which they sought permission to broadcast. "Directions 2"
mirrors "Directions" except for two modifications. One
difference is Woman # 3's response to the query "Cash?" by Man
# 1 holding up the American Express Card. Instead of saying
"You know, the thing is, not with that card. That's the
problem," she now responds "You know, the thing is, with that
card I don't know where. That's the problem." The other
alteration was made to the announcer's statement as Man # 1's
car crosses the bridge. Instead of "Looking for cash without
MasterCard can lead you nowhere," the announcer now says
"Looking for cash without MasterCard isn't exactly easy."
Although plaintiff admitted that the modifications addressed
its first two allegations, plaintiffs claimed that "Directions
2" was still false in two ways: (1) that the new commercial
falsely states that an American Express Card holder must travel
to remote locations to get cash with her card, and (2) that it
falsely states that is difficult to get cash with the American
Express Card. Therefore, plaintiff continued to seek an
injunction with respect to the new commercial.
On October 10, 1991, the court ruled orally that the
temporary restraining order applied to both "Directions" and
"Directions 2" while the outcome of the hearing was pending.
II. Findings of Fact
After hearing the evidence and weighing the testimony and
exhibits received in evidence, as well as the credibility of
the witnesses, the court makes the following findings of fact:
1. There is no reason to expect that the first commercial,
"Directions," will ever be broadcast again. Counsel for
defendant MasterCard represented that "Directions" will never
again "see the light of day." (Tr. 3). At the hearing,
defendants were prepared to stipulate that "Directions" will
not be broadcast in the future. (Tr. 3). Plaintiff presented no
evidence that "Directions" was broadcast after the temporary
restraining order was issued on October 2, 1991,*fn1 nor did
plaintiff express any reason to believe that "Directions" would
be broadcast in the future.
2. The new commercial, "Directions 2," is not explicitly
false in any way. The advertisement compares the relative
ability of American Express Card and MasterCard holders to find
locations where they can get cash with their card.
3. "Directions 2" does not discuss the steps that holders of
either the American Express Card or MasterCard must follow in
order to access cash in some way. Therefore, it is assumed that
the American Express Card holder in the new commercial has
already established the facility to access cash in some manner
using his card. Any difference in the procedure an American
Express Card holder or MasterCard holder must follow in order
to establish the ability to get cash with their card is of no
import to this case.
4. Nor does "Directions 2" discuss the difference in the cash
being accessed. Whether the cash being accessed by holders of
the American Express Card or Mastercard is in fact a loan or is
instead the cardholder's own cash being drawn from her checking
account is of no import to this case.
5. MasterCard provides more locations domestically and more
locations abroad at which its cardholders can get cash with
their card than does American Express. (Tr. 331). The following
chart provides approximate numbers.
Domestically Bank Branches/
------------ ATMs Travel Service Offices Total
---- ---------------------- -------
MasterCard 46,400 65,000 111,400
American Express 26,000 572 26,572
Abroad Bank Branches/
------ ATMs Travel Service Offices Total
---- ---------------------- -------
MasterCard 13,600 135,000 148,600
American Express 17,000 1,128 18,128
Worldwide Bank Branches/
--------- ATMs Travel Service Offices Total
---- ---------------------- --------
MasterCard 60,000 200,000 260,000
American Express 43,000 1,700 44,700
(Tr. 13, 20, 83, 85, 196-197, 238-39; Riese Aff. ¶ 7; Kendrick
Aff. ¶ 6-7).
6. Defendants' representation in "Directions 2" that
MasterCard holders can get cash with their card at about
200,000 bank branches and 60,000 automatic teller machines
("ATMs") worldwide is truthful.
