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Spruce Environmental Technologies, Inc. v. Festa Radon Technologies, Co.

United States District Court, D. Massachusetts

April 21, 2016

SPRUCE ENVIRONMENTAL TECHNOLOGIES, INC., Plaintiff,
v.
FESTA RADON TECHNOLOGIES, CO., Defendant.

MEMORANDUM & ORDER

Nathaniel M. Gorton United States District Judge

This case involves two direct competitors in the radon mitigation industry, a market that provides products for testing and reducing levels of the radioactive gas radon. Each party alleges that the other engaged in false advertising.

Pending before the Court is defendant’s motion for a preliminary injunction. For the foregoing reasons, that motion will be allowed, in part, and denied, in part.

I. Background

Plaintiff Spruce Environmental Technologies, Inc. (“plaintiff” or “Spruce”) is a Massachusetts corporation that manufactures and sells radon mitigation devices including a line of radon mitigation fans under the trade name RadonAway.

Defendant Festa Radon Technologies, Co. (“defendant” or “Festa”) is a Pennsylvania corporation that also manufactures and supplies radon mitigation devices. It entered the radon mitigation fan market in 1999 when that portion of the industry was dominated by plaintiff and one other company. Festa markets and sells a line of radon mitigation fans under the name AMG.

Plaintiff initiated this action in April, 2015 by filing a complaint alleging that defendant’s advertisements contained false and misleading statements in violation of the federal Lanham Act and various Massachusetts laws.

Plaintiff also filed a motion for a preliminary injunction requiring defendant to “cease its false and disparaging advertising . . . [and] publish corrective advertising”. That motion was allowed, in part, and denied, in part in July, 2015. Accordingly, the Court directed defendant to revise its advertisements and to cease making representations with respect to the certification of its radon fans.

In November, 2015, defendant filed a second amended answer with a counterclaim asserting that plaintiff’s advertisements contained false and misleading statements in violation of the federal Lanham Act and various Massachusetts laws. The three counts raised in defendant’s counterclaim closely mirror three of the four counts raised in plaintiff’s complaint.

In late February, 2016, defendant filed the pending motion for a preliminary injunction.

II. Motion for a preliminary injunction

A. Legal standard

In order to obtain a preliminary injunction, the moving party must establish 1) a reasonable likelihood of success on the merits, 2) the potential for irreparable harm if the injunction is withheld, 3) a favorable balance of hardships and 4) a favorable effect on the public interest. Jean v. Mass. State Police, 492 F.3d 24, 26-27 (1st Cir. 2007). Out of those factors, the likelihood of success on the merits “normally weighs heaviest on the decisional scales.” Coquico, Inc. v. Rodriguez-Miranda, 562 F.3d 62, 66 (1st Cir. 2009).

The Court may accept as true “well-pleaded allegations [in the counterclaim] and uncontroverted affidavits.” Rohm & Haas Elec. Materials, LLC v. Elec. Circuits, 759 F.Supp.2d 110, 114, n.2 (D. Mass. 2010) (quoting Elrod v. Burns, 427 U.S. 347, 350, n.1 (1976). The Court may rely on otherwise inadmissible evidence, such as hearsay, so long as it finds that, after

weighing all the attendant factors, including the need for expedition, this type of evidence was appropriate given the character and objectives of the injunctive proceeding.

Asseo v. Pan Am. Grain Co., Inc., 805 F.2d 23, 26 (1st Cir. 1986). Ultimately, the issuance of preliminary injunctive relief is “an extraordinary and drastic remedy that is never awarded as of right.” Peoples Fed. Sav. Bank v. People’s United Bank, 672 F.3d 1, 8-9 (1st Cir. 2012) (quoting Voice of the ...


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