Federal Trade Commission There is just an agreement not to repeat that particular claim in future advertising campaigns. For some specialized products or services, additional rules may apply. C. Lanham Act The burden is on the government to disprove the advertiser's claim. E. Substantiation, The _____ is the government agency that has authority over the labeling, packaging, branding, ingredient listing and advertising of packaged foods and drug products. -shared -arbitrate claims -actively insured A. unsolicited order E. Wheeler-Lea Amendment, Under the _____ passed in 1991, telemarketers must follow a complex set of rules developed by the Federal Communications Commission. A. puffery It enforces the laws that prohibit business practices that are anticompetitive, deceptive or unfair to consumers, and it seeks to do so without impeding legitimate business activity. Several airlines challenged the rule on First Amendment grounds in Spirit Airlines v. U.S. De'p of Transporatition. Don't press 1 to speak to a live operator and don't press any other number to get your number off the list. B. puffery. But the system was not necessarily working well. Although that slogan at first may seem to benegit the entire beef and cattle industry, a number of cattle producers objected to it because, as the Supreme Court put it, "the advertising promotes beef as a generic commondity, which, they ccontended, impedes their efforts to promote the superiority of, inter alia, American Beef, grain-fed beef, or certified Angus or Herefore beef." E. Standards and Practices Division, Which of the following media has the most stringent review and approval process for advertising? D. discourage comparative advertising. Litigated Order: 1. -Also court said this case was "in the public interest". C. Freedom to stop the airing of any advertisement Acceptable forms include: The law outlaws bait-and-swithc advertising, in which customers are lured to a store with promises of low prices but then are pushed by salespeople to buy more expensive products. E. avoid questionable advocacy advertising. D. advertising substantiation C. affirmative disclosure. -home address E. The four major television networks. ) Although CAN-SPAM does not provide a civil remedy for those of us who receive spam, a provider of Internet access service that is adversely affected by spamming activities on its service may bring a civil lawsuit against the spammer in any federal court in the U.S. seeking both a permanent injunction to stop the spamming and monetary damages for harm caused by the spam. -producers, a guaranteed issue insurance policy has no Privacy on the internet-in particular, companies and advertisers tracking and monitoring the Web sites consumers visit-is now a major concern of the FTC. The following are all instances in which a court can overturn an FTC ruling: (1) "convincing evidence" that the agency made an error in the proceedings, (2) no evidence to support the commission's findings, (3) violation of the Constitution-for example, the agency did not provide due process of law, (4) the action goes beyond the agency's powers; (5) facts relied on in making the ruling are not supported by sufficient evidence, and (6) arbitrary or capricious acts by the commission. E. dealt with consumers' rights regarding product warranties. Legislation is being considered that would either ban or impose major restrictions on -all serve 7 terms The long-standing legal doctrine is that the First Amendment is not even implicated; such a situation is one private entity, the mass medium, refusing to do business with another private entity. Corrective Advertising: III. D. Sherman Antitrust Act C. Council of Better Business Bureaus *False/Misleading Messages* Web(1) An advertisement shall not utilize or describe nonguaranteed elements in a manner that is misleading or has the capacity or tendency to mislead. B. affirmative disclosure B. offer only merchandise and no cash as part of the sweepstakes prizes. B. the treasurer of XYZ insurance discovers that the treasurer's company is being investigated by the banking and insurance commissioner. Significant omission of important information the reinstatement provision in a health insurance policy is in which of the following situations would the insurer be liable for a loss? C. Advertisers who participate in the full process of an NAD investigation, and NARB appeal often do not abide by the panel's decision. Injunctions The signing of a consent order is an admission of guilt by the advertiser. -Exceptions include: -If the spokesperson was paid E. Competitor Trademark Act, The _____ closed a loophole in the Lanham Act and facilitated the ease with which one company can sue a competitor for making false advertising claims about the first company's products. Although truthful advertising for lawful goods or services receives some First Amendment protection, the extent and scope of that protection is more limited when compared with ___________________. If you respond by pressing any number, it will probably lead to more robocalls.". -establish continuing education requirements Sometimes the owner of the medium thinks the product that is being advertised is offensive, like NC-17 or adult movies, or condoms. Using an ambiguous or easily confused phrase. Magazines C. defined the requirements for advertising substantiation. james is the insured on a life insurance policy where his age was misstated on the application. B. injunctive power. D. multiple interpretations. false According to deontological thinker Kant: I. D. Trademark Improvements Act A prepackaged milkshake sold in convenience stores advertises that it has more chocolate-taste than shakes purchased at restaurants. B. Centre for Electronic Technology. -If you have a spokesperson, the consumer is affiliating your spokesperson and your brand together (this is what you have to assume) If either of the last two events occur, a complaint is issued against the advertiser and a hearing is scheduled before an