Testimonials Require Substantiation
The high court in Köln ruled customer evaluations/opinions on a website constituted advertising. The testimonials in question stated
• “I use less detergent”
• “Needed less detergent and the laundry is more textured and softer”
• “Really works … requires less detergent and saves money”
Since these statements were meant to create confidence in performance and promote sales, the claims required substantiation, and must be pulled from the website.
jbho: always tricky using User Generated Content (UGC) in advertising. A reminder that testimonials are subject to the same validation criteria as any other advertising. If it’s something you can’t say yourself, you can’t hide behind someone else. Testimonials are generally okay if experiences are representative. However, don’t forget to get consent to republish, and disclose any consideration offered.
Ads Must Source Cited Claims
A telco ran ads stating it was “Best Internet Provider 2016” and cited a magazine as the source of the claim. The federal court in Köln ruled the ads were anti-competitive, since the claim did not include details allowing a consumer to easily find the source (e.g., no month/year of publication). The court rejected arguments that the article could be found using an internet search (could not be assumed a consumer would use a search engine). Moreover, there was no guarantee the source would be found, since search results are dependent on the user, search terms used, etc.
Since the ads put undue effort on consumers to verify the claim, the court ruled against the advertiser.
jbho: always tough when you don’t want to lard up you ad copy with legal disclosures, but when making comparative claims, you should include who performed the research, the date, and other relevant details as well as the location of the materials.
For #1 Claim, You Must Be #1 In All Advertised Markets
A suncream maker ran ads claiming it was ‘Number 1 in European Pharmacies*.’ However, the asterisk clarified that the UK and Poland were not part of that assessment. The court found that sales in the eight main markets relied on could not be extrapolated and applied to all of Europe. Furthermore, the court found the exclusion of the UK and Poland to preserve the ‘#1’ claim made the ad a ‘brazen lie,’ and the ads were clearly misleading.
jbho: I think a few lessons here:
• avoid absolutes in advertising copy
• claims have to be substantiated based on impartial, empirical data
• disclosures cannot contradict the claims
Ad Blockers Are Consumer Protection, Not Anti-Competitive
The Landesgericht in Hamburg has again ruled against an online publisher, finding that AdBlock Plus (AP) is a legitimate privacy tool that allows consumers to protect themselves from unwanted tracking and harmful programs. Spiegel argued the ‘whitelist’ built into AP gave certain advertisers an unfair advantage (the majority of users leave the AP ‘whitelist’ enabled by default), and advertisers must pay to be included in the Whitelist.
The court found that there was no inherent obligation on internet users to receive advertisements. Where an internet user initiated blocking and had full control over what was blocked, any default settings were irrelevant – even if a user chose not to change them.
Additionally, AP did not charge all ‘whitelist’ entities. Small and medium-sized websites – about 90% of the whitelist entities – were not charged. Only operators of larger websites were required to pay. The court felt that was no impediment to Speigel. Moreover, any injuries were self-inflicted by Speigel if it chose to prevent AP users from accessing its websites altogether.
jbho: an interesting an evolving topic. This decision is consistent with a previous challenge by BILD.
Also of interest: after the BILD decision, a letter supposedly from the European Commission surfaced, indicted that websites that detect ad-blockers to stop their users from reading webpages could be illegal under European law. http://www.theregister.co.uk/2016/04/23/anti_ad_blockers_face_legal_challenges
The saga continues…
Still Can’t Say Beer Is Healthy
The Federal court in Baden-Württemberg has upheld a lower court decision prohibiting a Swabian brewery from marketing its beer as “salubrious” (healthy/digestible). The regional court again ruled in favor of the consumer protection group citing an EC regulation that prohibits health claims on products with an alcohol content of more than 1.2% by volume.
jbho: following up on case from last year. Made me chuckle. I lived in Germany for five years and I would consider their beer to be health food – so long as it’s brewed according to the Reinheitsgebot, of course.
Can’t Say ‘Biggest’ Based On A Single Criteria
The regional court in Frankfurt ruled in favor of a window manufacturer who brought claims against a competitor for ads stating it was the ‘biggest window maker’ in Europe. The court found that although defendant may be producing the most windows, there were other criteria in which it was not the largest (distribution, sales, etc.). The court felt the average consumer would equate ‘biggest’ with sales volume, and even if clarified, defendant’s ‘biggest’ claim would still be misleading.
jbho: If you can’t substantiate the claim, you can’t say it. Anywhere. And a reminder to avoid absolutes in advertising copy.
Although… I wonder if the disclosures had been better placed, and followed the four Ps – PROMINENCE; PRESENTATION (easy to understand, not contradicted and timely); PLACEMENT where consumers are expected to look or hear; close PROXIMITY to the claim qualified – would the decision have been different?
No Exclusivity If Can Buy Through The Grey-Market
The regional court in Hamburg ruled a cosmetics manufacturer could not run ads stating ‘exclusively available at your pharmacy’ when the products were also available – despite the manufacturers intentions – in drugstores. Although defendant only sold products directly to pharmacies, the existence of the grey-market distribution of the same products ultimately meant consumers would be misled by the exclusivity claims.
jbho: another reason to avoid absolutes in marketing copy.
This is a weird one. Through no fault of her own, defendant’s products were being resold in a way she didn’t want. Does this mean the mere existence of eBay will prevent any company from ever claiming exclusivity in distribution?
No Notice Of Google Analytics is Unfair Competition
Plaintiff was awarded €5,000.00 in the matter.
jbho: Make sure your privacy policies are up to date and accurate.
And a reminder that in Germany, it’s not just the regulators you need to worry about. Companies can sues each other for perceived privacy breaches under the UWG (unfair competition act).
Deceptive Efficacy Claims Must Cease Across All Channels
The appellate court in Frankfurt ruled that unsubstantiated claims made by a manufacturer of “wellness devices” must be pulled not only from its website, but
from its print advertising as well. A judgment of €40,000 (~$45,000) was issued for failure of the company to pull its unsubstantiated claims from all marketing
jbho: If you can’t substantiate the claim, you can’t say it. Anywhere.