Reed Smith: Advertising & Marketing Legal News

What We're Reading 9/8/2010

Broadcasting & Cable: FCC Appeals Fox Indecency Ruling

Says court's decision makes coming up with new enforcement policy a "seeming impossibility"

The FCC, with the backing of the Justice Department, has appealed a Second Circuit's Court of Appeals decision that its indecency enforcement policy is unconstitutionally vague, saying the ruling was unnecessarily broad and made coming up with a new indecency enforcement policy that would pass muster with the courts a "seeming impossibility."

BNA: Italian Agency Questions Substantiation of Ad Claim

In what is portrayed as part of a broader crackdown on unsubstantiated medical claims, officials of Italy's Autorita Garante della Concorrenza e del Mercato disclosed on Aug. 23 that the makers of the “Power Balance” bracelet have 15 days to provide the scientific documentation to prove the medical benefits of their advertising claims.

NY Times: Charges Settled Over Fake Reviews on iTunes

Discerning Internet users know that glowing online reviews of things like books or restaurants cannot always be trusted. But federal regulators are serving notice that if you stand to gain financially from the review you are writing, you should be upfront about it.

Brandchannel: Celebrities Strike Endorsement Deals in China

As the Chinese economy evolves, brand marketers there seem to be following in the footsteps of other global brands in applying tried and true techniques, such as using celebrities. What's different, though, is that upstart Chinese brands are importing foreign celebrities to pitch local products to Chinese consumers.

Environmental Leader: EPA Proposes Fuel Economy Stickers

Beginning in 2012, new labels will help end the confusion caused by a new generation of electric and hybrid cars, fastcodesign.com reports.

The U.S. Environmental Protection Agency and the Department of Transportation on Monday released two proposed window stickers designed to make it easier for consumers to compare vehicles.

What We're Reading 9/1/10

Environmental Leader: Study Finds 40% of U.S. Consumers Likely to Test Drive Evs
Forty percent of consumers say they are likely to test drive an electric vehicle, according to an online survey of American adults from the Consumer Electronics Association (CEA).

Environmental Leader: FTC’s Green Guides Could Nullify Environmental Seals of Approval

The Federal Trade Commission (FTC) is on track to release an updated set of Green Guides that are used by the agency to enforce environmental marketing laws against unfair and deceptive advertising, reports Advertising Age. Experts tell the magazine that the pending guidelines could make about 300 environmental seals of approval useless.

FTC.gov: Auto Warranty Robocaller To Pay $2.3 Million, Sell Mercedes For Consumer Redress

Consumer Redress Collected from All Defendants in Robocall Case Totals $3 Million

One of the telemarketers who blasted U.S. consumers with millions of illegal auto “warranty” robocalls last year will pay approximately $2.3 million, give up his Mercedes, and be barred from telemarketing, under a settlement with the Federal Trade Commission that wraps up the agency’s case against the deceptive operation. In sum, the FTC is collecting nearly $3 million to reimburse victims of the scam.

Court House News: Facebook Gives Teachbook an F

Facebook claims schoolteachers copied its work and should get an F. The social networking site claims that Teachbook.com "rides on the coattails of the fame and enormous goodwill of the Facebook trademark" in "a blatant attempt to become Facebook 'for Teachers.'"

Reuters: Jury awards $7.3 million in "Man from U.N.C.L.E." case

A Los Angeles jury has awarded $7.3 million to producer Anchor Bay Entertainment from a woman who was accused of selling rights to the classic TV series "Man from U.N.C.L.E." that she didn't own.

CARU News: CARU Public Service Announcement Asks Parents: "Do you know where your children are on the internet?"

New York, NY - August 11, 2010 -The Children's Advertising Review Unit (CARU) of the Council of Better Business Bureaus, Inc., recently launched its first public service announcements, cautioning parents to be alert to their children's activities on the Internet.

The PSAs can be viewed at: http://www.youtube.com/user/CARUSelfRegulation.

The spots feature Catherine Hicks, star of the family drama "Seventh Heaven," and they recast the time-honored broadcast message "It's 10 p.m. Do you know where your children are?" to reflect contemporary concerns about the privacy and safety of children on the Internet.

