False advertising is not a new cause of action. However, the Internet has increased the number of mediums through which false advertising can be perpetrated. In particular, fake blog-style websites, also referred to as flogs, are becoming commonplace on the internet. These flogs, which oftentimes contain manufactured testimonials or enticing yet unsubstantiated claims, are one of the most the prolific ways by which third parties are advertising their products or services and gaining revenue therefrom. Internet lawyers need to take note of this increasing practice and be in a position to advise both advertisers and consumers alike regarding the same.
On the one hand, internet lawyers should advise advertiser clients that flogs may subject them to both civil and/or criminal liability under the federal advertising laws and FTC Rules, including the recently enacted Part 255 Guidelines. While truthful advertising, legitimate testimonials, and proper disclosure of material connections and other information, for example, can help to reduce the likelihood of liability for false advertising, understanding the intricacies of the law as well as the boundaries is now more critical than ever. Otherwise, it is very likely that advertisers may be subject to increased lawsuits as a result of flogs, deceptive advertisements, and false advertisements on the Internet.
On the other hand, it is also important that consumers who may have been induced to purchase goods or services in light of these flogs or other false advertisements understand that they may have a remedy available. The reality is that consumers, when presented with ads, more often than not click on them and consider them when making a purchasing decision. The resulting harm may warrant a lawsuit. Similarly, the FTC is constantly looking to protect consumers from nefarious advertisements that could harm the public.
Ultimately, improper endorsements, whether from a celebrity or otherwise, unsubstantiated product claims, and other untruthful statements may lead to significant legal and financial exposure. Companies wishing to advertise on the Internet should consult with an Internet attorney that can provide information regarding the use of testimonials, the need for disclosures, and the practices to avoid in order to mitigate the likelihood of a false advertising lawsuit or investigation by the FTC. An advertisement undoubtedly can lead to significant revenue, however, it must be presented in a lawful and proper way in order to ensure that whatever revenue derived will not ultimately be awarded as damages in a lawsuit. Therefore, as tempting as flogs may be to advertisers and consumers alike, truth in advertising remains paramount.
Brian A. Hall is an attorney and partner at Traverse Legal, PLC, a law firm specializing in Internet law, intellectual property law, and advertising law, including complex litigation. He regularly advises advertisers and consumers regarding advertising law issues. He has represented countless entities, including bloggers, with compliance issues, including FTC Enforcement Guidelines Under Part 255.
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