Published on June 29, 2016
There are new traps for companies looking to utilize consumer or celebrity testimonials or endorsements in advertisements. The new FTC Guides require one to disclose if testimonials or endorsements are of “atypical” results or if they were “coerced with freebies.”
The FTC Guides are just that, guides. They include a number of examples and explanations to assist one in interpreting the FTC Act. The FTC Guides covers the use of consumers and celebrities in advertisements. Some of the basic provisions are:
- Advertisements that feature a consumer’s experience with a product or service that may not be typical need to convey the results that consumers can generally expect. One cannot rely on a disclaimer anymore such as “results are not typical.”
- Any payments or freebies (“material connections”) provided to endorsers that consumers would not expect to have been made must be disclosed.
- Advertisers and celebrities may be liable for false or unsubstantiated claims made in an endorsement or for failure to disclose “material connections.”
- Celebrities have a duty to disclose any relationships or compensation outside traditional ads, such as when they appear on talk shows or in social media.
The FTC Guides look to stop “bought” opinions or endorsements of success, etc. which are not typical.
This message has been created by the Business Group at Ryan, Swanson & Cleveland, PLLC to advise of recent developments in the law. Because each situation is different, this information is intended for general information purposes only and is not intended to provide legal advice on any specific facts and circumstances. Ryan, Swanson & Cleveland, PLLC is a full-service law firm located in Seattle, Washington.