MMR Strategy Group » Litigation Surveys & Rebuttals

When Do You Need a False Advertising Survey?

Justin Anderson — Thu, 10 Sep 2015 21:58:14 +0000

There are three kinds of false advertising claims that companies might make in their advertising or product packaging. But only one kind of claim may need a survey to provide evidence of false advertising. A recent false advertising lawsuit against a pregnancy test manufacturer demonstrates the kind of false advertising claim that may not need a survey, while a lawsuit against a beverage maker demonstrates the kind of false advertising claim that can be measured by a survey.

False Advertising in Pregnancy Testing

As the old adage states, “You can’t be a little bit pregnant.” But many expectant mothers still want to know how far along they are in their pregnancy, and they want to know as soon as possible. Clearblue Advanced Pregnancy Test with Weeks Estimator was designed with this in mind. A rival pregnancy test maker alleged that certain television advertisements and product packaging gave the impression that the product estimates how long a woman has been pregnant the same way that a doctor would estimate how long a woman has been pregnant. In a recent ruling, the court largely sided with the plaintiff in this matter.

Three Kinds of False Advertising

There are three ways in which an advertisement or other promotional claim may be false:

Literal Falsity: If a claim is factually incorrect, it is literally false. To be considered literally false, a claim must be unambiguous, meaning that there is no room for alternative interpretations. For example, in the case of the pregnancy test, the plaintiffs alleged that the product advertising and packaging unambiguously communicated that the product measures weeks since pregnancy began in the same way that a doctor would measure weeks since pregnancy began. The court determined that the claim was factually incorrect, and therefore literally false. Literally false advertising claims are illegal.

Puffery: If a claim is so obviously false that no reasonable consumer would think it could be true, it is called puffery. For example, the famed “Joe Isuzu” campaign of the late 1980s featured a spokesman who made outrageous claims about Isuzu vehicles. One such example: “It has more seats than the Astrodome!” Certainly, “Joe Isuzu” made many claims, but because they were so outlandish as to be comical, they were deemed puffery. Puffery is legal.

Implied Falsity: If a claim is ambiguous, or open to interpretation depending on its context, then it might be impliedly false. In contrast to literally false claims, which clearly deceive consumers, impliedly false claims may be false, depending on how consumers interpret the message. For example, the makers of Polar Seltzer created an ad showing a polar bear throwing a can of Coca-Cola into a garbage bin. Text in the ad read “Keep the Arctic Pure.” Although the ad did not explicitly state anything about Coca-Cola, the context and imagery was deemed to imply that Coca-Cola is not pure, and was ruled to be false advertising. Impliedly false advertising claims are illegal.

False Advertising Surveys

false advertising surveys

Conducting Your False Advertising Survey

contact the survey experts at MMR Strategy Group

Dr. Justin Anderson Vice President MMR Strategy Group

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How to Be a Survey Super Hero!

Mary Beth Pokrzywnicki — Tue, 07 Jul 2015 18:04:41 +0000

Survey Researchers and Super Heroing have a lot in common! As an avid pop-culture-loving, Comic-Con attendee for the past two decades (and I’m talking THE San Diego Comic-Con, besides its numerous contemporaries–such as Wizard World, Anime Expo, Creation Entertainment conventions, etc., etc.) and as a marketer even longer, it’s easy for me to see the correlations.

Survey Researchers and Super Heroes both save the day!

Any super hero job description has “helping people” as its number one prerequisite! Save the citizens! And that’s what Survey Researchers do–help their clients. The (red) phone rings and duty calls! Hidden secrets are revealed (in probing survey questionnaires). The defamed are vindicated (in likelihood of confusion cases). Wrongs are righted (in false advertising studies). An ongoing fight for Truth and Justice! Who else does that sound like, hmmm?

Survey Researchers and Super Heroes both have arch nemeses

Unfortunately, it’s the age-old saga of Good vs. Evil, Right vs. Wrong, You vs. Me, Company vs. Company, or Company vs. Customer. *Sigh* And oftentimes the lines are blurred… I once asked my boss, after his trial testimony in a particular litigation case, if we represented the “winning” side (i.e. the side that received the judgment). His response: “Both sides feel they should be the winning side.” Everyone believes they’re right, and deserves the same effort, the same level of customer service.

Survey Researchers and Super Heroes both have well-stocked utility belts

It’s hard to find a super hero with just one super power or one weapon in their arsenal… Superman has an embarrassment of riches, what with super strength, super speed, flight, heat vision, x-ray vision, etc. Batman has his Batarangs, grappling hook, smoke grenades, Joker-repellant, and whatever else the occasion requires. Wonder Woman multitasks with her super strength, magic lasso and invisible plane. It’s the same with a good Survey Research consulting firm (like ours!). Selecting the right type of survey or approach for the situation is a skill-set all its own, born of experience: i.e. Line-up or Eveready? Customer Journey Map? Conjoint, MaxDiff, or Discrete Choice study? A&U Research? Devising the correct plan of attack is half the battle, and it’s good to have options.

