- Parties Settle Subway v. Quiznos Litigation
- April 22, 2010
- Law Firm: Loeb & Loeb LLP - Los Angeles Office
In 2006, Subway Restaurants filed a false advertising action against Quiznos Restaurants relating to two television commercials and a contest that invited consumers to submit videos comparing Quiznos and Subway sandwiches. The domain name for the contest website was www.meatnomeat.com. As part of the contest, Quiznos posted four sample videos that it created or approved, provided contest rules and "thought starters" with suggestions for entrants, and posted some of the contestant videos.
The advertising industry was closely following this case because one of the issues was whether Quiznos would be able to qualify for immunity from liability for the false advertising claim relating to the videos submitted by contestants under Section 230 of the Communications Decency Act. Section 230 provides in part: "No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider." Subway did not dispute that Quiznos was a provider and a user of an interactive computer service, so the issue was whether Quiznos merely published information provided by third parties or instead was, as the court said, "actively responsible for the creation and development of disparaging representations about Subway contained in the contestant videos."
The court declined to answer this question, stating that it was for a jury to decide if Quiznos was a traditional publisher or if it went "further and actively participated in creating or developing the third-party content submitted to the contest website." But the court did identify certain features of the contest that could sway a jury towards finding that Quiznos was not merely a publisher.
Here, the Defendants invited contestants to submit videos comparing Subway and Quiznos and demonstrating "why you think Quiznos is better." The domain name used to solicit entrants for the Contest, "meatnomeat.com," is arguably a literal falsity because it implies that the Subway sandwich has "no meat." In addition, the four "sample videos" designed by the Defendants to shape the Contest submissions arguably contain false representations because they depict the Subway sandwich as having no meat or less meat than a Quiznos sandwich.... Whether the Defendants are responsible for creating or developing the contestant videos is an issue of material fact, best submitted to the jury after viewing all of the relevant evidence. A reasonable jury may well conclude that the Defendants did not merely post the arguably disparaging content contained in the contestant videos, but instead actively solicited disparaging representations about Subway and thus were responsible for the creation or development of the offending contestant videos.