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Essentials of Advertising Law

Essentials of "Advertising" law

When is an ad misleading? An advertisement will contravene the law if it contains a representation that is either false or misleading. The following example highlights a misleading representation-an advertisement promotes a bedspread for $50, but the ad does not mention that it is a factory reject. This ad would be misleading because a consumer could be left to believe that the advertiser was selling first quality merchandise when it was second quality merchandise that was being advertised.
What if the copy is literally true? Even though each statement in an ad may be literally true, an offence can still arise if the "general impression" conveyed by the ad is misleading.

In reviewing an ad for misleading advertising, it is wrong to carefully parse the language of the copy in an effort to explain away an apparent misstatement.

In summary, the "general impression" conveyed by a representation, as well as the literal meaning, are taken into account in determining whether a representation is false or misleading in a material respect.
Do misleading advertising laws only apply to newspaper, radio and television ads? No. The misleading advertising laws apply to "any" vehicle used to promote a product, no matter how minor in nature the promotional vehicle is. Obviously there is POP and direct mail. But also consider these vehicles: any statements made on product packaging; any insert included inside the box containing the product; any oral statement made in the course of in-store, door-to-door or telephone selling.
Testimonials The Competition Act states that an advertiser cannot publish a testimonial about a product unless the testimonial was approved, in advance and "in writing," by the person who gave the testimonial.

Essentials of "Labeling" law

Bilingual labeling requirements Here is a checklist of some minimum translation requirements (this is a summary only; you should seek legal advice regarding a specific situation).

Federal law

All prepackaged products must have the following matters stated in both the English and French languages: product identity and net quantity. There are certain exceptions to this: test market and specialty market products, books, greeting cards, products sold in municipalities where the overwhelming majority speaks only English or French.

Food products must comply with additional translation requirements, for example: durable life, packaging date, and the list of ingredients must be bilingual.

Also, seek legal advice for these special products that have unique, additional requirements: cosmetics, medical devices and hazardous products.
Québec labeling law The Québec language statute is detailed and you should seek legal advice regarding any specific situation. Here is a very basic overview: all information shown on the product's label must be in the French language. You may use another language as well, for example, English (but French must have equal prominence).

Essentials of "Comparative Advertising" law

Telling the truth in a comparative ad Even though comparative advertising is legal, your competitor may still be able to successfully sue if they are the target of the ad and anything said about them is false or misleading.

If you do not specifically name your competitor, but they are capable of being identified by implication, they may be seen as the target.

Once the competitor is seen as the target (either by implication or by having been specifically named), if any fact or any impression created is false or misleading, the advertiser may be exposing itself to damages for false or misleading advertising. The competitor may also be entitled to an injunction to stop the campaign.

Principle: As always, the guiding principle is that all statements in an ad should be true and accurate. If they are, a competitor may not have a leg to stand on.
Using a competitor's trademark in a comparative ad CASE STUDY: Shopper's Optical ran a comparative ad in which it compared its prices to those of its competitor, Eye Masters. The competition went to court and was granted a preliminary injunction to prevent the ad from continuing to run.

Why? A competitor's trademark can be used in an ad if what is being advertised are "goods," but not "services" (an example of a service trademark is Purolator, since it is used in association with "courier services"). In the Eye Masters case, the comparative use of the trademark was with "optical services." As a result, Shopper's Optical encountered legal proceedings.

Principle: You can not run a comparative ad if it involves a use of your competitor's trademark and their trademark is used in association with services.
Use of design trademarks in a comparative ad Special care must be taken when a trademark has a design element (even if the design is merely a fancy font). The reason for this is that the law of copyright is involved in addition to the law of trademarks -- if a design component is involved, the best advice is to consult a lawyer before using the trademark.
Emphasize the differences in a comparative ad If you engage in a comparative advertising campaign that involves the use of a competitor's trademark, you may only do so if your ad stresses the differences (rather than similarities) between your product and that of your competitor.
CHECKLIST
  1. Are you targeting a competitor by name or implication? If yes, take the time to do a "double check" to ensure that everything said is accurate.

  2. Using a competitor's trademark:

    • you can only do so if the competitor uses the mark for goods, and not services

    • if the competitor's trademark involves a design, contact a lawyer before using the trademark

    • stress the differences (rather than similarities) between your product and that of your competitor

Essentials of "Disclaimer" law

Print disclaimers
  1. Disclaimers should be precise.

  2. A disclaimer can not: (a) contradict a statement contained in the main body of the copy, or (b) alter the general impression created in the copy.

  3. Disclaimers must be referenced by symbols (such as an asterisk) to the product to which the disclaimer applies. Do not use the same symbol twice -- use an asterisk for the first disclaimer and a dagger for the second one, etc.

  4. A disclaimer's font size cannot be smaller than 7 point.

  5. Where disclaimers might be used without a problem is where they:

    • clarify a minor ambiguity in the copy-e.g. ad for a battery operated tool has an * next to the price of it

      * batteries not included, or

    • add to the information contained in the copy-e.g. "Win a trip to Rio" *

      *Mardi Gras not availableFeb. 1-6

Disclaimers in TV advertising Disclaimers in TV advertising are of two types: mice-type at the bottom of the screen for a short duration, or a voice-over in a monotone voice, speedily spoken. The next section on radio advertising will deal with voice-overs.