Survey Researchers and Super Heroes both have sidekicks…

…or, as we learned the correct term in Disney’s sci-fi Sky High movie, “hero support.” There’s strength in numbers, and even a super hero appreciates someone having their back: Batman and Robin. Superman and Lois Lane. And Jimmy Olsen. The assembled Avengers! And Survey Research is no exception, with a dedicated team of analysts, statisticians, report gurus, client representatives, and administrative staff to aid the testifying expert in the swift completion of her or his appointed rounds, er,…jobs. Bottom line—it takes a village (Nomanisan Island is not just the villain’s lair in The Incredibles. Think about it).

Survey Researchers and Super Heroes both delve into secret identities

So much of Survey Research is confidential. Respondents’ identities are kept secret because the thought of revelation might influence their results. Surveys have to be precisely written, with distractors and controls, in order to be valid. My favorite is creating pictorial control groups for certain trademark infringement cases–where the elements in contention are graphically modified, to test if there’s any confusion. That’s like putting glasses on Clark Kent, and seeing if anyone still recognizes him as Superman. It’s all about masks and secret identities. So that’s just some of what Survey Researchers and Super Heroes have in common. Of course, there are differences as well. For starters, Survey Researchers get paid (usually), while super heroes are (as a rule) non-profit. But that’s a story for another issue…To Be Continued! Now excuse me while I go put on my cape and mask (they LOVE when I do that in the office!).

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Three Essential Elements of a Genericness Survey

Justin Anderson — Wed, 19 Nov 2014 11:44:29 +0000

So, you need a genericness survey, but you don’t know where to begin? This article explains the process for measuring genericness. To start with, there are two main types of genericness surveys: a Teflon survey, and a Thermos survey.The Thermos survey has its merits, and it might be appropriate in some cases. However, the Teflon survey is more commonly used in genericness cases, and is the focus of this article. Here are the three essential elements of conducting a Teflon genericness survey.

Teflon Survey Step 1: Provide Definitions and Examples

After screening for qualified respondents, the genericness survey may begin. The start of the survey should explain to respondents what is meant by the terms “common or generic name” and “brand name.”

Remember, respondents are neither marketers nor lawyers, and they probably don’t know the definitions of these terms – at least not in the way that we intend them in genericness surveys. Therefore, the survey starts by providing clear definitions of the terms “common or generic name” and “brand name.”

The start of the survey also provides examples of each, most likely related to the product or service category of interest. For instance, if the case involves a term used in the dog food category (e.g., “Wilderness”), you might provide the name “Purina” as an example of a brand name, and “kibble” as an example of a common or generic term. Two examples of each term seem to be sufficient to educate respondents about the meaning of each term.

Teflon Survey Step 2: Conduct a Mini Test

After defining the terms and providing examples, the survey would verify that respondents understand the terms “common or generic name” and “brand name.” A first measure is to directly ask respondents if they believe they understand the difference between the two terms. Terminate respondents who reply that they do not understand the difference or are not sure.

Next, the survey would test that respondents who claim to understand the difference really do know it. This can be measured by displaying either a common or generic name (e.g., “organic”) or a brand name (e.g., “Eukanuba”), and asking respondents to classify the name appropriately. Respondents who select the wrong answer or reply that they don’t know would be terminated.

Finally, the survey would display an example of the other type of name, and ask respondents to classify it. Again, respondents who are wrong or unsure would be terminated. Respondents would only be allowed to proceed to the main genericness survey if they claim to understand the difference between a “common or generic name” and a “brand name,” and if they correctly classify two terms as either a common or generic name or as a brand name.

Teflon Survey Step 3: Conduct the Main Genericness Survey

Finally, the survey measures the genericness of the name at issue (e.g., “Wilderness”). Just like in the mini test, the survey would display the name, and ask respondents to classify it as either a common or generic name, or as a brand name. (The survey would usually provide a “don’t know” option, as well.)

Additionally, the survey would display several other names relevant to the category, or closely related to it, and ask respondents to classify each term. Genericness surveys often test 6 to 8 additional terms, and display and measure each individually. These 6 to 8 terms include a mix of common or generic names and brand names. In the dog food example, the survey might test common names such as “grain-free” and “healthy,” and brand names such as “Pedigree” and “Blue Buffalo.”

In addition to terms from the same category, the survey might also test terms from related categories, such as “leash” or “Tuffy” (a brand of durable dog toys). These additional terms serve as controls and provide comparison measures for the results of the genericness survey.

Conduct Your Genericness Survey

These are the three essential steps of the Teflon format, but there are many more details to consider in any genericness survey. For assistance, contact the survey experts at MMR Strategy Group.

