In the article, “H&M class action: what lawyers told us”, featured in Apparel Insider, Partner Jason Stiehl commented on a recent class action complaint filed against H&M over its use of Higg Sustainability labels and its justification to charge premium prices for sustainable clothing. Stiehl provided insight on the importance to tighten internal systems
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
Now that some businesses are attempting to re-open and must sanitize their locations for employees and the public, Attorneys General will vigilantly monitor for unsupported claims that products can cure or prevent the transmission of COVID-19. They will also watch for claims that a location using these products will be safe for the public.
The National Advertising Division, referred Pharmavite, LLC to the Federal Trade Commission after the company refused to comply with NAD’s recommendations that it discontinue its claim that its NatureMade Omega 3 Xtra Blend dietary supplement has “Nearly 4X Better Absorption* *than standard fish oil concentrate.”
To substantiate its “Nearly 4X Better Absorption” claim, Pharmavite relied on a study that compared the absorption of 630 mg and 1680 mg doses of EPA/DHA omega 3 fatty acids manufactured with and without a self-microemulsifying drug delivery system (SMEDS). The study determined that the absorption of EPA/DHA manufactured with SMEDS was better than the absorption rate of standard fish oil (manufactured without SMEDS) for the two doses of EPA/DHA. The study concluded that there was a 6.2 differential for a 630 mg dose and a 9.6 differential for a 1680 mg dose.
The FTC continued its campaign against deceptive health and disease claims with enforcement actions against the marketers of “MelApp” and “Mole Detective,” smartphone apps that claimed to detect melanoma. These enforcement actions follow earlier FTC actions against smartphone apps that claimed to cure acne.
The Commission voted 4-1 to settle deceptive advertising claims against the Mel App defendant and two of the Mole Detective defendants and to litigate against the remaining two Mole Detective defendants. Commissioner Ohlhausen disagreed with the majority’s interpretation of the melanoma detection claims and thus with the amount of substantiation required. The settlement agreements require defendants to substantiate future melanoma-related claims with “competent and reliable scientific evidence [that] shall consist of human clinical testing” that meets rigorous scientific standards. Consistent with her analysis in POM Wonderful, Commissioner Ohlhausen’s dissent made clear that she would not require such “onerous” substantiation because “substantiation requirements must flow from the claims made by the advertiser” and “[w]ithout extrinsic evidence, I do not have reason to believe that a reasonable consumer would take away the implied claim that using these apps would increase their chances of detecting skin cancer in the early stages as compared to an examination by a dermatologist.”Continue Reading Holy Moly! FTC Says Smartphone Apps Don’t Detect Skin Cancer
Perusing the labels at your typical cosmetics counter or pharmacy aisle can feel akin to reading the menu of options for a smoothie bar. “Antioxidants,” “Aloe,” “Vitamin C,” “Almond extract,” “natural fruit,” and “protein” all appear to be popular options. When it comes to specifics, labels often vary from saying that an ingredient is contained
As the storm of concussion-related litigation continues to churn, the Federal Trade Commission is once again wading into its turbulent waters. In August, the FTC sent warning letters to five undisclosed “major” retailers, expressing concerns that athletic mouthguards are being advertised deceptively on the retailers’ web sites as helping to prevent concussions. These FTC letters represent the convergence of two trends at the Commission: (1) a recent focus on advertising claims of concussion prevention/protection; and (2) sustained efforts to hold retailers accountable for advertising claims concerning the products on their shelves.
Retailers in the Crosshairs
The FTC’s letters mark the first time that the Commission has called retailers to account for allegedly deceptive concussion claims. They cite a 1977 FTC decision, Porter & Dietsch, Inc., for the proposition that retailers “can be liable for violating the FTC Act by disseminating false or unsubstantiated claims.” The FTC cited an example of a specific (and redacted) product, and recommended that the retailers review their web sites to ensure that they do not contain “concussion protection claims for which competent and reliable scientific evidence does not exist.” The FTC stated its intent to revisit the retailers’ web sites within 90 days, and implied that enforcement actions would be forthcoming if unsubstantiated claims were not removed.
FTC’s concussion warning letters continue a trend of the Commission using the threat of enforcement against retailers essentially to turn them into deputized enforcers of false advertising rules. This practice places a substantial burden on retailers to demand substantiation of potentially questionable claims from product manufacturers.Continue Reading FTC Warns Retailers to Police Their Products’ Deceptive Concussion Prevention Claims