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Last week, the FTC announced yet another settlement with a company regarding its customer review practices. This case involved a popular cosmetics brand that retailed at Sephora—Sunday Riley. According to the FTC, Sunday Riley’s managers and Chief Executive Officer ordered employees and interns to create fake Sephora accounts and submit reviews for their products. The FTC had obtained multiple company emails showing the lengths Sunday Riley went to drive positive customer reviews, including evading Sephora’s detection by manipulating IP addresses.

Sunday Riley and its CEO settled with the FTC. In the settlement, the company and CEO did not admit fault, which is standard in these settlements. Similar to other recent settlements relating to “fake” customer reviews, the parties agreed on a go-forward basis to not make misrepresentations about the status of an endorser or customer review and to disclose material connections in endorsements and reviews.Continue Reading Customer Review Fraud Top of FTC’s Priority List

mascaraI love a good mascara case. And it’s been too long. The last time NAD looked at mascara, it was monitoring challenges over whether celebrities in mascara ads were merely spokesmodels or product demonstrations and concluded the latter. (See here and here and an earlier blog I wrote on this topic.) NAD recommended clear disclosure if the model used lash inserts or other enhancements beyond the mascara to plump and lengthen her lashes. This week came a case involving mascara that NAD found could not be cured with a disclaimer. Rather, a #1 selling claim must be supported with reliable and most recent data.

In this case, Benefit enjoyed the top spot in the prestige mascara category three years running with its They’re Real Mascara, until the latter part of 2016 and this year, when it was bested by Too Faced’s Better Than Sex Mascara. (Whether the latter name is a performance claim and whether it is supported are questions for another challenge!) Benefit promoted at point-of-sale and on the web that it was the best-selling prestige mascara in the US and the best-selling for three years, using a disclaimer identifying the source as the NPD Group dollar sales from July 2013-2016. Too Faced asserted that notwithstanding the source disclosure, readers would understand the claim to be based on current data, and its brand was the best-selling in dollars and units for 2016 full year and 2017. Benefit said the ads taken as a whole made clear the claims were based on past glories.Continue Reading NAD Lashes Out Over Use of Stale Market Share Data for a Best-Selling Claim

By Mokkie (Own work) [CC BY-SA 3.0], via Wikimedia Commons
Countless Cosmetic and Dietary Supplement Products Implicated

Effective Friday, December 4, the California Office of Environmental Health Hazard Assessment (OEHHA) listed Aloe vera (non-decolorized whole leaf extract) and goldenseal root powder as carcinogens on its list of…

Courtesy of tabaccofreekids.org

As most of our readers likely know, the FTC and FDA share jurisdiction over claims for foods, cosmetics and OTC drugs.  The two agencies have in place a written protocol which sets forth where each should defer to the other, for example, FDA has primary jurisdiction over food labeling while it defers to the FTC on food advertising.  For the most part the two agencies co-exist in relative harmony and it’s tempting to think if you’ve checked off one agency box you can check off the other agency box as well, but it’s not always that simple.

A recent warning letter sent by FDA to several tobacco manufacturers is a great example of how advertisers can sometimes get whipsawed between the two agencies.  In 1999 the FTC entered into a consent order with R.J. Reynolds regarding its advertising for its Winston “no additives” cigarettes. (A similar order was subsequently signed by what was then the Santa Fe Natural Tobacco Company).  While RJR made no express claims that its “no additives” cigarettes were safer the FTC alleged in its complaint that such a message was implied.  The consent order required that RJR include in its advertising for its product a prominent disclaimer that “No additives in our tobacco does NOT mean a safer cigarette.”  The FTC Bureau Director at the time was quoted in the Agency’s press release as stating “Reynolds’ disclosure should clear up any misconception that cigarettes without additives are safer to smoke than other cigarettes . . . .”Continue Reading FTC and FDA Don’t Always See Eye to Eye

There is lore that the beauty industry does not challenge itself sufficiently before NAD, and for this reason NAD brings more monitoring challenges in this area. After the recent decision in a case brought by Unilever, we would not be surprised if we see more competitor challenges in this area. And advertisers on the receiving end of these challenges might not find them cruelty free.

OGX makes shampoos, conditioners and related hair care products with a variety of what NAD termed “exotic” ingredients:  lines with argan oil from Morocco, coconut water, ‎keratin oil, biotin, cherry blossom ginsing, etc. Unilever said the product names were listed next to product benefits in a way that implied the benefit was due to the exotic ingredients. Unilever alleged the exotic ingredients were present at levels that would not deliver these benefits. OGX and its maker Vogue International did not provide evidence of what the exotic ingredients did. Instead, they said that the benefits were due to the formulas as a whole, that shampoo and conditioner clean hair generally, which make hair soft, fuller, etc. It voluntarily committed to redoing its packaging to separate the product benefits in the romance copy from the product name.Continue Reading When Your Brand Name is a Claim—NAD Cleans and Straightens Without Support from Advertiser

Risk-Free-TrialAs we’ve mentioned before, and as this year is unfolding, it looks like the Federal Trade Commission (“FTC”) is even more desperate to enforce the Restore Online Shoppers’ Confidence Act (“ROSCA”) than we are to find good skin care products.  The FTC has begun expanding its enforcement of ROSCA into various industries, including now the skin care industry.  Perhaps more importantly, the FTC is increasing the stakes on what constitutes adequate disclosures, forcing many marketers to spend less time looking in the mirror and more time looking at their online disclosures.

