It’s been a busy year in consumer protection law and during this holiday season, we’re taking stock of the past year and looking ahead to what’s next. In 2018, we saw many class actions related to pricing practices, scrutiny of Made in USA claims, continued growth in popularity and the evolution of influencers (
On September 26, 2018, Christine S. Wilson was sworn in as a Commissioner at the Federal Trade Commission into the seat previously held by Maureen Ohlhausen. Commissioner Wilson most recently held a senior legal role at Delta Airlines, previously was an antitrust partner at two large law firms, and during the George W. Bush Administration served as Chief of Staff to FTC Chairman Timothy Muris.
With the addition of Commissioner Wilson, the FTC now has a full slate of five commissioners at the helm, all of whom joined the agency within the last six months. It is still early days at the FTC under the leadership of Chairman Joe Simons but there are already signs that change is afoot. For example, the FTC has begun a broad review of whether it is using the full range of its remedial powers as effectively as possible, including whether there are new or infrequently applied remedies, such as monetary relief or notice to affected consumers in deceptive advertising cases. …
As consumers shift towards “organic,” “natural,” and “clean” foods for themselves and their families, they are also making similar purchasing decisions when it comes to pet food. However, as sales of “premium” pet food have increased in recent years, so has the number of consumer class action lawsuits filed against pet food manufacturers, specifically those involving claims that marketing and labeling pet foods as “natural” is false and misleading when they contain artificial ingredients, synthetic ingredients, chemicals, heavy metals, and/or toxins. …
Companies making Made in USA claims should adhere to Federal Trade Commission guidance and state law, as such claims are likely to draw attention from regulators and class action plaintiffs. Additional detail on regulatory compliance can be found in our prior post.
Deceptive Made in USA advertising continues to draw attention from the FTC. The FTC recently settled with hockey puck producer Patriot Puck and recreational equipment sister companies Sandpiper and PiperGearUSA regarding their allegedly false Made in USA claims. This brings the total number of FTC enforcement actions arising from misleading U.S.-origin claims to 25 since 1999, with six of those actions having been initiated since April 2017.…
Consumers notice and are more likely to buy products that are marketed as Made in USA, but companies face significant legal risk, negative publicity, and decades of government oversight if they overstate the extent to which their products are made in the United States.
- Companies marketing their products without qualification as Made in USA
- Support any comparative claims and clearly disclose the basis of the comparison.
- Be specific about claims regarding products or components made in the United States.
Last month, the National Advertising Division (NAD), a self-regulatory body, recommended that Telebrands, Corp., discontinue certain advertising claims for the company’s Atomic Beam flashlight, including claims comparing its brightness…
A California appeals court has allowed a putative-class-action complaint to proceed against an online retailer based on a consumer’s allegation that the retailer falsely advertised price discounts and that the consumer would not have purchased the items if he knew he was not receiving a discount.
In Hansen v. Newegg.com Americas Inc., Case No.…
- Health-related advertising claims must be supported by competent and reliable scientific evidence, generally consisting of human clinical trials that are methodologically sound and statistically significant to the 95% confidence level.
- Advertising claims must be clearly expressed as ingredient claims if the substantiation addresses only the efficacy of the ingredients in the product, not the product itself.
The NAD recently recommended that Perdue Farms, Inc. modify or discontinue certain TV and YouTube ads about Perdue’s “Harvestland Organic” chicken. Tyson Foods, Inc. challenged the Perdue ads before the NAD, arguing that they broadly communicated that all of Perdue’s chickens are “happy” and raised “organically” (free-range, non-GMO, 100% vegetarian-fed, and raised without antibiotics). Perdue responded that ads only communicated claims about Perdue’s “Harvestland Organic” sub-brand. The NAD, however, viewed the overall “net impression” conveyed by the ads and found that they communicated broad claims about all of Perdue’s chickens, in part because the ads contained many visual and audio references to the primary Perdue brand, but only fleeting visual references to the Harvestland Organic logo. Perdue announced that it will appeal the NAD’s decision.…
- Regulators continue to emphasize that relative comparisons in advertising must be supported by fact-based evidence.
- Each claim in an advertisement remains subject to review by the National Advertising Division.