Leatherman Tool Group, Inc. v. Coast Cutlery Co., 823 F.Supp.2d 1150 (D. Or. 2012)

In Leatherman Tool Group, Inc. v. Coast Cutlery Co., 823 F.Supp.2d 1150 (D. Or. 2012), the court denied plaintiff’s motion for a preliminary injunction requesting that the court forbid the defendant from falsely stating its knives are made the higher grade steal and order the defendant to send corrective notices to retailers and customers disclosing that its knives are not made from the higher grade steal. Both plaintiff Leatherman Tool Group (“Leatherman”) and defendant Coast Cutlery (“Coast”) manufacture tools and knives. Leatherman brought a false advertising claim against Coast, alleging that the company misrepresented the strength and hardness of the steal used in its blades in advertisements. In advertisements, Coast denoted that its blades were made with a higher grade and presumably more expensive type of steel. After Leatherman filed its complaint and request for a preliminary injunction, Coast took some corrective action, including sending a request to its retailers to change their online description of Coast’s blades.

In deciding whether to issue a preliminary injunction, the court weighed the likelihood of success on the merits, balance of the equities, the public interest, and the likelihood of irreparable harm. The court found that the first three factors weighed in favor of a preliminary injunction. Leatherman did demonstrate that it was likely to succeed if the case proceeded to trial. Through its corrective action, Coast indirectly admitted to false advertising. The statements were literally false, had a tendency to deceive the public, and that the statements were material because they would undoubtedly influence consumers’ purchasing decisions. However, although the balance of equities also favored Leatherman and it is in the public interest to prevent false or misleading statements from “permeating” the marketplace, Leatherman failed to show a likelihood of irreparable harm. It did not demonstrate that the false statements caused consumers to be diverted from Leatherman or another manufacturer of knives. Therefore, the court denied Leatherman’s motion for a preliminary injunction.

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