Another in the "Can They Really Get Away With That?" File...

Brian Doherty | February 5, 2007

Like Jesse Walker below contemplating the Texas governor's claimed power to vaccinate schoolgirls all by his lonesome, I am similarly perplexed and seeking guidance on this claim, in an L.A. Times story about McDonald's coffee beating Starbucks in a taste test (keep working on that chai, clown--does anyone buy straight cups of coffee at Starbucks anyways, as opposed to the "vanilla bullshit latte cappa things" that Larry David spoke of?):

No matter how much McDonald's revels in its win of the taste test, the company might be hard-pressed to use it in promotions. Consumer Reports, which takes no advertising, strictly prohibits companies from using its findings in ads.

Really? Consumer Reports isn't even the FDA, and it claims the legal right to restrict a private company from making a truthful claim in advertising? Can this be true? Lawyers, jokesters, and general interest kvetchers, your insights sought in the comments thread.

Comments

Aaron|2.5.07 @ 12:55PM|#

Perhaps they get the participants to sign a contract for honor of being included in the comparrision? That seems unlikely since Starbucks would never have agreed to this comparison. What would they possibly have to gain by being compared to MickyD's? Either they didn't tell them who they were being compared against or they will simply ban the products from future comparisons of anyone who uses the results in an ad. The winner of any comparision probably wouldn't want that.

|2.5.07 @ 12:56PM|#

I'm not sure if it helps, but here's their ad-violation reporting page:

http://www.consumerreports.org/cro/aboutus/adviolation/index.htm

tomWright|2.5.07 @ 12:57PM|#

Yes, CR will hunt down and kill, (legally speaking), anyone that uses their tests with attribution and use of the CR name and/or trademark, that does so without permission.

The most McD's can do is say somehting like 'A leading national consumer research organization found that...). If they specifically mention CR or any part of the copyrighted report, CR will go after them.

Dunno why, but with all the talk of "copy fight" and open sourceing all kinds of things, I find it amusing that lefty organizations like CR, Apple and others are the most militant in protecting their own property.

|2.5.07 @ 12:57PM|#

Consumer Reports use to sue businesses who used their findings in ads. I don't know whether they still do or not.

T|2.5.07 @ 12:58PM|#

Yup. If I recall correctly, an always dubious proposition, CR has trademarked the name of their magazine. They will, and have, sue if you use their trademark in advertising your product.

Someone in the legal field can cover exactly how that works, but they are militant about it. One of the workarounds is the "leading consumer magazine" phrase that pops up in ads sometimes.

|2.5.07 @ 1:02PM|#

If they prohibit using thier findings in ads why do I frequently see ads that say something like "rated as a Best Buy by Consumer Reports".

Warren|2.5.07 @ 1:04PM|#

Really? Consumer Reports isn't even the FDA, and it claims the legal right to restrict a private company from making a truthful claim in advertising?

It's not about regulating what the company says, it's about protecting their intellectual property. You can't quote their study because their study belongs to them, CR doesn't have anything to say about what claims you make in your ads, you just can't back them up with a CR report.

I can see the thinking behind this. CR lives on it's reputation of uncorrupted objectivity. Having it's studies used in ads might have the appearance of conflict of interest.

Course if I had my way, there'd be no copyright for CR to assert. I think they would get along OK without it.

|2.5.07 @ 1:11PM|#

Why would McDonald's want to tarnish their good name by associating with Consumer Reports. After they faked the child safety seat story I don't know why anyone would ever take them seriously again...

Warren|2.5.07 @ 1:11PM|#

Yes, CR will hunt down and kill, (legally speaking), anyone that uses their tests with attribution and use of the CR name and/or trademark, that does so without permission.

Hmm that's interesting, because I've always been a registered trademark supporter even as I became critical of copyright.

And If my understanding of some of the comments is correct. CR will allow a company to use its trademark if they negotiate a license. That kind of throws cold water on my Cesar's Wife's reputation theory.

|2.5.07 @ 1:23PM|#

CR's policy has always seemed dubious, but who has the motivation to challenge them in court? It's similar to the NFL's take-no-prisoners reaction to the use of the term "Super Bowl". If tested, CR and the NFL would likely lose, but nobody actually takes them on.

