This past week, several consumer protection actions made headlines that affect the retail industry.
Tyson’s Hot Dog TM Suit is Going, Going Gone
Tyson Foods and Hillshire Brands received a thumbs-up from the Third Circuit to continue using “Park’s Finest” for its Ball Park brand hot dogs. Hot dog competitor Parks LLC, alleged in early 2015 that Tyson’s brand infringed on Parks’ trademark and caused consumer confusion. The Pennsylvania district judge first denied Parks’ request for a preliminary injunction, and later tossed out the claims altogether for lack of substantial evidence of any brand confusion. The Third Circuit affirmed the dismissal, filing its decision under seal.
Paint Companies Agree to Stop Making Unsubstantiated Health and Environmental Claims
Four paint companies that made health and environmental claims about their paint have agreed to settle deceptive advertising charges with the FTC. The FTC alleged that the companies’ claims that the paints were emission- and VOC-free, and safety representations regarding sensitive populations like babies and pregnant women, were unsubstantiated. The FTC orders prohibit the companies – Benjamin Moore & Co., Inc., ICP Construction Inc., YOLO Colorhouse, LLC, and Imperial Paints, LLC – from making unsubstantiated health and environmental claims, and require the respondents to instruct retailers to stop using prior marketing materials. In addition, two of the companies are prohibited from misrepresenting the nature of third-party certifications.
Restaurants Seek to Slow NYC’s Enforcement of Menu-Labeling Regulations
In mid-July, several food retailer industry associations filed for a preliminary injunction against New York City to prevent enforcement of regulations requiring calorie and nutrient information on menus. The city announced that it will begin fining non-compliant food providers on August 21st. The plaintiffs oppose what they deem a premature enforcement, arguing that the city is preempted from acting because the FDA’s similar menu-labeling requirements will not go into effect until next May. State and local governments, according to the plaintiffs, cannot enforce a food regulation that is not identical to the FDA’s corresponding regulations, and because New York’s rule has a different enforcement date, it is not identical.
Lab Door Declines to Participate in the Self-Regulatory Process; NAD forwards claims to FTC
The NAD referred to the FTC Lab Door’s claims about its dietary supplement ratings and rankings, including that those ratings are “based on real science” and help consumers find “the best supplements.” Jarrow Formulas, Inc., a dietary supplement maker, challenged Lab Door’s ranking campaign, asking NAD to review, among others, Lab Door’s representation that it could accurately rank the safety and effectiveness of supplements. The advertiser declined to participate in the self-regulatory process, and NAD referred the advertising claims to the FTC for review.
Genesis Toys will undergo FTC Review for Privacy Concerns
PLZ’s Claims to have the “World’s Best” is Mere Puffery
According to the NAD, PLZ Aeroscience Corporation merely engages in puffery when labeling its “Sprayway” as the “World’s Best Glass Cleaner.” Home-cleaning product competitor S.C. Johnson argued that PLZ’s claim was unsubstantiated. NAD declined to use either PLZ or S.C. Johnson’s consumer perception surveys to evaluate the claim, and instead slipped on its own consumer shoes to determine that “World’s Best” was vague and fanciful, rather than a claim that PLZ was measurably better that its competitors. NAD noted that PLZ’s nostalgic-looking bottle depicting a 1950’s woman, combined with the small font of the disputed phrase, reflected only an “exaggerated display of the advertiser’s pride in its product.”
NAD Recommends Fabletics show its VIP Member Terms more clearly
NAD recommended that JustFab, an online shopping boutique, better disclose the terms of its VIP program in advertising. Justfab’s active-wear branch, Fabletics, advertises steep sales, but, according to NAD, could improve in adequately alerting potential members that their account will be automatically charged $49.95 per month unless the member logs on to “skip the month.” NAD recommended placing these deal terms in close proximity to the introductory advertisement offers. Fabletics agreed to comply with the recommendations.
NAD finds study insufficient to claim that “America Preferred” Sharkninja’s Vacuum
NAD recommended that Sharkninja refrain from claiming that “America” and “2 out of 3 households” preferred their vacuum cleaner. Sharkninja’s advertisements derived from a four-week household study in which households were given a Shark vacuum and a Dyson Cinetic vacuum for two weeks each. Dyson challenged the sufficiency of the study to support the claim, and NAD agreed that the study’s methodology and results were insufficient to support the contested claims. Sharkninja agreed to discontinue the advertisement.