"As a learning tool, the Internet provides an amazing depth and breadth of information about the world. As an entertainment vehicle, it can offer experiences that are creative, engaging and fun," said CARU Director Wayne J. Keeley. "But beyond the boundaries of age-appropriate Web content is territory that is far less benign. It is critical that parents know where their children go on the Internet."

The PSAs feature three scenarios:

• The first spot features young girls viewing an Internet fan-club site. One child calls out to her nearby parent, "Hey, Dad, what's your credit card number?" "Credit card number?" asks the father, alarmed.
• The second depicts young boys viewing a gaming site that requires registration. "Hey, Dad, what's my Social Security Number?" says one child. "Social Security Number?" asks the worried father.
• The third spot features girls viewing a social-networking site where one has just posted a questionable picture. As one girl says "I am glad my mother doesn't have an account," her mother walks in, sees the picture and states, "We have to talk."

In all three spots, Ms. Hicks asks the question: "Do you know where your children are on the Internet?"

The PSAs then direct parents to CARU's Website, http://www.caru.org/, where there is a wide range of information available to parents on Internet safety at CARU's "Parents' Corner."

The PSAs are currently running:

• On WABC-TV, which serves the largest market in the country - New York, New Jersey and Connecticut. The PSAs have been broadcast during Good Morning America, Rachel Ray and Live with Regis and Kelly and will continue to air.

"WABC-TV is committed to the safety of the children in our community and airing this psa allows us to reinforce the importance of children's safety on the internet," said Saundra Thomas Vice-President of Community Affairs.

• On Discovery Kids' "family-prime" evening programming which includes the shows "Timeblazers," "Mystery Hunters" and "The Saddle Club."

"The folks at the Hub and Discovery Kids are delighted to help CARU get this critical message out to parents; know where your children are... in the real world and the virtual world of the Internet," said Margaret Loesch, President and CEO, The Hub.

CARU is the self-regulatory forum for the children's advertising industry. CARU's self-regulatory program sets high standards for the industry to assure that advertising directed to children is not deceptive, unfair or inappropriate for its intended audience.

CARU's standards are embodied in principles and guidelines first adopted by CARU in 1975 and periodically updated to address changes in the marketing and media landscape. In addition to monitoring ads in all media for compliance with its guidelines, CARU staff also review Websites directed to children to assure compliance with CARU's guidelines and the federal Children's Online Privacy Protection Act (COPPA).

In the past three years, CARU has issued nearly 70 decisions on Website safety and online privacy; Internet-related cases account for one-third of CARU's caseload. CARU's decisions are available at http://www.narcpartners.org/.

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About Advertising Industry Self-Regulation: The National Advertising Review Council (NARC) was formed in 1971. NARC establishes the policies and procedures for the National Advertising Division (NAD) of the Council of Better Business Bureaus, the CBBB's Children's Advertising Review Unit (CARU), the National Advertising Review Board (NARB) and the Electronic Retailing Self-Regulation Program (ERSP).

The NARC Board of Directors is composed of representatives of the American Advertising Federation, Inc. (AAF), American Association of Advertising Agencies, Inc., (AAAA), the Association of National Advertisers, Inc. (ANA), Council of Better Business Bureaus, Inc. (CBBB), Direct Marketing Association (DMA), Electronic Retailing Association (ERA) and Interactive Advertising Bureau (IAB). Its purpose is to foster truth and accuracy in national advertising through voluntary self-regulation.

NAD, CARU and ERSP are the investigative arms of the advertising industry's voluntary self-regulation program. Their casework results from competitive challenges from other advertisers, and also from self-monitoring traditional and new media. NARB, the appeals body, is a peer group from which ad-hoc panels are selected to adjudicate NAD/CARU cases that are not resolved at the NAD/CARU level. This unique, self-regulatory system is funded entirely by the business community; CARU is financed by the children's advertising industry, while NAD/NARC/NARB's primary source of funding is derived from membership fees paid to the CBBB. ERSP's funding is derived from membership in the Electronic Retailing Association. For more information about advertising industry self-regulation, please visit http://www.narcpartners.org/.