IP protections are not absolute. You can't start a magazine and call it "Consumer Reports". You can't start an athletic competition and call it the "Super Bowl". You can't sell copies of CR's articles. You can't charge admission for people to watch NFL football games.

But free speech should permit someone to say "Our high-def TV is the best! Buy it before Friday and we'll install it in time for you to watch the Super Bowl" or "A leading consumer magazine says Acme Peanut Butter is the tastiest (Consumer Reports, March 2007 issue)"

I think part of CR's strategy is to be seen not as the bully they clearly are, but rather as the "noncommercial" underdog they portray themselves as.

|2.5.07 @ 1:30PM|#

Free speech doesn't apply to corporations in the same way as it does to individuals, either.

|2.5.07 @ 1:46PM|#

It could be something as simple as "if you use our trademarked name in an ad, we won't consumerly report on your next item of interest."

That would be enough for a lot of companies to exercise restraint.

Sam Franklin|2.5.07 @ 1:54PM|#

The question is why McDonald's wouldn't take on Consumer Reports over this overreaching policy.

One possible answer is that they are worried about informal retribution when they do their hamburger poll or their ranking of the best playgrounds.

Another possible answer is that they are worried about damages if they lose.

Without going into detail, I think McDonald's may be worried about statutory copyright damages, than they are worried about trademark or anti-dilution damages. statutory damages for copyright infringement are a scary thing. It would be nice if McDonald's could use its lobby bucks to repair the law of statutory copyright damages.

All that said, I think the most likely reason McDonald's doesn't challenge Consumer reports here is not retribution or court-madated payments of damages, but rather that McDonald's doesn't want to win the case and thereby set unfavorable precedents with respect to third party use of its own trademarks and anti-dilution rights. Which, if so, is a shame.

|2.5.07 @ 1:59PM|#

I used to get drip coffee from Starbucks. It was, in fact, mighty nasty. It's not that they use bad coffee; it's that they put it in those cook-all-day cylinders, and only make new coffee when they run out. Which means that at any given moment, you're probably going to get hours-old coffee that's been simmering and turning thick and bitter.

But it's fast, and it means you don't wait in line with the fuckos ordering a double-shot non-fat half-decaf soy milk machiatto smoothie.

|2.5.07 @ 2:02PM|#

McD could run their own taste test, like the Pepsi challenge. Let busy workers try two cups of coffee and then reveal TA-DA! McD tastes better.

Any ad person worth his salt already has this in motion.

|2.5.07 @ 2:04PM|#

This is straight forward. CR has a trademark on their name and copyright for their work products.

Fair use doctrine will allow you to quote parts of their work products for:

-- A critique of their work product

-- As a reference in your own research work products

-- Severe abuse of their work product in the form of parody

Including portions of their work product in a commercial advertisement would not be covered by Fair Use.

B|2.5.07 @ 2:19PM|#

"does anyone buy straight cups of coffee at Starbucks anyways"

Well, I do, mostly on account of my aversion to developing diabetes (if I had a sugary latte for every cup of black coffee I've consumed, I'd be pissing slurpies by now.)

|2.5.07 @ 2:22PM|#

Anything CR publishes is their copyrighted int prop, right?

Why shouldn't they be allowed to govern it's use?

|2.5.07 @ 2:30PM|#

Eric Tavenner:

Look more closely. There is a magazine and ranking organization called "Consumers Digest", which is a pay-to-play, consumer product testing equivalent of a PhD diploma mill.

Dollars to donuts that they are the source of all "Consumer _____ Best Buy" identifications in corporate-sourced materials that you see.

Consumer Reports represent the kind of truth-will-out, more information to the actual decisionmakers, that free market proponents like. Consumer Digest represent the kind of crony-capitalism and "money talks" that people afraid of the free market expect to take the place of, say, government agencies that certify things.

thoreau|2.5.07 @ 2:36PM|#

Wait, a copyright holder can not only control the specific words copyrighted but also the way that the information contained in it is used?

So nobody can report "So and so wrote this in their publication" without consent? The folks at Reason need the consent of a movie studio before reporting "Peter Jackson made a movie in which King Kong climbs a building"?

If you guys at Reason can write an article, and sell it with the statement "Peter Jackson made a movie in which a giant ape climbs a building", why can't somebody else produce and broadcast a video segment in which somebody says "Consumer Reports conducted a study in which this coffee beat that other coffee"?