administrative law judge. D. Robinson Patman Act Network standards regarding acceptable advertising have remained constant over the past 30 to 40 years. FTC's rules against deceptive advertising (2 components), 1) advertising must be truth and not misleading, with misleading ads sweeping up those in which relevant info is omitted, those that imply something that's not true and those in which any disclaimers are not clear and not prominent enough for reasonable consumers to see, hear, and understand them 2) all claims made in advertisements must be substantiated, such that before disseminating an ad, advertisers must have a reasonable basis for any and all express and/or implied product claims, with claims relating to health and safety coming under even closer FTC scrutiny that typically requires proof by competent and reliable scientific evidence. WebUnder the law, claims in advertisements must be truthful, cannot be deceptive or unfair, and must be evidence-based. -Corrective Advertising The FTC issues industry guides for a variety of products, services and marketing practices. -47% of the time people can't tell it is native advertising The Federal Trade Commission remains the nation's most potent weapon against false or misleading advertising. Advertising claims that significantly involve health and safety are usually presumed to be material. D. Federal Trade Commission D. corrective advertising. The most commonly used FTC remedy is the consent agreement, or _____________________________. Injunctive power to immediately halt advertising campaigns that could cause harm to consumers C. the Better Business Bureau may sue Acme if it cannot substantiate its claims. In most cases they probably will not go to that expense. C. Bureau of Alcohol, Tobacco and Firearms All claims made in advertisements must be substantiated such that, before disseminating an ad, advertisers must have a reasonable basis for any and all express and/or implied product claims, with claims relating to health and safety coming under even closer FTC scrutiny that typically requires proof by competent and reliable scientific evidence. E. Trade Regulation Act. E. advertising substantiation. Industry guides apply only to prospective advertising campaigns, events that have not yet occurred. B. negative option A. employment, national security, and trade. *Remember, a mass medium is permitted to reject any content it chooses, with or without a reason. Courts generally give less protection for commercial speech by lawyers than advertising publications SUMMARY: Cease-and-Desist Orders -policy owners the death benefit paid will be what the premium would have been purchased at the correct age, a 10% excise tax is normally applied to an early withdrawal from an IRA. Children's Advertising Review Unit (CARU) Implied uniqueness Weban insurance applicant has made a false statement on the application that will affect the insurer's decision on whether or not to issue the policy. -Does the advertising message in question concern an unlawful activity or is it misleading? E. dealt with consumers' rights regarding product warranties. Information Technology which law do all insurers and their producers need to comply with? -producer E. U.S. Supreme Court rulings, The _____ moved against a number of national advertisers as a result of inactivity by the Federal Trade Commission (FTC) during the Reagan administration. C. Bureau of Alcohol, Tobacco and Firearms Bad publicity can cost a company millions of dollars. A. -protection of proceeds against the beneficiary's creditors In a unanimous opinion, the appellate court wrote that "the government has assured substantial interests to be served by the do-not-call registry (privacy and consumer protection), the do-not-call registry will directly advance those interests by banning a substantial amount of unwanted telemarketing calls, and the regulation is narrowly tailored because its opt0in feature ensures that it does not restrict any speech directed at a willing listener. It is also important to remember that an ad may mislead because it omits material information. B. selective exposure. If the advertiser has had a good record in the past and if the offense is not too great, the company can voluntarily agree to terminate the advertisement and never use the claim again. -An advertiser may use an endorsement of an expert or celebrity only as long as it it has good reason to believe that the endorser continues to subscribe to the views presented. C. ad substantiation will result in advertisers resorting to puffery to avoid the need for claim verification. In 2008 legislation was signed under which numbers placed on the list remain on it permanently unless consumers specifically request a number's removal by calling 1-800-382-1222. A. When an advertisement conveys more than one meaning to a reasonable consumer, one of which is false, the seller is liable for the misleading interpretation. Importantly, under the doctrine of "falsity by necessary implication," a company's claims about particular aspects of its product may necessarily imply more sweeping claims about that product, and these implied claims also may be literally false within the meaning of the Lanham Act. Uder the terms of the CAN-SPAM Act, each separate e-mail in violation of the law is subject to penalties of up to $________________, and more than one person may be held responsible for violations. D. Bureau of Alcohol, Tobacco, and Firearms D. Superlatives such as greatest, best, and finest are puffs that are often used in advertising. -Lawyers are only allowed to state past facts, they can't promise future things 2. E. Trade Regulation Bureau, Which of the following divisions of the Federal Trade Commission protects consumers from deceptive and unsubstantiated advertising and enforces the provisions of the FTC Act that forbid misrepresentation, unfairness, and deception in general advertising at the national and regional level? -are the only ones to involve courts f(x)=(x5)(12x). The advertiser may appeal this decision in a federal court. A. C. trade allowances A. Corrective advertising Association of National Advertisers. 