Dr. Justin Anderson
Vice President
MMR Strategy Group

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Apple v. Samsung: The Next Round of Survey Evidence

Bruce Isaacson — Mon, 12 May 2014 11:35:52 +0000

Most readers of this blog know that over recent years, Apple and Samsung have engaged in high-profile litigation over certain patents used in smartphones and tablets. A decision was just provided in a trial involving five patents from Apple, and two patents from Samsung.

In 2012, I wrote a blog post on the litigation surveys used in an earlier trial, which involved patents relating to earlier models of smartphones and tablets.

The ruling in the 2014 trial appears to be mixed. Apple was awarded almost $120 million in damages, and Samsung was awarded approximately $158,000 in damages. These amounts are not very large, particularly compared with the $2.2 billion that Apple had been seeking or the $6.2 million that Samsung had sought. As with the 2012 trial, litigation surveys were both provided and rebutted in this matter.

There are summaries of this trial in sources such as The New York Times and Fortune. This blog post discusses the litigation survey evidence presented in the 2014 trial. (A general caveat: I was not involved in this matter. I wrote this blog post from public sources, and am not providing an opinion regarding any side’s argument or witnesses.)

A Litigation Survey Using Conjoint Analysis

In the 2014 trial, Professor John Hauser, from the Massachusetts Institute of Technology, provided survey evidence relating to the value of certain patents used in smartphones and tablets.

As in the 2012 trial, Professor Hauser used a method called conjoint analysis to measure the importance of certain features in Samsung products that rely on the patents at issue. Those features include universal search, automatic word correction, and slide to unlock. The survey conducted by Professor Hauser evaluated consumers’ willingness to pay for those features, and also measured the decrease in demand for Samsung products without those features.

Basically, conjoint is a method used to estimate the demand for certain elements in complex products, such as automobiles or electronics. In a conjoint study, respondents are shown different configurations of product profiles. By measuring consumer preference for the different configurations, conjoint can measure the value of specific features.

You can learn more about conjoint from a white paper I’ve written, which is available here. You can read more about Professor Hauser’s testimony, as well as the rebuttal testimony, at websites including theverge, Electronista, Bloomberg, and ZDNet.

Rebuttal of the Conjoint Survey

Professor Hauser was rebutted and/or cross-examined by three separate people, all of whom argued that Hauser survey misstated the value of the patents at issue. I’ve summarized their testimony below.

First, counsel for Samsung cross-examined Professor Hauser, arguing that key influences on consumer buying decisions were not included in the survey, such as the value of Samsung’s brand and marketing.

Second, Wharton Professor David Reibstein, a rebuttal witness, questioned Professor Hauser’s methods and conclusions. Professor Reibstein argued that the research was biased, and did not provide valid measures because it asked only about certain features, and did not ask about the most important features. Professor Reibstein compared this to asking consumers what cup holder they would like in a car, rather than asking about more important features such as their preferred manufacturer.

Professor Reibstein also conducted his own research with a smaller sample, which he maintains indicated that consumers do not understand the features involved in Professor Hauser’s conjoint survey.

Third, Tulin Erdem, professor of business and marketing at New York University, also rebutted Professor Hauser. She argued that Professor Hauser’s research only asked about certain features and not about other features. According to Professor Erdem, this would tend to elevate the value and importance of those features, by motivating consumers to think about features they normally would not consider in such detail.

What We Can Learn From This Litigation Survey

The ongoing battle between Apple and Samsung has been high profile, and this trial received a lot of press. Apple and Samsung are interesting, successful, and well-funded adversaries, and they compete in markets that are important and rapidly-changing. There is even evidence that Google helped fund some of Samsung’s legal fees in this matter. Because smartphones and tablets are markets that move so rapidly, these trials and these patents could have implications for innovations in these important products.

Despite the high stakes, the outcome in this round is less conclusive. Although Apple and Samsung spent a lot of time and a lot of money on this trial, they ended up with a mixed verdict – both sides were awarded something, but neither side was awarded what they had requested. Even the jury foreman, who has expertise with IBM in software and patents, states that he did not see the verdict as sending a message. This matter is likely not over, as both sides have promised to appeal.

However, the trial does provide a good example of how litigation surveys are often evaluated in court. Professor Hauser is one of the pre-eminent experts on conjoint. The opposition in this matter cross-examined Professor Hauser, and also brought in two additional experts to provide rebuttal testimony. Both sides spend a lot of effort and a lot of money either providing or rebutting the litigation survey.

It is not unusual for a survey offered in litigation to be questioned or rebutted by opposing counsel and multiple experts. When a survey is important to the litigation, and the litigation has high stakes to the parties involved, it is likely that the survey will attract extensive criticism from opposing parties. Conjoint is a particularly complex methodology, but this basic principle applies across a wide range of litigation surveys.

