Using Testimonial Claims in Social Media Platforms

Introduction to Endorsements Jeffrey A. Greenbaum

Section 5 of the FTC Act prohibits “unfair or deceptive acts or practices”

The Guides ,[object Object],[object Object],[object Object],[object Object]

“ Endorsement” ,[object Object],[object Object],[object Object]

Endorsement - Examples ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Endorsement - Examples ,[object Object],[object Object],[object Object],[object Object]

Endorsement - Examples ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Honest ,[object Object],[object Object],[object Object],[object Object],[object Object]

Substantiation ,[object Object],[object Object],[object Object],[object Object]

Consumers ,[object Object],[object Object],[object Object],[object Object]

Consumers - Typicality ,[object Object],[object Object],[object Object]

Experts ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Organizations ,[object Object],[object Object]

Connections ,[object Object],[object Object]

Connections - Payment ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Connections - Bloggers ,[object Object],[object Object],[object Object],[object Object],[object Object]

Connections - Bloggers ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

FTC’s FAQs ,[object Object],[object Object],[object Object],[object Object],[object Object]

Liability ,[object Object],[object Object],[object Object],[object Object]

Jeffrey A. Greenbaum (212) 826-5525 [email_address]

Using Testimonial Claims in Social Media Platforms: FTC Enforcement Affiliate Summit East, New York, NY August 22, 2011 Thomas A. Cohn, Venable LLP PLI -- Hot Topics in Advertising Law New York, March 21, 2011 © 2010 Venable LLP

For Release: 04/19/2011 FTC Seeks to Halt 10 Operators of Fake News Sites from Making Deceptive Claims Re: AcaiBerry Weight Loss Products ,[object Object],[object Object],[object Object],[object Object],© 2010 Venable LLP

For Release: 05/31/2011 FTC Charges Promissory Note Pitchman With Deceiving Consumers ,[object Object],© 2010 Venable LLP FTC charged Russell Dalbey and others with making phony claims that people could earn big bucks quickly by using his system of finding and brokering seller-financed promissory notes – privately held loans often backed by real estate. Dalbey's late night infomercial, "Winning in the Cash Flow Business," attracted thousands of people who paid from $40 to $160 each for the program. But FTC alleged that most of them didn't earn a dime. Dalbey and company also pushed enrollment in other services – like his Protégé Program – that cost consumers hundreds or thousands of dollars more. At the same time, the FTC and the Colorado Attorney General announced a settlement with Marsha Kellogg, a consumer who offered a glowing testimonial – but one the agencies said was deceptive – in one of Dalbey's infomercials. This is the FTC's first order against a consumer charged with making misrepresentations in a testimonial.

The Electronic Retailing Self-Regulation Program (“ERSP”) Peter Marinello ERSP Director, VP CBBB

The Advertising Industry ’ s Self-Regulatory System ,[object Object],[object Object]

TODAY … ,[object Object],[object Object]

Self-Regulation Components NARC Establishes policies for the self-regulatory structure NAD Resolves issues as to the truth and accuracy of national advertising claims CARU Analyzes and evaluates advertising directed to children under 12 ERSP Resolves issues as to the truth and accuracy of claims made in direct response NARB The appellate body of the self-regulatory forum

ERSP Goals and Procedures ,[object Object],[object Object],[object Object],[object Object],[object Object]

“ “ Lose 287% the weight compared to placebo” “ The World’s Fastest Weight-Loss Solution” “ Within 7 days my acne completely disappeared ” ‘ The Clinically Proven Weight Loss Supplement!” The #1 Doctor Recommended Joint Supplement” Over the past few years, ERSP has examined many types of claim substantiation: - Testimonials/Endorsements - Before and After Depictions - Weight Loss - Health and Safety - Establishment Claims - Disclosures - New Media - Puffery - Demonstrations

[object Object],[object Object],§ 255.5 Disclosure of material connections

LIQUID HCG DIET LLC Liquid HCG Diet ,[object Object],[object Object],[object Object]

NAD & Consumer Testimonials ,[object Object],[object Object],YourBabyCan, LLC (Your Baby Can Read! Early Language Development System), NAD Case #5313 ( 3/24/2011)

[object Object],[object Object]

Welcome to WeKnowDiets.com. We have compiled the most comprehensive database of information for people who are looking for a trimmer body and healthier lifestyle.

Welcome to Wikidietinfo.com. We have compiled the most comprehensive database of information for people who are looking for a trimmer body and healthier lifestyle.

Welcome to Googlediets.com. We have compiled the most comprehensive database of information for people who are looking for a trimmer body and healthier lifestyle.

URBAN NUTRITION, LLC WeKnowDiets.com (and affiliated websites) ,[object Object],[object Object],[object Object]

[object Object],[object Object],[object Object],[object Object],[object Object]

[object Object],[object Object],[object Object],[object Object]

ECOMMERCE SOLUTIONS, INC. Vibrant White Tooth Whitener ,[object Object],[object Object],[object Object],[object Object]

THANK YOU Peter Marinello ERSP Director, VP CBBB The Electronic Retailing Self-Regulation Program (“ERSP”) www.narcpartners.org ersp.blogspot.com

Disclosing Affiliate Relationships in Social Media Affiliate Summit East 2011 Presented by: Tom Chernaik CEO

Regulatory Environment ,[object Object],[object Object],[object Object],[object Object],[object Object]

FTC Requirements ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],All material connections must be disclosed with documented process

Notable Regulatory Events ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

State Attorney General Actions ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

OFT Actions in UK ,[object Object],[object Object],[object Object],[object Object],[object Object]

Connections Must Be Disclosed ,[object Object],[object Object],[object Object]

Risks of Non-Compliance ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

What Should We Consider? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Your Message Here ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

The Challenges of Compliance ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

How Are People Addressing This ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Preparedness Checklist Ensure Disclosure in all SM Formats Document Compliance Monitor Influencers for Compliance Follow Up & Takedown ✔ Audit & Archive Scale Efforts Across Brands & Programs Efficient Use of Human Resources Create & Implement Process ✔ ✔ ✔ ✔ ✔ ✔ ✔

Tom Chernaik CEO 646.369.4555 [email_address] http://cmp.ly “ It’s quick and easy, and you can even do it on micro-blogging services such as Twitter.” -Mashable “ Where there's a challenge, there's probably a tech startup. Enter CMP.LY, which aims to make compliance simple for the Twitter and Foursquare users of the world.” -CNN Money

Using Testimonial Claims in Social Media Platforms

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Editor's Notes