False Advertising and Labeling

Under Section 43(a) of the Lanham Act a business can sue a competitor for making false or misleading descriptions of fact in commercial advertising. This is the primary weapon for corporate warfare. To prevail the plaintiff must prove that the statement is literally false or that it is literally true but likely to mislead or confuse consumers.

We aggressively litigate the distinction between literal falsity and implied falsity. If a claim is literally false the court presumes consumer deception and injury. If it is merely misleading the plaintiff must produce extrinsic evidence such as consumer surveys to prove that actual deception occurred. We attack these surveys. We hire experts to demonstrate that the survey questions were biased or that the sample size was unrepresentative. By invalidating the evidence of deception we defeat the claim before it goes to trial.

The FTC is the primary federal regulator of advertising. Section 5 of the FTC Act prohibits unfair or deceptive acts or practices. The Commission requires that advertisers possess a reasonable basis for all objective claims at the time the claims are made. This is known as the prior substantiation doctrine.

We represent clients in FTC investigations regarding false advertising. When the Commission issues a Civil Investigative Demand we take control of the narrative. We present the scientific data and internal testing protocols that supported the claim. We argue that the interpretation of the ad by the FTC is overly broad and does not reflect how a reasonable consumer views the product. Our goal is to close the investigation without a consent decree or a monetary penalty.

California is the epicenter of labeling litigation. The UCL prohibits any unlawful or unfair or fraudulent business act. The courts apply the reasonable consumer test which asks whether a significant portion of the general consuming public acting reasonably in the circumstances could be misled.

We litigate the definition of the reasonable consumer. We argue that the plaintiff is advancing an unreasonable interpretation of the label that ignores common sense. For example if a cereal box shows a bowl of fruit we argue that a reasonable consumer does not expect the box to contain fresh fruit. We use judicial notice and motions to dismiss to argue that the alleged deception is legally impossible because no reasonable person would be fooled by the false labeling allegations.

Most state law claims are filed as class actions. The plaintiff seeks to represent millions of consumers who purchased the product. The certification of the class is the critical moment in the litigation. If the class is certified the potential damages skyrocket and settlement becomes the only viable option.

We fight certification by attacking the commonality and predominance requirements. We argue that each consumer purchased the product for different reasons and had a different understanding of the label. If one consumer bought a protein bar for the taste and another bought it for the health claim they are not similarly situated. We demonstrate that individualized inquiries into reliance and causation are necessary which makes a class action an improper vehicle for resolving the false labeling dispute.

One of the most powerful defenses in advertising law is the doctrine of puffery. Puffery refers to vague and subjective exaggerations or boasting upon which no reasonable buyer would rely. Statements like The Best Coffee in the World or Premium Quality are classic examples.

We move to dismiss claims based on puffery at the pleading stage. We argue that the statement is an opinion that cannot be proven true or false. If a statement is non-actionable puffery it cannot form the basis of a false advertising claim as a matter of law. We carefully parse the language of the ad to separate the objective factual claims which require proof from the subjective marketing copy which is protected.

Truth is an absolute defense. However proving truth in a scientific context is complex. The plaintiff often relies on a hired expert to debunk the product. We counter with our own independent experts.

We use double-blind studies and peer-reviewed literature to validate the claims. We argue that even if there is scientific debate the existence of some supporting evidence means the claim is not false. We assert the defense of scientific uncertainty. If reasonable scientists can disagree on the efficacy of an ingredient the advertiser is entitled to rely on the favorable science provided they do not misrepresent the consensus.

The term natural is the most litigated word in the grocery store. The FDA has not formally defined it which has created a vacuum filled by class action lawyers. Plaintiffs sue if a natural product contains trace amounts of synthetic preservatives or genetically modified ingredients.

We defend these cases by attacking the rigorousness of the testing. We argue that the presence of a synthetic substance at a parts-per-billion level does not render the natural claim deceptive to a reasonable consumer. For organic claims we rely on USDA certification. If the product meets the National Organic Program standards we argue that federal law preempts any state law claim challenging the organic label.

The Federal Trade Commission enforces a strict standard for unqualified Made in USA claims. The product must be all or virtually all made in the United States. This includes the sourcing of raw materials and the processing and the final assembly.

We audit supply chains to ensure compliance. If a product contains imported knobs or screws it may violate the standard. We help clients draft qualified claims such as Made in USA with Global Materials to mitigate risk. When facing an investigation regarding false labeling of origin we present costed bills of materials to prove the domestic economic value of the product. We argue that the foreign content is negligible and does not alter the fundamental domestic character of the good.

The Green Guides provide the framework for lawful environmental marketing. They warn against general environmental benefit claims which are difficult to substantiate and likely to mislead.

We review packaging and website copy to ensure specificity. Instead of saying a product is green we advise stating it is made with 50 percent post-consumer recycled plastic. We litigate the interpretation of these guides. While they are administrative interpretations and not binding law courts frequently defer to them. We argue that our client acted in good faith compliance with the guides which negates the element of willfulness required for certain penalties.

Carbon neutral and net zero claims require complex data verification. The plaintiff bar is increasingly suing companies for relying on carbon offsets that they allege are illusory.

We work with environmental engineers to verify the carbon accounting. We ensure that the offsets purchased are certified by reputable third-party registries. In litigation we defend the methodology used to calculate the carbon footprint. We argue that the company followed distinct industry standards for carbon accounting and that the criticism of the methodology is a policy debate rather than a basis for a false advertising lawsuit.