Guerrilla Marketing Under False Pretenses Might Be Passing Off–Heartland v. Forest River

By Eric Goldman

Heartland Recreational Vehicles, LLC v. Forest River, Inc., 2009 WL 418079 (N.D. Ind. Feb. 18, 2009). The Justia page.

When deciding whether it should bring a lawsuit, a potential plaintiff needs to consider not only their likelihood of winning, but also the risk that the lawsuit will prompt some counterclaims or affirmative defenses that leave the plaintiff worse off than if it had never sued in the first place. We’ve seen several examples of plaintiffs who probably wished they hadn’t started the litigation. See, e.g., American Blinds, Axact, and Buying for the Home. Sometimes it really is better to do nothing.

Today’s lawsuit started with a patent infringement claim by Heartland, a manufacturer of travel trailers/RVs, against its competitor Forest River. Forest River strikes back against Heartland by arguing that Heartland engaged in a type of guerrilla marketing. Here’s a recap (based on the facts recounted in the opinion):

Forest River brought RV dealers to lovely Mishawaka, Indiana (a suburb of South Bend) for a private trade show (which sounded like an event to wine-and-dine dealers of Forest River’s RVs). Forest River put the 700+ attendees up at local hotels. Heartland apparently got wind of the shindig and prepared packets for these attendees containing comparative advertising and an invitation to visit Heartland’s facility in beautiful Elkhart, Indiana (also part of the greater South Bend/Michiana metro area). Then, while the attendees were at one of Forest River’s events, Heartland employees:

went to the front desks of the hotels and then falsely stated and represented to the hotel attendants that they were “from Forest River” and that they had “important” envelopes which needed to be delivered to the Forest River guests “for a Forest River dealer meeting the next day.”

At least two hotel security cameras caught Heartland employees making these requests. (Say cheese!) Not wanting to reject a request putatively from a major customer, the hotel employees dutifully distributed Heartland’s packets to the guests staying there. According to Forest River, Heartland’s action caused “disruption and confusion among several of Forest River’s guests because of the incongruity and surprising manner in which the envelopes were delivered … [and] adversely affect[ed] Forest River’s good will with its dealers and adversely affected Forest River’s sales of its products.”

Clearly Heartland isn’t afraid of aggressive marketing. But was their stunt illegal?

The opinion does not suggest that Heartland’s packets contained deceptive marketing materials. The court also does not say that Heartland misappropriated a trade secret or otherwise impermissibly learned about the attendees (although the opinion implies that Heartland might have gotten an illicit copy of the attendee list). Further, knowing that the dealer group was in town, Heartland can freely communicate with the attendees in a variety of ways–billboards, radio ads, even leafletters standing outside the various hotels

So the main crux of the problem is Heartland’s apparent misrepresentation to the hotel employees to get them to distribute the packets to the hotel guests. Is such a misrepresentation actionable by the putatively harmed competitor? The court expresses doubt about the merits of Forest River’s claim but does not dismiss it, saying:

Heartland’s intentionally deceptive conduct in the hotel action plausibly had the natural and probable tendency and effect of which was to deceive the public so as to pass off its goods or business as for that of Forest River. Moreover, the Court will not condone Heartland’s actions as simply healthy competition.

One possible lesson from this case is that it would make a lot of sense for Heartland and Forest River to collaborate on a greater Michiana RV trade show that would have given them shared access to the dealer group. This would have mitigated the risk of guerrilla marketing by one of the local competitors and allowed them to share expenses.

Another lesson is that the case reinforces the already well-established rule that marketers should not lie in marketing campaigns, either in the marketing message’s substance or to get the marketing message delivered.

Finally. the case reminded me a little of the Toy Manufacturer’s case (Toy Manufacturers of America, Inc. v. Helmsley-Spear, Inc., 960 F.Supp. 673 (SDNY 1997)), which suggests that certain kinds of time-and-space adjacencies for competitive activities are not permissible. For more discussion about the trademark implications of such adjacencies, see my Brand Spillovers article.

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