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for its word design mark in july 2020 the court concluded that plaintiffs didn t and apparently couldn t allege a valid ownership interest in the mark at issue they claimed that the famous mark exception applied under grupo gigante whose logic i don t think survives abitron but the fourth circuit s belmora workaround probably does under grupo gigante where the mark has not before been used in the american market the court must be satisfied by a preponderance of the evidence that a substantial percentage of consumers in the relevant american market is familiar with the foreign mark at this stage the court is persuaded that plaintiffs have sufficiently alleged the necessary level of consumer recognition necessary to invoke the famous mark exception to the territoriality principle with respect to the market in which defendants use the mark that is berkeley and la s koreatown but they needed to replead to actually allege a date of first use which was also key to their cybersquatting claim false association 43 a doesn t explicitly require ownership citing blinded veterans thus plaintiffs sufficiently pled a claim query suppose they re the junior user full stop if ownership isn t required for a 43 a claim why can t big entrants use reverse confusion to eliminate small senior users is your answer causation is your answer that this wouldn t work because the small senior user could assert a counterclaim but if there s no registration how would a 43 a counterclaim be resolved except by using ownership priority rules abandoning a separate concept of unfair competition has caused many such puzzles anyway plaintiffs sufficiently pled confusion e g a post on red note that a customer was disappointed in the quality of defendants food apparently attributing the failure to tang huo kung fu puzzlingly the court held that the inability to make a trademark infringement claim also meant there was no actionable statement under california s fal despite the survival of the false designation of origin claim cancellation of registration fraud requires pleading with particularity fraud in procuring a trademark registration or renewal occurs when an applicant knowingly makes false material representations of fact in connection with his application plaintiffs insufficient allegations of foreign fame and diaspora recognition do not establish u s use or ownership without a plausible allegation that plaintiffs possessed superior u s rights at the time of the trademark application plaintiffs cannot demonstrate that any uspto statement about ownership or others rights was false much less knowingly false plaintiffs counsel really needs to use belmora to replead nor did they allege facts demonstrating that any specific uspto submission was actually false material or made with an intent to deceive they also sought cancellation on 2 a false affiliation grounds under belmora t o determine if a petitioner falls within the protected zone of interests we note that 14 3 pertains to the same conduct targeted by 43 a false association actions using marks so as to misrepresent the source of goods that worked here for services too at the pleading stage posted by rebecca tushnet at 11 39 am no comments email this blogthis share to x share to facebook share to pinterest labels trademark monday august 10 2026 chobani s zero sugar yogurt with allulose violates fda regs despite fda s nonenforcement 7th circuit reverses preemption ruling franco v chobani llc no 25 2087 7th cir jul 27 2026 federal law requires that foods advertised as sugar free contain less than a half gram of sugar chobani sold chobani zero sugar yogurt but it included four grams per serving of allulose a naturally occurring sweetener if allulose is a sugar under federal law franco s state law false advertising claims could proceed but if it wasn t then there was express preemption because federal law doesn t allow states to impose additional requirements on food labeling regulated by the fdca the district court deferring to fda enforcement guidance found preemption the court of appeals reversed finding allulose to be a sugar under the regulation the relevant regulation defines t otal sugars as the sum of all free mono and di saccharides such as glucose fructose lactose and sucrose and a food may not be labeled sugar free or zero sugar or similar terms unless it contains less than 0 5 g of sugars as defined by the previous regulation and meets other requirements hello loper bright interpreting the law is a job for the court though the court isn t required to ignore the fda s perspective about the meaning of its regulations and deference to agency interpretation of an ambiguous rule can be appropriate the fda has several times expressed a view in 2016 it observed that the final rule does not reach a decision as to whether allulose should be excluded from the definition of sugar and allulose as a mono saccharide must be included in the total sugars declaration pending any future rulemaking that would otherwise exclude this substance from the declaration in 2020 it issued industry guidance advising manufacturers of fda s intent to exercise enforcement discretion for the exclusion of allulose from the amount of total sugars and added sugars declared on the label pending review of the issues in a rulemaking the issue appears to be that the fda traditionally used chemical structure to identify sugars but novel sugars might also count depending on factors such as an association with dental caries and how they are metabolized in the body no further rulemaking has occurred but the court of appeals called for the views of the fda in its resulting amicus brief the agency took the position that total sugars as defined in that regulation include all monosaccharides including allulose the such as parenthetical at the end of the regulation was merely a list of non exhaustive illustrative examples and not as the district court found a limitation on sugars based on the physiological characteristics that the listed sub stances shared and an enforcement position isn t an interpretation of a regulation the court of appeals found this persuasive there s no dispute that allulose is a monosaccharide because the definition includes every monosaccharide and the following parenthetical is merely a list of examples allulose is a sugar the surplusage and noscitur a sociis canons didn t change anything chobani argued that a sugar needed the same nutritional characteristics as glucose fructose lactose and sucrose the surplusage canon suggested that the such as parenthetical should have some meaning but redundancy is common in the law and such as doesn t always mean of the same kind it can merely introduce examples of a class the fda defined a class by way of chemistry it reinforced that definition through examples all of which share the same chemical structure there s no need to derive a definition from the list of examples since they merely illustrate the definition that already appears nor did chobani argue that a definition of sugars that includes all monosaccharides will lead to absurd results and in defining total sugars the fda specifically invoked the language of chemistry which means decisions favoring common parlance meanings aren t persuasive either the fda could have defined total sugars based on physiological factors rather than chemical makeup but it didn t do so the regulation wasn t ambiguous so there was no reason to defer to the fda s enforcement guidance