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July 2nd, 2012
FTC Releases Study to Guide Advertisers Away from “Up To” Claims
The Federal Trade Commission ("FTC") announced the results of a study it commissioned, which indicates that many consumers understand "up to" claims as promising maximum results. The FTC believes the study will help guide advertisers to avoid the use of misleading "up to" claims.
In announcing the results of the study, the FTC stated that the study "reinforces the FTC's view that advertisers using these claims should be able to substantiate that consumers are likely to achieve the maximum results promised under normal circumstances." The FTC's position seems to be a departure from the standard set forth by many states and in the Better Business Bureau’s Code of Advertising, that advertisers must support "up to" claims with evidence that the maximum comprises "a significant percentage, typically 10%." The guidance announced by the FTC - that advertisers should be able to substantiate that "consumers are likely to achieve the maximum results" - appears to be more stringent than the commonly used “significant percentage” standard. This announcement may have widespread consequences for those making “up to” claims, at least with respect to savings claims.
The FTC's study was conducted in conjunction with investigations of five companies that settled allegations in February that they made false claims about how much money consumers could save on their heating and cooling bills by having certain windows installed.
If you have any questions about the FTC's study or "up to" claims generally, please contact Terri Seligman at (212) 826 5580 or tseligman@fkks.com, Jeffrey A. Greenbaum at (212) 826 5525 or jgreenbaum@fkks.com, or any other member of the Frankfurt Kurnit Advertising Group.
Other Advertising Law Alerts
What the Advertising Industry Can Learn from Kim Kardashian’s Settlement with the SEC
On October 3, 2022, the Securities and Exchange Commission (SEC) announced that it entered into a $1.26 million settlement with Kim Kardashian over her social media promotion of the EMAX token without disclosing payment she received from token issuer, EthereumMax. The matter provides important lessons for advertisers. Read more.
October 10 2022
Get Ready for California’s New “Automatic Renewal” Rules
California recently amended its Automatic Purchase Renewals law. The amended statute - effective July 1st -- require marketers to provide consumers of automatic renewal or continuous service offers with more information and easier ways to terminate. Read more.
June 22 2018
“Made in the U.S.A.” Claims Continue to be Scrutinized
In 2016, California amended Section 17533.7 of the California Business and Professions Code ("Section 17533"), liberalizing the standard for selling products labeled "Made in U.S.A" to California consumers. Read more.
June 4 2018
