Marketing what can i say

Marketing- What Can I

Say? (Service and Product

Claims)

By: Xonna Clark, Esq.

Confidential Information of Xonna Clark- Do Not Distribute 1

AGENDA ¤ 2nd in a series

¤ Basic guidance- building awareness ¤  Representations/Warranties ¤  Advertising and Marketing ¤  Disease/Health Claims ¤  Testimonials

¤ Options: DIY or Seek Support

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Confidential Information of Xonna Clark- Do Not Distribute

DISCLAIMER

This Workshop is a resource for educational and informational purposes only and should not take the place of hiring an attorney. Using this material and the legal resources referenced herein, paid and free, does not create an Attorney-Client relationship between you and Xonna Clark, Esq. Customized legal advice is not provided within this workshop or any of the resources available here. Instead, this workshop is a legal education resource designed to make you aware of basic key legal needs of your business and provide information you can use to meet those needs. Legal Care for Wellness Care is an educational company and not a law firm and

not a replacement for hiring an attorney.


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�  July, 2014 multimillion dollar settlement against a beverage company for making “unsubstantiated health claims.

�  Product contained pineapple, agave, grape seed,

beet juice powder, and orange juice. �  Claimed that it was an anti-inflammatory wellness

drink and effective for a host of conditions �  Referenced 3rd party literature-- insufficient

(Overhype and Subpar Science: A Prickly Pair, business.ftc.gov)

�  Several students at MUIH have had cease and desist orders and have had to shutdown websites and blogs

Why Important?

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The Risk --Services and Products

As integrative practitioners, we offer a service, BUT we may also develop and offer a product:

•  Foods •  Herbal products

With Both our Services and Our Products, We Make Statements !

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What Counts As Statements? �  Verbal �  Written

�  Marketing materials, letters, emails, labels, literature, testimonials

�  Symbols, Pictures, Logo

�  These statements may constitute �  Representation or warranty �  Health or disease claim �  Structure/Function claim �  Dietary Guidance

Each case is specific

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Knowledge of the Law Can Help Prevent

¤  Cease and desist orders ¤  Website/blog shutdowns ¤  Civil remedies/lawsuits ¤  Monetary liability ¤  Consumer re-dress ¤  Other corrective measures

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Awareness Some Ground Rules

Examples Forgive the Legalease

Today’s Goals

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Confidential Information of Xonna Clark-

Do Not Distribute

A Big Area Just Touching the Surface

Representations/Warranties

¤  Express/Implied (Products and Services) ¤  Express -by promise, description, or sample

¤  Key is “context” and “basis for bargain” ¤  No need for formal words

¤  Example: My herbal rinse prevents colds

¤  Implied- indirect or by inference “context” ¤  Fitness for a particular purpose ¤  Workmanlike quality ¤  Merchantability

¤  Example: My herbal product kills germs

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Disclaimers

¤  Some warranties can be disclaimed BUT ¤  Need proper legal language and placement ¤  Work with an attorney on your disclaimer language; is

case specific- boilerplate does NOT work.

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Marketing/Advertising ¤  Applicable Laws: FTC, State and Local, ¤  On State level, also look at Professional Scope of

Practice ¤  Law Covers Claims in Promotions, off and on line ¤  Are Specific Additional Laws for Internet Advertising ¤  Close Ties to FDA: similar concepts ¤  Today’s Focus: Mostly on FTC/FDA; state/local law similar

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THE LAW ¤ Truthful and Non-Deceptive ¤ Evidence to Back up Claims ¤ Cannot be Unfair ¤ Reasonable Consumer Standard

What is a Claim? ¤  Governed by:

¤  FTC for promotions (off an on line) ¤  FDA for labeling and point of sale literature

¤  Similar standards, so good to know and apply even though current status may be a start-up or small

¤  Law applies to foods, dietary supplements, general labels and promotional materials

¤  Especially good to know for anyone offering a food or dietary supplement product

¤  Are some limited exemptions for small businesses but are very specific

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Types of Claims

¤  Health/Disease Claims: refers to a relationship between a specific substance (nutrient or dietary ingredient) and a disease or health condition ¤  Example: Calcium prevents arthritis ¤  Must be reviewed by FDA/FTC in advance

¤  Structure/ Function Claims: refers to a specific substance and structure/functions of the body ¤  Example: Calcium helps build healthy bones ¤  Do not need to be reviewed by FDA/FTC but can be

scrutinized

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Dietary Guidance: ¤  Contains only 1 of the 2 elements (specific substance

or structure/function or health/disease reference) ¤  Typically refers to a food or category of foods, not a

substance ¤  Example: Carrots are goof for your health ¤  Example: Calcium is good for you. ¤  Example: Whole grains can reduce the risk of several

chronic diseases.

