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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
------------------------------------------------*
THE SCOTTS COMPANY,
Plaintiff-Appellee,
v.
UNITED INDUSTRIES CORPORATION,No. 02-1738
Defendant-Appellant,
and
PURSELL INDUSTRIES,
Defendant.
------------------------------------------------*
------------------------------------------------*
THE SCOTTS COMPANY,
Plaintiff-Appellee,
v.
PURSELL INDUSTRIES,No. 02-1739
Defendant-Appellant,
and
UNITED INDUSTRIES CORPORATION,
Defendant.
------------------------------------------------*
------------------------------------------------*
THE SCOTTS COMPANY,
Plaintiff-Appellee,
v.
UNITED INDUSTRIES CORPORATION,No. 02-1775
Defendant-Appellant,
and
PURSELL INDUSTRIES,
Defendant.
------------------------------------------------*
Appeals from the United States District Court for the Eastern District of Virginia, at Richmond. James R. Spencer, District Judge. (CA-02-240)
Argued: October 31, 2002
Decided: December 23, 2002
Before TRAXLER, KING, and GREGORY, Circuit Judges.
____________________________________________________________
Vacated and remanded by published opinion. Judge Traxler wrote the
opinion, in which Judge King and Judge Gregory joined.
____________________________________________________________
COUNSEL
ARGUED: Dudley William Von Holt, THOMPSON COBURN,
L.L.P., St. Louis, Missouri, for Appellant. Jeffrey Stuart Sutton,
JONES, DAY, REAVIS & POGUE, Columbus, Ohio, for Appellee.
ON BRIEF: Mark Sableman, James W. Erwin, THOMPSON
COBURN, L.L.P., St. Louis, Missouri; Dabney J. Carr, IV, TROUT-
MAN SANDERS, Richmond, Virginia, for Appellant United; Robert
M. Tyler, MCGUIRE WOODS, L.L.P., Richmond, Virginia, for
2
Appellant Pursell. Michael Y. Scudder, Jr., JONES, DAY, REAVIS
& POGUE, Columbus, Ohio; Robert M. Rolfe, Stephen P. Demm,
John Gary Maynard, III, Kimberley A. Isbell, HUNTON & WIL-
LIAMS, Richmond, Virginia, for Appellee.
____________________________________________________________
OPINION
TRAXLER, Circuit Judge:
The Scotts Company sued Pursell Industries and United Industries
(together, the "defendants"), claiming that the packaging of the defen-
dants' "Vigoro" brand crabgrass-control product conveyed certain
false messages to consumers. The district court granted a preliminary
injunction in favor of Scotts. This court granted the defendants'
motion for a stay of the injunction pending appeal and expedited the
appeal. We now vacate the district court's grant of a preliminary
injunction and remand for further proceedings on Scotts' request for
a permanent injunction.
I.
Generally speaking, chemical crabgrass-control products are most
effective when applied to "pre-emergent" crabgrass-crabgrass that
has yet to sprout. The products are also effective on early "post-
emergent" crabgrass, but are ineffective when applied to mature crab-
grass plants. Vigoro, the defendants' product, and Scotts' product
("Halts") offer some level of post-emergence control, if applied no
later than about four weeks after germination. Scotts, however, con-
tends that the Vigoro package misleads consumers into believing that
Vigoro can kill mature crabgrass.
In 1999, Scotts filed a Lanham Act false advertising claim against
Pursell based on the Vigoro package. At that time, the Vigoro pack-
age included what the parties refer to as the "crabgrass buster" logo-
a cartoon of a crabgrass plant with a sinister face, surrounded by the
familiar red circle with a slash through it. This graphic was located
directly above a text block that stated (in all capital letters) "pre &
post emergence control of crabgrass." The parties settled the 1999
3
action and entered into a settlement agreement under which Pursell
admitted no liability but agreed not to use the crabgrass buster logo
or a similar logo in close proximity to any claim that Vigoro controls
or suppresses post-emergent crabgrass.
In March 2000, Scotts filed another action against Pursell. In that
action, Scotts contended that Pursell breached the 1999 settlement
agreement by including the crabgrass buster logo in its promotional
materials. Scotts also asserted a new false advertising claim based on
a time-line graphic included in those promotional materials which
suggested that Vigoro was the only product with any post-emergence
effect on crabgrass. The district court concluded that Pursell had
breached the 1999 settlement agreement by using the crabgrass buster
logo and that the time-line graphic was false because it wrongly sug-
gested that Scotts' product had no post-emergence effect. The court
therefore entered a preliminary injunction requiring Pursell to remove
the offending logo and time-line from the promotional materials. The
parties entered into another settlement agreement under which Pursell
again admitted no liability.
In December 2001, United Industries purchased the Vigoro product
line from Pursell. Pursuant to their agreement, Pursell continues to
manufacture the product, and United distributes it exclusively to
Home Depot stores.
For the 2002 spring selling season, the defendants introduced new
packaging for the Vigoro products. A picture of lush green lawn occu-
pies approximately a third of the bag, and the product name appears
in the middle of that picture as follows (with some effort being made
to approximate the relative font sizes):
VIGORO
ULTRA TURF
PRE-EMERGENT
Crabgrass Control
4
plus Fertilizer
30-3-4
Centered on a bright blue background below this text and the lush-
lawn picture is the following (again, with some attempt to show the
relative font size):
Greens in 72 HOURS
Promotes Thick, Green Growth
and Stops Crabgrass and Many
Other Grassy & Broadleaf
Weeds Before They Start.
To the left of this text block is the graphic at issue in this case: a real-
istic rendering of a mature crabgrass plant positioned directly above
the following text:
Prevents Crabgrass up to 4 WEEKS After Germination
A small white cross by the crabgrass illustration leads to a disclaimer
on the bottom of the front of the package, printed in dark blue or
black ink and in very small type, which states, "Crabgrass image for
illustration only as this product is for pre- and early post emergent
control and does not control mature plants."
The crabgrass illustration on the Vigoro package is not unlike that
used by Scotts on its Halts packages, and the Halts packages likewise
claim some post-emergent effect. Scotts' post-emergent claim
("Delivers pre- and early post-emergent crabgrass control") is the first
of three "bullet points" in a vertical column on the lower left side of
the package front; the crabgrass illustration is placed just beside this
column, in the middle of the lower part of the package. A disclaimer
on the back of the Scotts' product states that "This product controls
5
crabgrass in its early stages of growth. This product does not control
mature crabgrass and other existing weeds."
Not satisfied by the revisions to the Vigoro packaging, Scotts filed
this action in the Eastern District of Virginia, where both the 1999
and the 2000 actions had been filed. Scotts asserted false advertising
claims under the Lanham Act, see 15 U.S.C.A. § 1125(a)(1)(B) (West
1998), claiming that the revamped packaging, by using the illustration
of a mature crabgrass plant, falsely suggested that Vigoro could kill
mature crabgrass.1
Scotts moved for a preliminary injunction and supported its motion
with evidence of consumer confusion derived from two focus group
discussions and face-to-face interviews with 40 shoppers selected
from a shopping mall in Richmond. Although the district court ques-
tioned the persuasiveness of some of Scotts' evidence, the court con-
cluded that Scotts had shown some evidence of consumer confusion,
that Scotts had presented at least a triable issue on its false advertising
claim, and that the balance of the harms favored Scotts. On July 2,
2002, the district court granted Scotts' request for a preliminary
injunction and ordered the defendants to change the Vigoro packaging
and remove existing product from store shelves or place a sticker cov-
ering the offending crabgrass graphic. The defendants thereafter
sought a stay of the injunction from the district court. At the hearing
on that motion, the district court stated that the question of whether
to issue the injunction had been a very close one and that the question
of staying the injunction was even closer. On July 15, 2002, however,
the district court denied the motion to stay the injunction, although the
court did modify the injunction so that it would take effect on August
30, 2002. The defendants appealed, and, as previously noted, we
granted the defendants' motion to stay the injunction pending resolu-
tion of this expedited appeal.
