.,
We note that the very nature of a focus group seems, to some extent, to limit its ability to identify the message an advertisement conveys to an individual consumer. As the defendants’ expert explained, focus groups “are a form of brainstorming where the participants are encouraged to ‘build on’ the thoughts of others.” J.A. 208. Because the participants in a focus group freely voice their opinions, the opinion of a participant can be shaped by those of the others. Thus, a participant who may have derived no false message from an advertisement viewed outside the context of the focus group might well change his opinion about the message conveyed by the advertisement after considering the views expressed by the other participants. Nevertheless, we need not decide the broader question of the general admissibility of focus group evidence, because wе agree with the defendants that, in this case, the focus group evidence was unreliable and cannot be considered probative on the question of whether the Vigoro packaging was likely to mislead consumers. .
In our view, the manner in which the focus group discussions were conducted prevents the results of those discussions from being considered as a reliable indicator of whether the Vigoro packaging conveyed misleading messages to consumers. This lack of reliability stems from the fact that the moderators of the groups channeled the discussions and led the participants into giving responses favorable to Scotts. See Novartis,
We believe this example well illustrates the problems with the focus group evidence in this case. Initially, no message was conveyed to John by the crabgrass illustration on the Vigoro packaging. But in a span of time reflected by a mere six pages in the joint appendix, John had moved from having no opinion as to the purpose of or message conveyed by the illustration to being convinced that the illustration did indeed convey a particular аnd false message. Thus, the manner in which the focus groups were conducted allowed the moderator to shape the opinions of the participants to mirror Seotts’ theory of the case and then report those shaped opinions as evidence to support Seotts’ claim.
We therefore conclude that the manner in which the focus groups were conducted destroyed the objectivity of the discussions, rendering the results utterly unreliable on the question of whether the Vigoro packaging conveys a false message. See Novartis,
2.
Without the focus group evidence, Seotts’ only evidence of consumer confusion comes from its survey of 40 do-it-yourself lawn care consumers. According to Seotts, the survey showed that 92.5% of the respondents were misled by the Vigoro packaging, a level of confusion that would be sufficient to support Seotts’ false advertising claims. See, e.g., Johnson & Johnson-Merck Consumer Pharms. Co. v. Rhone-Poulenc Rorer Pharms., Inc.,
As previously discussed, the express messages conveyed by the Vigoro packaging are literally true. Vigoro prevents crabgrass if it is applied up to four weeks after the crabgrass has emerged from the soil, a claim that Seotts does not dispute. And to the extent that Vigoro’s use of the
The interviewer showed the respondents an empty Vigoro bag folded in quarters so that the lower left quadrant (where the crabgrass illustration was located) was visible and asked: “Based on your review of this section of the bag, should this product prevеnt the growth of crabgrass that looks like the crabgrass pictured?” J.A. 119. Through the use of the word “prevent,” this question suffers from the same ambiguity as does the Vigoro packaging itself. That is, we cannot tell from this question whether the respondents who answered yes believed that Vigoro could prevent mature crabgrass by stopping it before it started, or whether they believed that Vi-goro could kill if applied to established, mature crabgrass.
Scotts, however, insists that the survey does address the critical issue. First, Scotts points out that the survey did not simply ask whether Vigoro would prevent crabgrass that looks like the illustration, but instead asked whether Vigoro would prevent “the growth” of crabgrass that looks like the illustration. According to Scotts, by focusing on preventing growth, the question “asks whether the product controls (e.g., stops) ‘the growth of the pictured crabgrass. And that of course goes to one of the key issues in the case.” Brief of Appellee at 41-42. We disagree.
As previously pointed out, the primary and most common meaning of “prevent” is “[t]o keep from happening.” American Heritage College Dictionary 1085 (3d ed.1997). Contrary to Scotts’ suggestion, the inclusion of the phrase “the growth of’ does not obliterate or transform this meaning — Vigoro can keep the growth of mature crabgrass from happening by stopping crabgrass before it has a chance to mature. The ambiguity in the survey question comes from the use of “prevent,” and that ambiguity simply is not cured by adding the phrase “the growth of.” Therefore, even though more than 90% of the respondents answered yes when asked whether Vigoro should “prevent the growth of crabgrass that looks like the crabgrass pictured,” J.A. 119, those responses shed no light on the question that is key to Scotts’ false advertising claims— whether the Vigoro packaging conveys the message that it can kill mature crabgrass.
