State v. Living Essentials, LLC.

Under ORS 646.608(1)(b) and (1)(e), a business practice is unlawful if it “[c]auses likelihood of confusion or of misunderstanding as to the source, . . . approval, or certification of . . . goods” or it “[r]epresents that . . . goods . . . have . . . approval, characteristics, . . . uses, benefits, quantities or qualities that the . . . goods . . . do not have.”

The State appealed after the lower court found that the Defendants’ advertising did not violate ORS 646.608(1)(b) and (1)(e). The State assigned error to the lower court’s holding that the statutes have an implied element that the misrepresentations are “material to consumer purchasing decisions.” On appeal, the State argued that the statutes do not have a materiality element. In response, Defendants argued that there is a materiality element. Under ORS 646.608(1)(b) and (1)(e), a business practice is unlawful if it “[c]auses likelihood of confusion or of misunderstanding as to the source, . . . approval, or certification of . . . goods” or it “[r]epresents that . . . goods . . . have . . . approval, characteristics, . . . uses, benefits, quantities or qualities that the . . . goods . . . do not have.” The Court found that the text, statutory context, and legislative history do not suggest that there is a materiality element of ORS 646.608. Further, the Court found that the statute did not violate the free speech provisions of the Oregon and federal constitutions because the Supreme Court has held that statutes regulating misleading commercial speech do not violate free speech provisions. Reversed and remanded.