Coty, Inc. (Sally Hansen Complete Manicure)

Coty, Inc. (Coty) (defendant) was a nail-polish manufacturer that ran advertising campaigns to promote its product called Sally Hansen Complete Manicure (the nail polish). Coty’s advertisements claimed that nine out of 10 salon professionals preferred the nail polish’s formula to the leading salon brand of nail polish. Coty advertised that all five steps of a salon manicure were included in one bottle of the nail polish: (1) the base coat, (2) the strengthener, (3) the growth treatment, (4) the nail polish color, and (5) the top coat. Coty’s advertising claims implied that the nail polish was already available and being used at nail salons by the salon professionals. O.P.I., Inc. (OPI) (plaintiff) was a competing nail-care-product manufacturer that challenged the advertising claims made by Coty about the nail polish. OPI filed a claim against Coty with the Better Business Bureau’s National Advertising Division (NAD), a self-regulatory organization created to control false or deceptive advertising. Coty submitted a study to support its claim that nine out of 10 salon professionals preferred Coty’s nail polish formula to the leading salon brand. OPI challenged the study’s many methodological flaws, including the small sample size and the potential for bias. OPI argued that Coty’s claim that all five steps of a salon manicure were included in one bottle of the nail polish was false because simply adding base coat ingredients to nail enamel did not produce the same results as a salon manicure and because the nail polish did not contain a growth-treatment ingredient. OPI claimed that its professional lacquer line was sold only in nail salons and was the leading salon brand with a 50 percent market share. OPI argued that Coty’s nail polishes were mass-marketed at retail stores and not sold in nail salons as implied by the advertisements.