The Federal Trade Commission has adopted updated guidelines for advertisers who use endorsements or testimonials, including those in blogs and other social media.

Among other important changes, the FTC Guides Concerning the Use of Endorsements and Testimonials in Advertising, which take effect on December 1, 2009, and reflect the Commission’s interpretation of the FTC Act:

  • Place new burdens on bloggers and companies whose products or services are reviewed in blogs
  • Affirm that endorsers can face personal liability for false or misleading advertising
  • Eliminate the safe harbor previously afforded by a "results not typical" disclaimer

Although the FTC has long required the disclosure of material connections between advertisers and endorsers (such as free products or payments), the FTC for the first time interprets that principle in the context of blogs and social media outlets, such as Facebook and Twitter. Such media often blur the line between grassroots product recommendations and traditional advertising.

Under the new Guides, adopted last week, a consumer who writes a blog or uses other social media bears primary responsibility for disclosing any material connection with the company. However, the company has an affirmative obligation to advise the blogger that she should make the disclosures in any positive reviews. The underlying theory is that consumers may not expect such connections, and without such disclosure a product review could be misleading.

Similarly, the Guides make clear that consumer and celebrity endorsers may, along with the advertiser, be liable for false or misleading statements, unsubstantiated claims, and undisclosed material connections. When discussing a product or service on a talk show, for example, a celebrity must relate her genuine experiences, rather than read from a prepared script about some theoretical experience, and disclose her relationship with the company.

Moreover, it is no longer acceptable for advertisers to rely on a "results not typical" disclaimer when using consumer testimonials that tell of extraordinary results; rather, advertisers must disclose the results that consumers can generally expect. For example, if a consumer claims in an ad to have lost 10 pounds in a week using a company's product, but the average user loses three pounds, the company must disclose the average result. And, as always, the advertiser must have adequate substantiation—such as competent and reliable scientific evidence—supporting the claimed average result.

The Guides provide detailed, illustrative examples of these and other interpretations.

For more information, contact Hara K. Jacobs (215.864.8209 or jacobsh@ballardspahr.com) or Paul Lantieri III (215.864.8279 or lantierip@ballardspahr.com).


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