Finnair's Eco Ad Has Its Wings Clipped

This post was written by Alun J. Jones and John P. Feldman.

On January 6, 2010, the UK's advertising watchdog, the Advertising Standards Authority (the ASA), issued a decision upholding complaints it received against a poster that promoted the Finnish airline, Finnair. The poster featured an image of an Airbus flying above Finland's coastline and stated, "Be eco-smart. Choose Finnair's brand new fleet."

Finnair supported its statement on the basis that it had a new fleet of planes and it structured its flight routes with an eye toward increasing fuel efficiency. The ASA did not find that support very compelling. ASA decided that readers were likely to interpret "eco-smart" as analogous to "environmentally friendly," implying that flying Finnair would have little or no detrimental effect on the environment. Furthermore, the ASA required robust substantiation for the fuel efficiency claims beyond Finnair's emissions data. ASA even questioned whether the ad was clear enough in defining the nature of the comparison: Was Finnair comparing its old fleet with its new fleet, or its new fleet with other airlines?

That general environmental claims lead to serious headaches at the ASA is nothing new. Consider the ASA's September 2009 decision upholding complaints against the Malaysian Palm Oil Council's "Palm Oil-The Green Answer" article. But, how specific do you need to go in order to be clear of a "general environmental claim"?

In a decision involving the carrier EasyJet, the ASA reviewed the claim "Because we operate Europe's most modern fleet, our planes emit 30% fewer emissions per passenger mile than traditional airlines. So you can enjoy your holiday safe in the knowledge you'll have done more for the environment than Gordon's taxes ever could." Similar to the Finnair ad, to be sure, but in the case of EasyJet, ASA held that the ad did not mislead consumers into believing that traveling with EasyJet was environmentally friendly. According to ASA, consumers were likely to understand that all airlines would cause environmental damage. There had also been a great deal of press regarding the doubling of Air Passenger Duty by the British government, and the advertisement would likely be read in that context. However, EasyJet based its calculations for the "30% fewer emissions" claim primarily on the number of passengers they could carry in their planes. Because they could carry more passengers than most other airlines, it followed, according to EasyJet, that the CO2 emissions per passenger were 30 percent less. There was no evidence that supported the claim that EasyJet's younger planes had 30 percent fewer emissions per passenger mile. Thus, ASA found the ad to be partially substantiated and partially in breach of the CAP Code.

That ASA hates open-ended, general environmental claims is clear. But, it is too easy to conclude that "green" claims are impossible for industries that are inherently big contributors to greenhouse gases. As the EasyJet decision shows, careful casting of the claim can make a world of difference. In another example, ASA accepted the substantiation of EDF Energy, which promoted itself in conjunction with "Green Britain Day," using the advertising line, "Brought to you by EDF Energy, sustainability partner of London 2012." Even though this advertisement produced far greater public outcry than the Finnair advertisement (149 complaints versus 4), ASA found the promotional line to be permissible.

Why This Matters

Specificity and clarity is the key. All of the relevant guidance in the UK on environmental marketing – the CAP Code, the ICC Code, Clearcast Guidance and DEFRA's Green Claims Code, all of which are informed by the ISO's standard 14021 – make it very difficult to use broad, general "green" claims. Linking vague descriptions, such as "friendly" or "kind" with words such as "eco," "ozone" and "nature," is to be avoided according to the Codes, as is the use of terms such as "sustainable," "green" or "non-polluting." This is in line with the detailed guidance given on the use of some specific terms, such as "biodegradable" and "recyclable" by ISO 14021. 

So, why did Finnair fail when EasyJet flew (in part)? Finnair's use of "eco-smart" was probably just too general and too vulnerable to multiple interpretations. Somewhat ironically, if Finnair had been more comparative in its advertising, comparing the age of its fleet with that of other airlines, and drawing a direct environmental benefit claim from that fact, ASA might have been less critical. The more hard-hitting but specific claim could have given Finnair the cover, whereas the general "eco-smart" claim did not. We often see comparative claims given more leeway than absolute environmental benefit claims, which can be misinterpreted as communicating a greater "green" message than may be intended. And, finally, as the EasyJet and EDF Energy cases suggest, placing an environmental message into a context that touches on current affairs can help to demonstrate that the public is cognizant of the limited environmental message.

