In determining whether an ad agency should be held liable, the FTC looks at the extent of the agency's participation in the preparation of the challenged ad, and whether the agency knew or should have known that the ad included false or deceptive claims. They may not simply rely on an advertiser's assurance that the claims are substantiated. Third parties - such as advertising agencies or website designers and catalog marketers - also may be liable for making or disseminating deceptive representations if they participate in the preparation or distribution of the advertising, or know about the deceptive claims.Īdvertising agencies or website designers are responsible for reviewing the information used to substantiate ad claims. Sellers are responsible for claims they make about their products and services. If your ad specifies a certain level of support for a claim - "tests show X" - you must have at least that level of support. The type of evidence may depend on the product, the claims, and what experts believe necessary. In addition, claims must be substantiated, especially when they concern health, safety, or performance. For example, a lease advertisement for an automobile that promotes "$0 Down" may be misleading if significant and undisclosed charges are due at lease signing. A claim can be misleading if relevant information is left out or if the claim implies something that's not true. That is, advertising must tell the truth and not mislead consumers.
The FTC Act prohibits unfair or deceptive advertising in any medium. In addition, an act or practice is unfair if the injury it causes, or is likely to cause, is: affect consumers' behavior or decisions about the product or service.In interpreting Section 5 of the Act, the Commission has determined that a representation, omission or practice is deceptive if it is likely to: The Federal Trade Commission Act allows the FTC to act in the interest of all consumers to prevent deceptive and unfair acts or practices. General Offers and Claims - Products and Services Laws Enforced by the Federal Trade Commission.General Offers and Claims - Products and Services.In addition, claims must be substantiated.
Advertising must tell the truth and not mislead consumers.
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