Union Update: Trust Agreements for SAG - Producers P&H Plans

The following documents constitute the Trust Agreements for the Screen Actors Guild - Producers Pension and Health Plans:

• SAG Producers Health Plan Trust Agreement
• SAG Producers Pension Plan for Motion Picture Actors

For a list of all Union updates and resources, please click here.

What We're Reading 8/17/2010

Las Vegas Sun: New York-New York wins trademark suit over Internet domain name

MGM Resorts International has won a trademark infringement lawsuit involving its New York-New York hotel-casino on the Las Vegas Strip, with MGM Resorts winning rights to the potentially valuable Internet domain name newyorknewyork.com.

Tech Daily Dose: Groups Call On Congress To Probe Internet Explorer's Privacy

Six privacy groups have called on the Senate and House Commerce committees to examine whether the latest version of Microsoft's Internet Explorer browser makes it easier for firms to track a consumer's Web surfing habits for advertising purposes.

FTC.gov: FTC Halts Cross Border Domain Name Registration Scam

Thousands of Small Businesses and Non-profits Billed for Bogus Renewal Fees

The Federal Trade Commission has permanently halted the operations of Canadian con artists who allegedly posed as domain name registrars and convinced thousands of U.S. consumers, small businesses and non-profit organizations to pay bogus bills by leading them to believe they would lose their Web site addresses unless they paid. Settlement and default judgment orders signed by the court will bar the deceptive practices in the future.

PC Mag: Google Extending Street View in Germany, Prompting Concern

Google will extend its Street View mapping service into Germany by the end of the year, but data protection officials said they were surprised by the fast-approaching deadline for residents to object to having their homes appear via Street View.

Excite News: Paris Hilton sued for $35M for wearing wrong hair

Paris Hilton was sued Wednesday for allegedly wearing someone else's hair.
A company that manufactures hair extensions claimed the 29-year-old socialite breached her contract to wear and promote their product when she sported the fake locks of a competitor in 2008.

What We're Reading 8/10/2010

LA Times: Lawmakers grill Internet firms over privacy protection

After a string of online privacy problems this year, legislators grilled Google Inc., Apple Inc., Facebook and others on Tuesday, seeking assurance that user information will be protected in the future.

Excite News: Chicken producers debate 'natural' label

A disagreement among poultry producers about whether chicken injected with salt, water and other ingredients can be promoted as "natural" has prompted federal officials to consider changing labeling guidelines.

Reuters: Google changes trademark ad policy in Europe

Google is set to allow advertisers in Europe to use rivals' trademarks when bidding for online ads in a move that will prevent big brand owners from controlling which ads appear during users' searches.

What We're Reading 8/4/2010

Environmental Leader: Congress Set to Reform Law on Personal Care Product Safety

Jan Schakowsky, D-Ill., Ed Markey, D-Mass., and Tammy Baldwin, D-Wis., have introduced a bill that will reform the current law on the use of ingredients in personal care products including cosmetics, reports The Campaign for Safe Cosmetics.

Brandweek: Looking Online to Verify Word-of-Mouth Recommendations

Word of mouth is all well and good, but a new Cone Inc. report indicates that consumers don't take it as gospel when deciding on purchases. With all due respect to Uncle So-and-so's opinion about what they should buy, people are looking online for information to support or rebut such advice.

ClickZ: FTC Studying Do-Not-Track List for Online Ads

As the House inches forward on comprehensive privacy legislation that could have a major impact on online advertising, a Senate Committee met today to discuss online privacy issues. During the hearing, Federal Trade Commission Chairman Jon D. Leibowitz said multiple times that the agency is currently assessing the viability of a do-not-track list for online advertising.

Antitrust & Trade Regulation Daily: House Passes Legislation To Regulate Fur Labeling

The House on July 28 passed the Truth in Fur Labeling Act (H.R. 2480), a bipartisan bill to improve the accuracy of labeling on fur products.

NY Times: Congress Rethinks Its Ban on Internet Gambling

With pressure mounting on the federal government to find new revenues, Congress is considering legalizing, and taxing, an activity it banned just four years ago: Internet gambling.

CARU PSA Links

Dear Friends and Supporters:

As most of you know, CARU is in the process of launching a PSA campaign on children's safety on the Internet. As Director of CARU and a parent of three young children, I ask that you please help us to get the word about this extremely important issue and our PSA campaign by following and "liking" the links below and passing along to friends and colleagues.