Scotts also argues that the responses to the follow-up “why or why not” question provide sufficient evidence of consumer confusion. Again we disagree. When asked to explain why they believed that Vigoro would prevent crabgrass that looks like the crabgrass pictured, many respondents said things like “because the bag says so,” J.A. 121; “because that is crabgrass,” J.A. 123; because “that is the type of [crabgrass] I am familiar with,” J.A. 127; “because that is what it says it does,” J.A. 137; “because it pictures that [crabgrass] so it should prevent it,” J.A. 145; and “because that is [crabgrass] and this is a prevent[ative],” J.A. 155. These responses аre just as ambiguous as the initial question, and, like the responses to the initial question, provide no evidence of consumer confusion on the critical issue.
There are, however, some explanations that do seem to support Scotts’ view of the message conveyed by the Vigoro packag
Moreover, the manner in which the survey was conducted creates significant questions about its relevance and reliability. The purpose of consumer surveys in false advertising cases is to determine the message actually conveyed to consumers. But the interviewers conducted the survey in this case in a way that effectively required the respondents to express a specific opinion, even if they did not have an opinion, by specifically not offering the respondents the opportunity to give “not sure” as a response. See J.A. 118-19. In addition, the survey respondents were given an empty Vigorо bag folded into quarters so that only the quadrant with the crabgrass illustration was visible, thus obscuring the parts of the Vigoro packaging that emphasized its focus on stopping crabgrass before it started, and the respondents were asked to review only that portion of the bag. The survey thus elicited information about the consumer’s reaction to an isolated part of the packaging, when the relevant issue in a false advertising case is the consumer’s reaction to the advertisement as a whole and in context. We believe that these deficiencies in the survey’s design, particularly when considered in light of the survey’s failure to focus on the critical question, weaken the relevance and credibility of the survey evidence to the point that it sheds no light on the critical question in this case. See Johnson & Johnson * Merck,
In its order granting the preliminary injunction, the district court expressed concerns about the survey evidence, noting that “the results of portions of the consumer studies are not entirely helpful or con
believed the product would “prevent” the crabgrass pictured in the graphic, this number does not necessarily demonstrate confusion. The product also indicates that it is a pre-emergent. As a result, if it is applied correctly, it will prevent mature crabgrass like the plant pictured on the package. The fact that the vast majority of respondents believe the product would “prevent” mature crabgrass, consequently, provides little insight.
J.A. 700-01 n. 7. Notwithstanding these concerns, the court relied on the survey evidence when concluding that Scotts had established a likelihood of confusion. As we have explained above, the survey evidence does not establish consumer confusion, primarily because it addresses issues that are not relevant to Scotts’ false advertising claim and yet fails to address the single question that is relevant to Scotts’ claims — whether Vigoro kills mature crabgrass. We therefore conclude that the district court abused its discretion by crediting the survey evidence.
D.
Scotts, however, contends that any deficiencies in its consumer confusion evidence are irrelevant, because it established that the defendants intentionally set out to deceive consumers about Vigoro’s effect on mature crabgrass. Although this court has not yet addressed the question, other circuits have held that, like a finding of literal falsity, a conclusion that a defendant intended to deceive triggers a presumption of consumer confusion that reheves a Lanham Act plaintiff of any obligation to present evidence of likely confusion. See Cashmere & Camel Hair Mfrs.,
The disclaimer, which is linked to the graphic by a faint cross symbol, states that “crabgrass image for illustration only as this product is for pre- and early post emergent control and does not control mature plants.” Scotts argues that “[i]f the graphic conveyed a truthful message, there would be no reason to ‘tell’ consumers in a nearly-invisible footnote that the mature crabgrass depicted ... is shown for ‘illustration only.’ ... At the very least, the disclaimer ... reveals a significant awareness of a risk that the current graphic conveys a misleading message.” Brief of Appellee at 30-31. Scotts contends that counsel for United effectively admitted the intent to deceive at the hearing when he stated to the district court that the disclaimer was intended, in part, to forestall a legal challenge by Scotts. See J.A. at 457 (“The factual point of the disclaimer was trying to keep Scotts from suing us again.”). With regard to the defendants’ “pattern and practice of mis
A defendant’s intent is a “quintessentially factual question.” United States v. McKie,
As to the disclaimer, we note that the mere fact that the defendants recognized the possibility that Scotts might sue does not inexorably lead to the conclusion that the defendants believed that the graphic was misleading and intended the graphic to deceive consumers. See J.A. at 457 (counsel for United explaining that “[sjometimes, though, even when you haven’t done anything wrong, you go ahead and you do a little bit more to try to prevent somebody from complaining”). While we do not rule out the possibility that a factfinder might attach some significance to a particular disclaimer and the circumstances surrounding its implementation when concluding that the defendant intended to deceive consumers, the district court did not do so in this case.
