On October 5, the FTC announced that it approved final revisions to the Guides. See http://www.ftc.gov/opa/2009/10/endortest.shtm. Generally speaking, the revisions address the disclosure requirements for (i) blog endorsements; (ii) celebrity endorsements; and (iii) statements regarding the results a consumer can generally expect. The revisions became effective on December 1, and are the first major updates to the Guides since 1980.

First, with respect to blog endorsements, an FTC-issued press release noted:

The revised Guides add new examples to illustrate the long-standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers—connections that consumers would not expect—must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization. And a paid endorsement—like any other advertisement—is deceptive if it makes false or misleading claims.

In other words, bloggers who receive products or other consideration from product manufacturers free of charge should clearly and conspicuously disclose such facts, the manufacturer should advise the blogger at the time it provides such consideration that this connection should be disclosed, and the manufacturer should have procedures in place to try to monitor his postings for compliance. See 16 CFR § 255.5, Ex. 7 (available at http://www.ftc.gov/os/2009/10/091005revisedendorsementguides.pdf). Bloggers endorsing a product must be bona fide users of the product at the time of the endorsement (e.g., a mere intent to use a product is insufficient). Failure to comply with these guidelines would subject bloggers and/or advertisers liability. Advertisers and bloggers would also be subject to liability for misleading or unsubstantiated representations made through the blogger’s endorsement.

Second, the revised Guides impose on celebrities a duty to disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media (e.g., Twitter or Facebook).

Third, under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case, will be required to clearly disclose the results that consumers can generally expect. This contrasts with the 1980 version of the Guides, which allowed advertisers to describe unusual results as long as they included a disclaimer such as “results not typical.”

Punishments for violations will range from a warning letter to a fine of up to $11,000 per violation. The regulations state that both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement or for failure to disclose material connections between the advertiser and endorsers. For parties interested in reporting such conduct, the FTC provides a “Claim Assistant” form on its website. See https://www.ftccomplaintassistant.gov/. As the FTC notes, user “complaints can help us detect patterns of wrong-doing, and lead to investigations and prosecutions.”