It would be one thing if you went around selling bootlegged copies of the movie. It's another thing to put your own short synopsis of it out there. Those are your own words, even if they make reference to somebody else's work. Likewise, it would be one thing if a restaurant sold copies of the report. It's another thing to say "Hey, there's this report out there." They aren't reproducing somebody else's intellectual property, they're just mentioning it.

I'm shocked that CR has that right.

What if a professor, being paid to teach a class, makes reference to a movie or TV show or song or book or magazine or some other copyrighted work? He doesn't hand out unauthorized copies of it, he just mentions that it exists and summarizes a few points from it. And he's making money by doing so. (If it helps, assume that he's doing this at a for-profit college, since there are such schools out there.)

|2.5.07 @ 2:37PM|#

More to Brian's point: If CR can't defend their information reporting, quality classification system and projected image of impartiality in the manner they desire, what hope is there for ever seeing replacement of government certification agencies (USDA "Organic", anything approved by the FDA come to mind) with private certification agencies?

Larry A|2.5.07 @ 2:38PM|#

The question is why McDonald's wouldn't take on Consumer Reports over this overreaching policy.

Never insult someone who buys ink by the barrel.

CR lives on it's reputation of uncorrupted objectivity. Having it's studies used in ads might have the appearance of conflict of interest.

CR hates corporations-->Corporations advertise-->CR hates advertising?

Consumer Reports represent the kind of truth-will-out, more information to the actual decisionmakers, that free market proponents like.

I subscribed to CR for a year. Every time they reported on a product I was familiar with their rating turned on BS "features." I.e. a good mattress has to have handles on the sides so you can flip it over regularly, even if it's designed with a top and bottom and not supposed to be flipped. A good backpack has to have a metal frame holding the mouth open so its easy to load. I didn't renew.

|2.5.07 @ 2:43PM|#

thoreau:

Apple and apples please. Fair use allows you to republish small exerpts of copyrighted material for exposotiory (ie the Reason story) or educational (ie the professor) purposes. Using CR's data in an ad is neither of these things; as currently classified an ad is not considered either news or education, and as such the fair use exemptions afforded those categories don't apply. This is similar logic to why the administration got in trouble for hawking video news releases that ran as news rather than as paid commentary.

|2.5.07 @ 2:44PM|#

Relax thoreau;

The whole point of Fair Use is to enable scholarly works, social commentary, and reporting (to a lesser extent).

The main issue here is whether or not McD can quote the work product of CR when they are clearly doing this for financial gain.

Now if McD's want's to write an opposing article to challenge the results of CR studies, then that would be allowed by Fair Use. They would be allowed to quote specifics from CR's work product in order to critique and challenge CR's interpretations.

Copyright is not the air-tight lockbox that so many posters at H&R make it out to be.

|2.5.07 @ 2:47PM|#

In a former job I represented companies in McD's position here, and based on the research I did then I have to disagree with Carrick. I think it would be possible to do an ad execution that said "Consumer Reports rated our product #1" in a manner that would be deemed fair use under Section 43(a) of the Lanham Act. (That's the US Trademark statute.) You probably would want to include a prominent disclaimer that said something like "Consumer Reports is not affiliated with our company and has not endorsed or approved our product or this advertisement."

My clients haven't done that, though, and I bet McD's won't either. Why not? Because CR will sue anyway, even if they have a low chance of winning, because they feel very strongly about this issue. So strongly, in fact, that they probably won't stop at suing you--they will also urge all their readers to boycott your products and otherwise treat you like a child molester. CR has a halo about them, perhaps deservedly so, and people who listen to CR's recommendations will likely take their side in the dispute. So in order to take advantage of the fact that CR is recomending you, you would in effect be destroying the value of that recommendation. At the end of the day it's not worth it.

thoreau|2.5.07 @ 2:49PM|#

rich-

OK, so those activities are specifically exempted. I still had no idea that one couldn't in general profit from merely discussing somebody else's work. I thought it was only reproducing and selling (either parts or all of) somebody else's work that was verboten.