Mice-type TV disclaimers are the most difficult form of disclaimer with which to deal. This is the way the Director of misleading advertising put it:
"It is unreasonable to expect that viewers will...see the ad repeatedly and gather the gist of the disclaimer...It is also unreasonable to expect viewers to video tape ads and freeze frame them in order to take the time necessary to read (them)."
TV disclaimers can too easily provide advertisers with a false sense of security. "Discretion" is the word that is likely your best guide. If you are going to err, do so on the side of caution. Make the font size and duration of exposure a little larger and longer than you might otherwise like. It is unlikely that a judge will have much sympathy for the advertiser who attempts to rely on a disclaimer that can not be read or comprehended by the average viewer in one normal viewing.
Disclaimers in radio advertising The problem with radio disclaimers is their speed. If the average listener can not hear or comprehend the radio disclaimer because of the speed with which it is spoken, from a legal standpoint it will not have much effect. Slow down the speed so that the average listener can reasonably be expected to hear the message in the disclaimer being communicated.
THE BOTTOM LINE
  1. Disclaimers should be precise.

  2. TV disclaimers should be large enough to enable them to be actually read.

  3. Voice-over disclaimers should be spoken slow enough that they can be understood.

Essentials of "Contest" law

Is a 'skill testing question' necessary? A skill testing question should form part of every contest so that the contest prize will not have been given away by 'chance'.

The skill component need not necessarily be a mathematical question. It could for example require the contestant to guess the number of jelly beans in a jar. When a mathematical question is used, the question must involve a degree of skill. The courts will not consider "2+2" to have tested the contestant's skill.
Can you require a purchase to enter the contest? In most contest situations, you cannot require a purchase to enter, and so must provide a means to enter without making a purchase (example, mail your name and address along with a hand-drawing of a UPC bar code…).
What about using the winner's name and photograph to promote the contest? A rule that frequently forms part of a contest states that in accepting the prize, the winner consents to the use of his/her name and photograph in an advertisement without compensation.

Without this rule, if the contest promoter used the winner's photograph without that person's consent, it could possibly be seen as a misappropriation of that person's likeness or personality.
Do you have to declare the prize value and chances of winning? All contests must disclose the number and approximate value of prizes, any regional allocation of prizes (for example, two prizes for Ontario and Quebec and one prize for the other provinces)
Are there any other important things to keep in mind? One important thing to keep in mind is that your contest rules must disclose any fact that materially affects the chances of winning (for example, if prizes are seeded in a particular way in a scratch & win contest).
What about Quebec? If you run a contest that will operate in Quebec, you must file an application with the Quebec Lottery Board to conduct the contest there (they are affectionately known as the "Regie"). The Regie charges a duty (or a tax), and depending upon the prize values, you may have to file a security bond).

Essentials of "Misappropriation of Personality" law

Who is a "celebrity?" Alice Donenfield has defined the term "celebrity" as follows: "(a celebrity is an) actor, author, artist, politician, model, athlete, musician, industrialist, executive, playboy, or any other of a hundred types who wish to be in the public eye for any of a hundred reasons."
What is a "celebrity's personality?" A celebrity's personality can include: the celebrity's name, portrait, likeness, distinguishing features, identity, image, voice, traits, trade mark phrase (an example of a trade mark phrase is: "Heeeerrrre's Johnny!").
What rights do celebrities have? Celebrities have the right to control the commercial value and exploitation of their name, picture, likeness, voice, etc. and to prevent others from unfairly appropriating this for their own benefit.
When is a "celebrity's personality" misappropriated? A celebrity's personality is misappropriated when it is unlawfully used without that person's consent.
Do you need the consent of aperson who isn't famous? Yes. In a recent decision from the Supreme Court of Canada, the Court stated: "(there is) an infringement of (a) person's right to (privacy)…as soon as (their) image is published without consent… ."
What about a photo that doesn'tshow a person's face? You probably need their consent. An important legal case shows that even if a photo does not portray a person's face, so long as the person is capable of being recognized, their consent is necessary (the case involved a photo of a person, only showing them from behind).
Are there exceptions to this rule of needing the consent of a non-celebrity? There are some important exceptions to the rule that one needs a consent to use the name, image or identity of a private individual. In the recent decision from the Supreme Court of Canada, the Court stated that a person's right to privacy is not entirely absolute. The Court by way of example said that no consent is needed:

  1. from those photographed in crowd scenes, or

  2. from those who are brought into the public arena because of their position, professional duties or due to some unique circumstance.

BOTTOM LINE There are nuances in the law. However, if you are unable to obtain legal advice in relation to a specific circumstance, a good rule of thumb to be guided by is that except in the two situations noted above, you should obtain a consent to use the name, image or identity of any person (be they a celebrity or non-celebrity).