A service of Stephen W. Workman P.C

Advertising Law

Mr. Workman represents advertising agencies and Internet marketing companies, and has significant experience in all facets of advertising law.

Advertising law covers a diverse array of legal principles and compliance with governmental agencies, at both the state and federal levels. At the federal level, the Federal Trade Commission (FTC) polices advertising and marketing messages for compliance with the FTC Act, which prohibits unfair or deceptive practices. The Act’s purpose is two-fold: to protect consumers and to foster competition. State governments have agencies that mirror that of the FTC, usually in the form of Consumer Protection Agencies.

Among the legal principles that may be implicated in an advertising campaign or discreet advertising message are: defamation law, law regarding rights of publicity, copyright law (e.g., copyright infringement due to failed rights clearance or an improper parody), trademark law - infringement or trademark dilution, the law of unfair competition under the Lanham Act or state statutes, the Digital Millennium Copyright Act (DMCA) which may apply to online advertising and ecommerce websites, Communications Decency Act (CDA), Sweepstakes Act, and the Children’s Online Privacy Protection Act (COPPA), among others.

Following are a few examples of advertising law in practice:

Rules regarding Endorsements: Section 16 CFR 255.2(a) of the FTC Guides states that an advertisement that makes use of an endorsement that reflects the product experience of a person or a group of consumers will be interpreted by the FTC as presented in the advertisement to reflect what consumers can generally expect for the product when actually used by them.

Therefore, advertisements that include consumer endorsements about atypical product performance should clearly and conspicuously disclose: (i) what the general expected performance would be in the depicted circumstance and (ii) the limited applicability of the endorser’s experience to how consumers should expect the product to perform. Advertisements featuring re-enactments of unusual but actual consumer experiences may be dramatized, but must correctly and accurately portray the product.

The problem of bias in testimonials: if a connection between the endorser and the product’s manufacturer or seller exists which could affect the credibility of the endorsement, then it must be disclosed. An example of this is the FTC’s new rule that requires endorsements by bloggers or tweeters to disclose if the endorser has or will receive compensation in exchange for the endorsement. This can be achieved by placing the words “Paid Endorsement” on the blog or in the tweet

Use of the term “Free” in Advertising: For an offer to be truly “free” in the eyes of the FTC, the consumer must pay nothing for the product and no more than regular price for the other product, if it is a “buy one get one free” promotion. There cannot be recovery of the price in shipping and handling charges, and there cannot be a substitution of inferior merchandise. All conditions and limitations to the “free” offer must be clearly and conspicuously disclosed and, as with all advertising messages, the ad must be truthful and not misleading.