Last week, the Central District of California entered a Temporary Restraining Order and the FTC issued a complaint, alleging that since at least 2010, a number of defendants had marketed and sold skin care products on a variety of websites that ran afoul the ROSCA, the FTC Act, and the Electronic Funds Transfer Act (“EFTA”). 
Continue Reading Court Attempts to Smooth out ROSCA Violations

We just read one of our favorite NAD decisions ever. And it just so happened to involve one of our favorite recent ad campaigns. We have blogged before about Dollar Shave Club, as a vehicle to talk about Restore Online Shopper’s Confidence Act (“ROSCA”) and a reminder of the legal issues with negative option plans. But we really just wanted to share the web ads because they are hilarious. If you have not seen them, stop reading this blog (yes, you read that right) and have a look.

And even if you have seen it before, you need to refresh your memory to put the NAD’s holding in context. (We promise we are in no way affiliated with the Dollar Shave people and get no pay-per-click revenues. We would like to have a beer with these guys, however.).Continue Reading NAD Doesn’t Trim Back Humor with a Razor – Important New Ruling on Puffery

Image via Inhabitat.Since we are now fully comfortable with “smart” everything, it should be no surprise that 3D printing has taken center stage in the tech world. It’s easy to imagine 3D-printed machine parts, prototype models, or even toys, but it might be harder to accept 3D-printed foods, implantable medical devices, cosmetics, drugs, and even human tissue.  Too futuristic? Not really. The technology to 3D-print, U.S. Food and Drug Administration (“FDA”)-regulated products is, in large part, already here and rapidly progressing.

Yet, as technology continues to develop, questions arise as to whether, and how, the FDA regulatory framework will keep pace to impose the same safety, quality, and efficacy standards to 3D-printed foods, drugs, cosmetics, and medical devices that currently apply to traditionally manufactured goods. How FDA chooses to deal with 3D-printed products will significantly impact not only barriers to market-entry, but also post-marketing enforcement risks. Similarly, even assuming an FDA-regulated 3D-printed product is successfully brought to market in accordance with FDA standards, manufacturers must still assess options and potential challenges associated with protecting their intellectual property.Continue Reading 3D Printing Series: Be Right Down — Printing My Makeup

3DPrinterWe agree – the Jetsons era has indeed arrived. Beyond the days of “smart” everything, now 3D printing has taken center stage in the tech world. While it is not so farfetched to imagine 3D-printed machine parts, prototype models, or even toys, it is might be harder to watch it printing foods, implantable medical devices, cosmetics, drugs and even human tissue. All too futuristic? Not really. The technology of 3D-print FDA-regulated products is, in large part, already here and rapidly progressing.

Yet, as technology continues to develop, questions arise as to whether, and how, the U.S. Food and Drug Administration’s (“FDA”) regulatory framework will keep pace to impose the same safety, quality and efficacy standards to 3D-printed foods, drugs, cosmetics, and medical devices that currently apply to traditionally manufactured goods. How FDA chooses to deal with 3D-printed products will significantly impact not only barriers to market entry, but also post-marketing enforcement risks. Similarly, even assuming an FDA-regulated 3D-printed product is successfully brought to market in accordance with FDA standards, manufacturers must still assess options and potential challenges associated with protecting their intellectual property.

Through this multi-part blog series, we will explore these questions, considerations and challenges for 3D printing that are likely to be regulated by FDA, with particular focus on foods (consumed on earth and in space), cosmetics and medical devices. While, at this stage, FDA issues may raise more questions than clear answers, this blog series will explore and discuss the topics that are at the forefront of FDA’s agenda regarding 3D printing and, therefore, require careful consideration by any company that contemplates involvement in the 3D-printed foods, cosmetics or devices industries. 
Continue Reading 3D Printing Series: Before You Click “Print” On Your Pizza, Palette or Prosthetic: FDA and IP Considerations With 3D-Printed Foods, Cosmetics And Medical Devices

LOrealWho doesn’t want young-acting skin?  We’re not talking about the way skin acted in the zits-on-picture-day years, but rather the dewy glow of innocence – the Code of Youth.

L’Oréal USA, Inc. addressed our anti-aging desires in a popular line of ads for Lancôme Génifique and L’Oréal Paris Youth Code skincare products.  But this week the company settled with the FTC on deceptive advertising grounds.  According to the complaint, L’Oréal made false and unsubstantiated claims about Génifique and Youth Code, overstating the products’ anti-aging benefits which allegedly involved targeting users’ genes and stimulating the production of youth proteins.

Specifically, one of the ads at issue claimed that Génifique products were “clinically proven” to boost genes’ activity and stimulate the production of youth proteins that would cause “visibly younger skin in just 7 days,” and would provide results to specific percentages of users.

In a related vein, ads for L’Oréal Paris Youth Code heralded  the “new era of skincare: gene science” and told consumers that they could “crack the code to younger acting skin.”

Sign us up for that era. 
Continue Reading FTC Tells L’Oréal that Youth Code Is Not Cracked