Crocs Must Face False Advertising Claims in Federal Court: Case Will Focus on Crocs's Intentionally Misleading Claims That Its Footwear Material is 'Patented'

SASKATOON, SK, Oct. 3, 2024 /PRNewswire/ - Double Diamond Distribution LTD./Dawgs reports that Crocs, Inc. must return to court to face allegations it violated federal false advertising laws with false promotional claims that its shoes are made of "patented" materials. Crocs, Inc. may be liable for hundreds of millions of dollars as a result.

The U.S. Court of Appeals for the Federal Circuit on October 3, 2024 sent the case back to federal court in Colorado for further proceedings after finding that promotional claims Crocs has made since its founding more than 20 years ago are subject to the Lanham Act's prohibition against false and deceptive advertising. In a unanimous precedential opinion authored by Circuit Judge Reyna, the Court noted that "Crocs conceded in its briefing, and at oral argument before this court, that its statements that Croslite was covered by a patent are false."

Starting almost at its founding in the early 2000s, Crocs falsely advertised its shoe material as "patented" and "exclusive." But Crocs admitted to the Federal Circuit that it never had a patent on the material.

As Crocs's own internal documents showed, Crocs wanted consumers to believe its Croslite material was technologically advanced and had unique qualities. It worked and consumers bought Crocs shoes en masse.

"This decision is not just a win for us, but for fair competition and for the millions of people who have been harmed by Crocs's fabricated claims and intentional false advertising," said Steve Mann, the CEO of Double Diamond Distribution. "Crocs has successfully killed off many of its competitors with forever-war litigation, and it has been trying to bury our family-owned business for nearly 20 years. We are laser-focused on making this trial the beginning of the end of Crocs's audacious lies."

The Federal Circuit judges previewed their decision – and their surprise at Crocs's deceptions – during oral argument in April.

Judge Jimmie V. Renya asked Crocs's lawyer Michael Berta: "Your client concedes it does not have a patent. So that's false?"

Berta replied: "Yes, yes, yes, one hundred percent."

At another point, Judge Alan D. Albright told Berta: "[B]y putting 'it's patented' on it, you're telling the world this is novel. But you're lying."

Dawgs contends that Crocs's intentional false advertising succeeded in confusing customers and harmed Dawgs financially. They are seeking to recover from Crocs hundreds of millions of dollars in ill-gotten profits.

Dawgs is a family owned footwear company based in Saskatoon, Saskatchewan, Canada.

SOURCE Double Diamond Distribution Ltd