As to the defendants’ prior conduсt, we note that the prior actions did not involve the graphic at issue in this case, but instead centered on the cartoon “crabgrass buster” logo and a time-line suggesting that Scotts’ products had no post-emergence effect. The district court in the second action did conclude that the time-line was false, but the court did not conclude in either the first action or the sec
Seotts is of course free to make these arguments to the district court at the trial on Seotts’ request for a permanent injunction, and nothing in this opinion should be understood as suggesting any particular outcome should the issue be rаised. But because the district court did not make any factual findings with regard to whether the defendants intended to deceive consumers, it would be improper for this court on this record to apply a presumption of consumer confusion so as to excuse the deficiencies we have identified in Seotts’ evidence.
Which brings us to this point. We have concluded that the Vigoro packaging is not literally false and that Seotts- can prevail on its implied falsity claim only by presenting extrinsic evidence of likely consumer confusion. And because we have rejected Seotts’ evidence of consumer confusion (and its various arguments as to why no extrinsic evidence was required), it follows that the district court erred by applying the presumption of irreparable harm, a presumption that was dependent on Seotts’ establishing consumer confusion. We therefore proceed to consider whether the preliminary injunction can be sustained without reference to the presumption.
III.
As previously discussed, the critical issue in a preliminary injunction case involves the balancing of the harms likely to be suffered by the parties. If the plaintiff has made a strong showing that it will suffer irreрarable harm if the injunction is denied, the court must balance the likelihood of that harm against the likelihood of harm that would be suffered by the defendant. The plaintiff must make a “clear showing of irreparable harm ..., and the required irreparable harm must be neither remote nor speculative, but actual and imminent.” Direx,
Seotts contends that it will suffer irreparable injury if a preliminary injunction is not issued because it faces the risk of a permanent loss of customers and goodwill. First, Seotts asserts that the misleading statements on the Vigoro packaging will cause customers to believe that Vigoro is the superior product and will thus decrease Seotts’ sales and perhaps even tarnish its reputation. Second, Seotts contends that by duping customers into believing that there is a product that will rid their yards of mature erabgrass, the defendants “run the risk of driving consumers from the do-it-yourself lawn care market altogether,” an event that would disproportionately affect Seotts, the market leader. Brief of Appellee at 34.
These arguments fall far short of establishing an actual and imminent injury in this case. The record establishes that between now and January 2003 (when the trial is scheduled on Seotts’ claims), sales of erabgrass control products are virtually non-existent. Sales will begin increasing in February, peaking in March and April. Moreover, Vigoro products are sold exclusively at Home Depot and currently are not even on the shelves in most of those stores. Therefore, even if the Vigoro
For their part, the defendants contend that they will suffer irreparable harm from the granting of the injunction, pointing to the expense of creating new packaging and covering over the offending graрhic on existing stock, as well as the harm to their reputation that would be caused by a determination that they engaged in false advertising. The district court largely dismissed these concerns, stating that “[a]ny harm that would result from a preliminary injunction would only be the result of the Defendants’ own allegedly deceptive advertising,” J.A. 701, a fact that “should be considered in balancing the harms.” J.A. 702.
We agree with the defendants that the district court gave impermissibly short shrift to the question of the harm that would be visited upon the defendants. The harm to a defendant, particularly a defendant in a false advertising case, could almost always be described as of the defendant’s own making. If self-made harm is given substantially less weight, as it was by the district court in this case, then the balance of the harms will almost always favor the plaintiff, thus transforming a preliminary injunction from an extraordinary remedy into a routine occurrence. And when the purpose behind the requirement that the court balance the harms is recognized, it becomes apparent that it is error to dismiss as self-inflicted the harms that might be suffered by a defendant if an injunction were to issue.