____________________________________________________________
1 While Scotts also asserted state law claims in its complaint, the dis-
trict court when granting the preliminary injunction focused only on the
Lanham Act claims, and the parties likewise address only the Lanham
Act claims in their appellate briefs. Any claims Scotts may have under
state law, therefore, are not at issue in this appeal.
6
II.
In this circuit, the entry of a preliminary injunction is governed by
the four-part test set forth in Blackwelder Furniture Co. of Statesville,
Inc. v. Seilig Mfg. Co., Inc., 550 F.2d 189 (4th Cir. 1977), which
requires a court to consider "(1) the likelihood of irreparable harm to
the plaintiff if the preliminary injunction is denied, (2) the likelihood
of harm to the defendant if the requested relief is granted, (3) the like-
lihood that the plaintiff will succeed on the merits, and (4) the public
interest." Direx Israel, Ltd. v. Breakthrough Med. Corp., 952 F.2d
802, 812 (4th Cir. 1991) (internal quotation marks omitted); see
Blackwelder, 550 F.2d at 193-95.
When deciding whether to grant a preliminary injunction, the court
must first determine whether the plaintiff has made a strong showing
of irreparable harm if the injunction is denied; if such a showing is
made, the court must then balance the likelihood of harm to the plain-
tiff against the likelihood of harm to the defendant. See Safety-Kleen,
Inc. (Pinewood) v. Wyche, 274 F.3d 846, 859 (4th Cir. 2001); Direx,
952 F.2d at 812. If the balance of the hardships "tips decidedly in
favor of the plaintiff," Rum Creek Coal Sales, Inc. v. Caperton, 926
F.2d 353, 359 (4th Cir. 1991) (internal quotation marks omitted), then
typically it will "be enough that the plaintiff has raised questions
going to the merits so serious, substantial, difficult and doubtful, as
to make them fair ground for litigation and thus for more deliberate
investigation," Blackwelder, 550 F.2d at 195 (internal quotation
marks omitted). But if the balance of hardships is substantially equal
as between the plaintiff and defendant, then "the probability of suc-
cess begins to assume real significance, and interim relief is more
likely to require a clear showing of a likelihood of success." Direx,
952 F.2d at 808 (internal quotation marks omitted).2
____________________________________________________________
2 Blackwelder's emphasis on the balancing of the harms rather than the
likelihood of success has been criticized, even within this court, as incon-
sistent with Supreme Court precedent. See Safety-Kleen, Inc. v. Wyche,
274 F.3d 846, 868 (4th Cir. 2001) (Luttig, J., concurring) (arguing that
Blackwelder "contravene[s] Supreme Court precedents by overvaluing
the inquiry into the relative equities of granting and denying a requested
injunction to an extent that essentially denies any value whatsoever to the
inquiry into the likelihood of success on the merits" and "virtually elimi-
7
"We review the grant or denial of a preliminary injunction for
abuse of discretion, recognizing that preliminary injunctions are
extraordinary remedies involving the exercise of very far-reaching
power to be granted only sparingly and in limited circumstances."
MicroStrategy Inc. v. Motorola, Inc., 245 F.3d 335, 339 (4th Cir.
2001) (internal quotation marks omitted). This standard "is not a rule
of perfunctory appellate review but one of careful scrutiny." Direx,
952 F.2d at 815.
We begin by considering whether the district court erred when con-
cluding that Scotts would suffer irreparable harm if an injunction
were not issued. In this case, however, that inquiry is bound up with
an inquiry into the likelihood that Scotts will prevail on its false
advertising claims. By virtue of certain intricacies in the law govern-
ing Lanham Act claims, some courts apply a presumption of irrepara-
ble harm if the plaintiff has made a threshold showing as to the merits
of his Lanham Act claim, and the district court here relied on such a
presumption when concluding that Scotts would be irreparably
harmed if the injunction were denied. See J.A. 698 ("Scotts need only
demonstrate that the advertising at issue confuses consumers in order
to satisfy the irreparable harm prong of the analysis."). Thus, because
the balance-of-the-hardship question is intertwined with questions
about the merits, our analysis of the balance-of-the-hardship question
will first require a detour into the substance of Scotts' Lanham Act
claims.
A.
The Lanham Act prohibits the "false or misleading description of
fact, or false or misleading representation of fact, which . . . in com-
____________________________________________________________
nate[s] altogether the inquiry into the likelihood of success on the mer-
its"). In the course of their challenges to the preliminary injunction, the
defendants ask that we "restate the standards for a preliminary injunction
to restore clarity to [our] jurisprudence." Brief of Appellants at 46. Of
course, "a panel of this court cannot overrule, explicitly or implicitly, the
precedent set by a prior panel of this court. Only the Supreme Court or
this court sitting en banc can do that." Mentavlos v. Anderson, 249 F.3d
301, 312 n.4 (4th Cir.), cert. denied, 122 S. Ct. 349 (2001). Moreover,
because we conclude that the preliminary injunction was improperly
issued under the Blackwelder formulation, we leave a re-examination of
the Blackwelder approach for another day.
8
mercial advertising or promotion, misrepresents the nature, character-
istics, qualities, or geographic origin of his or her or another person's
goods, services, or commercial activities." 15 U.S.C.A.
§ 1125(a)(1)(B) (West 1998). Thus, a plaintiff asserting a false adver-
tising claim under the Lanham Act must establish that:
(1) the defendant made a false or misleading description of
fact or representation of fact in a commercial advertisement
about his own or another's product; (2) the misrepresenta-
tion is material, in that it is likely to influence the purchas-
ing decision; (3) the misrepresentation actually deceives or
has the tendency to deceive a substantial segment of its
audience; (4) the defendant placed the false or misleading
statement in interstate commerce; and (5) the plaintiff has
been or is likely to be injured as a result of the misrepresen-
tation, either by direct diversion of sales or by a lessening
of goodwill associated with its products.
Cashmere & Camel Hair Mfrs. Inst. v. Saks Fifth Ave., 284 F.3d 302,
310-11 (1st Cir.), cert. denied, 71 U.S.L.W. 3163 (U.S. Nov. 4,
2002); accord IQ Prods. Co. v. Pennzoil Prods. Co., 305 F.3d 368,
375 (5th Cir. 2002); United Indus. Corp. v. Clorox Co., 140 F.3d
1175, 1180 (8th Cir. 1998). The only elements in dispute in this case
are the first and third.
