Archive for the ‘endorsements’ Category

Rebecca Tushnet on Regulation of Commercial Speech and User-Generated Ads

Wednesday, November 10th, 2010

Professor Rebecca Tushnet of the Georgetown University Law Center has posted to SSRN Attention Must Be Paid: Commercial Speech, User-Generated Ads, and the Challenge of Regulation on SSRN. The paper is being published by the Buffalo Law Review. Cite: 58 Buffalo Law Review 721 (2010)

Here is the abstract:

This Article examines the dynamics that drive advertisers to push into new formats, and the law’s ability to regulate them. I argue that it will remain possible, and constitutional, to identify advertising and subject it to prohibitions on false and misleading claims, even for ads in unconventional formats. The article also addresses the ways in which regulators were caught off-guard by these new formats. In particular, Section 230 of the Communications Decency Act, which frees online service providers and users from liability for content generated by other users, poses some unanticipated barriers to regulating advertising. Yet despite section 230’s provisions, regulators retain flexibility in many situations. The Article considers the Federal Trade Commission’s (“FTC”) recent revisions of its guides on testimonials and endorsements. The guidelines apply to bloggers and others who receive substantial benefits from advertisers in return for their endorsements. After exploring the First Amendment challenges posed by such situations, including questions that go to the heart of the justification for regulating commercial speech, I contend that neither section 230 nor sound policy require the FTC to ignore these new forms of communicating with potential purchasers.

Suit Says Mom Blogger Promised Puff Piece for Dental Work

Thursday, October 28th, 2010


From Jose Martinez in the New York Daily News: Mommy blogger Lyss Stern agreed to write puff piece to pay off $45K dental bill then reneged: suit Almost as soon as Lowenberg & Lituchy DDS filed the lawsuit in Manhattan Supreme Court, they said they were filing paperwork to dismiss it. Odd.

Robinson on FTC v. Reverb Settlement

Wednesday, September 1st, 2010

Eric P. Robinson on Blog Law Online discusses a settlement reached by Reverb Communications and the FTC over endorsement activity. The case isn’t about blogging itself, but it does fall under the FTC’s guidelines for “new media,” and that does include blogs.

Mall-Haul Vloggers and the Law

Friday, August 20th, 2010

Blair Fowler shows off snake-skin 4-and-a-1/2-inch gladiator heels from Shoes of Prey on her juicystar07 vlog.

The July issue of Marie Claire magazine (p. 75 in print, online here) has an interesting story by Abigail Pesta about shopaholic vloggers and the emerging YouTube genre of mall-haul videos.

Let’s explore the legal implications, shall we?

Marie Claire says that the fashion and beauty industry is sending “loads of free stuff” to the vloggers in the hopes of getting good reviews. There’s nothing illegal about getting free stuff. (Whew!) But if vloggers do go online singing the praises of their buddy swag-slingers, they’ll need to be upfront about it and disclose the relationship to viewers. (It’s all part of the new Federal Trade Commission guidelines.)

To see how this is playing out on YouTube, I watched a video in which juicystar07 (née Blair Fowler) plugged custom-designed footwear from Shoes of Prey. According to Marie Claire, Shoes of Prey got 200,000 visitors to their site after Fowler discussed the brand on her vlog. While I can’t be sure of which video Marie Claire was talking about, the video I watched seemed to introduce Shoes of Prey to Fowler’s viewers. The video was, in my view, entirely on the up and up. Fowler says in the video that Shoes of Prey sent her the shoes and that she has been talking with the firm’s “head honcho.” Fowler does not explicitly say that she received the shoes for free, but the implication is clear, I think.

(Also noteworthy: The video evidences solid production and post-production work. It’s a good example of the level of polish that can be achieved with citizen-produced media.)

FTC Factsheet on Blogger Endorsement Guidelines

Monday, August 9th, 2010

FTC headquarters in Washington, D.C. (Photo: Jonathan B. Morgan, FTC)

The Federal Trade Commission has issued a factsheet on last year’s revisions to its guidelines on testimonials and endorsements in advertising. Those revisions made it clear the FTC includes social media within its jurisdiction. Bloggers who engage in compensated buzz marketing and are not upfront about it are running afoul of federal unfair-competition law, under the new guidelines.

Attorney Eric P. Robinson has analysis at CMLP.

I’ve gotta say, I think this FTC factsheet is really well written. Kudos to the FTC. It’s really refreshing to see legal guidance doled out with phrases like,

It’s all pretty common sense: Don’t mislead readers into thinking that you are giving an unbiased testimonial if you’re on the take.

If you want an example of someone who doesn’t get it, check out the story of the New York Times food critic who reviewed the food at his own wedding. Ah, the taste of integrity!