“[Granting a preliminary injunction requires that a district court, acting on an incomplete record, order a party to act, or refrain from acting, in a certain way. ‘The danger of a mistake in this setting is substantial.’ ” Hughes Network Sys., Inc. v. InterDigital Communications Corp.,
If the judge grants the preliminary injunction to a plaintiff who it later turns out is not entitled to any judicial relief— whose legal rights have not been violated — the judge commits a mistake whose gravity is measured by the irreparable harm, if any, that the injunction causes to the defendant while it is in effect. If the judge denies the preliminary injunction to a plaintiff who it later turns out is entitled to judicial relief, the judge*285 commits a mistake whose gravity is measured by the irreparable harm, if any, that the denial of the preliminary injunction does to the plaintiff.
American Hospital Supply Corp.,
But in this case, any error by the district court in its consideration of the harm that would be suffered by the defendants is of little consequence, because we conclude that the defendants would suffer only minimal harm. While the defendants would incur the monetary costs of complying with the injunction by creating new packaging or placing stickers to cover the offending graphic on the existing packaging, they would be protected by the substantial bond posted by Scotts. See Hoechst Diafoil Co. v. Nan Ya Plastics Corp.,
We therefore conclude that relatively little harm would befall either side if the preliminary injunction issue were improperly decided against it. Because the balance of the harms does not tip toward either party, “the probability of success begins to assume real significance, and interim relief is more likely to require a clear showing of a likelihood of success.” Direx,
We have previously determined that the Vigoro packaging makes no literally false claims and that Scotts must therefore present evidence of consumer confusion to succeed on its false advertising claims. Because the evidence presented by Scotts is insufficient to show a likelihood of consumer confusion, Scotts has therefore failed to show a likelihood of success on the merits. This factor, then, counsels against the entry of a preliminary injunction.
Thus, after reviewing the record and considering the Blackwelder factors, we conclude that a preliminary injunction is not warranted in this case, a conclusion that flows directly from our determination that Scotts was required to present extrinsic evidence showing a likelihood of consumer confusion and that the focus group and survey evidence submitted by Scotts was not reliable or probative of the critical question in this case. The district court’s error in accepting this evidence as sufficient led it to erroneously apply a presumption of irreparable harm, which in turn led to an erroneous consideration and application of the preliminary injunction standards. We therefore conclude that the district court abused its discretion by granting Scotts’ request for a preliminary injunction. See, e.g., Quince Orchard Valley Citizens Ass’n, Inc. v. Hodel,
VACATED AND REMANDED.
Notes
. While Scotts also asserted state law claims in its complaint, the district court when granting the preliminary injunction focused only on the Lanham Act claims, and the parties likewise address only the Lanham Act claims in their appellate briefs. Any claims Scotts may have under state law, therefore, are not at issue in this appeal.
. Blaclcwelder's emphasis on the balancing of the harms rather than the likelihood of success has been criticized, even within this court, as inconsistent with Supreme Court precedent. See Safety-Kleen, Inc. v. Wyche,
. District courts within this circuit, however, have discussed or applied the presumption. See JTH Tax, Inc. v. H & R Block Eastern Tax Servs., Inc.,
. Scotts also suggests that the inclusion of the disclaimer shows that the message necessarily conveyed by the unitary graphic is literally false. According to Scotts, the disclaimer does not provide additional detail about or qualify the graphic, but instead "flatly contradicts it. Through the disclaimer, Defendants admit that Vigoro cannot do what the graphic says — ‘control mature plants.’ ” Brief of Ap-pellee at 29. If the graphic conveyed a literally or impliedly false claim, then the disclaimer might not be sufficient to eliminate the confusion. Cf. Novartis,
. As support for its claim that the defendants' prior conduct gives rise to an inference of an intent to deceive, Scotts cites to infringement cases where courts have held that a defendant who has previously copied a competitor’s trademark or trade dress must "keep a safe distance away from the margin line,” Broderick & Bascom Rope Co. v. Manoff, 41 F.2d 353, 354 (6th Cir.1930), such that subsequent design modifications by the defendant may still be found to be infringing, even if the same design by a "good faith user" would have been acceptable, Service Ideas, Inc. v. Traex Corp.,