False Advertising Law:

Could You Inadvertently Be Breaking this Law?

Or How I Learned to Stop Worrying About the 11,000 Dollar FTC Fine

False Advertising Law, as its name implies, is laws that protect consumers from false or misleading promotion of services or products.

False or deceptive advertising involves using false or misleading statements as part of the advertising. There are similar laws relating to labeling. Consumers have the right to know what they are buying.

The legal implications of the false advertising law falls into a few categories.

There are federal laws, often administered under the Federal Trade Commission (FTC)

Many times individual States will create mirror image laws that mimmic the federal guidelines.

So if you think the federal government won't come after you because your too small of a fish, then beware because the State Attorney General may just be knocking on your door. One small company in Bethlehem, PA was fined by just such a law. The fine, quite substantial according to the VP of the company that shared this warning.

A Simple Mistake. A Pennsylvania Company, on one of their sales contracts, failed to have a simple clause. The law required a three day right to change your mind clause. They instead had a thirty day clause. Because of failure to comply, they paid a fine. The cost of having their contracts and brochures reprinted and throwing out the old contracts was less than a few hundred dollars. The cost of the mistake, $10,000.

First, a reminder. I am not a lawyer and anything here about false advertising law is is not to be taken as legal advice. You should seek the advice of a competent lawyer knowledgeable in internet and advertising law before making any decisions. This section will hopefully cover some of the areas to help you know of things you may want to seek advice about.

Note this 3-2010 update: Assist 2 Web now has an attorney with 20 years experience in the field of internet law. More to come.

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Truth in Advertising, False Advertising Law and Your Website

There are five aspects of truthfulness that need to be addressed in your advertising. Some of the laws are called Truth in Advertising Laws.

To help you appreciate the seriousness of this, please watch this not so serious commercial.

If you are old enough to remember the old Joe Isuzu commercials, they capitalized on our thirst for a little honesty. Every thing Joe (David Leasure) Isuzu said was disclaimed in the copy. They even went so far as to say he was lying.

Check out one of the old ads still available for viewing.

What are the implications of false advertising law for website owners.

What you say about your or another persons goods, services, or business activity needs to be true. Statements you make cannot deceive or have the potential to deceive a considerable portion of the viewing audience.

Anything that could even remotely be considered deceptive must not affect the purchasing decision. The advertising would involve interstate commerce of goods or services.

The potentially deceptive aspect of the ad will or is likely to result in injury.

How could your product or service injure someone. Well, where does it hurt worse than the pain in the wallet secondary to a wounded ego.

Here is a partial list of some of the ways advertisers have experienced truth in advertising law trouble.

Hidden fees

Surcharges

Rebates Either / or from reneging and failure to disclose the sale price is after rebate.

Inflated price comparison

Perpetual sales

Selected Items where no items are selected

Bait and Switch a product or service is offered with no intention of selling it. Usually the value is diluted so that once biting on the bait, the customer can be switched to a more expensive product.

Photo Manipulation

Manipulation of standards

Misrepresentation of endorsements

Failure to inform

Creative Financing

Three areas of special note....

Anything that could be construed as offering legal advice, if your not a lawyer, could get you in trouble for practicing law with out a license. You may hear that you can write what ever you want and not get in trouble.

If you believe that, then consider this... In one book I often use and refer to when doing a particular public speaking topic is written by an attorney. Not only is he an attorney, he was at one time the Attorney General of Hawaii. In his book he has a legal disclaimer. Now, if a lawyer is going to have a legal disclaimer in his book, where does this leave you and me.

A second area of note is the area of medicine. In the United States, only the FDA can legally make the claim that any product, device or procedure is a cure. So anything you hear, read or see other wise is, quite simply illegal.

Some companies have lost their ability to sell products because of being shut down over such claims.

Even Lap Gastric Surgery, now considered a cure for diabetes is not advertised as such because the FDA has not recognized that it is actually a cure. Legal semantics, maybe but this is the law we have to live by.

With any health care or medical related sites, you cannot claim that anything will do any thing with out scientific evidence that is approved by the FDA. Even testimonials need to be used judiciously and now are covered by FTC guides. Often it is better not to use testimonials on the same page as sales are made from.

Planning and Insurance are likewise highly regulated. Many sites have disclaimers in place for protection legally and to keep out of the sites of the Attorney Generals.

Ours is not to question why, ours is just to do and cry.

Cheers and keep your website legal.

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