Proctor & Gamble Co. v. Haugen

Procter & Gamble Company (P&G) (plaintiff) made and distributed a variety of personal-care and household products. Amway Corporation (defendant) was a P&G competitor that distributed consumer products through a hierarchical distributor network. In April of 1995, Amway distributor Randy Haugen (defendant) posted a message on Amway’s distributor messaging system alleging that P&G’s president was a satanic agent who was using the profits from the sale of P&G’s products to support a satanic church. Haugen’s message referenced 43 specific P&G products and encouraged recipients to purchase Amway products instead. Haugen eventually retracted his allegations, but his message continued to circulate. P&G received numerous complaints and questions about the allegations. P&G brought an action in federal district court against Amway, Haugen, and some distributors in Haugen’s network, asserting that P&G had lost customers who were concerned that supporting P&G would be supporting Satan. P&G claimed, among other things, that Haugen’s message contained false or misleading representations in violation of the Lanham Act. The district court granted summary judgment for Amway, Haugen, and the distributors, concluding that Haugen’s message did not include any false representations about the qualities or characteristics of P&G’s products and thus fell outside the Lanham Act’s scope. P&G appealed, arguing that Haugen’s message was actionable under the Lanham Act because it misrepresented the nature, characteristics, or qualities of P&G’s commercial activities. The appellate court considered this argument and also considered the counterargument that Haugen’s message was not actionable under the Lanham Act because it was not commercial speech.