For liability to arise under the false advertising provisions of the
Lanham Act, "the contested statement or representation must be either
false on its face or, although literally true, likely to mislead and to
confuse consumers given the merchandising context." C.B. Fleet Co.
v. SmithKline Beecham Consumer Healthcare, L.P., 131 F.3d 430,
434 (4th Cir. 1997) (internal quotation marks omitted). "Where the
advertisement is literally false, a violation may be established without
evidence of consumer deception." Cashmere & Camel Hair Mfrs.,
284 F.3d at 311; accord Novartis Consumer Health, Inc. v. Johnson
& Johnson-Merck Consumer Pharm. Co., 290 F.3d 578, 586 (3d Cir.
2002); C.B. Fleet, 131 F.3d at 434. But if "a plaintiff's theory of
recovery is premised upon a claim of implied falsehood, a plaintiff
must demonstrate, by extrinsic evidence, that the challenged [adver-
tisements] tend to mislead or confuse consumers." Johnson & John-
son * Merck Consumer Pharm. Co. v. Smithkline Beecham Corp., 960
9
F.2d 294, 297 (2d Cir. 1992); see Abbott Labs. v. Mead Johnson &
Co., 971 F.2d 6, 14 (7th Cir. 1992) ("[A] court may find on its own
that a statement is literally false, but, absent a literal falsehood, may
find that a statement is impliedly misleading only if presented with
evidence of actual consumer deception.").
In Lanham Act cases involving trademark infringement, a pre-
sumption of irreparable injury is generally applied once the plaintiff
has demonstrated a likelihood of confusion, the key element in an
infringement case. See, e.g., Eli Lilly & Co. v. Natural Answers, Inc.,
233 F.3d 456, 469 (7th Cir. 2000) ("Irreparable harm is generally pre-
sumed in cases of trademark infringement and dilution."); Genessee
Brewing Co. v. Stroh Brewing Co., 124 F.3d 137, 142 (2nd Cir. 1997)
("In the context of trademark and unfair competition injunctions, the
requirement of irreparable harm carries no independent weight, as we
have held that a showing of likelihood of confusion (a requirement of
both trademark infringement and unfair competition claims) estab-
lishes irreparable harm."). A similar presumption also appears in
many Lanham Act false advertising cases, although there seems to be
some disagreement among the courts as to when the presumption
should be applied. Compare, e.g., United Indus., 140 F.3d at 1183
(suggesting that the presumption applies in all Lanham Act cases
where the plaintiff has established a tendency to deceive), with Ortho
Pharm. Corp. v. Cosprophar, Inc., 32 F.3d 690, 696 (2nd Cir. 1994)
(explaining that the presumption of irreparable harm is generally lim-
ited to cases involving false comparative advertising).
This court has never spoken directly to the applicability of such a
presumption of harm in Lanham Act cases.3 Not surprisingly, Scotts
____________________________________________________________
3 District courts within this circuit, however, have discussed or applied
the presumption. See JTH Tax, Inc. v. H&R Block Eastern Tax Servs.,
Inc., 128 F. Supp. 2d 926, 948 (E.D. Va. 2001) ("[A] demonstration that
the competitor's advertising tends to mislead consumers satisfies the
[Lanham] Act's irreparable harm requirement."), aff'd in part, vacated in
part, and remanded, No. 01-1353, 2002 WL 27257 (4th Cir. Jan. 10,
2002); Black & Decker (U.S.) Inc. v. Pro-Tech Power Inc., 26 F. Supp.
2d 834, 862 (E.D. Va. 1998) ("Courts have explained that a demonstra-
tion that the competitor's advertising tends to mislead consumers satis-
fies the Lanham Act's irreparable harm requirement.").
10
contends that we should endorse the use of the presumption in false
advertising cases and that we should adopt the presumption in its
broadest formulation. For their part, the defendants suggest that we
should follow the approach of the Second Circuit and conclude that
a presumption of irreparable harm applies, if at all, only to cases
involving false comparative advertising. We need not, however,
decide whether and under what circumstances a presumption of irrep-
arable harm should be applied in false advertising cases. As we will
explain below, Scotts has failed to make even a prima facie showing
of consumer confusion, thus precluding application of the presump-
tion, regardless of how it is formulated.
B.
As previously noted, the evidence required of a false-advertising
plaintiff is dependent upon whether the case involves advertising that
is literally false or advertising that is only impliedly false. If the
advertising is literally false, no evidence of consumer confusion is
required. But if the advertising is impliedly false, the plaintiff must
present extrinsic evidence of consumer confusion.
"In analyzing whether an advertisement . . . is literally false, a court
must determine, first, the unambiguous claims made by the advertise-
ment . . ., and second, whether those claims are false." Novartis, 290
F.3d at 586. "A literally false message may be either explicit or con-
veyed by necessary implication when, considering the advertisement
in its entirety, the audience would recognize the claim as readily as
if it had been explicitly stated." Id. at 586-87 (internal quotation
marks omitted).
Here, the only claim explicitly made on the Vigoro package is that
the product prevents crabgrass up to four weeks after germination,
and Scotts concedes that this message, standing alone, is true. Scotts,
however, contends that the falsity springs not from the text standing
alone, but from the juxtaposition of the mature crabgrass illustration
directly above this text, which creates what Scotts describes as a "uni-
tary graphic." According to Scotts, the placement of the mature crab-
grass illustration so close to the phrase "prevents crabgrass up to 4
weeks after germination" necessarily leads consumers to believe that
the picture shows what crabgrass looks like four weeks after germina-
11
tion. That message, in turn, leads consumers to believe that if they
applied Vigoro to crabgrass that looked like the illustration, the prod-
uct would kill the crabgrass, or at least prevent it from spreading. At
four weeks after germination, however, crabgrass does not look like
the illustration, but instead appears as small shoots. Thus, Scotts con-
tends that the unitary graphic conveys the literally false message that
Vigoro is capable of killing mature crabgrass.
The district court concluded that the Vigoro packaging made no lit-
erally false claims, a factual finding that is entitled to deference. See
C.B. Fleet, 131 F.3d at 434 (explaining that literal falsity of an adver-
tisement is a factual question); Fed. R. Civ. P. 52(a) (requiring district
court to make specific findings of fact and conclusions of law when
granting or denying preliminary injunctions and stating that such fac-
tual findings "shall not be set aside unless clearly erroneous"). Scotts
does not even acknowledge the district court's factual finding, much
less articulate why that finding is erroneous. Our own review of the
record confirms the correctness of the district court's decision on this
point.
Preliminarily, the sheer complexity of Scotts' explanation as to
why this case involves a literal falsity seems to undercut the argu-
ment. See United Indus., 140 F.3d at 1181 ("The greater the degree
to which a message relies upon the viewer or consumer to integrate
its components and draw the apparent conclusion, however, the less
likely it is that a finding of literal falsity will be supported."). More-
over, the illustration is teamed with a claim that Vigoro "prevents"
crabgrass, a word that generally is used in the stopping-from-ever-
starting sense. See, e.g., American Heritage College Dictionary 1085
(3d ed. 1997) (giving "[t]o keep from happening" as the first defini-
tion of "prevent"). As the district court recognized, Vigoro can in fact
prevent mature crabgrass by stopping the weed before it starts, which
makes it difficult to see how the message conveyed by the Vigoro
packaging can be literally false.