What We're Reading 02/02/2010

What We're Reading

Environmental Leader: 72% of UK Consumers: Give Us Carbon Footprint Labels on Food

New research from the Newcastle Business School at Northumbria University suggests that nearly three-quarters of UK shoppers are in agreement with government plans to go forward with a voluntary carbon footprint label on food items.

 

Environmental Leader: Taiwan Working on Carbon Footprint Labeling for CPGs

Taiwan is the latest nation to float a plan to label the carbon footprint of common consumer packaged goods, following in the footsteps of the UK and Sweden.

 

TV Week: Longform Ads Pull in Revenue but Raise Ethics Questions

The package is presented like something you’d see on the local news rather than like a traditional infomercial. Sometimes it resembles a lengthy feature story; other times it’s an interview with a local doctor or businessman, or a roundup of local tourist destinations.

 

Excite News: 4 nations clear hurdle for non-Latin Web names

Egypt, Russia, Saudi Arabia and the United Arab Emirates are the first countries to win preliminary approval for Internet addresses written entirely in their native scripts.

 

Environmental Leader: Wal-Mart, Best Buy, HP, Dell, Toshiba Establish ‘Green’ Electronics Label

Retailers Wal-Mart and Best Buy, together with electronics suppliers Dell, HP, Intel and Toshiba, have banded together to create a system to help consumers identify “green” electronics, according to a press release.

What We're Reading 01/27/2010

What We're Reading

NY Times: Judge Lifts Some Tobacco Ad Limits

A federal judge in Kentucky issued a mixed ruling Tuesday in the first significant legal challenge to the new federal law regulating tobacco products.

 

DIRECT: Smartphone Users Will Buy, If Site Allows: Survey

Here’s good news for marketers who have invested in mobile marketing platforms: Smartphone users will make purchases using their handheld devices. But here’s some bad news: Potential customers will hang up if a retailer’s mobile site functionality is poor.

 

NY Times: Coat Maker Transforms Obama Photo Into Ad

A garment company in New York known for publicity stunts has seized the attention of the Obama administration.

 

Environmental Leader: UK Government Calls for Food Labels to Show Carbon Footprint

Supermarket food in the UK will be labeled to show its carbon footprint, country of origin and animal welfare standards as part of the government’s new food strategy for the next 20 years, reports the Telegraph. The voluntary “green” food labels will show how much carbon was produced in the manufacture and transportation of food, according to the article.

 

Environmental Leader: Finnair Green Ad Banned

The Advertising Standard Authority (ASA), the UK’s advertising watchdog, has banned a Finnair ad claiming that it is eco-smart for travelers to use the Finnish airline, reports Electric News. ASA also recommends that airlines choose their ad words carefully when promoting their green credentials, according to the article.

Arms' War in Italy: Aggressive Marketers Versus Privacy Watchdog

This post was written by Avv. Felix Hofer, and first appeared in Volume V of the Gala Gazette.

1. Implementing both, EU Directive 2002/58/EC of July 12th, 2002 (Directive on privacy and electronic communications) as well as Directive 2000/31/EC of June 8th, 2000 (Directive on electronic commerce) the Italian legislator decided that unsolicited commercial communication must always to adopt a strictly “opt-in” approach. The choice clearly didn’t drive marketers into a state of happiness: they felt that their business was unnecessarily harassed by complex and costly burdens. Therefore they decided initially not to care too much about the requirements set by the new regulations and to continue in their proven aggressive marketing techniques.

In doing so they nevertheless had underestimated a couple of factors: on one hand, consumers’ reaction (who became more and more annoyed by SPAM and behavioural targeting and were no longer tolerant of disturbing intrusions into their sphere of personal intimacy), on the other hand, the role of a Special Authority (the Privacy or Information Commissioner - DPA) in charge – in all countries members to the EU - of supervising proper compliance with the key principles of protection of personal data (and quickly focusing on the purpose of achieving a correct balance between consumers’ privacy and electronic marketing.
 

Click here to read the full article as published in Volume V of the Gala Gazette.

2010 ANA Advertising Law & Public Policy Conference

Join top legal professionals and government regulators March 17-18, 2010 in Washington, D.C., at the 2010 Annual ANA Advertising Law & Public Policy Conference, where you will hear from Jon Leibowitz, Chairman of the FTC and Doug Gansler, Maryland attorney general, as well as leading legal experts both from law firms and client-side marketers.

