consumer protectionAs we previously blogged, the National Advertising Division held its 2017 Annual Conference in New York City last week. Kicking off the event was Mary Engle, the FTC’s Associate Director of Advertising Practices, who gave the keynote address on behalf of Tom Pahl, the FTC’s Acting Director of the Bureau of Consumer Protection. Tom has generously been very active in speaking at many industry conferences, but he unfortunately fell ill and had to miss this year’s NAD conference. Mary’s delivery of the address as “Tom” added a bit of levity to what was otherwise a very substantive set of remarks.

The remarks, delivered to a ballroom of advertising lawyers and industry players, were focused primarily on explaining the ways in which the FTC is implementing Acting Chairman Maureen Ohlhausen’s positive consumer protection agenda. Mary identified three key elements of this agenda.

Continue Reading NAD Annual Conference 2017 – FTC Priorities Keynote Address

The Venable team had a great start to our week last week attending the NAD Annual Conference in New York City. For those who were not able to attend, we will fill you in on some of the highlights with this week’s blog posts. The conference started with a bang with its move to new Battery Park digs for some additional space. The hotel was home Sunday night not just to incoming advertising lawyers at firms and in-house, but also to many of the golfers in town for the 2017 Presidents Cup. Many in our bar used to meet for a quiet drink in the lounge on Sunday night to catch up before the event kickoff. In contrast to the big leather chairs and soundless TV of the old bar, the new hotel featured a (stunning) rooftop bar with thumping club music, gleaming young millennial guests, and offering $25 cocktail popsicles. Change can be hard. But this is an exciting year of change at NAD and should be embraced.

In August, NAD announced the selection of its new director, Laura Brett, who replaces Andrea Levine after a 20-year tenure. Laura is known to all who participate in the self-regulatory process as a staff lawyer at NAD since 2012 and frequent speaker at advertising conferences. She brought as monitoring cases many of NAD’s early assessments of native advertising and influencer campaigns in an effort to give industry compliance tools before the FTC issued its statements or to provide additional guidance. She has also authored some of the most important cases in the last few years looking at use of crowd sourced data and online reviews. She came to NAD an experienced attorney with both law firm experience and public service in local politics. If you have had occasion to meet Laura, you know her as being thoughtful and measured, always listening before she speaks, and approaching each challenge with an open mind. In other words, exactly the kind of person meant to lead the helm of advertising self-regulation. It was with great excitement that attendees of the conference waited eagerly for the last panel in which Laura made her directorial debut headlining the session on NAD process and coordination with the FTC. Joining Laura for this session was Devin Domond, who is Chief of Staff for the FTC’s Division of Advertising Practices and is responsible for the day-to-day coordination with the NAD.

Continue Reading New Director Discusses Her Plans For “Making NAD Even Better”

spaghetti with tomato sauceWe love to eat! Maybe this is why we blog about taste claims and substantiation a lot! See here and here. And since at least one of us is always on a diet, when we indulge we like to pick the best tasting options. A competitive taste superiority message is incredibly powerful, and as such developing the necessary substantiation is exacting and expensive. Dollars to (better) tasting doughnuts, your less delicious competitor will be watching your back and seeking to test the quality of that evidence. Every year multiple challenges involving taste preference claims and the testing that supports them land on NAD’s plate to assess. One just this week actually involved dueling taste tests and considered the important question of who are the right people to test? We blogged about this before here in a case involving cereal looking at the right age range of people to test – buyers or eaters of the product. NAD’s general mantra is “taste tests should sample consumers who customarily use the products being compared.” The most recent case involving pasta sauce delved more specifically into this question of the appropriate testing universe.
Continue Reading Follow NAD’s Recipe to Support a Taste Preference Claim

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

kids and laptopsFor some time now the Children’s Advertising Review Unit (CARU) has been guided by the able hands of Acting Director Phyllis Spaeth. The Council of Better Business Bureaus (BBB) which oversees both CARU and NAD just announced the conclusion of their search for a new permanent director — Dona Fraser. Phyllis returns to her previous

ToxicWhoopsy daisy.

Better Life, a maker of home cleaning products, recently ran evocative comparative video ads with a product demonstration to grab consumers’ attention and gain share. It’s a common enough advertising strategy, but one that Better Life in this case should have nipped in the bud, according to NAD.

The ads featured a time-lapse demonstration in which gerbera daisies were placed inside Better Life All Purpose Cleaner and in four other household cleaning products, including Windex®. During a sped-up 24-hour period, consumers watched as the daisies in the other four cleaning products tragically wilted and died, while the daisy in Better Life’s cleaner thrived. Beneath the video appeared this message: “Amazing things happen when you take the toxins out of the household cleaners.”

