False “salon-only” advertising!


Sales of hair care products represent an important revenue source for salons; indeed, the profit margin on these products is generally higher than the margin for the hair care services provided in the salons. Manufacturers have false advertising and unfair competition under the Lanham Act, and injunctive relief. Manufacturers state that the their product labels, on company websites, and in print advertisements, that their hair care products are available for purchase exclusively through salons and not through mass-market retailers such as CVS and Walgreens. Although the manufacturers maintain that they offer their products exclusively through salons, since at least 2004 the manufacturers have engaged in widespread diversion of their products to mass retailers. “Diversion” here is defined as the sale of products marketed as salon-only through stores that do not have salons on the premises. Diversion now accounts for “more than $1 billion of the beauty industry’s $5 billion in annual sales of salon-only products.” Plaintiffs contend that the defendants’ false “salon-only” advertising damages their reputation with consumers who purchase products at their salons, only to discover that the products are also available at mass retailers.

L’Oreal USA, Inc. (“L’Oreal”) manufactures and sells several lines of hair and skin care products, including the Matrix, Kerastase, Redken, and Pureology lines of products. Prior to 2011, Matrix products were labeled “For sale only in professional beauty salons.” Kerastase products are labeled “For professional use only”; Pureology products advise that they are “Available Only at Fine Salons and Spas.” A sample distribution contract between L’Oreal’s distributor and a salon notes that diversion damages L’Oreal’s goodwill with consumers. The contract provides for liquidated damages in the amount of $100 per unit of L’Oreal product diverted by the salon.

TIGI Linea, LP (“TIGI”) manufactures and sells the Bed Head line of hair products. Bed Head products are labeled as “Sold Only in Professional Salons.”

Conair Corporation (“Conair”) manufactures and sells the Rusk premium line of hair care products. Rusk products contain the label “Sold exclusively in professional salons.” Rusk products can be purchased online.

John Paul Mitchell Systems (“Paul Mitchell”) manufactures and sells the Paul Mitchell line of hair care products. The packaging of these products contains the following warning: “Guaranteed only when sold by a professional hairdresser, otherwise it may be counterfeit, black market, and or tampered with.” Paul Mitchell advertisements in magazines advise readers that products are available “Only in salons and Paul Mitchell schools.” A sample contract between a Paul Mitchell distributor and a salon states that diversion “seriously damages the reputation and good will established by [Paul Mitchell] and the Distributor and interferes with their business relationship with other SALON customers as well as the consumer.” The contract provides that the distributor or Paul Mitchell shall be entitled to at least $25,000 in liquidated damages for any diverted products.

The Wella Corporation (“Wella”) manufactures the Sebastian line of products, which are labeled “Guaranteed only when sold by an authorized salon.” A sample contract between Wella and a salon for the distribution of Wella hair care products provides that diversion “damages Wella’s brands, trademarks, and goodwill and damages its contractual relations with its distributors and other salon customers.” Wella’s contract also provides for liquidated damages in the event that the salon is found to be diverting Wella products.

Why Dont you support a Entrepreneur!!!

From the producers of the “Real Hair Truth,” comes the next film in
the RHT series, “Beautiful Lies.”

“Beautiful Lies” produced by Jotivi Designs, Inc, will be released in  December 2012.

“Beautiful Lies” will encompass entrepreneurs, manufacture deception,
marketing, ingredients, product labeling, deceptive labeling,
formulating your own brand, health and welfare, as well as uncovering
what professionals are using in the salon and what is in salon

There are many new members in this film and also a few will return
from the first film “The Real Hair Truth.”

In “Beautiful Lies,” we will hear from OSHA and FDA on the topics of
health and welfare. We will be closely informing the viewer of what
they are using in the salon and whether it fits the standards and
regulations that OSHA and the FDA have recently passed pertaining to
Keratin Treatments.

Being an entrepreneur is not an easy task and “Beautiful Lies” will
discuss all of the topics regarding entrepreneurship: the highs and
lows of starting your own business from scratch, product lines, books,
videos etc. The viewer will learn the “hows” and “what nots” in this
segment of the film. Motivation, Perseverance, Ambition; the film
“Beautiful Lies” covers it all.

“Beautiful Lies” will be completed by December 2012 and will be
available for Digital Download as well as DVD purchase. In this film
we do not advertise major manufacturers only the real beauty industry.
This film was solely funded by Jotovi Designs Inc, and is not seeking
any form of sponsorship. And as of February 11, 2012 “Beautiful Lies”
is Copyright in this Website (including, without limitation, Text,
Images, Software, Logos, Icons, Sounds Recordings. Films and HTML
code) is owned or licensed by Jotovi Designs Inc. All editorial
content and graphics on this site are protected by U.S. copyright.