Connect with key industry leaders and policymakers as we discuss the most volatile and fast-moving legal and political environment for advertising and marketing in decades. Learn about the new regulations, legislation and major court cases that are fundamentally changing the business environment, and how you can keep up!

For the full agenda and to register, go to http://www.ana.net/adlaw2010.

The Study That Never Was - A Lesson in Comparative Advertising

This post was written by Steven Getzoff and Adam Snukal.

On Jan. 19, 2010, Weight Watchers International Inc. of New York sued its rival, Jenny Craig, Inc., in the U.S. District Court for the Southern District of New York. The suit alleged that the latter's ads were misleading and deceptive, claiming they reference a comparison study carried out by Jenny Craig between the two companies' competing products--Weight Watchers' current weight-loss program and Jenny Craig's pre-packaged meals system. Apparently, no such study was ever conducted. Weight Watchers' suit asked for injunctive relief and damages. The next day, Jan. 20, 2010, Weight Watchers announced that the court had issued a Temporary Restraining Order (TRO) against Jenny Craig. TROs are generally issued when the court believes the plaintiff's claims would likely succeed on their merits in a preliminary injunction proceeding, and that to do nothing in the interim would unfairly prejudice the plaintiff. The TRO forbids Jenny Craig from broadcasting, publishing or disseminating claims of superiority over the Weight Watchers program. In other words, they cannot use the ads at issue or any other ads containing these claims.

The comparative advertising doctrine allows one party to use the trademarks of another without permission if truthful and verifiable facts presented provide a valid factual comparison that helps consumers decide which product is better. On the other hand, a comparative advertisement that falls short of substantiation and validation, as in the foregoing case, could very well give the harmed party a claim of trademark tarnishment, in addition to deceptive advertising.

One e-columnist claims the lawsuit was and is a waste of time. We wonder, if it were that columnist's trademarks or those of his e-journal that were being exploited by a competitor, would he be so philosophical.

What We're Reading 01/12/2010

What We're Reading

Environmental Leager: 85% of Americans Expect to Reduce Household Energy Use in 2010

As New Year’s Day 2010 approaches, more Americans say they are resolved to improve household energy consumption and recycling, according to a survey by Tiller LLC.

 

Environmental Leader: Survey Reveals Ethical Sales Tripled over Decade in UK

Consumer spending on “ethical” products ranging from Fairtrade goods to “green” products for the home has almost tripled in the UK in the past decade, according to the Co-operative Bank’s Ethical Consumerism Report 2009, which measures ethical spending in Britain, reports The Guardian.

 

Brandweek: BrandShield Tool to Debut

As the Web becomes more fragmented, and as more and more online advertising is sold through third and fourth parties via networks and exchanges, major brands are taking extra steps to ensure that their campaigns run exactly as planned.

 

FTC.gov: FTC Approves Two Reports to Congress on the National Do Not Call Registry

The Federal Trade Commission, as required by The Do-Not-Call Registry Fee Extension Act of 2007, has approved two reports to Congress: a biennial report focusing on the use of the Do Not Call Registry by both consumers and businesses, as well as the impact that new technologies have had on the Registry, and a one-time report on enforcement efforts and consumers’ perceptions of the Registry’s effectiveness.

 

Environmental Leader: Save the Earth Sues Honda Over Trademark Infringement

Environmental group Save the Earth Enterprises, claiming that a Honda Civic commercial infringes upon its logo, filed suit Dec. 23.

Déjà Google

Give Google credit that when it announced its acquisition of AdMob, a leading provider of mobile advertising services and technology, in November 2009, it proactively addressed the likelihood of a Federal Trade Commission (FTC) investigation into the transaction. Google even went as far as posting a web page that the media, regulators and other interested parties alike could access that explained why it believed the deal did not pose any “competitive” (note: antitrust) concerns.  Whether it was a self-fulfilling prophesy or just an inevitable step whenever Google makes an acquisition in the digital advertising space, Google last week announced it received a second request for information from the FTC on the AdMob acquisition. This, however, is familiar territory for Google, which has been the target of government scrutiny over previous deals. The FTC held an eight-month investigation into Google's plan to buy DoubleClick Inc. in 2007 before approving that transaction, and last year Google walked away from a search deal with Yahoo after the U.S. Justice Department indicated that it would consider blocking the agreement and strategic alliance.

