Readers will recall June 2012 was a very busy time for counsel representing Millennium Laboratories (ML) and Ameritox in a lawsuit in which ML accused Ameritox of violations of the Lanham Act (false advertising). The issues in June began soon after both parties agreed, in a consent order, to measures that would end the lawsuit. A flurry of legal activity ensued. What follows is a brief summary of the legal wranglings and the ultimate conclusion of the case. For a very nice but longer summary of this case from beginning to end, please see the judge’s summary memorandum.
Almost immediately after the parties signed the consent order, ML put out a press release (PR) stating a “Federal jury” found Ameritox’s:
…advertising claims about its Rx Guardian and Rx Guardian CD medication monitoring system to be literally false and material, and “actually deceives or had the tendency to deceive” physicians.
The PR went on to describe in a little more detail the advertising infractions and the remedies the judge ordered Ameritox to undertake. Within hours, Ameritox filed for, and was granted, a restraining order preventing ML from distributing the PR, which Ameritox said contained both misleading information and information still under seal.
The following day, Ameritox filed to convert the restraining order to a preliminary injunction and also filed a new lawsuit against ML, claiming the contents of ML’s PR amounted to false advertising. As I stated in my post on this matter, Ameritox took issue with the fact that:
The jury was only an advisory jury, not a “deciding” jury; ML falsely claimed Ameritox has pursued a years-long false advertising campaign; that the jury found Ameritox lied to physicians; that the court ordered Ameritox to take corrective advertising action.
The judge found, at least preliminarily, ML’s PR did contain misleading information and granted the motion for the injunction.
Ameritox then put out its own PR, which sought to clarify what the consent order actually contained and that the judge had preliminarily found ML’s press release to be misleading. From Ameritox’s press release regarding the contents of the consent order:
NO NEED exists for Ameritox to change its current products or services. NO financial damages of any nature were awarded. NO adverse ruling was made by the Court as to the science behind Ameritox’s industry-leading Rx Guardian CD, despite Millennium’s misleading claims to the contrary. Rx Guardian CD will continue to be offered WITHOUT CHANGE.
At some point, ML also filed an additional suit against Ameritox, alleging new Lanham Act violations in Ameritox’s PR.
After all this rapid fire back and forth, the judge decided to coalesce all of the cases into one and then told Ameritox and ML he was preparing to summarize everything that had happened to date and then dismiss the case with prejudice. To dismiss with prejudice means the case is over forever and cannot be refiled. The judge filed his summary of the case on January 18, 2013 and dismissed the case soon thereafter in a separate order.
The judge states the following as justification for dispensing of this case in this fashion. One, the court that issues a consent order has authority to resolve issues associated with the consent order and can also prevent a party from making misleading statements about ongoing litigation. Two, both Ameritox and ML asked for a jury to resolve these issues, and the judge said it would be “unconscionably wasteful of both judicial and private resources” to ask a jury to review “thousands of pages of pleadings, orders, exhibits, and transcripts.” Three, it would require speculation to reach the conclusion any of the statements made in either party’s PRs actually caused damage to either company.
There is one part within the judge’s summary that indicates, at least to me, the judge was somewhat irritated with both parties. After the consent order was signed, the judge
…also cautioned the parties that it had no intention of refereeing the advertising war that would likely follow the Order’s publication. This proved a vain hope. Hostilities resumed within hours.
I was interested to see how Ameritox and ML felt about the way in which the case reached its conclusion.
According to Lon Wagner, Director of Communications at Ameritox,
Ameritox is satisfied with Judge Legg’s dismissal of the remainder of this case, and we are content to let his memorandum speak for itself.
ML did not provide me with a comment.
While this case may be over, there are still several lawsuits between Ameritox and ML that are slowly making their way through the courts.
The judge’s full summary of this case is here.