Marketing and Promotions Law: What Every U.S. Advertiser Needs to Know

A company that receives an FTC civil investigative demand or faces a deceptive advertising charge must mount a defense that addresses the substantiation for each claim that the FTC has identified as potentially deceptive, and advertising and marketing law counsel defending a deceptive advertising investigation must evaluate whether each challenged advertising claim was substantiated by competent and reliable scientific evidence at the time the claim was made and whether the overall net impression of the advertisement is actually misleading to a reasonable consumer rather than being mere puffery.

A company that runs comparative advertising identifying a competitor's product by name must ensure that every comparative claim is literally true and is not likely to mislead consumers even if technically accurate, because the Lanham Act permits a competitor to seek injunctive relief and damages for claims that are literally false or that create a misleading impression through selective use of accurate data, and false advertising lawsuit counsel advising on comparative advertising must evaluate whether the comparative performance data is based on tests conducted under conditions representative of actual consumer use and whether any headlines or graphics create a misleading overall impression that overstates the comparative advantage.

A sweepstakes in which winners are selected by chance must eliminate the consideration element of an illegal lottery by providing a free alternate method of entry that is equivalent to the purchase entry and is adequately disclosed in all advertising materials, and consumer protection law counsel advising on sweepstakes design must evaluate whether the free alternate method of entry is genuinely equivalent to the purchase entry in terms of the odds of winning and whether the sweepstakes advertising clearly and conspicuously discloses the no-purchase-necessary requirement.

A company that runs a sweepstakes or contest without clearly drafted official rules addressing technical failures, fraud, force majeure events, and the company's right to cancel or modify the promotion exposes itself to participant claims that the company breached its contractual obligations, and e-commerce regulations counsel advising on official rules design must evaluate whether the rules give the company adequate discretion to disqualify fraudulent entries, whether the limitation of liability and warranty disclaimer provisions are enforceable under the law of the state governing the promotion, and whether the arbitration clause and class action waiver are structured to survive a challenge under the applicable state contract law.

A brand that compensates an influencer with money, free products, or any other benefit in exchange for promotion must ensure that the influencer clearly and conspicuously discloses the material connection in each piece of sponsored content, and consumer protection investigations counsel advising on influencer marketing compliance must evaluate whether the brand's influencer agreements require disclosure in a manner that satisfies the FTC's specificity requirements and whether the brand has implemented a system for monitoring influencer disclosures across all platforms where the influencer publishes sponsored content.

A company accused of facilitating fake reviews or suppressing negative reviews must demonstrate that its review solicitation practices are transparent and that any compensation provided to reviewers was clearly disclosed, because the FTC's strengthened rules against fake reviews and insider testimonials impose substantial civil penalties, and class actions and consumer defense counsel advising on review practice compliance must evaluate whether the company's review solicitation emails disclose any incentive provided in exchange for the review and whether any internal policies against publishing negative reviews violate the Consumer Review Fairness Act.

A company that sends commercial email to U.S. .onsumers must satisfy the CAN-SPAM Act's requirements for accurate header information, a physical postal address, and a functional opt-out mechanism, and must also evaluate whether its email targeting practices constitute a sale of personal information triggering CCPA disclosure and opt-out requirements, and consumer data protection counsel advising on email marketing compliance must evaluate whether the company's opt-out mechanism processes unsubscribe requests within the ten-business-day window required by CAN-SPAM and whether the company's data sharing relationships with advertising technology vendors qualify as sales of personal information requiring a do-not-sell opt-out under the CCPA.

A company whose website or online service is directed to children under thirteen, or that has actual knowledge it is collecting personal information from children under thirteen, must obtain verifiable parental consent before collecting any personal information from those children, and advertising and marketing law counsel advising on COPPA compliance must evaluate whether the company's website or service is directed to children based on its subject matter, visual content, music, animated characters, or other features that the FTC considers in determining whether a site is child-directed and whether the company's age-screening mechanisms are sufficiently robust to prevent children from accessing the site without triggering the COPPA consent process.