Advertising & Product Risk Management

Since the Federal Trade Commission (“FTC”) published its updated 2023 Guides Concerning the Use of Endorsements and Testimonials in Advertising earlier this year, consumer reviews have been front of mind. This guidance covers, in part, the treatment of consumer reviews, and companies have been (or should be) preparing for an uptick in FTC enforcement. But it’s not just the FTC to watch out for. A recent wave of class actions arising under California Civil Code § 1670.8 related to a customer’s right to make statements about their experience with a seller has raised the bar for retailers to another level.Continue Reading I Can’t Say What? New Wave of Class Actions Target Consumer Review Terms & Conditions

In a decision to be applauded by brand owners throughout the country, the Supreme Court clarified the balance between trademark rights and First Amendment interests in its decision in the Jack Daniel’s case, Jack Daniel’s Props., Inc. v. VIP Prods. LLC, No. 22-148 (June 8, 2023).  Vacating the judgment of the U.S. Court of Appeals for the Ninth Circuit, the Court held that an accused infringer does not receive special First Amendment protection when it has used a trademark to designate the source of its own goods.  Such use is subject to the traditional test for likelihood of confusion, the Court held, not a threshold test derived from the First Amendment such as that contained in Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989).[1]Continue Reading A Win for Brand Owners as Jack Daniel’s Escapes the Doghouse in Supreme Court Ruling

On December 20, 2022, the FTC originally noticed its solicitation for public comments regarding potential updates and changes to the Green Guides (Guides for the Use of Environmental Marketing Claims) on the Federal Register. While the original deadline to submit comments was February 21, 2023, the Federal Trade Commission (“FTC”) extended the public comment period to April 24, 2023.Continue Reading Green Guides Update – Comments Closed, but the FTC Wanted to Hear More About Waste

For months, Jack Daniel’s has had a bone to pick with VIP Products, the manufacturer of a parody dog toy called “Bad Spaniels.” In Jack Daniel’s Properties Inc. v. VIP Products, claims of trademark infringement and dilution by tarnishment were raised against the dog toymaker. The Bad Spaniels dog toy at the center of this dispute is shaped and colored like a Jack Daniel’s bottle, with similarly stylized labels stating “Bad Spaniels,” “The Old No. 2,” and “on your Tennessee Carpet.” Regardless of one’s whiskey preferences, this case may leave quite the aftertaste on trademark use in expressive works as it rests at the intersection between trademark law and the First Amendment.Continue Reading Jack Daniel’s in the Doghouse: SCOTUS Opines on First Amendment and Trademark Law

#ICYMI – The Federal Trade Commission (“FTC”) extended the public comment period on its solicitation for public comments regarding potential updates and changes to the Green Guides (Guides for the Use of Environmental Marketing Claims) by 60 days.  On December 14, the FTC held an open meeting and voted to notice the public comment period. On December 20, the FTC noticed the public comment period on the Federal Register, which would have originally expired on February 21, 2023. All public comments must now be filed by April 24, 2023.Continue Reading Green Guides Comment Deadline Extended

Is there a legal, cognizable claim for a consumer who was misled by a movie trailer? Perhaps. In June 2022, two Plaintiffs filed a lawsuit against Universal concerning a movie they streamed titled Yesterday which is owned by Universal.  Woulfe et al v. Universal City Studios LLC et al., 22-cv-00459, ECF No. 83 (C.D. Cal. Dec. 20, 2022).  Prior to streaming, the Plaintiffs watched the movie trailer, which featured actress Ana De Armas.  In the complaint, Plaintiffs alleged they were persuaded by the trailer, and De Armas’ role in particular to stream the movie.  However, De Armas’ character was cut from the final version of Yesterday, so she was not featured in the film whatsoever.  The Plaintiffs alleged they would not have rented the movie had they known De Armas would not appear in the movie. The Plaintiffs then sued Universal under a host of consumer protection violations, including a violation of the California Unfair Competition Law, California Consumer Legal Remedies Act, and California False Advertising Law. Continue Reading Can Movie Trailers Be False Advertisements? One Court Says, Maybe.

In an expansion designed to bring its advertising review jurisdiction in line with those of international self-regulatory organizations and enforcers, the National Advertising Division (NAD) has expanded its review authority so that it not only covers the truth and accuracy of national advertising, but also advertising that portrays “negative harmful social stereotyping, prejudice or discrimination.” In so doing, NAD seeks to adapt its review process to permit the review of ads that cause possible social harm based on stereotypical or discriminatory portrayals. Unlike some international bodies, which are not constrained by the First Amendment, NAD proposes to tether its review to such portrayals that may cause harm because they are misleading and inaccurate.Continue Reading National Advertising Division (NAD) Expands Jurisdiction to Review of Advertising Portraying “Negative Harmful Social Stereotyping, Prejudice or Discrimination.”

The news of Elon Musk’s $42-44 billion offer to purchase Twitter, and his apparent cold feet, have spread far and wide. Speculation has swirled that his offer was a politically-motivated stunt and that he never intended to actually follow-through with the deal. More recently, however, Musk has publicly demanded more information from Twitter regarding its so-called “bots” and he has publicly suggested that up to 20% of Twitter’s active user base is comprised of fake accounts, in contrast to the 5% that Twitter itself has claimed in its latest annual report. So, is Musk’s stated concern real or a coverup for cold feet?

While some have derided Musk’s demands as pretextual, he has a valid point that the number of real, daily active users on the Twitter platform – actual human eyeballs – is critical to the value of Twitter. A difference of 15% in estimates of bots is likely to be material. Twitter itself has said so.Continue Reading Does Elon Musk Have a Point? The Impact of Bots on Twitter Revenue.

In the wake murder of George Floyd in 2020 and the demonstrations that followed, brands pledged to support anti-racism and solidarity with the Black community. Some companies professed that they would make large donations to social justice organizations, leading commentators to ponder whether brands were “woke washing.” At the end of Black History Month, the National Advertising Division (“NAD”) announced that it investigated two companies making express claims committing to sizable charitable contributions to ensure that those claims were substantiated. See Niantic, Inc. (Advertising by Niantic Labs), Report #7037, NAD/CARU Case Reports (February 2022) and DoorDash, Inc. (Advertising by DoorDash, Inc.), Report #7036, NAD/CARU Case Reports (February 2022).
Continue Reading NAD Makes Clear that “Woke Washing” is False Advertising

Tuesday, September 14, 2021

Bureau of Competition and Bureau of Consumer Protection

  • The FTC and Justice Department issued a joint statement detailing antitrust guidance for businesses taking part in relief efforts and those involved in rebuilding communities affected by Hurricane Ida without violating the antitrust laws. The statement highlighted that the agencies will hold businesses or individuals accountable for attempting to “illegally subvert competition or engage in fraudulent conduct under the guide of disaster recovery.”

FTC Operations

  • The FTC approved a series of resolutions that will enable agency staff to efficiently and expeditiously investigate conduct in core FTC priority areas over the next ten years. The Bureau of Consumer Protection and the Bureau of Competition recommended that the Commission authorize eight new compulsory process resolutionsin these essential areas: (1) Acts or Practices Affecting United States Armed Forces Service Members and Veterans; (2) Acts or Practices Affecting Children; (3) Bias in Algorithms and Biometrics; (4) Deceptive and Manipulative Conduct on the Internet; (5) Repair Restrictions; (6) Abuse of Intellectual Property; (7) Common Directors and Officers and Common Ownership; and (8) Monopolization Offenses.

Continue Reading FTC Updates – September 2021