Court Rules Companies Can Make ‘First to Market’ Claims in Ads

A federal appeals court ruled that companies can advertise they were “first” to bring products to market without facing certain types of false advertising lawsuits. The decision came in a dispute between two cooler companies.

Vericool World sued Igloo Products over advertising claims about who invented or first sold specific cooling technology. Vericool argued that Igloo’s “first to market” claims were false and violated federal advertising laws.

The 9th Circuit Court of Appeals disagreed with Vericool. The court applied a legal rule called the Dastar doctrine, which limits when companies can sue each other over claims about who created or first developed products.

Under this ruling, companies have more freedom to make claims about being pioneers or innovators in their advertising. The court said these types of disputes should be handled through patent law, not false advertising lawsuits.

One judge disagreed with the majority decision. Judge Bumatay wrote a dissent arguing the court was expanding the Dastar rule too far beyond its original purpose.

This decision affects how companies can advertise their products and innovations. Businesses may now have more protection when making claims about being first to market with new technologies or products.

The ruling specifically impacts companies in states covered by the 9th Circuit, including California, Washington, Oregon, and several western states. Companies in these areas can now make “first to market” advertising claims with less risk of facing false advertising lawsuits.

The decision shows how courts balance protecting honest advertising against allowing companies to compete and promote their innovations in the marketplace.