• CARU's Facebook Page
• CARU PSA's on YouTube

Best,

Wayne

Wayne J. Keeley
Director, CARU
Vice President, CBBB

What We're Reading 8/2/2010

Reuters: Half of social networkers worried about privacy: poll

Half of Americans who have a profile on social networking sites such as Facebook and MySpace are worried about their privacy, according to a new poll.

MediaPost: Story Study: Drug Ads Educate, Inform

Those warnings of all the side effects that can arise from prescription medication may be distracting, but they seem to be doing their job of making consumers feel they're getting a fair and balanced picture of the product's benefits and risks.

FTC.gov: FTC Joins New Asia-Pacific Multinational Network of Privacy Enforcement Authorities

APEC Cross-Border Cooperation Will Help Protect Consumers’ Privacy

Advancing its mission to protect consumers’ privacy as their data moves across borders, the Federal Trade Commission has joined an agreement with privacy enforcement authorities from other member economies of the Asia Pacific Economic Cooperation forum. The agreement provides a framework for agencies from different APEC member economies to help each other with enforcement investigations. It also enhances information sharing among these agencies.

MediaPost: IAB: New Privacy Regulation Proposal In House Is 'Mixed Bag'

Privacy legislation introduced on Monday by Rep. Bobby Rush (D-Ill.), chairman of the consumer protection subcommittee, is a "mixed bag" for the online ad industry, says Interactive Advertising Bureau Vice President of Public Policy Mike Zaneis.

MediaPost: DoubleVerify Launches Fraud Detection Lab

Digital media-verification company DoubleVerify on Wednesday debuted a research arm to uncover fraudulent sites, as well as malware, spyware, adware and other forms of fraudulent online ads. The Advertising Fraud Detection Lab will investigate ad fraud in real-time and raise awareness of deceptive scams taking place online.

Update: The GRP Talent Payment JPC/Unions Pilot

Earlier this year, the GRP Pilot, testing a new way actors who perform in television commercials are paid, got underway. More than 2,000 commercials are being tested to see if a GRP (ratings)-based compensation model will work. The results of the Pilot will be the centerpiece of negotiations with the unions that are scheduled to begin in October 2011. If adopted, this model will revolutionize the way advertisers pay actors. Some advertisers will pay less; others will pay more. But for the first time since the union agreements were adopted in the 1950s, there will be a measureable correlation between what an advertiser pays actors and their ROI on those costs.

Many advertisers are participating and more are being invited to do so. Surprisingly, some advertisers who have been asked to participate have declined, citing concerns over confidentiality of the data they share in the Pilot, or because they do not like the idea of paying on GRPs (fearful of paying more than the current model requires).

Without question, confidentiality of the data is critical, but the concerns on confidentiality in the Pilot are unfounded. PricewaterhouseCoopers is running the Pilot under strict confidentiality requirements. PwC routinely handles highly confidential information for advertiser clients, many of whom are competitors. They have never had a breach. The same standards are being applied in the Pilot.

Fear of how a new payment model will affect costs is understandable. That is the precise reason we are running the Pilot—to see where price changes will occur and to adjust the model to insure equitable distribution of costs. By not participating, an advertiser will not have the opportunity to raise real, measurable concerns, and the JPC will not have an opportunity to take those concerns into consideration. That leaves non-participating advertisers in the dark. If adopted, there will be no choice in how actors are paid—it will be the new model. So not participating is, quite frankly, short sighted. It's a gamble that the Pilot will have an advertiser in it that has the same media profile as the advertiser electing not to participate. In a Pilot that is dealing with annual industry spending of more than $1 billion, that's a gamble with very poor odds.

If you would like to participate, please contact Allan Linderman at allan@lindermanmedia.com or call him at +1 805 498 5163. If you have decided not to participate, I urge you to reconsider or to call me to discuss your concerns. I can be reached at dwood@reedsmith.com or +1 212 549 0377.

Douglas Wood is the Chief Negotiator for the advertising industry in its relations with SAG and AFTRA, is General Counsel to the ANA, and is a partner in the law firm of Reed Smith LLP.