Welcome to our new Advertising Alert Series, where we will use recent National Advertising Division (NAD) decisions as real-world examples to examine various ad law principles.
To set the stage for our forthcoming blogs, it is helpful to provide some context on the NAD. As some of our readers may be aware, the NAD is a division of BBB National Programs, an advertising self-regulation program established in 1971 to monitor and review national advertising across the United States. Its primary purpose is to protect consumers from false or misleading advertising claims and to ensure fair advertising among competitors in the marketplace. NAD investigates advertising claims that are brought forward by competitors, consumers, or on its own initiative, examining national ads that appear in television, print, online, and social media.
NAD offers three main types of proceedings to participants: Fast-Track SWIFT, Standard Track, and Complex Track, with the appropriate track depending on the amount and complexity of the claims being challenged. Types of advertising claims that NAD has examined in the recent past, and in turn the types of claims that we will detail in the Advertising Alert series, include the following, among others:
- Comparative claims (e.g., X cleans quicker than brand Y)
- Superiority claims (“#1,” “best,” “leading brand”)
- Performance and efficacy claims (“99% coverage in the USA”)
- Preference Claims (“most preferred toilet paper”)
- Health and safety claims (“clinically proven” “enamel safe”)
- Environmental or “green” claims (“better for the earth” “100% recyclable”)
- “Made in USA” and other origin claims
- Pricing and value claims (“$200 off if you sign up this week”)
- Endorsements and testimonials ( “best product I’ve ever used”)
- Taste or sensory claims (“the best mustard I’ve ever tasted”)
When NAD determines that a certain advertising claim is not supported by adequate evidence, it recommends modifications or discontinuation of those claims, and advertisers have the option to either comply with NAD’s recommendations or appeal the decision to the National Advertising Review Board (NARB). Meanwhile, advertisers who do not comply with NAD recommendations can have their advertising referred to various regulatory bodies such as the FTC or FDA, as well as state attorney generals and regulators, or elsewhere.
We will further evaluate the mechanics of NAD proceedings throughout our Advertising Alert series, but it is important to remember that the NAD is another tool in the toolkit when examining and thinking about both your and a competitor’s advertising. In the meantime, if you have any questions about the NAD, feel free to reach out to our advertising team who is experienced not only in NAD representation but also advising potential challengers on the strength of their challenges and advising advertisers on appropriate claim substantiation to help avoid (or successfully overcome) an NAD challenge.
The material contained in this communication is informational, general in nature and does not constitute legal advice. The material contained in this communication should not be relied upon or used without consulting a lawyer to consider your specific circumstances. This communication was published on the date specified and may not include any changes in the topics, laws, rules or regulations covered. Receipt of this communication does not establish an attorney-client relationship. In some jurisdictions, this communication may be considered attorney advertising.