Dr. Bruce Isaacson
President
MMR Strategy Group

The post Apple v. Samsung: The Next Round of Survey Evidence appeared first on MMR Strategy Group.

Survey Evidence to Evaluate Religious Freedom, Discrimination and a Dress Code Sign

Bruce Isaacson — Fri, 28 Feb 2014 12:16:38 +0000

Some readers will no doubt have heard about the recent case in Williamsburg, Brooklyn, involving seven Chassidic shop owners who posted a dress code sign in their shops. The sign required that shoppers be modestly dressed, and was written in English, Hebrew, and Spanish. According to the sign, “Shorts,” “Barefoot,” “Sleeveless,” and “Low Cut Neckline” were not allowed in the store. See the sign to the left.

The storeowners were sued by the New York Commission on Human Rights, an organization that addresses discrimination matters (what the Commission calls “Human Rights”) in New York City. The Commission argued that the sign discriminated on the basis of gender and creed, and wanted the sign taken down and the store owners fined on the basis of discrimination.

The law firm of Kirkland & Ellis took on the matter on a pro bono basis, arguing that the sign was not discriminatory and that the real issue was the storeowners’ freedom of religion. Kirkland & Ellis retained MMR Strategy Group to conduct a survey in the matter, which we conducted at a reduced rate. The Commission conducted their own survey.

I do not know of any other cases involving litigation surveys to measure perceived discrimination. This post provides an overview of the matter, discusses the two surveys, and describes the outcome.

Freedom of Religion versus Freedom from Discrimination

A lot has already been written about this matter, much of it critical of the Commission’s position. For example, the New York Post published an editorial with the headline, “Discrimination lawsuit against Hasidic stores silly.” The Weekly Standard called the Commission’s activities a “half-baked inquisition.”

The seven stores are all owned by Chassidic (ultra-Orthodox) Jews who belong to a particular branch of Judaism called “Satmar.” Satmar Chassidim live what many would describe as an insular and religious life, which is focused around their community. Their tight-knit community offers what they believe is a defensive mechanism to preserve their way of life against the encroachment of outside influences. Satmar Chassidim dress in very modest clothes, including long dresses for women, and long pants for men, in any season.

The shops involved, in all likelihood, primarily serve the local Satmar community. The stores are small and are located within a few blocks of each other, on Lee Avenue in Williamsburg, Brooklyn. Some of them sell items such as Satmar-oriented styles of clothing, kosher foods, invitations for bar mitzvahs, or household items that a person is unlikely to want unless they are part of the Satmar community.

Elsewhere in Brooklyn, including in other parts of Williamsburg, many neighborhoods are filled with a very diverse population, including urban trendsetters and hipsters who dress very differently than Satmar Chassidim. Brooklyn is a popular and trendy locale, the home of Jay-Z, the Barclays Center, and lots of urban renaissance. It is a melting pot where many residents view themselves as progressive and outspoken.

The mix of different demographics and lifestyles in and around Williamsburg shows how this matter can raise issues of freedom of religion versus freedom from discrimination.

On the one hand, the Commission argued that the sign subtly suggests that certain types of people are not welcome in the store, such as women or perhaps even non-Jews. Kirkland & Ellis, on behalf of the storeowners, argued that the sign was addressed equally to men and women, and that all people who were modestly dressed were welcome in the store. Kirkland & Ellis also argued that dress code signs are commonplace, as in the familiar sign that states “No shirt, no shoes, no service.”

Two Litigation Surveys Measuring Discrimination

Two surveys were submitted in this matter, one from me and one from the Commission on Human Rights. I conducted my survey among people representative of those who might see the sign in New York City. My survey measured discrimination based on a standard which defines discrimination as any practice making ordinary people feel uncomfortable on the basis of religion or gender.

Specifically, my survey measured whether ordinary people who might see the sign believe that a store displaying the sign would make typical people:

feel unwelcome based on gender,
feel unwelcome based on religion, or
feel that the store welcomes men only.

In addition to testing pictures showing the sign in front of the store, my survey also tested a “control,” which consisted of the stores without the sign. The results of my survey showed that the sign was not discriminatory according to the standard described above. For example, the vast majority of respondents felt that the store, even with the sign, welcomes both men and women.

The Commission, meanwhile, conducted their own survey. The Commission’s survey was written by Commission staff people, with the data gathered by interviewers hired by the Commission. At least by my analysis, the Commission’s survey also showed that the sign contributed relatively little towards the key measures relating to discrimination.

Due to confidentiality requirements, I cannot describe my survey or the Commission’s survey in more detail.

A Settlement Based in Part on Litigation Surveys

In the end, the two sides settled just before trial. There will be no fines against the stores, and the stores will be allowed to retain the dress code sign in a modified version that makes clear that everyone is welcome.