Scotts, however, contends that even though the stopping-crabgrass-
before-it-starts message would be unobjectionable standing alone, the
packaging conveys another message that is literally false. Scotts
points out that while "prevent" is often used in the sense of stopping
something from happening, it can also mean hindering, impeding, or
12
eliminating something, or stopping something from existing. And
according to Scotts, the defendants have exploited this secondary
meaning of the word "[b]y juxtaposing a picture of mature crabgrass
with the words `prevents after germination,'" which suggests that
Vigoro "can stop, retard, and eliminate mature crabgrass once growth
has occurred." Brief of Appellee at 25. That is,"[t]o say that the prod-
uct is capable of preventing crabgrass after crabgrass has occurred is
to say that the product eliminates crabgrass after the fact and after it
has reached maturity." Brief of Appellee at 26.
We agree that "prevent" does carry the secondary message to
which Scotts refers and that the Vigoro packaging conveys the mes-
sage that Vigoro can stop or eliminate crabgrass once growth has
occurred. But the packaging states that it can prevent (i.e., eliminate)
crabgrass up to four weeks after it has emerged, a message which is
true and which is a far cry from Scotts' assertion that the packaging
claims that Vigoro eliminates crabgrass after maturity. Scotts' literal
falsity argument is thus dependent on the claim that the placement of
the crabgrass illustration so close to the "4 weeks after germination"
text necessarily conveys to consumers that the illustration is of a crab-
grass plant four weeks after germination. That argument, however, is
untenable when the graphic is viewed in context, as it must be. See
United Indus., 140 F.3d at 1180 (When "assessing whether an adver-
tisement is literally false, a court must analyze the message conveyed
within its full context.").
If the illustration were positioned over text claiming that Vigoro
kills crabgrass, we might be more sympathetic to Scotts' claim. But
the graphic is simply one part of a package that focuses primarily on
controlling pre-emergent crabgrass. The most obvious part of the
package is the lush-lawn photo upon which the product is referred to
(in very large letters) as "Ultra Turf Pre-Emergent Crabgrass Con-
trol." And beside the crabgrass graphic, in the center of the bottom
third of the package front, is the large-letter statement that Vigoro
"Stops Crabgrass and Many Other Grassy & Broadleaf Weeds Before
They Start." Under these circumstances, we simply cannot agree with
Scotts that the meaning it attaches to the unitary graphic is the one
necessarily conveyed by the graphic. While it is possible that some
consumers would interpret the graphic in the manner Scotts suggests,
it is likewise possible that consumers would understand the illustra-
13
tion as showing mature crabgrass for identification purposes only, so
that they can determine whether the weed that is vexing them is crab-
grass or some other backyard pest. Because the graphic can reason-
ably be understood as conveying different messages, Scotts' literal
falsity argument must fail. See Novartis, 290 F.3d at 587 ("[O]nly an
unambiguous message can be literally false."); United Indus., 140
F.3d at 1181 ("Commercial claims that are implicit, attenuated, or
merely suggestive usually cannot fairly be characterized as literally
false.").4
C.
Because we cannot conclude that the Vigoro packaging makes any
literally false claims, the question is whether Scotts can establish that
the packaging makes any impliedly false claims. See Clorox Co.
Puerto Rico v. Proctor & Gamble Commercial Co., 228 F.3d 24, 35
(1st Cir. 2000) ("[A] factfinder might conclude that the message con-
veyed by a particular advertisement remains so balanced between sev-
eral plausible meanings that the claim made by the advertisement is
too uncertain to serve as the basis for a literal falsity claim, though
even in that case it could still form the basis of a claim that the adver-
tising is misleading."). As discussed above, a plaintiff asserting an
implied falsity claim generally must present extrinsic evidence of
consumer confusion. See id. at 36 ("Unlike the requirements of a
____________________________________________________________
4 Scotts also suggests that the inclusion of the disclaimer shows that the
message necessarily conveyed by the unitary graphic is literally false.
According to Scotts, the disclaimer does not provide additional detail
about or qualify the graphic, but instead "flatly contradicts it. Through
the disclaimer, Defendants admit that Vigoro cannot do what the graphic
says-`control mature plants.'" Brief of Appellee at 29. If the graphic
conveyed a literally or impliedly false claim, then the disclaimer might
not be sufficient to eliminate the confusion. Cf. Novartis, 290 F.3d at 599
("Although we are skeptical whether disclaimers can cure false advertis-
ing claims (made literally or by necessary implication), they may be able
to dispel misleading messages implied by a product's name."). But we
have already rejected Scotts' assertion that the illustration of the mature
crabgrass plant atop text claiming a limited post-emergent effect conveys
the message that Vigoro kills mature crabgrass. If that message is not
conveyed by the graphic itself, it certainly is not conveyed by the graphic
and the disclaimer in combination.
14
claim of literal falsity, the plaintiff alleging a misleading advertise-
ment has the burden of proving that a substantial portion of the audi-
ence for that advertisement was actually misled."); Johnson &
Johnson * Merck, 960 F.2d at 297 (explaining that if "a plaintiff's
theory of recovery is premised upon a claim of implied falsehood, a
plaintiff must demonstrate, by extrinsic evidence, that the challenged
[advertisements] tend to mislead or confuse consumers").
Consumer confusion "is most often proved by consumer survey
data," Clorox Co., 228 F.3d at 36, but "full-blown consumer surveys
. . . are not an absolute prerequisite" at the preliminary injunction
stage, United Indus., 140 F.3d at 1183. Nevertheless, "the movant-
even at the preliminary injunction stage-must present evidence of
deception." Johnson & Johnson Vision Care, Inc. v. 1-800 Contacts,
Inc., 299 F.3d 1242, 1247 (11th Cir. 2002). Accordingly, we now turn
to the defendants' challenges to Scotts' evidence of consumer confu-
sion.
To show consumer confusion, Scotts presented evidence of two
focus group discussions and the results of a survey of forty consum-
ers. We consider each type of evidence separately.
1.
Scotts' focus groups consisted of a small number of Richmond-
area consumers who owned their homes and performed their own
lawn care. A moderator led each of the group discussions. Dr.
Kiecker, Scotts' marketing expert, summarized the results of the
focus group sessions and concluded that "[m]ost participants felt that
[the] purpose of the image of the plant on the front of the Vigoro bag
was to show consumers the type of crabgrass the product would pre-
vent." J.A. 102. Although none of the participants noticed the dis-
claimer on his own, Kiecker stated that once the disclaimer was
pointed out to them, the participants believed that the purpose of the
disclaimer was to "reverse the impression created by the plant image."
J.A. 103.
Scotts asserts that this focus group evidence satisfies its burden of
showing consumer confusion through extrinsic evidence. The defen-
dants, however, contend that focus group evidence is inherently
15
unscientific and thus inadmissible under Rule 702 of the Federal
Rules of Evidence or Daubert v. Merrell Dow Pharmaceuticals, Inc.,
509 U.S. 579 (1993), as evidence of consumer confusion in a false
advertising case. In the alternative, the defendants contend that even
if focus group evidence is generally admissible, the focus group evi-
dence in this case is insufficient to support Scotts' claims.
We note that the very nature of a focus group seems, to some
extent, to limit its ability to identify the message an advertisement
conveys to an individual consumer. As the defendants' expert
explained, focus groups "are a form of brainstorming where the par-
ticipants are encouraged to `build on' the thoughts of others." J.A.
