FTC Announces New Notices Concerning Substantiation of Product Claims

Advertisers delight in activating values and hidden desires of consumers using the language of the advertising claim. The “claim” is the part of an ad that makes some claim of superiority for the product being advertised. These days it is difficult to recognize those that are misleading and even downright lies, because most fit into the category of neither bold lies nor helpful consumer information. When consumers see or hear an advertisement, whether it’s on the Internet, radio or television, or anywhere else, federal law says that ad must be truthful, not misleading, and, when appropriate, backed by scientific evidence. 

The FTC just announced a Notice of Penalty Offenses Concerning Substantiation of Product Claims, that could add a costly consequence for non-compliance. On April 13, the FTC  put almost 700 advertisers on notice that they should avoid deceiving consumers with advertisements that make product claims that cannot be backed up or substantiated.

Under the FTC Act, the FTC has authority to seek civil penalties from a company that engages in deceptive or unfair advertising practices with knowledge that it was unlawful. More recently, the FTC  issued Notices of Penalty Offenses covering endorsements, money-making opportunities, and education. 

The key take away from the Notice of Penalty Offenses Concerning Substantiation of Product Claims are the five practices that violate the FTC Act:  

• Making claims without competent and reliable evidence;

• Making a health or safety claim without (1) competent and reliable scientific evidence (2) conducted and evaluated in an objective manner (3) by qualified persons, (4) that is generally accepted in the profession, and (5) likely to yield accurate and reliable results;

• Express or Implied claims about effectiveness in the cure, mitigation, or treatment of any disease without relying on at least one human clinical trial of the product that: 1) is randomized, 2) is well controlled, 3) is double-blinded (unless the marketer can prove blinding can’t be effectively implemented); 4) is conducted by qualified people; 5) measures disease end points or validated surrogate markers, and 6) yields statistically significant results;

• Misrepresenting the level or type of substantiation for a claim; and 

• Representing that a claim has been scientifically or clinically proven unless the advertiser relies upon evidence sufficient to satisfy the relevant scientific community of the claim’s truth.

As the FTC states, the goal is to ensure that marketers understand and adhere to their legal obligations. If you have questions about your advertising, whether you have adequate evidence to support your claims, whether your health or safety claims are properly substantiated, or any other concerns about making sure your advertising claims meet FTC requirements, or if you need assistance navigating the process, please feel to contact me for more information. (866)734-2568 and David [at] adler-law.com