Advertising Law

NAD Sniffs at Odor Protection Claims

Concerned that a 48 hour antiperspirant/deodorant constitutes an overstated claim of “100% odor protection,” the National Advertising Division recommended discontinuation.

The Procter & Gamble Company touted its Secret Clinical Strength product as providing “100% odor protection” with a disclaimer “as typically noticed by others.” The advertiser also used “#100%orNothing” on its Twitter feed.

Challenger Unilever argued that when coupled with the label’s statement that Secret provides “48 hour odor protection,” the implied message to consumers was that the products are clinically proven to provide complete protection from underarm odor for 48 hours for 100% of women in 100% of circumstances, including after enduring stress, physical activity, and heat.

P&G told the self-regulatory body that Unilever improperly collapsed disparate claims and that the “100%” claims were presented in a fanciful way, such as a television voiceover stating that a woman using Secret was “80% nervous to lead the meeting, 90% confident I’d say the right thing, but with 100% odor protection, I had nothing to worry about.”

Rejecting the advertiser’s position, the NAD noted that “100%” claims convey a message of completeness and certainty to consumers.

“Looking at the advertiser’s ‘100% odor protection’ claim in the various contexts in which it appears, NAD determined that it conveys a message of ‘objective certainty,’ and that consumers could quite reasonably understand the claim to mean that they would not emit any underarm odor when using Secret Clinical Strength,” the NAD wrote. “While the advertiser’s ‘100%’ claim is often presented in the context of a playful use of percentages, NAD found that the claim’s juxtaposition against other uses of percentages does not serve to limit consumers’ reasonable takeaway regarding the scope of the claim.”

As for the disclaimer, the NAD said even if consumers had noticed, read, and understood it, they would not necessarily appreciate that the promised 100% odor protection would only be provided in some, and not all, situations. The disclaimer also contradicts the main message of the claim and accompanying visuals, as the consumer may fail to understand that odor protection would not always provide 100% odor protection in atypical situations like close encounters or very stressful events.

When used alone, the Twitter hashtag “#100%orNothing” did not necessarily convey a claim regarding product performance, the self-regulatory body said. But the NAD cautioned the advertiser that if used in the context of tweets about Secret’s odor protection capabilities, it could reasonably convey the message that the product provides consumers with total odor protection.

P&G also provided three tests it asserted would otherwise substantiate the “100%” claim, but the NAD found several problems with the protocol in the clinical studies and the use of consumer judges in a home use test.

Finding the evidence insufficient to support the “100% odor protection” claim, the NAD recommended that it be discontinued.

To read the NAD’s press release about the decision, click here.

Why it matters: The industry self-regulatory body concluded that Secret’s “100% odor protection” claim conveyed a message of “objective certainty,” which lacked sufficient evidentiary support. The decision provides a cautionary note to advertisers about the use of percentage claims, which the NAD said “convey a message of completeness and certainty to consumers.”

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Body of Message Satisfied Spam Law, California Appellate Court Rules

In dismissing a putative class action against a marketing company, a California appellate court ruled that as long as the sender’s name can be determined from the body of an e-mail message, the name used in the header address field of the message is not misleading.

Guthy-Renker LLC faced allegations that by sending e-mails purporting to be from “Proactiv Special Offer” and “Wen Hair Care,” the company violated California’s anti-spam law. The 46 plaintiffs also claimed that the defendant ran afoul of the law with a deceptive subject line by stating that the recipient was entitled to a free or complimentary gift without adding that the gift was contingent upon a purchase.

For example, one of the defendants’ challenged messages had a subject line reading: “Exclusive WEN Deal: Complementary Shipping” and originated from “Wen Hair Care (mavk@r.andedox.info). The domains were not traceable to Guthy, the plaintiffs said, and a WHOIS search would not identify the defendant as the sender.

Section 17529.5(a) of California’s anti-spam law states: “It is unlawful for any person or entity to advertise in a commercial e-mail advertisement either sent from California or sent to a California electronic mail address under any of the following circumstances: (1) … (2) The e-mail advertisement contains or is accompanied by falsified, misrepresented, or forged header information. … (3) The e-mail advertisement has a subject line that a person knows would be likely to mislead a recipient, acting reasonably under the circumstances, about a material fact regarding the contents or subject matter of the message.”

But focusing on the messages as a whole, the appellate panel found the e-mails legal.

“[T]he body of the e-mails was sufficient to enable the recipient to identify Guthy as the sender,” the court wrote. “The e-mails were advertisements for Guthy’s various consumer brands. The e-mails provided a hyperlink to Guthy’s website, and provided an unsubscribe notice as well as a physical address in Palm Desert, California. Plaintiffs cannot plausibly allege that Guthy attempted to conceal its identity, as the clear purpose of the e-mails was to drive traffic to Guthy’s website.”

Giving Section 17529.5(a)(2) a commonsense reading, “[w]e conclude a header line does not misrepresent the identity of the sender merely because it does not identify the official name of the entity which sent the e-mail, or merely because it does not identify an entity whose domain name is traceable via a database such as WHOIS, provided the sender’s identity is readily ascertainable from the body of e-mail, as was the case here,” the court said.

Turning to subsection (a)(3), the panel refused to read the subject line in isolation, as suggested by the plaintiffs, and instead evaluated it in conjunction with the body of the message.