208. Because the participants in a focus group freely voice their opin-
ions, the opinion of a participant can be shaped by those of the others.
Thus, a participant who may have derived no false message from an
advertisement viewed outside the context of the focus group might
well change his opinion about the message conveyed by the advertise-
ment after considering the views expressed by the other participants.
Nevertheless, we need not decide the broader question of the general
admissibility of focus group evidence, because we agree with the
defendants that, in this case, the focus group evidence was unreliable
and cannot be considered probative on the question of whether the
Vigoro packaging was likely to mislead consumers.
In our view, the manner in which the focus group discussions were
conducted prevents the results of those discussions from being con-
sidered as a reliable indicator of whether the Vigoro packaging con-
veyed misleading messages to consumers. This lack of reliability
stems from the fact that the moderators of the groups channeled the
discussions and led the participants into giving responses favorable to
Scotts. See Novartis, 290 F.3d at 591 ("A survey is not credible if it
relies on leading questions which are inherently suggestive and invite
guessing by those who did not get any clear message at all." (internal
quotation marks omitted)). The moderators asked highly leading
questions, often ignored responses that were inconsistent with the
view that the Vigoro conveyed the message that it could kill mature
crabgrass, and typically explored in detail only the responses that
were consistent with this hypothesis. For example, in one of the focus
groups, a participant named John stated that he did not know what the
purpose was of the crabgrass illustration on the Vigoro packaging.
16
The moderator then asked, "if it says prevents crabgrass up to four
weeks after germination do you think it will kill crabgrass that looks
like that?" J.A. 613. Some discussion among the participants fol-
lowed, none of which unambiguously supported Scotts' hypothesis.
The moderator then asked if any participant knew what crabgrass
looked like four weeks after germination, to which John responded,
"I would assume it's just little shoots coming up." J.A. 619. The mod-
erator responded, apparently to John and in reference to his earlier
comment: "If you don't know the purpose, again, let's go back to the
plant." J.A. 619. John immediately changed his tune and said, "This
is what it would look like up to this point." J.A. 619.
We believe this example well illustrates the problems with the
focus group evidence in this case. Initially, no message was conveyed
to John by the crabgrass illustration on the Vigoro packaging. But in
a span of time reflected by a mere six pages in the joint appendix,
John had moved from having no opinion as to the purpose of or mes-
sage conveyed by the illustration to being convinced that the illustra-
tion did indeed convey a particular and false message. Thus, the
manner in which the focus groups were conducted allowed the moder-
ator to shape the opinions of the participants to mirror Scotts' theory
of the case and then report those shaped opinions as evidence to sup-
port Scotts' claim.
We therefore conclude that the manner in which the focus groups
were conducted destroyed the objectivity of the discussions, rendering
the results utterly unreliable on the question of whether the Vigoro
packaging conveys a false message. See Novartis, 290 F.3d at 591
("The evidentiary value of a survey depends on its underlying objec-
tivity as determined through many factors, such as whether the survey
is properly filtered to screen out those who got no message from the
advertisement, whether the questions are directed to the real issues,
and whether the questions are leading or suggestive." (internal quota-
tion marks and alteration omitted)). We recognize, of course, that a
district court's evidentiary rulings are entitled to deference. See, e.g.,
Supermarket of Marlinton, Inc. v. Meadow Gold Dairies, Inc., 71
F.3d 119, 126 (4th Cir. 1995). But the deficiencies in the focus group
evidence are so substantial that we are constrained to conclude that
the district court abused its discretion by giving the evidence any
weight. See, e.g., Direx, 952 F.2d at 815 (explaining that an appellate
17
court may overturn the district court's factual findings if, after
reviewing the entire record, the appellate court is "left with the defi-
nite and firm conviction that a mistake has been committed." (internal
quotation marks omitted)).
2.
Without the focus group evidence, Scotts' only evidence of con-
sumer confusion comes from its survey of 40 do-it-yourself lawn care
consumers. According to Scotts, the survey showed that 92.5% of the
respondents were misled by the Vigoro packaging, a level of confu-
sion that would be sufficient to support Scotts' false advertising
claims. See, e.g., Johnson & Johnson-Merck Consumer Pharm. Co.
v. Rhone-Poulenc Rorer Pharm., Inc., 19 F.3d 125, 129 (3d Cir.
1994) (explaining that a false advertising plaintiff must show that
"there is actual deception or at least a tendency to deceive a substan-
tial portion of the intended audience"). The defendants, however,
challenge the admissibility of the survey evidence, arguing that the
survey is inadmissible because it does not satisfy the standards of reli-
ability set forth by the Supreme Court in Daubert. The defendants
also contend that if the survey is admissible, it does not establish any
level of consumer confusion on the relevant question. Because we
agree with the latter contention, we will not address the former.
As previously discussed, the express messages conveyed by the
Vigoro packaging are literally true. Vigoro prevents crabgrass if it is
applied up to four weeks after the crabgrass has emerged from the
soil, a claim that Scotts does not dispute. And to the extent that Vig-
oro's use of the mature crabgrass plant illustration directly above the
claim that Vigoro prevents crabgrass up to 4 weeks post-emergence
sends the message that Vigoro prevents mature crabgrass, that mes-
sage, as the district court recognized, is literally true. By preventing
crabgrass from even starting, Vigoro does prevent mature crabgrass.
The critical question in this case, then, is whether the Vigoro packag-
ing conveys the message that Vigoro kills mature crabgrass, a mes-
sage that would be false. The survey, however, simply did not address
that question.
The interviewer showed the respondents an empty Vigoro bag
folded in quarters so that the lower left quadrant (where the crabgrass
18
illustration was located) was visible and asked: "Based on your
review of this section of the bag, should this product prevent the
growth of crabgrass that looks like the crabgrass pictured?" J.A. 119.
Through the use of the word "prevent," this question suffers from the
same ambiguity as does the Vigoro packaging itself. That is, we can-
not tell from this question whether the respondents who answered yes
believed that Vigoro could prevent mature crabgrass by stopping it
before it started, or whether they believed that Vigoro could kill if
applied to established, mature crabgrass.
Scotts, however, insists that the survey does address the critical
issue. First, Scotts points out that the survey did not simply ask
whether Vigoro would prevent crabgrass that looks like the illustra-
tion, but instead asked whether Vigoro would prevent "the growth" of
crabgrass that looks like the illustration. According to Scotts, by
focusing on preventing growth, the question "asks whether the prod-
uct controls (e.g., stops) `the growth of' the pictured crabgrass. And
that of course goes to one of the key issues in the case." Brief of
Appellee at 41-42. We disagree.
As previously pointed out, the primary and most common meaning
of "prevent" is "[t]o keep from happening." American Heritage Col-
lege Dictionary 1085 (3d ed. 1997). Contrary to Scotts' suggestion,
the inclusion of the phrase "the growth of" does not obliterate or
transform this meaning-Vigoro can keep the growth of mature crab-
grass from happening by stopping crabgrass before it has a chance to
mature. The ambiguity in the survey question comes from the use of
"prevent," and that ambiguity simply is not cured by adding the
phrase "the growth of." Therefore, even though more than 90% of the
respondents answered yes when asked whether Vigoro should "pre-
vent the growth of crabgrass that looks like the crabgrass pictured,"
J.A. 119, those responses shed no light on the question that is key to
Scotts' false advertising claims-whether the Vigoro packaging con-
veys the message that it can kill mature crabgrass.
