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Home | BakerHostetler

Randal Shaheen Quoted in National Law Journal on FTC’s Regulatory Approach

Peter Roskam Comments on Political Climate in National Law Journal

ADventures in Law

Dark Patterns Go International: FTC and International Consumer Protection Networks Conduct Sweep of ‘Deceptive Design Practices’ Related to Subscription Services, Privacy

Jeff Paravano, Michelle Hervey, Nick Mowbray Speak to Tax Club of Cleveland

When it comes to advertising disputes, there are relatively few substantive decisions to inform best practices. The relevant law boils down to whether a claim constitutes “misleading or deceptive advertising,” which means plaintiffs and defendants typically find it in their best interest to settle rather than face the uncertainty of trial. Even competitors are more likely to use the National Advertising Division’s self-regulatory forum instead of taking on the risk and expense of litigation. This makes the Ninth Circuit’s recent decision on a greenwashing claim in McGinity v. The Procter & Gamble Co. even more notable. The court affirmed the dismissal of a complaint against P&G for its “Nature Fusion” claim, which it used on Pantene Pro-V Nature Fusion products.



For background, “greenwashing” refers to advertising claims that overstate a product’s or service’s environmental benefits. Sometimes greenwashing just suggests <a>–</a> to some – bad practices, for example, advertising an SUV as having the best gas mileage in its class. Other times, greenwashing is actually deceptive. Environmental benefit claims run a broad spectrum – from sustainable to recyclable to earth-friendly – but the <a href="https://www.ftc.gov/sites/default/files/attachments/press-releases/ftc-issues-revised-green-guides/greenguides.pdf">FTC’s Green Guides</a> include guidance on most variations.



Back to the Ninth Circuit. In this case, the plaintiff alleged that the “Nature Fusion” claim, in conjunction with imagery of an avocado on a green leaf, conveys to consumers that the products include only natural ingredients. While the products include avocado oil, they’re also made of various synthetic ingredients, which, accepting the plaintiff’s “all natural” interpretation, constitutes misleading advertising under various consumer protection statutes. The plaintiff claimed that he would not have paid as much for the product had he known it was not all natural and, as a result, he is entitled to damages. The difference between the price the plaintiff paid and what he would have paid for a non-natural product may be negligible, but it becomes significant when including that same number from the entire class of purchasers. Fortunately for P&G, the court affirmed the dismissal of the suit, finding that “nature fusion” is an ambiguous claim that is adequately qualified by the ingredient list on the back of the label. The ingredient list, of course, includes both the natural and artificial ingredients. It weighed in P&G’s favor here that the specific claim was “nature fusion,” implying that natural ingredients were being fused with other ones. A “natural” claim on its own would not have fared as well.



Somewhat unusually, the plaintiff took the extra step of conducting a consumer survey, which was submitted as extrinsic evidence that consumers did in fact interpret the claim to mean the products are made of natural ingredients. While surveys are the best evidence of a consumer’s interpretation, they’re also often criticized, and here the court found the survey was not reliable because it did not provide respondents with the opportunity to view the ingredient list found on the back of the label.



Ultimately, this decision should give some comfort to advertisers that it is possible to adequately qualify green claims. But don’t be fooled; environmental claims carry substantial risk, including from class action plaintiffs, activist NGOs and regulators like the FTC. All environmental claims must be adequately qualified to avoid the label of greenwashing. If you’ve read through the Green Guides and still have questions on whether your claims are substantiated, let us know.



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Greenwashing or Hair Washing?

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