Can hashtags promoting your beverage create liability in the same way other advertising content can? #YouBet
A recent closing letter from the Federal Trade Commission has shed some light on the view the FTC, and, presumably, civil courts (if litigants make the argument in private false advertising suits), take of hashtags.
The matter involved “Made in the USA” claims which the FTC has been, and will be, forever reviewing. In the matter, the FTC investigated Native Ken Eyewear over concerns that the company’s marketing materials may have overstated the extent to which the company’s eyewear was made in the United States.
[Aside on implied Made in USA claims]: Such claims, like direct “Made in the USA” claims (saying “made” when really the parts are made elsewhere and just “assembled” in the USA) are subject to the FTC’s Issuance of Enforcement Policy Statement on “Made in USA” and Other U.S. Origin Claims. Under the FTC’s enforcement guidelines, “[d]epending on the context, U.S. symbols or geographic references, such as U.S. flags, outlines of U.S. maps, or references to U.S. locations of headquarters or factories, may, by themselves or in conjunction with other phrases or images convey a claim of U.S. origin.” So claims like “Made in Illinois” or “Made in Alaska” or even “Made in Maine” can be problematic, not just for products that are only partially made, or are simply assembled in those states, but also for a view that they imply U.S. manufacture. Deceptive advertising by implication is just as actionable as directly statements – take, for instance, the ongoing Kona Brewing false advertising lawsuit or the recent Asahi Beer settlement of implied false advertising claims. In both those suits, the overall design and theme of the packaging gave rise to allegations of implied false advertising and not direct “made in” statements. [End Aside]
Important to the notion of hashtags, and whether or not hashtags can give rise to false advertising claims, in the Native Ken matter, the FTC’s closing letter (a letter the FTC issues in closing out an investigation), the FTC noted that part of the corrective action taken was that “[t]o avoid deceiving consumers, Native Ken removed all claims that its products are ‘made’ or ‘built’ in the United States or New York City from its advertising materials, including hashtagged claims on social media platforms.” Thus, it is safe to assume that the FTC, and potentially civil lawsuits, will review and look to all content, including hashtags, in assessing the context and overall message, implied or direct, in a false advertising matter.
The takeaway: In reviewing your social media content for potentially misstated, overstated, non-puffery, or false/impliedly false statements, don’t overlook something behind the #, whether you created it or whether you’re using one someone else created.