Scotts also argues that the responses to the follow-up "why or why
not" question provide sufficient evidence of consumer confusion.
Again we disagree. When asked to explain why they believed that
Vigoro would prevent crabgrass that looks like the crabgrass pictured,
many respondents said things like "because the bag says so," J.A.
19
121; "because that is crabgrass," J.A. 123; because "that is the type
of [crabgrass] I am familiar with," J.A. 127; "because that is what it
says it does," J.A. 137; "because it pictures that [crabgrass] so it
should prevent it," J.A. 145; and "because that is [crabgrass] and this
is a prevent[ative]," J.A. 155. These responses are just as ambiguous
as the initial question, and, like the responses to the initial question,
provide no evidence of consumer confusion on the critical issue.
There are, however, some explanations that do seem to support
Scotts' view of the message conveyed by the Vigoro packaging. For
example, one respondent explained that Vigoro should prevent the
growth of crabgrass that looks like the illustration "because it says it
prevents up to 4 [weeks] after germination which would look like
this." J.A. 119. Other explanations included: "because that is
c[rab]g[rass] (`pre-emergent')," J.A. 143; "says it prevents [crabgrass]
up to 4 [weeks] and that looks like a picture of [crabgrass] up to 4
[weeks]," J.A. 157; "the picture shows what you are trying to kill,"
J.A. 161; and "photo use[d] should be representative," J.A. 175. But
even some of these explanations, however, are as ambiguous as the
initial question. For example, the explanation that "the picture shows
what you are trying to kill" would be consistent with an understanding
that the crabgrass illustration is for identification purposes only and
that Vigoro prevents the pictured crabgrass by stopping it from start-
ing. While a few of these explanations more unambiguously support
Scotts' claim, we simply cannot conclude that the relatively small
number of such explanations establish that a substantial number (or,
a "not insubstantial number") of consumers are likely to be misled by
the Vigoro packaging. See Rhone-Poulenc, 19 F.3d at 134 (noting that
a Lanham Act plaintiff asserting an implied falsehood claim must
establish that "the advertising tends to deceive or mislead a substan-
tial portion of the intended audience" (internal quotation marks omit-
ted)); Johnson & Johnson * Merck, 960 F.2d at 298 (explaining that
a plaintiff raising a claim of implied falsity must establish "that a not
insubstantial number of consumers" are likely to be confused or mis-
led (internal quotation marks omitted)).
Moreover, the manner in which the survey was conducted creates
significant questions about its relevance and reliability. The purpose
of consumer surveys in false advertising cases is to determine the
message actually conveyed to consumers. But the interviewers con-
20
ducted the survey in this case in a way that effectively required the
respondents to express a specific opinion, even if they did not have
an opinion, by specifically not offering the respondents the opportu-
nity to give "not sure" as a response. See J.A. 118-19. In addition, the
survey respondents were given an empty Vigoro bag folded into quar-
ters so that only the quadrant with the crabgrass illustration was visi-
ble, thus obscuring the parts of the Vigoro packaging that emphasized
its focus on stopping crabgrass before it started, and the respondents
were asked to review only that portion of the bag. The survey thus
elicited information about the consumer's reaction to an isolated part
of the packaging, when the relevant issue in a false advertising case
is the consumer's reaction to the advertisement as a whole and in con-
text. We believe that these deficiencies in the survey's design, partic-
ularly when considered in light of the survey's failure to focus on the
critical question, weaken the relevance and credibility of the survey
evidence to the point that it sheds no light on the critical question in
this case. See Johnson & Johnson * Merck, 960 F.2d at 300 ("The
evidentiary value of a survey's results rests upon the underlying
objectivity of the survey itself. This objectivity, in turn, depends upon
many factors, such as whether the survey is properly filtered to screen
out those who got no message from the advertisement, whether the
questions are directed to the real issues, and whether the questions are
leading or suggestive." (internal quotation marks and alterations omit-
ted)).
In its order granting the preliminary injunction, the district court
expressed concerns about the survey evidence, noting that "the results
of portions of the consumer studies are not entirely helpful or con-
vincing." J.A. 700 n.7. The court recognized that while 92.5% of the
respondents
believed the product would "prevent" the crabgrass pictured
in the graphic, this number does not necessarily demonstrate
confusion. The product also indicates that it is a pre-
emergent. As a result, if it is applied correctly, it will pre-
vent mature crabgrass like the plant pictured on the package.
The fact that the vast majority of respondents believe the
product would "prevent" mature crabgrass, consequently,
provides little insight.
21
J.A. 700-01 n.7. Notwithstanding these concerns, the court relied on
the survey evidence when concluding that Scotts had established a
likelihood of confusion. As we have explained above, the survey evi-
dence does not establish consumer confusion, primarily because it
addresses issues that are not relevant to Scotts' false advertising claim
and yet fails to address the single question that is relevant to Scotts'
claims-whether Vigoro kills mature crabgrass. We therefore con-
clude that the district court abused its discretion by crediting the sur-
vey evidence.
D.
Scotts, however, contends that any deficiencies in its consumer
confusion evidence are irrelevant, because it established that the
defendants intentionally set out to deceive consumers about Vigoro's
effect on mature crabgrass. Although this court has not yet addressed
the question, other circuits have held that, like a finding of literal fal-
sity, a conclusion that a defendant intended to deceive triggers a pre-
sumption of consumer confusion that relieves a Lanham Act plaintiff
of any obligation to present evidence of likely confusion. See Cash-
mere & Camel Hair Mfrs., 284 F.3d at 316 ("It is well established that
if there is proof that a defendant intentionally set out to deceive or
mislead consumers, a presumption arises that customers in fact have
been deceived."); William H. Morris Co. v. Group W, Inc., 66 F.3d
255, 258 (9th Cir. 1995) ("If [the defendant] intentionally misled con-
sumers, we would presume consumers were in fact deceived and [the
defendant] would have the burden of demonstrating otherwise.");
Johnson & Johnson * Merck, 960 F.2d at 298 ("[W]here a plaintiff
adequately demonstrates that a defendant has intentionally set out to
deceive the public, and the defendant's deliberate conduct in this
regard is of an egregious nature, a presumption arises that consumers
are, in fact, being deceived." (internal quotation marks omitted)).
Scotts contends this intent to deceive is evidenced by the defendants'
"pattern and practice of misleading consumers," Brief of Appellee at
20, and by the inclusion of the disclaimer on the Vigoro packaging.
