Simpson Strong-Tie Company Inc. v. MiTek Inc.

Background

Simpson asserted five claims against MiTek: false advertising under the federal Lanham Act; false advertising under California Business and Professions Code section 17500; passing off under the Lanham Act; unfair competition under California Business and Professions Code section 17200; and copyright infringement under 17 U.S.C. section 106. A bench trial was set for February 6, 2023.

Simpson manufactures and sells structural connectors for building construction and uses alphanumeric product names. Simpson alleged that MiTek, which also sells competing structural connectors, used product names identical or similar to Simpson’s and used Simpson’s product names as reference numbers for MiTek products. Simpson argued that these uses could deceive consumers into believing that the products were equivalent or interchangeable, or that MiTek’s products were actually Simpson’s products.

Simpson retained Rob Wallace, a survey and brand-communications expert. Wallace conducted four surveys involving MiTek catalog, website, product-label, and conversion-guide materials. The surveys addressed whether Simpson’s product names were widely known, whether MiTek’s uses caused confusion about product equivalence, source, affiliation, endorsement, or approval, and whether confusion affected purchasing decisions. MiTek retained Professor David Franklyn solely to review and critique Wallace’s evidence.

Legal standard

Federal Rule of Evidence 702 allows expert testimony when the expert’s specialized knowledge will help the factfinder, the testimony rests on sufficient facts or data, reliable principles and methods, and a reliable application of those principles and methods. The court’s gatekeeping role is to assess the soundness of the expert’s methodology, not decide whether the expert’s conclusions are correct. Under Ninth Circuit law, flaws in survey questions, survey administration, or survey format generally affect the evidence’s weight rather than its admissibility, although a survey may be excluded if it was not conducted according to accepted survey principles.

MiTek’s motion concerning Wallace

MiTek did not challenge Wallace’s qualifications. It argued that his surveys were unreliable because they used leading questions, an inadequate group of participants, and improper controls.

The court rejected MiTek’s challenge to the survey universe. Wallace screened for people employed in the construction industry who were involved in selecting, specifying, or purchasing structural connectors for wood-framed structures and held specified construction-related positions. MiTek argued that this group was both too broad because some participants lacked sufficient industry familiarity and too narrow because it excluded do-it-yourself customers. The court held that these objections went to the weight of the evidence, not its admissibility. The court noted that MiTek conceded that construction professionals were part of the relevant consuming public and concluded that the imperfect survey universe did not make the results entirely unreliable or lacking in value.

MiTek also challenged Wallace’s use of closed-ended, leading questions and the consistent presentation of the answer “Yes” first, where that answer favored Simpson. The court found these arguments well-founded but concluded that, under Ninth Circuit law and the flexibility involved in designing surveys for false-advertising claims, the questions were not so unreliable that exclusion was warranted. Those objections could be considered in deciding how much weight to give the survey evidence.

MiTek argued that Wallace’s secondary-meaning questions may have biased respondents because they followed questions that repeatedly displayed MiTek materials. The court found those criticisms persuasive and recognized that the survey structure may have biased respondents against MiTek. But the court again concluded that the objections concerned the evidence’s weight rather than admissibility.

Wallace used control groups. For the advertising-confusion surveys, control respondents saw the same MiTek materials with the reference numbers removed. For the secondary-meaning surveys, control respondents saw fictitious product names. The test and control groups produced similar results. Wallace proposed explaining the similarity by asserting that MiTek’s alleged deceptive marketing had created widespread preconceived notions in the industry. The court found that explanation unsupported and speculative. Wallace could testify about the control-survey results, comparisons between the test and control results, and any disclosed statistical significance analysis, but he could not speculate about the reasons for the results. Accordingly, the court denied MiTek’s motion in part and granted it in part.

Simpson’s motion concerning Franklyn

Simpson sought to exclude Franklyn’s testimony because he had not conducted his own survey, his criticisms allegedly relied on unreliable methods, and he lacked expertise in the construction-connector industry. MiTek responded that Franklyn was qualified in survey methodology and could critique Wallace’s work based on his knowledge and experience.

The court held that Franklyn could testify to the full scope of his opinions criticizing Wallace’s survey evidence. The court treated Simpson’s objections about survey methodology as issues affecting the weight of Franklyn’s testimony rather than its admissibility.

Because Franklyn lacked relevant expertise in the construction industry, however, the court limited some of his proposed testimony. He could discuss certain survey-methodology criticisms, including the survey universe, respondent sophistication, and responses to open-ended questions. He could testify about industry-related matters—such as overlapping product-naming conventions, other companies’ naming practices, and consumer availability of the products—only if the trial record clearly showed that he was relying on information or evidence supplied by competent sources.

Franklyn could not speculate about why MiTek chose particular naming or marketing strategies. He also could not speculate about how the relevant consuming public would react to alternative product names because he had not conducted his own survey research. The court therefore denied Simpson’s motion in part and granted it in part as to specified matters outside Franklyn’s expertise.

Disposition

The court denied MiTek’s motion to exclude Wallace’s testimony, except that it granted MiTek’s motion to exclude Wallace’s testimony about the reasons he believed the test and control surveys produced similar results. The court denied Simpson’s motion to exclude Franklyn’s testimony, except that it granted Simpson’s motion as to certain matters outside Franklyn’s expertise. The order was entered by Judge Virginia K. Demarchi.