Sunday, September 26, 2010

Responses not typical

The FTC now disfavors "results not typical," since research reveals that consumers don't process this disclaimer.  Typical results need to be disclosed.  As I found while preparing for my advertising law class, not every advertiser has reacted to this development--even some (franchises of) big names.
As I'm in the middle of teaching the class, I find myself particularly interested in the use of Guides to make policy when the Guides are admittedly not entitled to the deference due ordinary APA-style rulemaking.  Since the FTC isn't allowed to engage in such rulemaking, it uses a lot of Guides; the Guides are produced using a notice-and-comment procedure that strongly resembles at least the initial stages of APA-style rulemaking.  Formally, in an enforcement proceeding, the FTC would have to show a violation of Section 5 because the Guides have no independent authority; but the Guides would be due some deference in determining whether such a violation had occurred.  The underlying consumer research supporting the FTC's abandonment of the "results not typical" safe harbor would also be important, supporting the factual contention in any given case that use of that label doesn't disabuse consumers of the notion that they could expect the depicted results.  The new Guides say that an advertiser could avoid an enforcement action by having substantiation that its particular "results not typical" disclaimer somehow manages to work, unlike all the others.  I wonder whether we'll see that tried.

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