The disclaimer, which is linked to the graphic by a faint cross sym-
bol, states that "crabgrass image for illustration only as this product
is for pre- and early post emergent control and does not control
mature plants." Scotts argues that "[i]f the graphic conveyed a truthful
22
message, there would be no reason to `tell' consumers in a nearly-
invisible footnote that the mature crabgrass depicted . . . is shown for
`illustration only.' . . . At the very least, the disclaimer . . . reveals a
significant awareness of a risk that the current graphic conveys a mis-
leading message." Brief of Appellee at 30-31. Scotts contends that
counsel for United effectively admitted the intent to deceive at the
hearing when he stated to the district court that the disclaimer was
intended, in part, to forestall a legal challenge by Scotts. See J.A. at
457 ("The factual point of the disclaimer was trying to keep Scotts
from suing us again."). With regard to the defendants' "pattern and
practice of misleading consumers," Scotts states that the "Defendants
have appeared before the same judge three separate times for using
three strikingly similar versions of the same misleading graphic to
deceive consumers into believing that Vigoro products can control
mature crabgrass." Brief of Appellee at 20. Scotts contends that "[o]n
this record of past deception, it would have defied common sense for
[the district court] to have insisted upon Scotts providing mounds of
extrinsic evidence to support its motion." Brief of Appellee at 22.5
A defendant's intent is a "quintessentially factual question." United
States v. McKie, 951 F.2d 399, 403 (D.C. Cir. 1991); see Warren v.
Halstead Indus., Inc., 802 F.2d 746, 751 (4th Cir. 1986) ("Issues of
intent are included in the factual matters for the trier of fact to dis-
cern."). The district court, however, did not conclude that the defen-
____________________________________________________________
5 As support for its claim that the defendants' prior conduct gives rise
to an inference of an intent to deceive, Scotts cites to infringement cases
where courts have held that a defendant who has previously copied a
competitor's trademark or trade dress must "keep a safe distance away
from the margin line," Broderick & Bascom Rope Co. v. Manoff, 41 F.2d
353, 354 (6th Cir. 1930), such that subsequent design modifications by
the defendant may still be found to be infringing, even if the same design
by a "good faith user" would have been acceptable, Service Ideas, Inc.
v. Traex Corp., 846 F.2d 1118, 1124 (7th Cir. 1988); see also Osem
Food Indus., Ltd. v. Sherwood Foods, Inc., 917 F.2d 161, 164 n.4 (4th
Cir. 1990). While there seem to be substantial differences between this
case and the repeat-infringer cases cited by Scotts, we will assume, with-
out deciding, that a defendant's history of false advertising could, in a
proper case, operate to relieve the plaintiff of presenting extrinsic evi-
dence of consumer confusion created by an impliedly false advertise-
ment.
23
dants intended to deceive consumers. The court was, of course, aware
of the prior actions brought by Scotts, and the court did consider the
effect of the disclaimer when concluding that the packaging contained
an implied falsehood. But nothing in the court's opinion suggests that
the court concluded as a factual matter that the defendants' prior his-
tory, the disclaimer, or any other evidence demonstrated that the
defendants intended to deceive consumers, and it is not the function
of this court to supplement the factual findings made by the district
court. Moreover, while there is some evidence at this point that could
perhaps support a finding that the defendants intended to deceive con-
sumers, the evidence is limited and far from overwhelming.
As to the disclaimer, we note that the mere fact that the defendants
recognized the possibility that Scotts might sue does not inexorably
lead to the conclusion that the defendants believed that the graphic
was misleading and intended the graphic to deceive consumers. See
J.A. at 457 (counsel for United explaining that"[s]ometimes, though,
even when you haven't done anything wrong, you go ahead and you
do a little bit more to try to prevent somebody from complaining").
While we do not rule out the possibility that a factfinder might attach
some significance to a particular disclaimer and the circumstances
surrounding its implementation when concluding that the defendant
intended to deceive consumers, the district court did not do so in this
case.
As to the defendants' prior conduct, we note that the prior actions
did not involve the graphic at issue in this case, but instead centered
on the cartoon "crabgrass buster" logo and a time-line suggesting that
Scotts' products had no post-emergence effect. The district court in
the second action did conclude that the time-line was false, but the
court did not conclude in either the first action or the second action
that the crabgrass buster logo conveyed a false or misleading mes-
sage. Instead, through settlement agreements under which it admitted
no liability, Pursell agreed not to use the crabgrass buster logo, but
specifically reserved the right to use a graphic claiming post-
emergence control. And in our view, the graphic at issue in this case
-a realistic rendering of a mature crabgrass plant-bears little if any
resemblance to the menacing crabgrass buster logo. Again, a fact-
finder might draw negative inferences from this evidence, but the dis-
trict court did not do so here.
24
Scotts is of course free to make these arguments to the district court
at the trial on Scotts' request for a permanent injunction, and nothing
in this opinion should be understood as suggesting any particular out-
come should the issue be raised. But because the district court did not
make any factual findings with regard to whether the defendants
intended to deceive consumers, it would be improper for this court on
this record to apply a presumption of consumer confusion so as to
excuse the deficiencies we have identified in Scotts' evidence.
Which brings us to this point. We have concluded that the Vigoro
packaging is not literally false and that Scotts can prevail on its
implied falsity claim only by presenting extrinsic evidence of likely
consumer confusion. And because we have rejected Scotts' evidence
of consumer confusion (and its various arguments as to why no
extrinsic evidence was required), it follows that the district court erred
by applying the presumption of irreparable harm, a presumption that
was dependent on Scotts' establishing consumer confusion. We there-
fore proceed to consider whether the preliminary injunction can be
sustained without reference to the presumption.
III.
As previously discussed, the critical issue in a preliminary injunc-
tion case involves the balancing of the harms likely to be suffered by
the parties. If the plaintiff has made a strong showing that it will suf-
fer irreparable harm if the injunction is denied, the court must balance
the likelihood of that harm against the likelihood of harm that would
be suffered by the defendant. The plaintiff must make a "clear show-
ing of irreparable harm . . ., and the required irreparable harm must
be neither remote nor speculative, but actual and imminent." Direx,
952 F.2d at 812 (internal quotation marks omitted).
Scotts contends that it will suffer irreparable injury if a preliminary
injunction is not issued because it faces the risk of a permanent loss
of customers and goodwill. First, Scotts asserts that the misleading
statements on the Vigoro packaging will cause customers to believe
that Vigoro is the superior product and will thus decrease Scotts' sales
and perhaps even tarnish its reputation. Second, Scotts contends that
by duping customers into believing that there is a product that will rid
their yards of mature crabgrass, the defendants "run the risk of driving
25
consumers from the do-it-yourself lawn care market altogether," an
event that would disproportionately affect Scotts, the market leader.
Brief of Appellee at 34.
These arguments fall far short of establishing an actual and immi-
nent injury in this case. The record establishes that between now and
January 2003 (when the trial is scheduled on Scotts' claims), sales of
crabgrass control products are virtually non-existent. Sales will begin
increasing in February, peaking in March and April. Moreover, Vig-
oro products are sold exclusively at Home Depot and currently are not
even on the shelves in most of those stores. Therefore, even if the
Vigoro packaging were misleading, the denial of a preliminary
injunction would cause very little harm to Scotts. A permanent
injunction after the trial in January, should the district court conclude
an injunction is warranted, would be more than sufficient to protect
Scotts' market share and reputation, because the injunction would
take effect before the crabgrass-preventative season begins in earnest
in the spring. We therefore conclude that, without the presumption of
irreparable harm that was applied by the district court, Scotts has
failed to establish that, without a preliminary injunction, it will suffer
irreparable harm that is "neither remote nor speculative, but actual
and imminent." Direx, 952 F.2d at 812.