S.C. Johnson & Son, Inc. (SCJ), the maker of Windex® and other cleaning products, did not like to be tagged as a flower killer along with a germ killer, so it turned to the National Advertising Division (NAD). SCJ argued that the video denigrated and disparaged Windex® by falsely suggesting that it is toxic and harmful to consumers.

Continue Reading NAD Finds Support for Cleaning Products Claims Not All Sunshine and Daisies

New York CityWith the end of summer and the start of school also comes the fall advertising law conference season, starting with the annual NAD conference. We wanted to share some highlights of the two-day event from last week.

FTC Bureau Director Jessica Rich gave the keynote. While the FTC will not discuss pending cases, when discussing priorities, the Bureau Director is obviously aware of what is in the pipeline and where the staff is investigating and considering new cases, so we always give these remarks close attention. Jessica said when deciding what cases to bring, “we take our cues from the marketplace and target our enforcement on practices that limit consumer choice and do consumers harm.” She said the marketplace issues are currently closely tied to technology – how people shop for goods and engage with friends and with the products they buy. She flagged the establishment of the Office of Technology Research and Investigation (OTech) and credited it with helping the Bureau of Consumer Protection get on top of tech issues including training staff about new technology, hosting visiting scholars, engaging with the tech community and planning workshops. She said “we want to be the consumer protection agency for tech issues.” As far as current advertising enforcement priorities, Jessica noted 3 trends in Advertising Practices, in addition to the “steady diet” of health and weight loss claims and problems of disclosures. These are health apps, health claims targeting older consumers and advertising in new media. In more detail:

Continue Reading Live from New York It’s the NAD Advertising Law Conference!

By Okram (Own work) [CC BY-SA 3.0], via Wikimedia Commons

A recent NAD decision provided an opportunity for NAD to once again opine on the standard for performance-related “up to” claims – this time related to energy efficiency.  As even infrequent readers of the blog are aware, this is a popular topic and one we’re prepared to talk about more often than Disney releases a Star Wars movie.

In this case, the North American Insulation Manufacturers Association (NAIMA) challenged several claims that Applegate made about its cellulose insulation.  Among other things, NAIMA challenged Applegate’s energy savings claims. Although the FTC in a similar case involving window energy efficiency claims applied a strict standard — that the majority of consumers using the product under ordinary operating conditions achieve the maximum touted results —  the NAD in response said it would not vary from its standard of an “appreciable number” of consumers achieving the touted results.  This case arguably put that pronouncement to the test as it involved claims virtually identical to those addressed by the FTC.  Nevertheless, NAD stuck to its guns and applied the “appreciable number” test, which raises the possibility that an advertiser, particularly one advertising energy savings claims might satisfy the NAD but still face FTC regulatory scrutiny.
Continue Reading “UP TO” NO GOOD

Lee Peeler has had a remarkable career. Currently he is President of the Advertising Self-Regulatory Council, which among other things oversees the NAD and CARU. Prior to that he was Deputy Director of the FTC’s Consumer Protection Bureau and an Associate Director of its Advertising Practices Division. And to top it all off, anyone who

By Cajsa Lilliehook from Portland (Chicken Noodle Soup) [CC BY-SA 2.0], via Wikimedia Commons

With the popularity of the eating local movement, it’s no wonder food companies want to promote when they do business with local farmers or have small batch local operations. NAD recently provided some guardrails for such claims in a case involving General Mills. Its Progresso Soups tout “Vineland, New Jersey: Home of Progresso” and “This [Vineland] i‎s where the great produce that goes into the soups is sourced.” Campbell’s asserted the claims implied that all or most of the Progresso ingredients were sourced locally in Vineland and that Progresso is a small company from rural New Jersey. Campbell’s said Progresso was owned by food giant General Mills, headquartered in Minneapolis, and the team running Progresso is in Minneapolis.

The soups identify General Mills and Minneapolis as the name and place of the business of the manufacturer under FDA regs and direct consumer inquiries to Minneapolis. Further, the challenger asserted that while some soups are made in Vineland, New Jersey, there are other facilities for soup making in Hannibal, Missouri and that non-soup Progresso products are made throughout the United States and Canada. (And while Missouri no doubt has some fine quality produce, something is lacking in touting Hannibal rather than Vineland as Progresso’s home base. Certainly for soup with fava beans.)

Continue Reading Soup Competitors Stir the Pot on Local Sourcing Claims at NAD