What Google may not have expected is the data privacy and consumer protection industry group backlash that has taken up the not-yet-completed transaction as a struggle to protect consumer data and the mobile advertising market. At least two prominent consumer groups reportedly approached the FTC, asking it to block the acquisition, arguing that a Google/AdMob combination would put “significant amounts of data for tracking, profiling and targeting” of U.S. mobile consumers into the hands of a single advertising network. Google and AdMob combined will form the largest mobile-advertising company, with 30 to 40 percent of the market, according to Karsten Weide, an analyst with researcher IDC in San Mateo, California. These groups want the FTC to consider whether Google's access to AdMob's technology will give it an unfair advantage in selling mobile advertising.

Understandably, Google has asserted that the economic/market impact of such an acquisition would be almost impossible to measure against the dozens of other mobile ad networks that compete with AdMob on a daily basis. Moreover, a spokesperson for Google has suggested the deal will provide users with more free mobile applications, in some cases as an alternative to pay-to-download apps, since it will allow developers to subsidize their products through better and more targeted mobile advertising.

One interesting issue that has arisen from this and other similar transactions over the past couple of years is whether and how consumer privacy fits into an FTC antitrust analysis. It is well documented that the FTC primarily rests its antitrust analysis on two categories: (i) agreements that are per se illegal, and (ii) agreements that are analyzed under the Rule of Reason. Types of agreements that have been held per se illegal include agreements among competitors to fix prices or output, rig bids, or share or divide markets by allocating customers, suppliers, territories, or lines of commerce. On the other hand, agreements not challenged as per se illegal are analyzed under the Rule of Reason to determine their overall competitive effect. A Rule of Reason analysis entails a flexible inquiry and varies in focus and detail, depending on the nature of the agreement and market circumstances. While this analysis still begins with a review of the primary agreement (e.g., merger, joint venture, license, etc.) driving the FTC’s analysis, it will then extend to other external factors.

Largely until 2007 and the Google/DoubleClick transaction, the issues and types of analysis described above were primarily centered on consolidations and combinations of goods and services, and not privacy or consumer information. During the FTC’s review of Google’s acquisition of DoubleClick, however, all five FTC commissioners who reviewed that transaction agreed that data privacy can constitute a form of non-price competition under a Rule of Reason analysis and, where/when appropriate, should be considered as one of many pieces in their study and review of a prospective transaction. In fact, the FTC, in its decision approving the Google/DoubleClick transaction, provided, “We investigated the possibility that this transaction could adversely affect non-price attributes of competition, such as consumer privacy.” At the core of the FTC’s review was whether, given the nature and economics of online and digital advertising, the concentration of user information that results from a Google/DoubleClick combination meant that no other company would be able to buy, target and optimize ads as profitably, thereby substantially reducing the ability of other ad networks to compete.

On what basis, then, is consumer privacy evaluated? Proponents have successfully argued that privacy harms can reduce consumer welfare, which is a principal goal of modern antitrust analysis. In addition, these same groups have argued that privacy harms can lead to a reduction in the quality of a good or service, which is a standard category of harm that results from excessive market power. On the other hand, those who oppose the incorporation of a privacy review in any antitrust analysis generally rest their argument on two points: (i) they disagree that privacy is a competition-related issue and point to precedents in which non-competition issues (like pollution) have not been traditionally factored into an antitrust analysis, and (ii) these transactions have proved themselves to create market efficiencies and improved offering/technology that ultimately benefit consumers with a more personalized online experience. This latter opinion may best be summarized in a Yahoo statement from 2008: “The advertising model has made Internet content and services available to millions of people in the United States and around the world—for free. The business model of relying on advertising revenue to fund websites has meant that vast amounts of information on the Internet has been fully accessible to people of all ages and income levels.”

Why this Matters: 

Those who ignore history are doomed to repeat it. Our economy today is flush with companies that have been created to essentially trade in almost every aspect of behavioral advertising and consumer data. In fact, one might argue that consumer data has become a currency of sorts in the digital advertising and media industries. As consumer privacy becomes, on the one hand, increasingly protected by both legislation and self-regulatory initiatives (leaving aside the even more complex discussion of the implications of cross-border transactions and acquisitions where the same piece of consumer data may be subject to varying laws), and also a valuable commodity that is highly sought after, companies should be more aware of the legal implications associated therewith in all spheres of their business – including the arena of mergers and acquisitions. Whether one agrees that consumer privacy should be factored into an FTC antitrust analysis or not, it seems unlikely that the FTC will shift from the position it seems to have taken (as evidenced by the Google/AdMob transaction) over the past couple years, and therefore, companies that are contemplating mergers or acquisitions in the digital media and advertising arenas should at least consider the implications that consumer privacy may have on their deals.