For their part, the defendants contend that they will suffer irrepara-
ble harm from the granting of the injunction, pointing to the expense
of creating new packaging and covering over the offending graphic
on existing stock, as well as the harm to their reputation that would
be caused by a determination that they engaged in false advertising.
The district court largely dismissed these concerns, stating that "[a]ny
harm that would result from a preliminary injunction would only be
the result of the Defendants' own allegedly deceptive advertising,"
J.A. 701, a fact that "should be considered in balancing the harms."
J.A. 702.
We agree with the defendants that the district court gave imper-
missibly short shrift to the question of the harm that would be visited
upon the defendants. The harm to a defendant, particularly a defen-
dant in a false advertising case, could almost always be described as
of the defendant's own making. If self-made harm is given substan-
tially less weight, as it was by the district court in this case, then the
26
balance of the harms will almost always favor the plaintiff, thus trans-
forming a preliminary injunction from an extraordinary remedy into
a routine occurrence. And when the purpose behind the requirement
that the court balance the harms is recognized, it becomes apparent
that it is error to dismiss as self-inflicted the harms that might be suf-
fered by a defendant if an injunction were to issue.
"[G]ranting a preliminary injunction requires that a district court,
acting on an incomplete record, order a party to act, or refrain from
acting, in a certain way. `The danger of a mistake in this setting is
substantial.'" Hughes Network Sys., Inc. v. Interdigital Communica-
tions Corp., 17 F.3d 691, 693 (4th Cir. 1994) (internal alteration omit-
ted) (quoting American Hosp. Supply Corp. v. Hospital Prods. Ltd.,
780 F.2d 589, 593 (7th Cir. 1986)). The entire preliminary injunction
inquiry, and particularly the requirement that the district court care-
fully balance the harms to the parties, is intended to ensure that the
district court "choose[s] the course of action that will minimize the
costs of being mistaken." American Hosp. Supply Corp. 780 F.2d at
593 (7th Cir. 1986). Thus, while cases frequently speak in the short-
hand of considering the harm to the plaintiff if the injunction is denied
and the harm to the defendant if the injunction is granted, the real
issue in this regard is the degree of harm that will be suffered by the
plaintiff or the defendant if the injunction is improperly granted or
denied:
If the judge grants the preliminary injunction to a plaintiff
who it later turns out is not entitled to any judicial relief-
whose legal rights have not been violated-the judge com-
mits a mistake whose gravity is measured by the irreparable
harm, if any, that the injunction causes to the defendant
while it is in effect. If the judge denies the preliminary
injunction to a plaintiff who it later turns out is entitled to
judicial relief, the judge commits a mistake whose gravity
is measured by the irreparable harm, if any, that the denial
of the preliminary injunction does to the plaintiff.
American Hospital Supply Corp., 780 F.2d at 593. By dismissing out-
right or giving less weight to the harm that would be suffered by a
defendant on the grounds that the harm was self-inflicted, a court is
effectively considering the harms that would flow from a properly
27
entered injunction (that is, an injunction entered against a defendant
who would go on to lose) rather than considering the harms that
would flow from an injunction entered in error (an injunction entered
against a defendant who would go on to win). We therefore believe
that it is error for a district court to conclude that any harm that would
be suffered by a defendant was self-inflicted and thus entitled to
lesser weight in the balancing-of-the-harms portion of the preliminary
injunction calculus.
But in this case, any error by the district court in its consideration
of the harm that would be suffered by the defendants is of little conse-
quence, because we conclude that the defendants would suffer only
minimal harm. While the defendants would incur the monetary costs
of complying with the injunction by creating new packaging or plac-
ing stickers to cover the offending graphic on the existing packaging,
they would be protected by the substantial bond posted by Scotts. See
Hoechst Diafoil Co. v. Nan Ya Plastics, Inc., 174 F.3d 411, 421 n.3
(4th Cir. 1999) ("In fixing the amount of an injunction bond, the dis-
trict court should be guided by the purpose underlying Rule 65(c),
which is to provide a mechanism for reimbursing an enjoined party
for harm it suffers as a result of an improvidently issued injunction
or restraining order."); Gateway Eastern Ry. Co. v. Terminal R.R.
Ass'n of St. Louis, 35 F.3d 1134, 1140 (7th Cir. 1994) ("In deciding
whether to grant a preliminary injunction, the court must also con-
sider any irreparable harm that the defendant might suffer from the
injunction-harm that would not be either cured by the defendant's
ultimately prevailing in the trial on the merits or fully compensated
by the injunction bond. . . ." (internal quotation marks omitted)). And
while the defendants' concern about the effect of an injunction is
legitimate, we believe that this concern is significantly lessened by
the fact that Home Depot is the defendants' only customer. If a pre-
liminary injunction were entered and the defendants were exonerated
after trial, the defendants' task in alleviating any concerns would be
less onerous (and more likely to succeed) with only one customer in
need of updating as to the outcome of the litigation.
We therefore conclude that relatively little harm would befall either
side if the preliminary injunction issue were improperly decided
against it. Because the balance of the harms does not tip toward either
party, "the probability of success begins to assume real significance,
28
and interim relief is more likely to require a clear showing of a likeli-
hood of success." Direx, 952 F.2d at 808 (internal quotation marks
omitted); see Blackwelder, 550 F.2d at 195 n.3.
We have previously determined that the Vigoro packaging makes
no literally false claims and that Scotts must therefore present evi-
dence of consumer confusion to succeed on its false advertising
claims. Because the evidence presented by Scotts is insufficient to
show a likelihood of consumer confusion, Scotts has therefore failed
to show a likelihood of success on the merits. This factor, then, coun-
sels against the entry of a preliminary injunction.
The final Blackwelder factor to be considered is whether the public
interest would be served by the injunction. As the district court noted,
"there is a strong public interest in the prevention of misleading
advertisements." Novartis, 290 F.3d at 597 (internal quotation marks
and alteration omitted). But because we have determined that Scotts
has not, at least at this juncture, established a likelihood of success on
its false advertising claim, we cannot conclude that public interest
weighs in favor of the issuance of an injunction.
Thus, after reviewing the record and considering the Blackwelder
factors, we conclude that a preliminary injunction is not warranted in
this case, a conclusion that flows directly from our determination that
Scotts was required to present extrinsic evidence showing a likelihood
of consumer confusion and that the focus group and survey evidence
submitted by Scotts was not reliable or probative of the critical ques-
tion in this case. The district court's error in accepting this evidence
as sufficient led it to erroneously apply a presumption of irreparable
harm, which in turn led to an erroneous consideration and application
of the preliminary injunction standards. We therefore conclude that
the district court abused its discretion by granting Scotts' request for
a preliminary injunction. See, e.g., Quince Orchard Valley Citizens
Ass'n, Inc. v. Hodel, 872 F.2d 75, 78 (4th Cir. 1989) ("A district court
abuses its discretion by applying an incorrect preliminary injunction
standard, by resting its decision on a clearly erroneous finding of a
material fact, or by misapprehending the law with respect to underly-
ing issues in litigation." (internal quotation marks omitted)). Accord-
ingly, we vacate the injunction and remand for proceedings on Scotts'
request for a permanent injunction and other relief. Given the sea-
29
sonal nature of the products at issue here, we encourage the district
court to make every effort to resolve this case as expeditiously as pos-
sible.
VACATED AND REMANDED
30