So, say, can a TV personality, who profits from his show, chat about a copyrighted work? Is that considered "expository" use? What if the TV network ran an ad saying "Stay tuned for Joe Loudmouth's show, where he'll discuss (insert latest movie here)"? The ad for the show is mentioning somebody else's copyrighted work, and the TV network is running the ad in order to make a profit.

As a scientist, I routinely see product descriptions that cite published research articles. I had no idea that they had to get permission just to mention somebody else's work.

|2.5.07 @ 2:50PM|#

Thank you mister advertising laywer.

I am merely an engineer, so I try to work within a framework that is least likely to get my legal department to give me a call.

|2.5.07 @ 2:53PM|#

The issue here is not primarily copyright law, it's unfair competition. It's a violation of federal law to put out an ad that would be likely to cause confusion as to sponsorship, affiliation, or endorsement.

|2.5.07 @ 2:55PM|#

"Consumer Reports rated our product #1"

I would tend to agree that this conclusion is fair use, where quoting text from the article that supported the conclusion is much less likely to be considered fair use unless it is in a scholarly or newsworthy article.

Dan T.|2.5.07 @ 2:59PM|#

Do people really subscribe to Consumer Reports or really care what the magazine says? Are any current Starbucks regulars going to switch to McDonald's or (even really give it a try) based on the preferences of a group of people they don't know? It seems like this is one place where the market would sort out whose product was best.

|2.5.07 @ 3:02PM|#

Good point Carrick, and it actually creates an interesting double-bind for whoever would want to do this. On the one hand, you want to quote as little as possible to avoid giving grounds for a copyright claim. On the other hand, if you just say "CR said we're number 1", then CR might say it's false advertising because you took the headline out of the context of its nuanced results. So you have to be very careful how you do it.

(This is another reason not to go down this path...to do it safely you wind up with advertisement written entirely by lawyers, and my clients assure me that advertisements written by lawyers suck. I'm guessing they're right about that.)

|2.5.07 @ 3:13PM|#

Is the Newman's Own Organic Coffee available at Mickey D's outside the northeast yet?

|2.5.07 @ 3:15PM|#

OK, so those activities are specifically exempted. I still had no idea that one couldn't in general profit from merely discussing somebody else's work. I thought it was only reproducing and selling (either parts or all of) somebody else's work that was verboten.

Thoreau, you can discuss someone's elses work to your heart's content. Copyright only comes in when you begin to quotes someone's work products.

If you get dinged for copyright infringement, there are two things that will be assessed when the judge figures out the damages. How much did you profit from the infringement? How much did you damage the ability of the copyright holder to profit from his/her work?

The last point is probably what worries an entity like CR. If you dilute their reputation by quoting their work products, you will be liable for damages even if you make no profit of your own.

|2.5.07 @ 3:23PM|#

Fair use allows you to republish small exerpts of copyrighted material for exposotiory (ie the Reason story) or educational (ie the professor) purposes. Using CR's data in an ad is neither of these things; as currently classified an ad is not considered either news or education, and as such the fair use exemptions afforded those categories don't apply.

Small problem: Facts (data) are not copyrightable.

|2.5.07 @ 3:28PM|#

yeah -- facts -- another interest problem

I think the NLB or NFL or someone like that just lost a major court case on whether league statistics were facts or "copyrightable" information.

I have no idea how test results or survey results generated as a work for hire would be handled.

Feel free to quote CR and let us know how it works out.

|2.5.07 @ 4:08PM|#

Consumer Reports ratings are not facts. They are the opinions of its raters.

Mike Laursen|2.5.07 @ 4:14PM|#

does anyone buy straight cups of coffee at Starbucks anyways

I drink the straight stuff at Starbucks all the time. And I've had a few cups of McDonald's coffee. The McDonald's stuff is better. Both places are mediocre and very uniform from location to location.

|2.5.07 @ 5:29PM|#

Not that it's relevant, but I imagine that in a taste test between Budweiser and Guinness, most folks would choose Budweiser. That doesn't mean that Bud isn't swill.

|2.5.07 @ 5:47PM|#

a) The branch of trademark law implicated is known as nominative fair use, and it is very, very nebulous.

b) The fact that Consumer Reports ratings came out a certain way is certainly a fact.

thoreau|2.5.07 @ 5:48PM|#

Small problem: Facts (data) are not copyrightable.

