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Mini Law Lesson(Public Service Announcement on)
Testimonials and Endorsements
Brian Heidelberger [email protected]
Twitter @briheidelbergerwww.winston.com/bheidelberger
IMPORTANT DISCLAIMER
• I am not your attorney.
• This is not legal advice.
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Why Do We Need Refresher Course?
• Recent FTC action against major agency
• Assistant AE sent an agency-wide email to staff to Tweet about client’s product
"This is sick . . . See the new Major Game System in action. The gaming #GameChanger“
• Agency employees tweeted on personal accounts
• Failed to notify employees of their obligation to disclose relationship
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FTC Guides Concerning Endorsements and Testimonials
• Apply when both are present:
“Endorsement” • Opinion which is not the advertiser’s
“Sponsored Advertising Message”• “material connection” between person speaking
and advertiser– Money
– Free stuff
– Contest entries
– Employee of advertiser or its agency
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FTC Examples of When Disclosure Is Required
1) Bloggers who get free stuff
2) Employees who write reviews for their company’s products
3) “Street team” members who get points/prizes for talking about products
4) Actors “cast” to appear in ads as real consumers
5) Real people who are aware that they will be appear in ad or be paid if they say something positive about product/service
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Training Required
• Info re product/service touted
• Obligation to give honest opinion
• Obligation to disclose connection
• Monitoring
• Takedown
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FTC Thought Disclosure Was Required
• Ann Taylor Invited bloggers to event and gave
free stuff• Hyundai
Invited bloggers to event asked them to link to commercial and gave them gift certificates
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FTC Brings Action Against PR Agency
• Posted reviews of client’s video games
• Did not disclose that they were hired to promote the games
FTC Brought Action re Failure to Disclose in Affiliate Program
• Used advertising affiliates to promote guitar courses
• Endorsements were written as consumers without disclosing paid commission
• $250,000 Settlement
FTC Brings Action Against Home Security Company
• National family and safety expert known as “The Safety Mom” appeared on media touting home monitoring system
• FTC believed :
Company represented the person was independent;
Failed to disclose connection; and
Failed to correct misleading impression
• Investigation Included PR Agency
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NY AG Fined Company for “Fake” Testimonials
$300,000 Penalty
for Using “Fake”
Testimonial
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Company Fined for Making Up “Fake” Testimonials (cont.)
$300,000
Penalty
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Having second thoughts? You won’t
be sorry, just go for it! I feel and
look great.
FTC Says Disclosure Must be Easily Understood
FTC Says Disclosure Can’t Be At End of Long Post
FTC Says Disclosure Must be in Same Tweet
FTC Says Disclosure Must Clearly Indicate “Connection”
“#ContestEntry”NOT
“#ContestName”
Reminder of Obligations
• Info re product/service touted
• Obligation to give honest opinion
• Obligation to disclose connection
• Monitoring
• Takedown
• Conduct training for employees (or at least send an email)
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How Does A Company Disclose?
• #sponsored
• #ad
• #XZYemployee
• #XZYadagency
• #XYZcontestentry
• Disclosure should be “clear and conspicuous” and in conjunction with claim
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What’s Not Ok?
• Not disclosing
• Disclosing in bio
• #spon
• #ee
• #genericstatement
• Posing as a consumer
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youtube.com/adage or
Youtube.com/brianheidelberger
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@BriHeidelberger
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