For centuries, monsters have been vilified in countless books and films. Although the bad reputation that monsters have earned is generally well-deserved – they do, after all, frequently hurt people, destroy things, and otherwise cross the line of what’s socially acceptable – it’s important to keep in mind that some monsters are actually a lot
Ad Law Access Podcast: Comparative Advertising 101
Companies often want to claim that their products or services are better than the products or services offered by a competitor. However, comparative claims tend to be highly scrutinized by competitors and subject to challenge.
On the latest episode of the Ad Law Access podcast, it provides five tips advertisers should keep in mind
NAD Decision Addresses Product Comparisons
This month, NAD announced a decision involving T-Mobile’s ads for its TVision service. The service currently allows subscribers to watch TV over a wired broadband connection, though T-Mobile plans to offer wireless technology in the future. The decision covers a lot of ground, but we’ll focus on some key points related to product and feature
2019 Selected Top Ad Law Access Reads and Listens
In 2019, Ad Law Access published 124 stories on a wide range of topics. However, two topics stood out above the others:
- California Consumer Privacy Act (CCPA)
CCPA was far and away the most popular topic of 2019 and, as mentioned in one of our last posts of the year, “businesses and privacy professionals
Gatorade Lands in Hot Water by Encouraging Others to Avoid Water
This week, the California Attorney General announced a settlement involving allegations that Gatorade made misleading claims about the relative performance benefits of Gatorade and water in a mobile game that was targeted to teens.
Players controlled a cartoon version of Olympic Gold Medalist Usain Bolt, and ran a race to recover gold coins 
stolen by
NetSpend Settles FTC Charges, Resolving Allegations that it Deceived Consumers over Access to Prepaid Funds
Last week the FTC announced that it had reached a settlement with NetSpend over allegations that NetSpend deceived consumers by promising “immediate access” with “guaranteed approval” to money loaded on its general purpose reloadable cards. Approved 2-1 with a vote by then-Commissioner Ramirez before her resignation, the order prohibits NetSpend from making misrepresentations about the
Court Suggests Companies Can Be Liable as Soon as Claims Become Stale
It’s a common question. A company creates a product with a competitive advantage; it takes steps to substantiate a superiority claim; and, satisfied that it has met the legal standard, it bases an advertising campaign on that claim. Then, a competitor comes along with a new product, and the superiority claim is no longer accurate.
D.C. Circuit Upholds FTC on POM’s Advertising, Strikes Two-Study Standard
The U.S. Court of Appeals for the D.C. Circuit issued an opinion on Friday, January 30, upholding the Federal Trade Commission’s findings that POM Wonderful’s advertising, in which it claimed that consuming POM Wonderful pomegranate juice could prevent or reduce the risk of heart disease, prostate cancer, and erectile dysfunction, was deceptive. Although the D.C. Circuit acknowledged the importance of clinical trial evidence in supporting disease risk reduction claims, the Court disagreed with the Commission’s application of the two randomized clinical trial (RCT) standard, finding it unjustified under the First Amendment.
The D.C. Circuit Held that POM’s Advertising was Deceptive
The Court’s opinion discusses the research that POM Wonderful conducted regarding heart disease, prostate cancer, and erectile dysfunction and how the studies were used to support the advertising. In this analysis, the Court was critical of POM’s selective use of favorable small-scale studies in advertising while disregarding other, larger, unfavorable or inconclusive studies. The Court also noted certain inconsistencies in POM’s arguments regarding the inability to conduct RCTs on certain food products, such as the hurdles of blinding and expense, both of which POM overcame to perform its own research. The Court gave appropriate deference to the agency as an expert in determining whether an advertisement is deceptive and substantively upheld the Commission’s conclusion that POM’s advertising was deceptive.
Continue Reading D.C. Circuit Upholds FTC on POM’s Advertising, Strikes Two-Study Standard
In Pricing Case, California Court Determines Meaning of “Free” Shipping
In the Overstock.com case described in the post yesterday, the plaintiff also argued that Overstock’s representations that shipping was “free” or “only $2.95” violated California’s False Advertising Law because the company factored the full cost of shipping into the underlying product price. The court ruled in Overstock’s favor, determining that the claim was “nonsensical,”
California Court Imposes $6.82 Million Civil Penalty in Comparative Pricing Action
Still recovering from the holiday sales? If you’re a retailer or a manufacturer pricing your own products, don’t forget about the state laws governing promotional pricing and deceptive pricing claims. The state of California certainly hasn’t – on Friday, a California judge issued an almost $6.82 million civil penalty against Overstock.com via a tentative ruling and proposed statement of decision regarding the company’s comparative price advertising. The court also imposed stringent injunctive provisions regarding comparative price advertising. Yesterday, Overstock announced that it will appeal.
The complaint alleged that Overstock made false and misleading price comparisons to products’ “advertised retail price” (“ARP”), in violation of California’s False Advertising Law and Unfair Competition Law. Specifically, the state alleged that Overstock exaggerated the Overstock discount by referencing the highest price found for the ARP or constructing an ARP using a formula that applied an arbitrary multiplier to Overstock’s wholesale cost. Additionally, the company allegedly failed to disclose that some ARPs were based on the retail price of a similar, but non-identical, product. The court concluded that comparisons to ARPs identified as “list prices” and based on a formula or the price of a different, non-identical product were false and misleading representations, and every such ARP was an untrue statement because those ARPs did not actually exist. The court dismissed Overstock’s argument that its pricing strategy caused no consumer harm because customers always received the lowest price available on the internet, ruling that harm is presumed when an ad is demonstrated to be false, deceptive, or misleading.
Continue Reading California Court Imposes $6.82 Million Civil Penalty in Comparative Pricing Action