Sued for alleged disparagement of product

[consultingsued]

Ohio.

I'm an engineering consultant and hired to provide advice for a specific industry. 2 weeks ago I received a letter from an attorney representing a company that provides equipment for this industry. They allege that companies I have consulted for have instead selected their competitor's products, and that because their product is superior both in quality and price, the only explanation is that I have slandered their company with malicious advice. Now they are threatening to sue me to stop my supposed disparagement and for damages for all their lost profits and interference with their legitimate business expectations.

What's the case law here? For what it's worth, I have never disparaged their company. I don't want to get involved in costly litigation but I also don't want to stand for nonsense and will fight if I have to.

 

[quincy]

Ohio.

I'm an engineering consultant and hired to provide advice for a specific industry. 2 weeks ago I received a letter from an attorney representing a company that provides equipment for this industry. They allege that companies I have consulted for have instead selected their competitor's products, and that because their product is superior both in quality and price, the only explanation is that I have slandered their company with malicious advice. Now they are threatening to sue me to stop my supposed disparagement and for damages for all their lost profits and interference with their legitimate business expectations.

What's the case law here? For what it's worth, I have never disparaged their company. I don't want to get involved in costly litigation but I also don't want to stand for nonsense and will fight if I have to.

You will need to find out exactly what they are claiming you said, and what sort of evidence they have that you said it, before you can know if their threats of a disparagement claim could have merit.

 

[RJR]

Agree with the quince.

 

[quincy]

Agree with the quince.

That is good to know.

 

[Taxing Matters]

Ohio.

I'm an engineering consultant and hired to provide advice for a specific industry. 2 weeks ago I received a letter from an attorney representing a company that provides equipment for this industry. They allege that companies I have consulted for have instead selected their competitor's products, and that because their product is superior both in quality and price, the only explanation is that I have slandered their company with malicious advice.

If that's the attorney's argument then he or she is really reaching on this. The argument is simply not logical. First, in most cases whether one product is superior to another in quality and price tend to be subjective things that are not easily proven. Second, lots of factors go into a purchasing decision and thus even if the attorney is correct that his/her client has the better overall quality and price it is certainly not the case that disparagement is the only explanation. If the attorney was unable or unwilling to give even a single example of your alleged disparagement in that letter that suggests to me that the attorney has no real evidence of it. If I were you, I'd alert my attorney to the issue just in case this company brings some kind of legal action, but I'd not respond to that company attorney and risk saying something that might bite me later.

 

[RJR]

"Puffery" on the complaining companies product.

 

[quincy]

I suspect if the other company has an attorney contacting consultingsued, there is far more involved than what currently has been related.

Puffery, as a note, are advertising claims that consumers cannot take seriously because they are immeasurable statements. They cannot be proved true or false. Statements like "the world's best hamburger" would be puffery.

Statements like "longer engine life and better engine performance" or "outperforms any leading motor oil," on the other hand, can be proved false - and these statements were proved false, in a false advertising claim filed against Penzoil by Castrol in 1993 that Castrol won.

 

[Taxing Matters]

I suspect if the other company has an attorney contacting consultingsued, there is far more involved than what currently has been related.

That could be, but I'll not assume that to be the case. Had the company had a stronger basis for its claim I would have expected it to say so. I've seen (unfortunately) instances in which some attorneys have pursued things on very flawed logic before so it would not entirely surprise me that this attorney is simply going on a bad theory hoping to shake some concession or money out of the OP for his client.

 

[quincy]

That could be, but I'll not assume that to be the case. Had the company had a stronger basis for its claim I would have expected it to say so. I've seen (unfortunately) instances in which some attorneys have pursued things on very flawed logic before so it would not entirely surprise me that this attorney is simply going on a bad theory hoping to shake some concession or money out of the OP for his client.

I suspect there is more to the story. I don't believe most attorneys are retained for no reason or go around making baseless threats.

 

[xylene]

Now they are threatening to sue me to stop my supposed disparagement and for damages for all their lost profits and interference with their legitimate business expectations.

If you are being threatened with a lawsuit, what exactly are they asking you to do to avoid such action?

 

[quincy]

If you are being threatened with a lawsuit, what exactly are they asking you to do to avoid such action?

Knowing exactly what was said in the letter would help.

If a company is threatening a lawsuit, however, it probably would be a good idea for consultingsued to find an attorney of his own for a personal review.

I know some large companies with large legal teams (like Disney and the NFL) will send out cease and desist letters that are based on meritless claims but most smaller businesses do not have a budget that allows for the hiring of an attorney to issue frivolous threats.

Again, I suspect there is much that has been left unsaid here.

 

[RJR]

Puffery, as a note, are advertising claims that consumers cannot take seriously because they are immeasurable statements. They cannot be proved true or false. Statements like "the world's best hamburger" would be puffery.

Statements like "longer engine life and better engine performance" or "outperforms any leading motor oil," on the other hand, can be proved false - and these statements were proved false, in a false advertising claim filed against Penzoil by Castrol in 1993 that Castrol won.

I read that case you cited, very interesting.

 

[quincy]

I read that case you cited, very interesting.

Yes. It is one of many interesting suits over false advertising.

Here is a link to Castrol v. Pennzoil, 987 F.3d 939 (3D Cir 1993): https://h2o.law.harvard.edu/cases/4774

And here is a link to the Lanham Act, 15 USC section 1125(a):
https://www.law.cornell.edu/uscode/text/15/1125

States also have false advertising/disparagement laws.