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Types of Claims-cont.

Nutrient Content Claims: ¤  Characterize the level of a nutrient in a

food ¤  Example: gluten free (new stricter

guidelines) ¤  Example: low fat

¤  Exception: Claims can be made about nutrient deficiency diseases or that describe the effect on general wellbeing ¤  Example: Vitamin C and Scurvy

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So What Does It All Mean? (truthful and not deceptive, substantiated, not unfair)

¤  Deceptive- “if contains a statement or omits information that is likely to mislead consumers acting reasonably under the circumstances and is material to consumer’s decision to buy”

¤  Looks at words, pictures, phrases ¤  Looks at express and implied ¤  Looks at what is not said- misimpressions ¤  Looks at materiality

¤  Performance, price, safety, effectiveness DEEMED material

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Examples

¤  Example: 2-3 Doctors recommend X—must have documented proof

¤  Example: University studies prove that X herb can improve athletic performance ¤ Must have the studies ¤  Is an inference that studies are methodologically

sound ¤ Example: 90% of cardiologists take this product

¤ Express: % of cardiologists who take the product ¤  Implied: Product offers some benefit to the heart (FTC Dietary Supplements, an Advertising Guide)

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Sometimes, Even Claims That Are Normally Acceptable As Structure/Function Claims

Can Be Problematic

Example: Ad for herbal supplement claims product boosts immune system to help maintain a healthy nose and throat during the winter BUT name is Cold Away and pictures feature people sneezing and coughing

�  In context, conveys product helps prevent colds �  Law requires substantiation of the claim �  Even without the product name and images, the

reference to nose and throat health during the winter may still convey a cold prevention claim (FTC Dietary Supplements, an Advertising guide)

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Example: An ad for product called “Arthricure” claims that product maintains joint health and mobility in old age. The “before” picture shows an elderly women using a walker. The “after” picture shows her dancing with her husband. ¤  The images and product name likely convey that the

product is effective in the treatment of the symptoms of arthritis, and may also imply that the product can cure or mitigate disease.

(FTC Dietary Supplements, an Advertising Guide)

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Can’t be Misleading Can be deceptive because of what it fails to say. ¤  Example: An advertiser for weight loss cites a placebo

controlled double-blind clinical study as demonstrating that the product resulted in an average weight loss of 15 pounds over 8 weeks.

¤  The advertisement should make clear that users must follow the same diet and exercise regimen to achieve the claimed weight loss results.

(FTC: Advertising Guide for Small Businesses)

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Disclosures must be clear and prominent

Must be Substantiated


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¤ Depends on Nature of the Claim ¤ Guiding Principle: the amount and type of evidence

that experts in that field would consider adequate

¤ Must have “reasonable basis” and “objective evidence”

¤  FTC plays close attention to health and safety claims, especially diet services and products

Testimonials/Endorsements


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¤ Watch testimonials—health claims can be conveyed through testimonials

¤ Consumer endorsements themselves are not competent or reliable scientific evidence

¤ Need the science to support ¤ Can’t be any material connection between

endorser and marketer

Takeaways on Promotional Material

¤  Must be truthful, not misleading and substantiated ¤  Pay attention to overall context, not just words ¤  Pictures, Phrases, Name and suggestions count ¤  Must disclose relevant information so not

misleading ¤  Make sure supporting evidence is

¤  Scientifically sound ¤  Adequate in context ¤  Relevant

¤  Also consider State’s scope of practice

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Xonna Clark, Esq.

Contact Xonna Clark, Esq. 704-516-6973 [email protected]

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¤ DIY Support Package- $250 (for appropriate services) ¤ Consultations:15 minutes-free/ $125 per 30 minutes ¤ Webinars-$50/session:

¤ 10 Steps to Legally Set Up Your Business ¤ Legal Agreements You Need ¤ Trademarks/Copyrights ¤ Marketing-What Can I Say

¤ Service Retainer: special package rates Referrals Welcomed

References


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FTC.gov FDA.gov Business.ftc.gov DHHS: Dietary Supplements: Structure/Function Claims Fail to Meet Federal Requirements FTC; Advertising Guide to Small Businesses FTC: Dietary Supplements: An Advertising Guide to Industry FDA: Food: Guidance for Industry: Structure/Function Claims, Small Entity Compliance Guide

Health & Medicine

Marketing what can i say