The Federal Trade Commission (“FTC”) recently announced that it reached a settlement in its first ever “organic” marketing case against Moonlight Slumber, LLC (“Moonlight”). If you are familiar with Aziz Ansari’s position on thread count, then you would imagine that Aziz, like the FTC, would not be pleased with allegedly non-organic mattresses. The FTC communicated its displeasure with Moonlight’s organic marketing practices wherein it alleged in the underlying Complaint that Moonlight had violated Section 5(a) of the FTC Act based on claims that Moonlight allegedly misrepresented and/or could not support.
What did the FTC allege violated the law?
Organic Marketing Practices and the FTC Complaint
Moonlight manufacturers, advertises, offers for sale, and distributes baby and child mattresses. Moonlight advertised some of its mattresses as organic and claimed that the materials used in these mattresses were natural. Moonlight also represented that at least one of its mattresses contained a natural latex core and that many of its mattresses are made of eco-friendly plant-based foam material. The FTC alleged in its Complaint that Moonlight’s organic product marketing representations are false and/or misleading. According to the FTC, Moonlight’s mattresses are made of mostly non-organic material, contain synthetic (not natural) latex, and contain little or no plant-based material. In addition, the FTC alleged that Moonlight failed to disclose, or disclose adequately, that it was self-certifying its products with its own designation called “Green Safety Shield.”
Better Have Some Backup
In addition to its organic marketing claims, Moonlight also advertised that its mattresses will not emit any substance, including volatile organic compounds (“VOCs”), and further represented that testing proved that its mattresses were free of VOCs. According to the FTC, Moonlight’s claims are false or misleading and unsubstantiated because it did not possess any proof, including any clinical studies, to support that its mattresses are free of VOCs.
On December 11, 2017, the FTC announced a settlement with Moonlight. As part of its organic marketing settlement with the FTC, Moonlight has agreed that:
- it will not represent that its products are organic, natural, plant-based, or otherwise promote the environmental or health benefits of its products unless Moonlight possesses reliable scientific evidence to do so;
- it will not represent the emissions level of any substance, including VOC emissions, associated with its products unless Moonlight possesses reliable scientific evidence to support same;
- it will not misrepresent any test, study, or research regarding VOCs or off-gas;
- it will not misrepresent the degree to which a third party or independent party has evaluated or certified its product(s); and
- it will clearly and conspicuously, and in close proximity to the representation, identify any material connection to product endorsers.
Don’t Wake up the FTC – Avoid Liability in Connection with Organic Marketing Campaigns
The ability to market a product as “organic” can create significant value and brand recognition for businesses. Indeed, the market for organic products in the U.S. grew from $3.6 billion in 1997 to $47 billion in 2016. However, before engaging in an organic marketing campaign, it is important for businesses to be aware of the issues that may put them at risk and the due diligence and legal counsel necessary to help avoid such risks.