In my opinion, this is a reasonable solution for both sides. I was told, and believe, that the survey evidence presented helped convince the Commission that it made sense to settle this matter.

I also believe that the sign is not discriminatory and that the stores should have been allowed to keep the sign in some version. I was surprised that the matter took so long to resolve, but the Commission was determined to pursue this matter.

Most of all, I’m grateful that I live in a country that believes both in freedom from discrimination and freedom of religion. This case required a balance between the two. The process of resolving that balance was not fast and not easy, but it worked in the end. I am grateful to Kirkland & Ellis (particularly Jay Lefkowitz, Devora Allon, Chris Reigstad, and Terence Leong) for involving me in the process of resolving this matter, and for their efforts on behalf of the storeowners.

Dr. Bruce Isaacson
President
MMR Strategy Group

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Secondary Meaning Survey Helps Resolve Dispute Over Phrase Made Famous by President Reagan

Bruce Isaacson — Wed, 04 Sep 2013 13:04:10 +0000

“Peace through Strength,” a famous slogan popularized by President Ronald Reagan, has been under attack. Trademark attack, that is. The Center for Security Policy (CSP) believes that this historic phrase should be utilized as widely as possible and enlisted the American Freedom Law Center (AFLC) to provide legal assistance. As in many trademark protection cases, expert testimony is critical. The AFLC hired Dr. Bruce Isaacson, President of MMR Strategy Group, to provide expert testimony. Dr. Isaacson conducted a secondary meaning survey and provided analysis that has since helped the AFLC win in a settlement agreement. Secondary meaning occurs when consumers associate words or phrases with a single source. One way to measure consumers’ mental associations is through secondary meaning surveys.

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Tiffany vs. Costco: Possible Types of Litigation Surveys

Bruce Isaacson — Sun, 04 Aug 2013 13:23:58 +0000

In February, 2013, Tiffany & Co. filed a trademark suit against Costco, accusing Costco of, among other charges, trademark infringement, dilution, counterfeiting, unfair competition, false and deceptive business practices, and false advertising.

Despite the long list of charges, the central issue in the case is straight forward. Tiffany wants Costco to stop referring to certain types of diamond engagement rings as having “Tiffany” settings. While Costco claims that consumers understand this term to refer to a common setting for a diamond, Tiffany claims the term refers to Tiffany & Co, the retailer.

This case is between two large companies who run successful brands and have a lot at stake. If this matter is not settled soon, both sides may find that they need to conduct intellectual property surveys, particularly on issues such as likelihood of confusion, genericness, or secondary meaning. This post describes the core issues and explains the types of intellectual property surveys each party might decide to conduct.

The Basics of Surveys for Confusion, Genericness, and Secondary Meaning

The matter focuses on a particular type of setting for an engagement ring. A Tiffany-style solitaire ring has a diamond mounted onto a single band with six slender prongs.

Costco says this is a generic term for a type of setting popularized by Tiffany’s founder back in 1886. Costco maintains that the term “Tiffany setting” is commonly used, and even appears in the dictionary. As Costco’s lawyer has stated, “It’s like Phillips screwdriver, it’s like Murphy bed, it’s like Ferris wheel.”

Tiffany argues that by using this term, Costco is creating a likelihood of confusion with rings sold by Tiffany. After all, Costco is known for selling other high-end goods which come from well-known manufacturers. Tiffany also claims that Costco has described some of the rings as Tiffany rings, not just as having “Tiffany settings.”

Costco maintains that the likelihood of confusion is low – its rings are sold in plain beige gift boxes, which do not resemble Tiffany’s well-known blue boxes, and Costco sells its rings with a Costco receipt, not a Tiffany’s receipt.

Tiffany counters that at retail, Costco referred to this type of ring as a “Tiffany ring,” which, says Tiffany, has the potential to confuse consumers. As Tiffany wrote in its initial complaint, “We now know that there are at least hundreds if not thousands of Costco members who think they bought a Tiffany engagement ring at Costco”.

Read the Tiffany lawsuit (.pdf) and the Costco countersuit (.pdf) here.

Given how much is at stake, both sides are likely to undertake litigation surveys, particularly on issues such as likelihood of confusion, genericness, and secondary meaning. The remainder of this post explains all three types of litigation surveys and how they might fit into the case. (Disclaimer: I have not been engaged by either side. I’m writing this post based on what materials in the public domain and my experience. Also, the surveys described below address word marks and not trade dress or product design.)

Likelihood of Confusion, Confusion Surveys, and Tiffany Settings

One of the central issues in the case is the likelihood of confusion, which measures whether or not consumers believe that the particular ring setting sold at Costco comes from Tiffany, or was endorsed or approved by Tiffany for sale at Costco. The Lanham Act and other regulations allow manufacturers to protect their brands from marketplace confusion, and protect consumers from business practices that cause confusion or mistakes about the source of products or services.