“The e-mail advertisements plainly and conspicuously stated the conditional nature of the offer, so that an e-mail recipient, acting reasonably under the circumstances, would not be misled about a material fact with respect to the nature of the offer of a free gift or free shipping,” the court said. “Therefore, a reasonable sender would not have reason to believe the subject lines were likely to mislead a recipient, acting reasonably under the circumstances, about a material fact regarding the contents or subject matter of the message.”

Because the court concluded the challenged messages did not violate California’s law, the panel declined to address whether the claims were preempted by the federal CAN-SPAM Act.

To read the opinion in Rosolowski v. Guthy-Renker LLC, click here.

Why it matters: The California appellate panel adopted a common-sense approach to its consideration of the anti-spam law and refused to read a subject line or the sender’s address outside the context of the entire e-mail message. Marketers that attempt to reach new customers by e-mail can now breathe more easily.

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Florida Class Action Targets “Natural” Claims

Continuing the seemingly never-ending litigation challenging “natural” claims, a new lawsuit in Florida alleges that Fullbar LLC’s “100% Natural” and “All Natural” claims are false and deceptive.

Elizabeth Livingston alleged that the “100 Natural” and “All Natural” labeling on the snack bar wrapper and box violate Florida’s Unfair and Deceptive Practices Act because the chocolate peanut butter and cranberry almond bars contain synthetic ingredients. The “prominently displayed” representations are central to Fullbar’s marketing, according to the complaint.

According to the plaintiff, Fullbar’s products “are highly processed and contain numerous artificial, synthetic, and/or genetically modified ingredients” like maltodextrin, used as a thickener or filler, as well as soy protein concentrate, soy protein isolate, and soy lecithin, all derived from genetically modified organisms or genetically engineered seeds.

While the Food and Drug Administration has not issued a formal definition of “natural,” the agency has loosely defined the term as a product that “does not contain added color, artificial flavors, or synthetic substances,” she added.

The plaintiff, who purchased her Fullbars between 10 and 15 times, seeks to certify both a statewide and nationwide class of purchasers who “were forced unwittingly to support an industry that contributes to environmental, ecological, and/or health damage” and “were denied the benefit of the beneficial properties of the natural foods promised.”

The plaintiff seeks injunctive relief, restitution, damages, and compensation for unjust enrichment, all of which are based on a breach of express warranty, violations of the Magnuson-Moss Act, negligent misrepresentation, and violations of Florida’s consumer protection statute.

To read the complaint in Livingston v. Fullbar, LLC, click here.

Why it matters: Consumer class action lawsuits challenging “natural” claims have been filed repeatedly in recent years, with some speculating that such labels are disappearing from supermarket shelves as a result. Companies have paid out multi-million settlements like Ben & Jerry’s $7.5 million deal and a $9 million settlement by Naked Juice. The case against Fullbar joins the list of hundreds of other companies facing similar litigation.

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FTC Halts Tech Scam

The Federal Trade Commission filed a complaint against a group of defendants that engaged in a tech-related scam where consumers were tricked into paying for support services they did not need or software that was available for free.

Employees of Pairsys, Inc. cold-called consumers pretending to be associated with various online social media companies to pitch security programs and tech support, the agency alleged. Once on the phone, the FTC said the defendants would try to gain remote access to the consumer’s computer to imply that benign portions of the operating system contained viruses and malware.

Some callers were told that their computer was “severely compromised” and needed immediate “repair.”

By frightening consumers via the phone calls as well as through deceptive Internet ads that suggested the business offered legitimate services, the defendants sold security programs and tech support which had “no value at all,” according to the FTC. Consumers paid between $149 to $249 for otherwise freely available software or a warranty program, although some paid up to $600.

Since 2012, the defendants have reaped almost $2.5 million, the FTC told the court in its complaint alleging violations of both the Federal Trade Commission Act and the Telemarketing Sales Rule.

A federal court judge in New York granted a preliminary injunction that prohibits the defendants from making misrepresentations to consumers about the company they represent or whether the consumer has spyware or viruses on their computer. The order also bans Pairsys, Inc. and two related individuals from illegal telemarketing practices, freezes their assets, and forbids the sale of customer lists to a third party.

The complaint seeks a permanent injunction as well as restitution for duped consumers.

To read the complaint and temporary restraining order in FTC v. Pairsys, Inc., click here.

Why it matters: Similar tech support scams were the subject of a “major, international” crackdown by the FTC in 2012, when the agency filed six actions against defendants who tricked consumers into purchasing fixes for viruses or malware. Those cases yielded more than $5 million for the FTC, which continues to keep its eye on the issue.

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Noted and Quoted . . . Corporate Counsel Turns to Brody and Shah to Explore Legal Issues in the Twittersphere

On November 12, 2014, Manatt attorneys Jesse Brody and Suemyra Shah penned an article for Corporate Counsel titled, “Navigating Legal Issues in the Twittersphere.” As companies explore novel tactics to engage with consumers, they must be mindful of potential risks that may exist when interacting with other Twitter users for advertising and similar commercial purposes.

In the article, the authors noted, “[I]t is imperative that counsel properly educate and closely work with their clients, and in-house counsel with their brand marketing teams, on developing a Twitter content clearance risk minimization strategy in order to reduce the risk of a costly lawsuit as well as the negative publicity that can result from a social media strategy gone awry.”

To read the full article, click here.

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