Suing a Competitor for False Advertising in California (B&P 17500 and the Lanham Act)

Last updated: November 2026

A California business can sue a competitor for false advertising under two overlapping laws: the state false advertising law in Business and Professions Code section 17500, and the federal Lanham Act. The state law gives a competitor an injunction and, in limited cases, restitution. The Lanham Act adds the defendant's profits, the plaintiff's damages, and in some cases treble damages and attorney fees. Kolmogorov Law, P.C. brings and defends competitor false advertising cases in Orange County, Los Angeles, and federal court.

Call (909) 235-6116 or contact us online to discuss a competitor whose advertising is costing you customers.

What counts as false advertising

California's statute makes it unlawful to disseminate to the public, in any advertising medium including the internet, a statement about goods or services that is untrue or misleading. The speaker must have known, or by the exercise of reasonable care should have known, that the statement was untrue or misleading. (Bus. & Prof. Code, § 17500.) A violation is also a misdemeanor, though we pursue the civil remedy; criminal enforcement belongs to prosecutors.

The federal statute reaches anyone who, in commercial advertising or promotion, misrepresents "the nature, characteristics, qualities, or geographic origin" of his own or another person's goods, services, or commercial activities. (15 U.S.C. § 1125(a)(1)(B).) Both statutes cover literally false statements and statements that are literally true but misleading in context.

Puffery is not covered. "The best tacos in Orange County" is opinion. "Made with 100 percent organic ingredients" when they are not is a false statement of fact. "Clinically proven" with no clinical study is false.

Three ways it comes up

A competitor advertises that its product is "UL certified" or "FDA approved" when it is not. Customers who care about certification switch.

A rival service company runs ads claiming "the only licensed provider" in a city when several are licensed, including you. The claim is about the competitor's own status, but it directly disparages yours.

A competitor compares its product to yours in a chart, using specifications for your product that are years out of date. Comparative advertising is lawful when accurate. When it misstates your product, both statutes apply, and our page on defamation of a business covers the related trade libel claim.

Who can sue: standing under each law

Under California law, a private action for an injunction may be brought by "any person who has suffered injury in fact and has lost money or property as a result of a violation." (Bus. & Prof. Code, § 17535.) A competitor that can show lost sales traceable to the false advertising generally meets that test.

Under the Lanham Act, the statute says any person "who believes that he or she is or is likely to be damaged" may sue. (15 U.S.C. § 1125(a)(1).) The Supreme Court narrowed that language. A plaintiff must allege an injury to a commercial interest in reputation or sales, and must show that injury flowing directly from the deception the advertising worked on consumers. (Lexmark Int'l, Inc. v. Static Control Components, Inc. (2014) 572 U.S. 118 [134 S.Ct. 1377, 1390-1391].) Consumers cannot sue under the Lanham Act. Direct competitors usually can. Businesses further down the chain, such as a competitor's landlord, cannot.

What each law gives you

This is where the choice matters.

Under the state statute, the court may enjoin the practice and may order the defendant to restore money or property acquired by means of the false advertising. (Bus. & Prof. Code, § 17535.) Restitution returns money the defendant took from the plaintiff. A competitor rarely paid the defendant anything, so in practice the state law gives a competitor an injunction and little else. The same is true under the Unfair Competition Law, which incorporates any act prohibited by the false advertising chapter. (Bus. & Prof. Code, § 17200.) Our UCL page explains that statute's remedies.

Under the Lanham Act, a prevailing plaintiff may recover the defendant's profits, its own damages, and costs, subject to the principles of equity. The court may increase damages up to three times the amount found, and may award attorney fees in exceptional cases. (15 U.S.C. § 1117(a).) Courts may also enjoin the advertising, and a plaintiff who shows a likelihood of success is entitled to a rebuttable presumption of irreparable harm on a preliminary injunction motion. (15 U.S.C. § 1116(a).)

For a competitor who has lost real revenue, the Lanham Act is usually the claim that pays. The state claims ride alongside it.

Deadlines and where to file

The Unfair Competition Law carries a four-year limitations period. (Bus. & Prof. Code, § 17208.) The false advertising law has no period of its own, and a claim under it is generally treated as a liability created by statute, which carries three years. (Code Civ. Proc., § 338, subd. (a).) The Lanham Act has no express limitations period, and federal courts borrow from analogous state law, so act well inside three years.

A Lanham Act claim can be filed in federal court, where the state claims come along under supplemental jurisdiction. For our clients that usually means the Central District of California in Santa Ana or Los Angeles. A purely state-law case goes to the Superior Court: the Central Justice Center in Santa Ana for Orange County, the Stanley Mosk Courthouse for Los Angeles. Related disputes over a competitor's use of your name in paid search are covered on our Google Ads competitor page.

What we do

We start with the advertisement itself: screenshots with dates, archived web pages, the ad platform's records. Then we gather proof the statement is false, which may require testing, certification records, or a public records request. For Lanham Act damages, we document lost sales and the competitor's gains during the campaign.

Where the advertising is ongoing and the harm is accumulating, we move early for a preliminary injunction. Our page on TROs and preliminary injunctions explains the standard.

We also defend these cases. A defense built on substantiation, puffery, and the absence of consumer deception frequently succeeds.

What to bring to the first meeting

Copies of the advertisements with dates and where they ran. Any evidence the claims are false. Your own substantiation for any comparative claims you have made, because the other side will look. Sales data showing when the decline began. And a list of customers who told you why they switched.

Frequently asked questions

Can I sue a competitor for false advertising in California?

Yes. A competitor who has lost money or property because of untrue or misleading advertising may sue for an injunction under Business and Professions Code section 17535. It may also sue for damages and the defendant's profits under the Lanham Act if the injury to its sales or reputation flows directly from the deception.

What is a Lanham Act false advertising claim?

It is a federal claim under 15 U.S.C. section 1125(a)(1)(B) against anyone who, in commercial advertising, misrepresents the nature, characteristics, qualities, or geographic origin of goods or services. A commercial plaintiff must show a false or misleading statement, actual or likely deception, materiality, interstate commerce, and injury to its sales or reputation caused by the deception.

Do I have to prove customers were actually deceived?

For a literally false statement, courts generally presume deception. For a statement that is true but misleading, you usually need evidence of actual consumer confusion, often a survey. The distinction drives cost. We evaluate which category the advertisement falls into before recommending a lawsuit.

What damages can I get for competitor false advertising?

Under the Lanham Act: the defendant's profits from the false advertising, your lost profits, and costs, with the court able to increase damages up to three times and award attorney fees in exceptional cases. Under California's false advertising and unfair competition laws, a competitor usually gets an injunction; restitution is limited to money the defendant took from you.

Talk to a California business litigation attorney

If a competitor's advertising is false and your business is paying for it, or if your business has been accused of false advertising, call (909) 235-6116 or contact us online. Kolmogorov Law, P.C. is located at 327 Magnet, Irvine, CA 92618, and represents businesses in Orange County, Los Angeles, and throughout California.

This page provides general information about California and federal law and is not legal advice. Outcomes depend on the advertisement, the facts, and the court.