Guest Post: U.S. FTC Updates FAQs on Endorsements and Testimonials in Social Media

Major enforcement agencies, notably in the United States (U.S. FTC) and Canada (Competition Bureau have been increasingly focusing on misleading online testimonials and disclaimers. In this respect, earlier this week Canada’s Competition Bureau launched a new advertising law publication with the first issue focusing on digital marketing issues (see: here). These issues have also been a focus of the U.S. FTC, which has recently updated its rules on online endorsements and testimonials. Brian Heidelberger of Winston & Strawn in Chicago has posted a very good “mini law lesson” video of the U.S. FTC’s new position (with many of the tips also good practices for Canadian brands and agencies. ____________________ FTC Updates Its FAQs on Endorsements and Testimonials in Social Media Brian Heidelberger (Chair, Advertising, Marketing and Privacy – Winston & Strawn LLP) The FTC has elaborated on its rules on endorsements, making plain that it’s not enough to just link … read more »

Competition Bureau Highlights Priorities, Compliance Guidelines in New Advertising Publication

The Canadian Competition Bureau has been increasing its advocacy, outreach and compliance efforts since the (relatively) new Commissioner of Competition (John Pecman) took office. As part of this effort, it appears to be focusing on introducing more new media (and also an increasing range) of communication publications and compliance tools, including business-focused pamphlets, compliance videos, multi-media tools and, most recently, a new advertising law focused publication: the Deceptive Marketing Practices Digest (Marketing Digest). In reading the Bureau’s new Marketing Digest, several key things struck me that are notable for companies, brands and agencies: 1. A continued increasing focus on the digital economy: Like other major enforcement agencies (notably the U.S. FTC), the Bureau is increasingly focusing on the digital economy. 2. Past and current Bureau enforcement priorities: The Bureau’s Marketing Digest reiterates past and current enforcement priorities for the Bureau – for example, disclaimers, misleading “general impression” issues, failing to … read more »

Competition Bureau Makes Major Changes to Canadian Competition Law Compliance Programs

On June 3, 2015, the Canadian Competition Bureau (Bureau) finalized its new core competition law compliance materials. They are essential reading for corporate compliance officers, senior management and in-house counsel. In announcing its new Corporate Compliance Programs Bulletin, the Commissioner of Competition said: “This bulletin seeks to help businesses of all sizes in the development of a credible and effective compliance program, but the updated bulletin pays special attention to small and medium‑sized businesses. It is designed to help businesses get the solid information they need to reduce their risk of contravening the law. A compliance program benefits businesses in two ways: it helps them to identify areas of high risk of contravention of the Competition Act and other laws; and it allows them to determine circumstances where they may be the victim of anti‑competitive conduct by other parties.” The Bureau’s new compliance materials now consist of a competition compliance … read more »

Canadian Contest Law: Key Questions to Ask if Running a Contest in Canada

I am a competition and advertising lawyer. For about the past ten years (probably more) I have been working on promotional contests for a wide range of clients – from large consumer products firms, to start-ups and individuals that want to promote their brands in a perennially successful way: contests. They are extremely popular with both brands and consumers. While contests can vary considerably depending on the type of promotion, where the contest will be run and how it will be promoted, in Canada there are a number of important preliminary considerations to think about. In general, these typically involve questions relating to the type of promotion, where it will be run (e.g., Canada-wide, Canada excluding Quebec, North America, etc.) and how it will be promoted (e.g., through traditional media, social media, using e-mail etc.). Other key considerations include complying with basic competition, privacy and criminal law requirements. In this … read more »

Water Heater Supplier Scalded With $7 Million Advertising Law Settlement, Tough Compliance Terms (and Monitor)

Misleading advertising is squarely part of Canadian competition law. Violation of the Competition Act’s civil or criminal misleading advertising provisions can also lead to significant liability for companies or individuals. As a recent reminder of this, the Competition Bureau has announced that water heater supplier National Home Services (National) has agreed to pay a $7 million penalty for alleged false or misleading claims made by its sales agents. The case has been settled under a consent agreement, which is available on the Competition Tribunal’s website. According to the Bureau, National’s sales agents made false or misleading claims relating to their identities, the purpose of their visits and claims that consumers’ water heaters were unsafe or eligible for no-cost upgrades. Based on the consent agreement, the Bureau’s concerns appear to include alleged claims by National’s sales agents that they were associated with the government (or quasi-government agencies), needed to access water … read more »

Hockey Helmet Case a Reminder of Canada’s Performance Claim Rules (and a Few Key Points)

Performance claims remain a popular advertising strategy for many brands. These can include statements about a product’s speed, reliability or other performance. Performance claims in Canada, however, are subject to both the “general misleading advertising” sections of the Competition Act (Act) and a stand-alone performance claims provision (section 74.01(1)(b) of the Act). The importance of ensuring that adequate and proper tests have been performed before product performance claims are made was highlighted again with the announcement earlier today by the Competition Bureau (Bureau) that Bauer has agreed to stop make certain claims in relation to its RE-AKT hockey helmets (and donate $500,000 to charity). Under a consent agreement (i.e., settlement), Bauer has also agreed to remove or modify the challenged claims and adopt an enhanced corporate compliance program. The Bureau had taken issue with claims (both words and images) that, in the Bureau’s view, created the impression that Bauer’s helmets … read more »

Numerous Warning Letters Serve as a Reminder that the FTC is Always Watching

November 11, 2014 Guest post by Shannon Harell (Information Law Group) The Federal Trade Commission (“FTC”) has been very active in its enforcement efforts in the past couple of months. In addition to other actions which we have blogged about, the FTC recently sent dozens of warning letters to advertisers in two separate efforts. In September, the FTC sent letters admonishing companies for their failure to make adequate disclosures in an effort dubbed “Operation Full Disclosure.” Then, in October, the FTC sent letters to companies for their potentially misleading “oxo degradable” claims in violation of the FTC’s Guides for the Use of Environmental Marketing Claims (or “Green Guides”). Operation Full Disclosure Warning Letters First, in Operation Full Disclosure, the FTC sent warning letters to more than sixty undisclosed companies—including twenty of the largest advertisers in the US—for their failure to make clear and conspicuous disclosures in television and print advertisements. … read more »