Last year, the Supreme Court of Canada’s much-anticipated Richard decision signaled a shift in Canadian consumer protection law and a rejection of the traditional “buyer beware” standard.  What the Richard decision means for businesses marketing products on both sides of the border remains an open question, although for the time being caution should be exercised when making implied claims to Canadian audiences or using disclaimers in Canadian marketing materials. At the same time, it is imperative that American businesses understand the relative parameters of the U.S. consumer protection laws in order to calibrate advertising directed to a wider North American audience.

The Richard case involved a French-speaking Québécois consumer who received an English-language sweepstakes mailing from a magazine publisher suggesting, in large letters, that he had won a cash price of over $800,000, but dispelling that notion in carefully-worded small print.  After returning his claim coupon and subscribing to the publisher’s magazine, the consumer learned that he had not in fact won any sweepstakes.  In an ensuing lawsuit, the consumer asserted that the magazine publisher had violated the Quebec Consumer Protection Act by mailing English-language pamphlets to a predominantly French-speaking province that gave the misleading “general impression” that the recipient had already won a cash prize and needed only to submit a claim coupon to obtain the money.  The Quebec Superior Court agreed, finding that the mailing was “specifically designed to be misleading . . . especially to a person who is not reading in his or her mother tongue.”  In so finding, the court ruled that the “general impression” of an advertisement must be viewed from the perspective of the “average, inexperienced French-speaking consumer in Quebec.”  On appeal, however, the Quebec Court of Appeals reversed and held that the “general impression” test should be applied from the perspective of a consumer with an “average level of intelligence, skepticism, and curiosity.”

In February 2012, the Canadian Supreme Court settled the matter, reversing the Quebec Court of Appeals and holding that commercial advertising must be assessed from the perspective of a “credulous and inexperienced” consumer – that is, an “ordinary hurried purchaser” who is “not particularly experienced at detecting falsehoods or subtleties found in commercial representations.” Applying this rule, the Court deemed the small-print disclaimers found in the mailing too inconspicuous to dispel the misleading “general impression” of the advertisements.

In the wake of this ruling, many questions remain unanswered: Does the “ordinary hurried purchaser” standard apply beyond the Quebec law at issue?  Will English advertisements directed to predominantly French-speaking provinces pose greater risks of misleading this hypothetical consumer?  Will this “credulous and inexperienced consumer” act more like a consumer with an “average level of intelligence, skepticism, and curiosity” when purchasing something significant like a new car?

Moreover, for American attorneys, who likely see many similarities between the “credulous and inexperienced consumer” and the often-cited “reasonable consumer”: Will the Richard decision encourage American courts to start interpreting U.S. advertising laws from a more consumer-friendly perspective?  Have U.S. courts already begun doing so?  What considerations should you keep in mind when advising clients who market products in both the United States and Canada?

These questions and many more will be discussed this Friday, March 1, 2013, from 3:00 pm to 4:30 pm ET during a free panel discussion, co-hosted by the American Bar Association and the Canadian Bar Association, entitled “Is There a One Size Fits All Reasonable Person Standard? U.S. and Canadian Perspectives on Ad Interpretation.”  I will moderate an experienced panel of American and Canadian legal experts who will discuss the Richard decision, the direction of analogous U.S. laws, and the future of cross-border marketing practices.

To register and obtain dial-in information for this free panel, please click here.