Imperial and Cosmo are competitors in the sale of discount menswear. Litigation arose when a newspaper advertisement accused Imperial of copying Cosmo’s “3 for 1” sale idea and stated that Imperial “inflate[s] prices and compromise[s] quality.” Specifically, the ad described Imperial products as “rags,” “flea market style warehouse,” “low rent,” and “a hooker’s come on.” It also made comments comparing the owner of Imperial to the Iraqi Information Minister.
Under Illinois law, a statement is defamatory only if it can reasonably be interpreted as falsely stating a fact. The Court considered three factors: (1) whether the statement has a precise and readily understood meaning; (2) whether the statement is verifiable; and (3) whether the statement’s literary or social context signals that it has factual content. The Court ruled that Cosmo’s advertisement statements were merely subjective characterizations and lacked precise and readily understood meaning. The Court reasoned that because the world of discount menswear is highly competitive, no reasonable person would regard them as anything other than colorful hyperbole aimed at capturing the reader’s interest and attention.
Likewise, in a recent Appellate Court case, J. Maki Construction Company v. Chicago Regional Council of Carpenters, the Court reversed a jury verdict in favor of the plaintiff because the alleged defamatory statement could not be readily verified. In Maki, the defendants created a handbill which included a limerick that accused the plaintiff of building “crappy” houses. The Court determined that the term was not actionable because it was imprecise and lacked a method to measure the “crappiness” of the houses.
If you have any questions concerning what constitutes defamation or commercial disparagement, and whether you have a claim for damages, please contact a member of the firm.