Courts have a number of standards to evaluate the likelihood of confusion; for example, depending on the jurisdiction, courts may use use guidelines such as the Sleekcraft Factors or the Polaroid Factors to evaluate whether consumers are likely to be confused. Confusion surveys are one of the most common methods of measuring the likelihood of confusion.

I’ve written about confusion surveys before, and you can read my posts on confusion surveys here. There are two main formats for confusion surveys, often called Eveready or Lineup. For either format, the survey tests whether or not consumers are likely to believe that the settings in question come from, or were approved or endorsed by, Tiffany & Co.

Genericness Surveys and Tiffany Settings

A second question in this matter is whether “Tiffany setting” is a generic term for a type of setting with a single gemstone mounted on multiple prongs. This issue might be addressed by conducting a genericness survey.

There are two primary formats for conducting genericness surveys. In one format, called “Teflon,” respondents are told about the difference between a generic term and a brand name, given examples of each, tested on the difference, and then asked to sort a series of terms as either generic or representing a brand name.

In another format, called “Thermos,” respondents are asked questions to elicit the names that they would use to ask for a type of product, or describe a type of product. In the original Thermos case, respondents were asked questions to determine, among other things, what they would call an item that kept beverages cold or hot.

This article in The Trademark Reporter provides more detail on both types of genericness surveys.

Secondary Meaning Surveys and Tiffany Settings

Secondary meaning may also be the subject of surveys in this matter. A secondary meaning survey measures whether customers associate a trademark or trade dress with a single source, and, for some secondary meaning surveys, whether they associate that source with the plaintiff or with the defendant.

In this matter, a secondary meaning survey might measure the percentage of respondents who have heard of the term “Tiffany setting”, and who associate it as coming from only one company. It might also measure whether consumers associate that term specifically with Tiffany & Co. Alternatively, a secondary meaning survey may measure secondary meaning relating to the specific setting.

To find out more about secondary meaning surveys, watch this video on How to Measure Secondary Meaning in a Litigation Survey.

In my opinion, a secondary meaning survey is likely to show either that the term “Tiffany setting” is associated with the retailer Tiffany & Co., or not. It is more difficult to predict whether consumers would associate a picture of a specific ring setting with Tiffany & Co.

Litigation Surveys, Confusion, Genericness, and Secondary Meaning

I’ve written in this post about the role that a confusion survey, a genericness survey, and a survey of secondary meaning might play in this matter. The matter is made more complicated because it involves both trademarks, such as “Tiffany,” and trade dress, such as the look of a particular type of setting.

Stay tuned. I’ll write more on this matter as it proceeds.

Dr. Bruce Isaacson
President
MMR Strategy Group

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Don’t Miss! Advertising Claims Support: Case Histories and Principles

Elesia Kreinces — Thu, 07 Mar 2013 07:47:43 +0000

Many of MMR Strategy Group’s clients increasingly find that claim substantiation and advertising substantiation are important areas of focus for their marketing communications.

Dr. Bruce Isaacson, President of MMR Strategy Group, will be speaking at the Advertising Claims Support: Case Histories and Principles conference presented by The Institute for Perception, April 8 – 10, 2013, at The Greenbrier in White Sulphur Springs, WV.

At the conference, Dr. Isaacson will discuss how surveys are used to substantiate advertising claims and what is required to substantiate or refute a claim.

Other speakers at this multi-day conference include a host of experienced attorneys, researchers, and industry authorities, including:

David Bernstein, Litigator – Debevoise & Plimpton, LLP
Chris Cole, Litigator – Crowell & Moring
David Mallen, Deputy Director – National Advertising Division (NAD) of the Better Business Bureau
Kat Dunnigan, Senior Staff Attorney – National Advertising Division (NAD) of the Better Business Bureau
Nancy Felsten, Advertising & Marketing Lawyer – Davis Wright Tremaine, LLP
Don Lofty, former Internal Counsel – S. C. Johnson & Son, Inc.
Lawrence Weinstein, Litigator – Proskauer Rose, LLP

Dr. Daniel Ennis, President of The Institute for Perception has stated that, “How a survey or product test is planned, executed and interpreted is often the persuasive element in an advertising claim dispute.” This conference will help attendees understand how to design, implement, and analyze surveys for claim substantiation and advertising substantiation.

The post Don’t Miss! Advertising Claims Support: Case Histories and Principles appeared first on MMR Strategy Group.

How to Measure False Advertising in a Litigation Survey

Bruce Isaacson — Mon, 05 Nov 2012 13:51:37 +0000

False advertising surveys are frequently used in intellectual property matters. This post describes the circumstances when false advertising surveys are typically used and explores the expectations and requirements for designing and executing a false advertising survey.

