Trademark partner Leigh Ann Linquist takes a look at the changes in the FTC's guide regarding endorsements and testimonials in advertising. Her summary is below:
The Federal Trade Commission (FTC) has recently released its revised Guides Concerning the Use of Endorsements and Testimonials in Advertising. There are three significant changes:
• In advertisements where a customer conveys that his/her experience is typical when that is not the case, the advertisement must clearly disclose what results are typical. Previously, advertisers could merely include a disclaimer such as “results not typical.” This is no longer sufficient.
• New examples are now provided to further illustrate what constitutes “material connections” between advertisers and endorsers. These examples explain what constitutes an endorsement when a blogger or other word of mouth marketer conveys the message. Specifically, a blog who receives cash or in-kind payment to review a product is considered an endorser and the blog must disclose the material connection between him or her and the seller of the product or service.
• The revised Guide now clearly state that advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement. Advertisers and endorsers may also be liable if the advertisement fails to disclose material connections. Celebrity endorsers have a further duty to disclose their relationship with advertisers when making non-traditional endorsements, such as on a talk show or in social media.
Although the FTC Guides are administrative interpretations of the law and are not binding law, they are intended to assist advertisers with compliance under the FTC Act. The revised Guides Concerning the Use of Endorsements and Testimonials in Advertising may be found at http://www.ftc.gov/os/2009/10/091005revisedendorsementguides.pdf.