As consumer demand for eco-friendly, non-toxic, and sustainably-sourced products continues to rise, so does the use of environmental certifications on packaging and advertisements for virtually every kind of consumer product, including children's products. To avoid scrutiny by the Federal Trade Commission ("FTC"), as well as civil claims for false advertising, children's products marketers should be familiar with Section 260.6 of the FTC's Green Guides, which specifically addresses the use of environmental certifications and seals of approval.
THE GREEN GUIDES GENERALLY
The FTC's Green Guides, 16 CFR § 260, provide guidance on how truth-in-advertising principles apply to "green" marketing. The Green Guides are administrative interpretations of the law and thus are not independently enforceable. However, the FTC can (and has) taken action under Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45 ("the Act"), if a marketer makes an environmental claim that is inconsistent with the Guides.
SECTION 260.6: CERTIFICATIONS AND SEALS OF APPROVAL
- Section 260.6 of the Green Guides provides the following guidance on certifications and seals of approval:
It is deceptive to misrepresent, directly or by implication, that a product, package, or service has been endorsed or certified by an independent third party individual or organization.
- A marketer's use of the name, logo, or seal of approval of a third-party certifier may be an endorsement, and therefore should meet the criteria for endorsements provided in the FTC's Endorsement Guides, 16 CFR § 255.
- Marketers should disclose any material connections to the third party certifier. A material connection is one that could affect the credibility of the endorsement.
- Unless a certification or seal clearly conveys the basis for the certification or seal, it likely conveys that the product offers a general environmental benefit1. Because general environmental benefit claims are difficult to substantiate, marketers should not use environmental certifications or seals that do not convey the basis for the certification.
- Marketers can and should qualify general environmental benefit claims conveyed by environmental certifications and seals of approval. To avoid deception, marketers should use clear and prominent qualifying language that conveys that the certification or seal refers only to specific and limited benefits.
Importantly, both advertisers and third-party certifiers have responsibilities under Section 5 of the Act and can be held responsible for deceptive use of seals and certifications. To illustrate how a business can lawfully advertise a legitimate green seal or certification, the FTC posted a clear example on its Business Blog.
Click here to view the image.
As is evident from the FTC's "Bad Example," displaying an ambiguous green seal that does not itself explain its underlying basis is considered deceptive. To convey the basis for the seal, the FTC encourages marketers to use explanatory language that is big, easy to understand, and close to the claim it qualifies.
If the underlying basis for the green claim cannot be succinctly summarized and placed close to the seal, or if it is otherwise impracticable to list all applicable attributes close to the seal itself, the Green Guides advise that it is appropriate for marketers to refer consumers to a website that provides more information on the specific environmental attributes claimed. However, the marketer must still use qualifying language to convey that the seal refers only to specific and limited benefits. For example, another way to bring the FTC's "Bad Example" into compliance with Section 260.6 would be to add the following statement adjacent to the seal: "For details on the specific environmental impacts tested by [Company], go to [website]."
Before using a green seal or certification on product packaging or in any kind of advertisement, marketers should consider the following:
- Can you substantiate the express and implied claims conveyed by the seal or certification?
- Does the seal or certification itself convey the basis for the certification, or is qualifying language required?
- Is the qualifying language big, easy to understand, and close to the claim it qualifies?
- Is there a material connection to the third-party certifier that should be disclosed?