Serious question: Suppose that somebody measures, say, the frequency of an atomic transition, and publishes that measurement. (Assume it's a new measurement to a level of precision not previously attained.) Say that somebody else uses that data to build a device that can be sold. (Not entirely outside the realm of possibility for some specialized application, like GPS or a type of spectroscopy for chemical analysis, or whatever.)

Now, the second party in this example didn't publish a design that could be patented, they just published some data, some fact (e.g. "The frequency of this transition is 1.457231 +/1 0.00006 THz." (Totally made up number.) Somebody else incorporates that fact into the design of an instrument with greater precision than was previously obtained, and sells it.

Should they expect to hear from a lawyer representing whoever holds the copyright on that research article? They profited from that information, after all.

If facts are not copyrightable then it shouldn't be a problem. But if you can get in trouble for quoting some data like "4 out of 5 people in this study preferred our coffee", could you get in trouble if some scientific data from a copyrighted publication made its way into a product data sheet, or a patent application, or whatever else?

thoreau|2.5.07 @ 5:57PM|#

CORRECTION:

1.457231 +/- 0.00006
not
1.457231 +/1 0.00006

Also, I suspect that in reality this would not be a problem, because anybody who can measure the crucial number to better accuracy than anybody else in the world would probably be recruited by the company making the device, for a consulting fee if not outright employment. Sure, if the author assigned the copyright to the journal (which is the usual case) the journal could still say "Hey, their product data sheets quote from our copyrighted material!" But no journal will do that in practice, and the most likely aggrieved party (the guy who did the measurement) would probably be brought into the project anyway.

So maybe it's not the best example.

Sam Franklin|2.5.07 @ 6:13PM|#

Sounds like the guy who invented the critical number should have spent some $$$ on a better patent atty.

Then maybe his disclosures of these wonderful new devices would not have been so limited and he could have patented and really profited from them, instead of settling for that measley salary you seem to think he will be grateful to get.

|2.5.07 @ 6:53PM|#

The first rule of Consumer Reports is, you do not talk about Consumer Reports.

The second rule of Consumer Reports is...YOU DO NOT TALK ABOUT CONSUMER REPORTS!

.|2.5.07 @ 10:57PM|#

Number 6,

Budweiser is not swill, that is why they sell so much more of it than Guinness does of their bitter yeasty liquid bread.

|2.6.07 @ 8:16AM|#

Isildur - I worked at Starbuck's during college. Though I still think their coffee sucks, I can assure you that we were required to dump it every hour. And we did. The urns all have little digital timers for that very purpose.

|2.6.07 @ 10:56AM|#

A thought - what if an advocacy group started threatening anyone who quotes or cited its releases in a manner they didn't like (ie, critically) with copyright suits?

What would be the fundamental difference?

Muttrox|2.6.07 @ 4:11PM|#

JD Powers does the same thing essentially. They do a study. If you want to use the results, they will charge you an arm and a leg. That's their business model.

|2.7.07 @ 8:12AM|#

Thoreau,

Actually, there is a situation very similar to what you posit that is occuring right now - people are looking thru human DNA and getting patents on the specific sequences that relate to particular traits. I believe that they want to lock in the IP rights for tests for these traits, but there is some concern that someone, at one point will "own" the IP rights to things like "lung cancer susceptability", "the fat gene", or even "two legs". Imagine the licensing fees that people will have to pay for all of their "design features".

Sam Franklin|2.7.07 @ 10:27AM|#

Actually, there is a situation very similar to what you posit that is occuring right now - people are looking thru human DNA and getting patents on the specific sequences that relate to particular traits. I believe that they want to lock in the IP rights for tests for these traits, but there is some concern that someone, at one point will "own" the IP rights to things like "lung cancer susceptability", "the fat gene", or even "two legs". Imagine the licensing fees that people will have to pay for all of their "design features".

Unless all these patents are "obvious." Then the patent holders get nothing.

Oh, wait a sec. this research is done by well compensated phDs and is expensive. Of course, it is not obvious. Expensive research is never obvious to do or it wouldn't be expensive. Also, if it were somehow obvious to catalog genes and patterns therein, then you would not need phDs to do it. Only creative people get phDs. They wouldn't give phDs to people who are merely super-intelligent yet, at the same time, unimaginative. Riiight?