This past week, several consumer actions made headlines that affect the retail industry.
Federal Court in New York Dismisses Diet Pepsi Case
A federal judge dismissed a complaint accusing Pepsi-Cola Co. of misrepresenting that its “diet” drinks help consumers lose weight. In the proposed class action, plaintiffs claimed that Diet Pepsi is made with no-calorie sweeteners, which allegedly contributes to weight gain and increased risk of metabolic disease, diabetes and cardiovascular disease. The judge rejected the plaintiffs’ studies, finding that the evidence indicated an association between the sweeteners and weight gain, but not causation. The judge also concluded that reasonable consumers understand that the “diet” label simply means low calorie.
NAD Refers Conair’s “Most Trusted Name in the Kitchen” Claim to FTC
The NAD has referred the Conair Corporation to the FTC after Conair declined to participate in the NAD’s self-regulatory process regarding long-standing Cuisinart claims. The maker of KitchenAid kitchen appliances challenged Conair’s claim that its Cuisinart brand is “The Most Trusted Name in the Kitchen.” The challenger contended that a “most trusted” claim conveys to consumers that the product is in fact the most trusted brand, but that Conair lacked survey support for such a claim. Conair stated that the claims had been running for over three years, and that it would not participate in the self-regulatory process because the NAD does not allow advertisers to assert a defense that a challenge is unreasonably delayed. The matter will be referred to the FTC.
NAD Recommends T-Mobile Discontinue “Best Unlimited Network” Claim
The NAD has recommended that T-Mobile USA, Inc., discontinue its “Best Unlimited Network” advertising claims, following a challenge by AT&T Services, Inc. As support for the claim, T-Mobile provided data from two independent sources, showing that its network provides superior data speeds as compared to other major providers. The NAD concluded that even if it found this evidence to be reliable, it did not support the breadth of T-Mobile’s “Best Unlimited Network” claim—because other attributes, such as coverage area, talk and text services, and reliability, are also relevant network measurement categories. T-Mobile says it will appeal the NAD’s decision to the NARB.
NAD Recommends Epson Discontinue Claims Its Digital Projectors Are “3x Brighter”
The NAD has recommended that Epson America, Inc., discontinue claims that its 3LCD digital projectors are “3x Brighter,” but agreed that Epson could continue promoting color brightness based upon “Color Light Output” or CLO. The maker of Digital Light Processing imagers challenged Epson’s advertising claims. The NAD found that Epson’s evidence did not substantiate the claim that its projectors have “up to 3x brighter colors.” However, the NAD concluded that Epson’s explanation of CLO as a measurement of brightness capability was not misleading and could be continued by the advertiser. Epson agreed to comply with the NAD’s recommendations.
FTC to Host Decrypting Cryptocurrency Scams Workshop in Chicago
On June 25, 2018, the FTC will host a workshop on “Decrypting Cryptocurrency Scams” at DePaul University. The workshop will bring together consumer groups, law enforcement agencies, researchers and private sector representatives to explore how scammers are exploiting the current interest in cryptocurrency, such as bitcoin, and how consumers can be better protected and empowered. The workshop is free and open to the public, and the conversation starts at 1:00 pm (CST) at DePaul University in Chicago, IL. Pre-registration is not required, but attendees are encouraged to RSVP to [email protected] The event will also be webcast live.