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The ACA, the Lanham Act and personal injury lawyers

April 14, 2014

The Lanham Act, named for its chief sponsor, then-Texas Representative Fritz Lanham regulates trademark infringement and  false advertising, among other things. Signed into law by President Harry Truman in 1947, it has been the principal basis for many multi-million dollar awards against companies for false, misleading and injurious advertising practices, as illustrated in an article dealing with advertising scandals.

Under the provisions of the Lanham Act, specifically 15 U.S.C. § 1125(a)(1)(A)and (B), consumers may  bring a civil suit if they allege they have been deceived or injured by misleading statements or misrepresentation about a product or service .

 In the context of the law,  injury is not defined as an actual injury, but must only meet the standard of potential injury. In addition, the burden of proof demands that it is proven  the advertiser knowingly made false statements of fact about its product, the deception was material, the false advertising deceived or had the potential to deceive a large segment of its target demographics, the deception was of a material nature, and the product was sold in interstate commerce.

Virtually every claim made by the originators and backers of the ACA touted its superiority over any existing product (insurance policy) and the front men and women for the ACA loudly and incessantly claimed that it would not only give everyone who did not have insurance a policy, but that the product would be cheaper and better than existing competing products.

Many of the commercial  products later adjudged to have been marketed under false advertising claims had well known front people such as actors, actresses and  auto racing icons. The ACA had Barack Obama,  then Secretary of Health and Human Services Kathleen Sibelius, and Senator Harry Reid, as well as a coterie of Hollywood types. In addition, the insurance companies seemed to be if not complicit in the drafting and promotion of the ACA,  at least willing co-enablers.

A large number of American citizens lost their existing insurance policies, and many more will potentially lose existing policies now offered by their employers. Some have lost access to their health care providers of choice as well. Competing products in existence before the passage of the ACA were vociferously denounced as sub-standard and more expensive than the plans approved by the ACA. This would seem to meet the standard for injury as defined in the Lanham Act.

Given that our courts have successfully prosecuted other high-profile  instances of product misrepresentation, where exactly is the outrage over the deceptive practices engaged in to sell this law and its subsequent product, i.e. the ACA and its insurance policies?

Obviously filing suit against the government is not something undertaken by your average citizen. Indeed, it is usually the government prosecuting the offending companies, and the government bureaucrats and politicians are not likely to indict themselves.

Certainly there have been challenges to portions of the ACA, such as the case currently under review by SCOTUS relating to employers objecting to covering certain contraceptive drugs, but the firms or nonprofits such as the American Center for Law and Justice (ACLJ)  assisting these plaintiffs are typically seeking  standing on constitutional grounds. They are either naming the government itself as defendants, or defending their clients on constitutional grounds against an action brought by the federal government. That may be the wrong type of attorney to pursue action under the Lanham Act.

Private companies on the other hand can be sued by individuals or classes of individuals. After all, it is the insurance companies, not the government directly, that cancelled existing insurance policies.

You can’t turn on the TV without seeing some personal injury  law firm chasing after clients to sue for damages for asbestos-related disease, some drug or the other, or an auto manufacturer. Notably, the potential defendants have deep pockets. 

So why in the name of all that is just, isn’t some firm suing the insurance companies under the Lanham Act?

At some point, someone is going to suffer real harm because they couldn’t access their previously approved  healthcare provider’s services and treatment protocol. Someone is going to have serious injury exacerbated or even expire because they were transported to a hospital 200 miles away that qualifies for inclusion on the provider list of their insurance company’s Obamacare-approved  policy in preference to a closer facility that isn’t on the preferred provider list. That would seem to meet the standards of the Lanham Act for potential for injury.

The  product, i.e. the insurance policies, with their seemingly unalterable framework of mandated coverage provisions is sold across state lines, which makes it interstate commerce.

The advertising was clearly false, since the law was passed on the premise that it would not disrupt people’s then-current policies, it would allow them to keep the same doctors and hospitals, and it would cost less than their current policies.

Instead of pushing back against those claims that they knew to be false, the insurance companies participated, seemingly willingly, by making sure that the government-approved product was the only one available to replace cancelled policies.

Insurance company executives clearly knew before the law became effective that some of their products would not meet ACA guidelines, that they would displace providers, and that they would be more expensive in terms of total out-of-pocket costs, including premiums,  than existing policies. There are documented meetings of these executives at the White House, and even if that were not the case, they had to have enough advance knowledge to conduct actuarial research and craft new policies.

If lawyers care about whether male enhancement products could have or have caused injury, where is the class action suit demanding recompense for injury under the ACA?

Surely advertising for plaintiffs to pursue an artificial joint manufacturer isn’t any less potentially profitable than pursuing a claim against insurance companies for taking away someone’s access to a perfectly good existing product and substituting an inferior one. 

Whether through intimidation or actual collusion, the insurance companies participated in what appears to be false claims of efficacy, or to put it more bluntly, they were complicit or at least compliant in perpetrating fraudulent claims of benefit.

Yes, it would be all too easy for the companies to say “the government made us do it”. The obvious defense is that they were simply reacting to a government edict.

Here’s the difference. In order to make that defense they are going to have to show in open court, sans DOJ attorneys, that they did not collude in marketing the idea in the first place and that they did not know the product roll out could have injurious consequences for consumers.

It will certainly take enhancement of another portion of the male anatomy to bring a suit like this, but hey, there are such enhancement products on the market. Perhaps they should be utilized in a slightly off-label application.

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