In the factsheet, FTC helpfully boils the guidelines down to three key points:

The revised Guides – issued after public comment and consumer research – reflect three basic truth-in-advertising principles:
  • Endorsements must be truthful and not misleading;
  • If the advertiser doesn’t have proof that the endorser’s experience represents what consumers will achieve by using the product, the ad must clearly and conspicuously disclose the generally expected results in the depicted circumstances; and
  • If there’s a connection between the endorser and the marketer of the product that would affect how people evaluate the endorsement, it should be disclosed.

Then, the FTC answers your questions. Here are a few of the Q&A pairs:

What are the essential things I need to know about using endorsements in advertising?
The most important principle is that an endorsement has to represent the accurate experience and opinion of the endorser:
  • You can’t talk about your experience with a product if you haven’t tried it.
  • If you were paid to try a product and you thought it was terrible, you can’t say it’s terrific.
  • You can’t make claims about a product that would require proof you don’t have. For example, you can’t say a product will cure a particular disease if there isn’t scientific evidence to prove that’s true.
Do the Guides hold online reviewers to a higher standard than reviewers for paper-and-ink publications?
No. The Guides apply across the board. The issue is – and always has been – whether the audience understands the reviewer’s relationship to the company whose products are being reviewed. If the audience gets the relationship, a disclosure isn’t needed. …
I’ve heard that every time I mention a product on my blog, I have to say whether I got it for free or paid for it myself. Is that true?
No. If you mention a product you paid for yourself, the Guides aren’t an issue. Nor is it an issue if you get the product for free because a store is giving out free samples to all its customers. The Guides cover only endorsements that are made on behalf of a sponsoring advertiser. …
What if all I get from the company is a $1-off coupon, or if the product is only worth a few dollars? Do I still have to disclose?
Here’s another way to think of it: While getting one item that’s not very valuable for free may not affect the credibility of what you say, sometimes continually getting free stuff from an advertiser or multiple advertisers is enough to suggest an expectation of future benefits from positive reviews. If you have a relationship with a marketer who’s sending you freebies in the hope you’ll write a positive review, it’s best if your readers know you got the product for free.
I have a website that reviews local restaurants. It’s clear when a restaurant pays for an ad on my website, but do I have to disclose which restaurants give me free meals?
If you get free meals, it’s best to let your readers know so they can factor that in when they read your reviews. Some readers might conclude that if a restaurant gave you a free meal because it knew you were going to write a review, you might have gotten special food or service.
Is there special language I have to use to make the disclosure?
No. The point is to give readers the information. Your disclosure could be as simple as “Company X gave me this product to try . …”
Do I have to hire a lawyer to help me write a disclosure?
No. What matters is effective communication, not legalese. A disclosure like “Company X sent me [name of product] to try, and I think it’s great” gives your readers the information they need. …
Would a single disclosure on my home page that “many of the products I discuss on this site are provided to me free by their manufacturer” be enough?
A single disclosure doesn’t really do it because people visiting your site might read individual reviews or watch individual videos without seeing the disclosure on your home page.
What about a platform like Twitter? How can I make a disclosure when my message is limited to 140 characters?
The FTC isn’t mandating the specific wording of disclosures. However, the same general principle – that people have the information they need to evaluate sponsored statements – applies across the board, regardless of the advertising medium. A hashtag like “#paid ad” uses only 8 characters. Shorter hashtags – like “#paid” and “#ad” – also might be effective.
Are you monitoring bloggers?
We’re not monitoring bloggers and we have no plans to. If concerns about possible violations of the FTC Act come to our attention, we’ll evaluate them case by case. If law enforcement becomes necessary, our focus will be advertisers, not endorsers – just as it’s always been.

FTC Attorney Discusses Rules for Blogging About Products

Friday, May 28th, 2010

David M. Newman, an attorney with the Federal Trade Commission, discussed how FTC rules apply to blogs and bloggers in a just-published piece for New York’s Practising Law Institute.

With regard to blogs, he said:

The core principles of Commission consumer protection jurisprudence are flexible enough to adapt to new media and new marketing techniques. As Gertrude Stein might have said, “deception is a deception is a deception.” Nevertheless, the Commission has had to address how existing deception and unfairness standards apply to marketing on the Internet and through social media.

Blog Endorsements. The Commission recently announced that bloggers who review products or services in their blogs will have to disclose if they receive free products or compensation in connection with the review. This is not designed to stifle blogs, but it is designed to ensure that bloggers who have turned their websites into commercial ventures, where they promote an advertiser’s product in exchange for free products, payments or other perks, reveal that relationship to readers. It is a new application of the well established principles in the Commission’s Endorsement Guides, which have always required that endorsers disclose any compensation or connection with the product they are endorsing.

From: 1811 PLI/Corp 679, PLI Order No. 22603, May-June 2010 (citations removed).

The revised guidelines to which Mr. Newman refers are here (pdf format). The FTC’s press release about the revisions to the guides is here.