I remember people complaining that the trailer for Sweeny Todd doesn't mention that the film is a musical.

I feel like that's an important thing to mention. Maybe someone was afraid not as many people would go see it if they knew it was a musical.

Yeah. Musicals don't make as much money as gory historical thrillers. So when the studio made a musical, the promotional people decided to market it as a thriller. Which makes sense from their point of view, but in that case why make a musical in the first place?

I'm reminded of all of those web-ads that maket perfectly ordinary online games as soft-porn experiences. I can kind of understand, but if the company so desperately wants to make porn, why don't they just make porn?

The lawsuit is a cash grab, but the plaintiff's argument is correct. Trailers are advertisements for the movie. Claiming that a product has a particular characteristic when, in reality, it does not, is false advertising. Claiming that a movie has a particular movie star in it when, in reality, it does not, is false advertising.

I think their complaint is technically correct, but I can't see how they can expect damages greater than the $3.99 viewing fee.

That's one of the rules of lawsuits. Always demand way more than you think you can possibly get. That way, when the judge decides to award you a small percentage of what you asked for, it's still a lot. Asking for millions also makes a small claims case seem bigger and more important than it really is.