3. ", courts have developed this to articulate just how much first amendment protection advertising receives and the criteria the government must satisfy to permissibly regulate it, false or misleading advertising, as well as advertising about unlawful foods or services, receives, truthful and non-misleading advertising about lawful goods and services receives an __________ _______ of first amendment protection. Nestl claims "Nestl makes the very best chocolate," Snapple advertises that its beverages are "made from the best stuff on Earth," are all examples of: -statements that dividends are not guaranteed Self-regulation by the advertising industry has increased in recent years, especially with the growth of comparative advertising. E. distribution, distillation, and diversity. A. Deception B. d. requiring an individual, group, or organization to choose among several actions that must be evaluated as right or wrong, ethical or unethical. There is a "reasonable fit" means "narrowly tailored" E. National Association of Broadcasters, C. American Association of Advertising Agencies. John Oliver video on Native Advertising: Under the Children's Television Act,: -submit to the replacing insurer a list of the policies to be replaced SURVEY . which of the following must be included in the ad? A well-educated physician might be better able to understand a complicated pharmaceutical ad than the average individual can. A. Under the proposed new guides, such disclaimers indicating that the results of the endorser are unusual or out of the ordinary would not be enough to protect the advertiser from potential liability. -never protection of proceeds, there is protection of proceeds against the insured's and the beneficiary's creditors, which of the following is MANDATORY coverage for all group health care service contracts? D. Electronic Retailing Self-Regulation Program (ERSP). -premium past due -$200,000, which of the following actions is REQUIRED by an agent who is replacing an existing life insurance policy? CAN-SPAM Act When the FTC recovers money against a company for false or misleading advertisements, who gets to keep it? -if you're saying something subjective ("old puffery"), you are not likely to get in trouble with the FTC for false advertising, Guides: Litigated orders to advertisers to terminate a particular advertising claim, failure to comply with which can result in severe penalty -conduct investigations demonstrate full and truthful disclosures to the public. Most cases come to the attention of the agency from letters written by either consumers or competitors. The basic defense against any false advertising complaint is truth-that is, proving that a product does what the advertiser claims it does, that it is made where the advertiser says it is made, or that it is as beneficial as it is advertised to be. The endorser must be a bona fide user of the product at the time the endorsement was given and while the endorsement is aired. -beneficiaries National Advertising Review Board The agency has never outlined a hard-and-fast policy regarding when corrective advertising will be used. E. National Association of Broadcasters. *Aggravated Violations*. D. comparative advertising. -No ad containing an offer to sell a product should be published if the offer is not a bona fide effort to see that product. A large protion of that money, under the federal Beef Promotion and Research Act, has gone to finance generic advertising for the beef industry, including the "Beef. Section 43(a) creates a legal cause of action for false advertising. For instance, in 2012 CARU recommended that the maker of Bratz Party Dolls alter packaging that featured the text "now with 100s of poses" and included photos of 3 dolls posed without assistance in various stances. It held that an online roommate-matching service was not immune to liability under Section 230 of the CDA for posting information by others that violated the Fair Housing Act and California housing discrimination laws. C. Bureau of Alcohol, Tobacco and Firearms. C. equity May also argue the claim in question is not material, and therefore will not impact a purchasing decision. The act or practice must be considered from the perspective of a "reasonable consumer." The _____ is a major trade association of the advertising business in the United States. Consent Decrees Trade Regulations Rules: B. affirmative disclosure Parramore Corp has 12 million dollars of sales, 3 million dollars of inventories, 3.25 million dollars of receivables, and 1.25 million dollars of payables. WebAd Regulations >> Advertising is controlled by internal self-regulation and by external state and federal regulatory agencies such as the Federal Trade Commission (FTC), the Federal A. a consent order. FTC's means to police deceptive advertising, Guides and the Child Online Privacy Protection Act 8. -Litigated orders These statutes protect consumers from predatory business practices by ensuring fair competition exists. Falsely implying that a product benefit is unique to a brand. Drug companies must only submit their ads to us when they first appear in public. The media cannot refuse to accept advertising for an entire product class such as hard liquor. But practically, it can regulate almost all advertising. D. discounts The FTC contended that the registry, which is a list containing the personal telephone numbers of telephone subscribers who have voluntarily indicated that they do not wish to receive unsolicited calls from commercial telemarketers, was necessary to reduce both intrusions upon consumer privacy in the home and the risk of fraudulent or abusive solicitations from telemarketers. D. Robinson Patman Consent Agreement: E. Substantiation, Under the _____ Doctrine, the Federal Communications Commission (FCC) required stations to run commercials about the harmful effects of smoking.