Chilly Reception at the White House

On January 6, 2010, The Weatherproof Garment Company (a division of David Peyser Sportwear) put up a billboard (actually two, a diptych) in New York's Times Square. The advertiser used an Associated Press (AP) licensed photo of President Barack Obama during his visit to China's Great Wall back in autumn wearing a Weatherproof jacket. Legal pundits have long discussed and opined whether the First Amendment trumps the commercial product endorsement (commercial free speech being more limited than free speech per se). One thing is VERY clear--the AP's contract required that "the necessary clearance" be obtained prior to the Weatherproof Garment Company's use of the image. Weatherproof president Freddie Stollmack blandly told the media he had not bothered to obtain the clearance. The White House legal team has already been in contact with both AP and Weatherproof's parent company.

…and what about the Wall? It will be interesting to see if the Chinese Consulate complains about the advertiser's unauthorized use of that country's GI--geographical indication--namely the image of The Great Wall of China. For those who may not be aware, this is a growing and interesting area of international IP law, which extends protection to countries over the commercial use of their cultural icons.

Bottom line, agencies and advertisers alike need to consider which rights (image, voice, video, etc.) need clearance--whether it’s the Chief of Staff in a wind slicker or a protective barrier built in the 7th Century B.C.

Maine Introduces COPPA Extension Bill

This post was written by John P. Feldman and Andrew R. Boortz.

Last year, the Maine Legislature adopted 10 MRSA c. 1055, which, among other things, attempted to extend COPPA-like protection to all minors (that is, children under the age of 18). The law was plagued by a number of issues, including questions regarding its constitutionality, and ultimately caused the Maine attorney general to promise not to enforce the law as written. Based on this, it was generally understood that the Maine Legislature would revisit the law in the 2010 legislature session.

The legislature did not wait long. On January 7, 2010, a new children's privacy bill was referred to the Maine Senate Committee on Business, Research, and Economic Development. The new bill, currently listed as LD 1677, would repeal the existing children's privacy law, but would enact a new prohibition on the collection and use of personal information that is: (a) collected and used on the Internet; (b) about a minor; or (c) for the purposes of pharmaceutical marketing.

Although this bill is narrower in scope than the law it seeks to replace, there are still problems with it. First, the bill applies to any personal information about a person under the age of 18, regardless of whether that information is related to health. Therefore, any information about a minor, including name, e-mail address, etc., would be covered. Second, the law seems to apply only to information collected on the Internet; it is unclear whether this information would apply to information collected through other means such as offline collection, mobile device, etc. Third, the text of the prohibition is poorly worded. The prohibition states that "any person may not collect and use information collected on the Internet ..." (emphasis added). Thus, by a literal reading of the text of the bill, a company could collect information about a minor for the purpose of pharmaceutical marketing and avoid liability if it does not use the information. Alternatively, a company could use information that is collected on the Internet by someone else since it would neither have collected nor used the information.

Of course, it is unlikely that the Maine attorney general would interpret the law in this way because this would create a substantial loophole. Instead, it is more likely that the law would be interpreted as creating two strict liability offenses—one for collection of information if the reason for the collection is to promote pharmaceutical sales, and one for the use of any information about a minor to promote pharmaceutical sales, whether or not the information was originally collected for that purpose.

Why This Matters: If enacted, this bill would place a higher burden on companies that sell either over-the-counter or prescription drugs, including pharmaceutical manufacturers and retailers. Such companies will have to be very careful with any marketing program that could conceivably collect or use information about a minor. For example, an e-mail blast with weekly offers that includes discounts on over-the-counter products could violate the bill's prohibition on marketing to children if a minor's e-mail address was included in the recipient list. Companies that sell pharmaceutical products should watch the progress of this bill closely to determine what kinds of systems should be created to avoid liability. There may be an opportunity to comment on rules that must be promulgated by the Maine attorney general within a year after enactment of the law.