which wasn t an official position anyway what about the marketing permit chobani secured from the fda t he fact that one sovereign the united states indicated that it would not enforce its labeling requirements with respect to allulose should not have led chobani to believe that the states would take a similar approach similarly the agency s marketing permit said nothing about state law consumer protection suits chobani is a sophisticated actor and should have been aware that the fda s decisions about its enforcement priorities would not immunize the company from suits based on state law chobani s additional preemption theory based on monsanto co v durnell 609 u s 2026 wl 1825691 june 25 2026 could be handled on remand by the district court deception was also plausible chobani argued that consumers don t care about the existence of monosaccharides in their food but are instead concerned with avoiding the ad verse health consequences associated with traditional sugars whether reasonable consumers care about the existence of allulose in their yogurt isn t the same thing as asking whether reasonable consumers would be deceived by it discovery was the right next step posted by rebecca tushnet at 12 37 pm no comments email this blogthis share to x share to facebook share to pinterest labels consumer protection false advertising fda preemption false advertising in online games leads to over 700 million award to competitor skillz platform inc v papaya gaming ltd 2026 wl 2151126 no 24cv1646 dlc s d n y jul 27 2026 some previous opinions more linked there at a jury trial skillz won a substantial damage award for false advertising about papaya s use of bots in the real money skill based mobile gaming rmsb market the court here rejected papaya s post trial motions and skillz was awarded 719 million plus its attorney s fees for the years 2024 and 2025 and certain costs skillz created the first rmsb platform in 2012 papaya entered this market in 2019 and quickly took a significant market share in the light most favorable to skillz the evidence at trial showed significant barriers to entry in this market because a successful platform needs a customer base large enough to match players of similar or comparable skill in tournaments within a reasonable amount of time aka liquidity skillz maintains that its tournaments are games of skill not chance and thus not gambling it was required to and did represent to app stores payment processors and advertising hosts that it was not engaged in gambling and that the outcome of its tournaments was determined by the skill of the players then papaya decided to enter the rmsb market in 2019 by deceiving the public and others about the nature of its product instead of running tournaments in which the players who had paid entry fees competed against each other papaya decided to solve the problem of building liquidity by running tournaments in which multiple participants were not other human players but were instead bots papaya s bots were essentially scores designated by papaya s algorithms they were not artificially intelligent players in these tournaments a player s score was compared to the scores papaya assigned to its bots in this way papaya was always able to run a tournament including tournaments with what appeared to be a dozen or more participants at any time of night or day papaya gave its bots usernames and profiles to make them appear to be individual customers papaya used liquidity bots to create immediately accessible tournaments of up to 20 or more players permitting a player in a papaya game to learn quickly whether he had won or lost a tournament thereby increasing the odds that he would pay to enter another papaya tournament it also used tailored win loss bots so that a player who had a losing streak could be given a win to motivate them to keep playing in more tournaments tailored bots operated in over 630 million papaya tournaments or in roughly one quarter of the 2 6 billion tournaments that papaya hosted 2021 2024 during that period bots accounted for over 13 million of the participants on papaya s platform compared to about 11 million human players over half of humans played in at least one tournament where tailored bots were designed to give them a loss and more than 7 3 million played in tournaments with tailored bots designed to give them a win unsurprisingly papaya s bots were used most heavily in the initial phases when it needed to build liquidity about 90 of the time in 2021 because of its use of bots papaya only paid customers roughly 2 billion of the 6 7 billion that it advertised had been awarded in prizes and just before papaya stopped using bots near the end of 2023 papaya was still using bots in roughly 50 of its cash tournaments papaya achieved a substantial presence in the rmsb market while investing only a fraction of the money expended by skillz to do so when seeking investors it bragged about its strategy of multiple player tournaments unique platform capabilities and revenue growth 8 times more than the industry leaders papaya never disclosed its use of bots but purposely advertised falsely that its games were fair and skill based that it has no vested interest in who wins or loses a tournament and described the participants in its tournaments with pictures and in terms that apply to human players when players complained papaya denied using bots at the direction of executives papaya made similar misrepresentations to app stores its payment processers and its advertising channels papaya did not stop using bots until late 2023 at which point skillz s revenue had fallen by 60 in just two years from 384 million to 152 million while papaya s revenue skyrocketed from 163 million to 461 million over the same period given the overwhelming evidence of intentional false advertising the parties principally litigated damages before the jury and also the court sought an advisory verdict on disgorgement the jury was instructed that skillz is not entitled to duplicative monetary recoveries and the court will ensure that skillz only recovers once for any injury it has shown it suffered the jury awarded skillz 420 million in damages or two thirds of the requested amount and an advisory disgorgement verdict of 719 million for papaya s unjust profits and 652 million for papaya s unfair cost savings in acquiring users through fake liquidity papaya argued that skillz s damages expert improperly relied on a but for world in which papaya did not use bots and its advertising statements were true making its expenses greater and its profits lower because it did not rely on bots to build its business papaya argued that the expert was required to model a different but for world specifically one in which papaya removed all false statements from its advertising while not altering its business model or its use of bots but papaya didn t explain how this could be done skillz proved at trial that papaya could not have entered the rmsb market by using bots in the way that papaya did and at the same time truthfully describe that use and its product to consumers in its advertising papaya has offered no authority to suggest that a plaintiff s expert must create a but for world that could not exist among other things payment processors and others wouldn t have allowed papaya to use their services had papaya told the truth and consumers wouldn t have wanted to play against bots given these constraints skillz showed that the damages flow...
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