False advertising surveys focus on implied statements rather than literal falsity

By “false advertising”, I refer to the question of whether or not some type of communication – typically advertising, product packaging, or another form of marketplace communication – provides a false or misleading description or representation. False advertising is addressed in Section 43(a) of the Lanham Act. Typically, there are at least two types of falsity: literal falsity, when a communication is literally false, or implied falsity, when an item “… has a tendency to deceive a substantial segment of the target audience.”

Surveys are most often used for resolving matters involving implied falsity, because they measure the meaning that customers and prospects perceive from an item such as an ad or a package.

False advertising studies involving causality use a control

Matters involving false advertising typically ask whether or not a package, ad, or other type of stimulus causes an impression to be formed in the minds of the viewers. Because false advertising surveys examine issues involving causation, they typically must use a control.

The control is an item that is as similar as possible to the original stimulus, but removes the objectionable elements. For example, I once conducted a study that measured whether a consumer product had deceptive claims stated on its packaging. For this study, my false advertising survey tested two versions of the package: the actual package used in the marketplace, including the language disputed by the plaintiffs, as well as an otherwise-identical package that replaced any potentially-objectionable language with non-objectionable copy.

By comparing the difference between the two, my survey measured whether or not language used by the defendant caused certain impressions to be formed among relevant consumers.

You can learn more about controls in a brief video I’ve recorded.

False advertising surveys have a specific order

False advertising surveys typically follow a specific format, which involves showing a product or ad to respondents, then measuring their impressions immediately after they have seen the stimulus. Often, the item is presented in a format that matches marketplace conditions. For example, if the survey involves a food item typically seen in grocery stores, the false advertising study might show the item to respondents in an in-person setting. By contrast, if the item is software or an online service, the study is more likely to be conducted online.

After showing the stimulus, a false advertising study usually asks general questions first, such as, “What are the main messages conveyed by the advertisement?” Questions such as these, which are answered in the respondents own words, can help measure:

whether the respondent is paying attention,
whether the respondent understands the main purpose of the ad, and
the main messages conveyed by the ad.

Because this type of open-ended question is answered with verbatim comments, the resulting data can be analyzed in a quantitative manner by “coding”, which counts the number of responses that reflect specific themes of interest.

Most (but not all) false advertising studies will progress from general questions to more specific questions about certain messages possibly communicated by the ad, such as how a product or service operates, how it compares to alternatives, or the benefits provided by the product or service.

Most (but again, not all) false advertising surveys include questions to measure both the messages conveyed by the item, and the materiality of those messages. By materiality, I mean whether the messages are likely to affect marketplace purchase decisions in a meaningful way. For example, a false advertising survey might ask respondents whether certain information would affect their likelihood to purchase an item, or to recommend an item for purchase in their organizations. There are many different ways to phrase questions involving materiality.

What does this mean for your false advertising survey?

Litigation surveys, such as those used to measure false advertising or other types of advertising claims, must follow a specific and detailed set of standards that are specific to the context and differ from traditional market research. You can learn more about these standards in the “Reference Guide on Survey Research”, by Shari Seidman Diamond.

This post has provided just a few examples of the many elements to be considered in designing and executing a false advertising study. As you consider these elements, keep in mind that every study must reflect the specific conditions involved in the matter, the industry, and the product involved.

Dr. Bruce Isaacson
President
MMR Strategy Group

The post How to Measure False Advertising in a Litigation Survey appeared first on MMR Strategy Group.

How Trademark Surveys Measure Patent Infringement and Damages

Bruce Isaacson — Wed, 31 Oct 2012 07:02:19 +0000

Surveys are commonly presented in litigation matters involving Lanham Act issues such as trademarks and false advertising. Increasingly, litigation surveys are also used to estimate damages in patent infringement matters.

This post explores the use of surveys to assess damages in patent litigation, describing the reasons for their use, the issues they measure, and some of the ways in which surveys can assess damages in patent litigation.

Why Surveys Are Used To Assess Damages in Patent Litigation

Surveys are increasingly referenced by courts as a means to support damage assessment in patent infringement matters. Historically, there have been three ways to assess damages. Using definitions from Compensatory Damages In Patent Infringement Cases: A Handbook for Federal District Court Judges, the three methods are based on:

Lost profits: The profits that would have been made by the patentee if the infringement had not occurred.
Established Royalty: Royalties based on the patentee’ established or regular royalty rates.
Reasonable Royalty: Although there are a variety of approaches to reasonable royalties, one approach is what a willing licensee would have paid, and what a willing licensor would have accepted, if the license was negotiated just before the infringement started. The negotiation, although hypothetical, considers factors known as the Georgia-Pacific factors.

Surveys may be helpful in patent infringement matters in those cases where there is no history upon which to calculate established or regular royalty rates. In such cases, surveys can measure customer attitude and behaviors in areas such as the following:

Consumer buying behavior, including the criteria that are considered in the buying process.
Commercial success and sales.
The ways that products or specific features are used, as well as the manner of their use.
The communications that customers receive in the marketplace.
Customer attitudes and impressions in the marketplace.