7. "Directions 2" does not explicitly say, either in its
audio or video components, that it is "difficult" for an
American Express Card holder to find a location where he can
get cash with his card. The new commercial points up the
comparative difficulty American Express Card holders have
vis-a-vis holders of MasterCard in finding locations where they
can use their card to get cash. The difference is truthful
since MasterCard offers more locations. The execution,
"Directions 2," is literally truthful in its depiction of
strangers attempting to give directions to the American Express
Card holder looking for a location where he can get cash with
his card. There is nothing the strangers literally do or say
that can be called false or misleading. Since it may in fact be
harder for an American Express Card holder to get such
directions given the difference in the number of locations
offered, the explicit message that it is "more difficult" for
an American Express Card holder than for a MasterCard holder to
find a location where she can get cash with her card is
8. "Directions 2" does not explicitly say, either in its
audio or video components, that the locations offered by
American Express to its cardholders to get cash with their card
are "remotely situated." In the new commercial, the strangers
try to help the American Express Card holder find a location
where he can get cash with his card. Although he is pointed in
several directions, must drive his car, and is told by Woman #
4 that he should "go through a corset store" where "in back,
there's a dirt road," none of the depictions are literally
false or misleading. Again, since fewer locations means that
they may be harder to locate, the explicit message is truthful.
9. The exaggeration used by defendants to convey the message
that it is more difficult for an American Express Card holder
to find a location where he can get cash with his card is mere
10. The consumer reaction survey used by plaintiff to attempt
to prove that "Directions" conveys a false and misleading
message to consumers has no bearing on the new commercial,
"Directions 2." The survey does not prove that the new
commercial implicitly misleads consumers nor does it raise
serious questions going to the merits to make them a fair
ground for litigation.
III. Conclusions of Law
1. A suit for injunctive relief is moot when the offending
conduct ceases and the court finds "'that there is no
reasonable expectation that it will resume.'"
Upjohn Co. v. American Home Products Corp., 598 F. Supp. 550,
554-55 (S.D.N.Y. 1984) (quoting McNeilab, Inc. v. American Home
Products Corp., 501 F. Supp. 517, 523 (S.D.N.Y. 1980) (citing
Allee v. Medrano, 416 U.S. 802, 810-11, 94 S.Ct. 2191,
2197-2198, 40 L.Ed.2d 566 (1974); United States v. Concentrated
Phosphate Export Ass'n, 393 U.S. 199, 203, 89 S.Ct. 361, 364,
21 L.Ed.2d 344 (1968))).
2. When a defendant revises an allegedly infringing
commercial and represents that the original commercial will not
be broadcast in the future, the need for injunctive relief as
to the original commercial is moot. Consumers Union of United
States, Inc. v. General Signal Corp., 724 F.2d 1044, 1052 and
n. 11 (2d Cir. 1983), cert. denied, 469 U.S. 823, 105 S.Ct.
100, 83 L.Ed.2d 45 (1984); see Tambrands, Inc. v.
Warner-Lambert Co., 673 F. Supp. 1190, 1198 (S.D.N.Y. 1987); cf.
Upjohn, 598 F. Supp. at 554-55; McNeilab, 501 F. Supp. at 523.
3. A party is entitled to preliminary injunctive relief if it
can show "(a) irreparable harm and (b) either (1) likelihood of
success on the merits or (2) sufficiently serious questions
going to the merits to make them a fair ground for litigation
and a balance of hardships tipping decidedly toward the party
requesting the preliminary relief." Wallace Int'l Silversmiths,
Inc. v. Godinger Silver Art Co., 916 F.2d 76, 78 (2d Cir. 1990)
(quoting Jackson Dairy, Inc. v. H.P. Hood & Sons, 596 F.2d 70,
72 (2d Cir. 1979)), cert. denied, ___ U.S. ___, 111 S.Ct. 1622,
113 L.Ed.2d 720 (1991); MGM-Pathe Communications Co. v. The
Pink Panther Patrol, 774 F. Supp. 869, 872 (S.D.N.Y. 1991).
4. The merits of this case are governed by Section 43(a) of
the Lanham Act, 15 U.S.C. § 1125(a) (1988), which states:
Any person who, on or in connection with any
goods or services, . . . uses in commerce any
word, term, name, symbol, or device, or any
combination thereof, or any . . . false or
misleading description of fact, or false or
misleading representation of fact, which —
(2) in commercial advertising or promotion,
misrepresents the nature, character, [or]
qualities . . . of his or her or another person's
goods, services, or commercial activities,
shall be liable in a civil action by any person
who believes that he or she is or is likely to be
damaged by such act.
5. An advertisement can be false, and thus violative of the
Lanham Act, in two ways: (1) it can be explicitly false or (2)
it can be ambiguous on its face, but implicitly misleading to
consumers as evidenced by the consuming public's reaction to
it. McNeil-P.C.C., Inc. v. Bristol-Myers Squibb Co.,