Standing Out: A Commonsense Approach to Standing for False Advertising Suits under Lanham Act Section 43(A)
Gerald P. Meyer | 2009 U. Ill. L. Rev. 295
This Note analyzes the benefits and shortcomings of the varying ap-proaches federal circuit courts have taken when determining which plain-tiffs have standing to sue for false advertising under section 43(a) of the Lanham Act. Some circuits have adopted a categorical approach, focus-ing on the relationship of the parties, and requiring the plaintiff to be a direct competitor of the defendant that has suffered a competitive injury to have standing. Other circuits implement a quasi-categorical approach that requires the plaintiff to have a reasonable interest in being protected by the Act and a reasonable belief that the alleged false advertising was damaging in order to have standing. Finally, other circuits have used a somewhat overlapping five-factor balancing test to determine whether the plaintiff has standing.
After conducting a thorough analysis of each approach, the author rea-sons that each one has significant flaws, ultimately causing uncertainty for plaintiffs contemplating litigation under the Lanham Act. As a recent example, in Phoenix of Broward, Inc. v. McDonald’s Corp., the Eleventh Circuit reached a puzzling result that would seemingly vanquish a plaintiff’s right to sue for false advertising under the Lanham Act in any market with several competitors. The author determines that none of the approaches is satisfactory and explores an innovative three-prong bright-line test designed to reconcile the legislative intent of the Lanham Act with the realities of the marketplace. The author concludes that this new test would be easier to apply than each approach currently in operation and would provide consistent and predictable results, which would also allow litigants to settle and relieve the burden on the federal court system.