Surveys can also be helpful in patent infringement matters because they can directly measure issues relevant to the Georgia-Pacific factors. As described in an article by Christopher Larus and Bryan Mechell, “Using Consumer Surveys to Prove Patent Infringement Damages at Trial”, surveys may help measure factors such as the following:

The Sixth Factor: The effect of selling the patented item on sales of the licensee’s other products, and the value of the invention to the licensor on sales of other non-patented items.
The Eighth Factor: The profitability, popularity, and/or commercial success of products made under the patent.
The Tenth Factor: The character of the invention in the marketplace, and benefits of the invention to those who use it.
The Eleventh Factor: The extent to which the accused infringer used the invention and the value of the use.
The Thirteenth Factor: The portion of profits attributable to the invention as opposed to other non-patented elements.

Surveys in patent infringement matters allow parties to measure the above items directly, by simply asking customers. They are particularly helpful because patents often involve business-to-business markets, where there may be very little data otherwise available on customer behaviors, marketplace sales, and other relevant issues.

Where Have Surveys Helped Assess Damages in Patent Infringement Matters?

Recent matters that have used surveys to measure customer actions, impressions, and attitudes include the following:

Apple v. Samsung: As I’ve described in another post, surveys were presented in this matter to measure likelihood of confusion and secondary meaning. In addition, a conjoint study was presented to measure the value that customers attribute to certain product features.
Applera v. MJ Research: A survey was used in this patent infringement matter to measure how customers used certain machines, both in terms of the techniques they used and the frequency of performing those techniques.
i4i Limited Partnership v. Microsoft Corp: A survey of customers in this patent infringement matter showed that only about 2% of customers who own the software at the heart of the case used the patented feature under dispute. The survey results had a significant impact on damages calculations.

While the cases above show the ways that surveys can be used in patent infringement matters, other cases, such as Fractus v. Samsung, show that surveys in patent infringement matters (as other litigation surveys) are held to strict standards. Among other criteria, they must focus on the technology involved in the matter.

What Types of Survey Questions Can Be Used to Assess Damages in Patent Infringement Matters?

The surveys used in patent infringement matters can employ a variety of formats to gather data from respondents. To demonstrate the various formats, let’s assume that a hypothetical and fictional patent infringement matter focuses on a patented component used in a laptop computer. Let’s further assume that the survey is intended to measure marketplace practices for damages assessment.

The types of survey questions used in this kind of matter might include the following:

Ratings: Ratings questions ask respondents to use a numerical scale to indicate their response to a particular question. In our hypothetical case, the question might ask respondents to rate the items important to them in their decision to purchase the laptop computer, using a 1 to 5 scale from “not at all important” to “very important”. Although ratings are easy for respondents to provide, respondents often prefer more of most features rather than less. A ratings scale, if not properly constructed, can end up with many different attributes with high ratings.
Rankings: Rankings questions solve one of the problems with ratings by asking respondents to rank the attributes, perhaps from greatest interest to lowest interest, or perhaps picking the top attributes from a larger list. The rankings force some attributes to rise to the top, and others to the bottom.
Choice-Based Methods: Choice-based methods present a series of choices to consumers, and ask them to indicate which features or which combinations of features are preferred, and which are less preferred. In other words, choice-based methods force consumers to make choices. Two of the better known methods are Conjoint and MaxDiff. These methods can provide more sophisticated measurements of preference for certain features, and can indicate how much consumers would be willing to pay for certain features. They are, however, complex and must be designed and explained properly.

What Does the Future Hold for Surveys in Patent Infringement Matters?

In my opinion, we are likely to see more surveys in patent infringement matters for a few reasons. First, courts seem to be moving away from the “Entire Market Value Rule”, which assesses damages based on the value of the entire product rather than the specific patents involved in the matter. Surveys provide evidence that, used appropriately, may help match awards and infringement.

A second and closely related reason is that surveys can help validate some of the assumptions behind damage assessments conducted by economists. In recent cases, such as Lucent Technologies v Gateway, Cornell University v. Hewlett-Packard, or LaserDynamics v. Quanta Computer, courts have asked experts to link damage calculations to consumer demand; surveys provide a way to create this linkage.

A third reason is the comparison with trademark cases, particularly those involving issues such as false advertising, likelihood of confusion, or secondary meaning. In recent decades, courts have increasingly turned to surveys as a (relatively) efficient way to develop quantitative evidence gathered scientifically from consumers. Given the high stakes in damage assessment in many patent litigation cases, it is natural to expect that the demand for surveys will grow over time in a similar manner.

Dr. Bruce Isaacson,
President,
MMR Strategy Group

The post How Trademark Surveys Measure Patent Infringement and Damages appeared first on MMR Strategy Group.