As we blogged about earlier this summer, NAD referred advertising for The Coldest Water, LLC to the FTC after the advertiser failed to participate in NAD's investigation. NAD had opened a routine monitoring case about videos featuring the advertiser's products posted on a popular social media platform. The videos did not include any claims about the products – or even mentions by the influencers -- but they all included prominent display of the product so that the brand name and logo were visible. NAD was concerned that the videos constituted endorsements that did not comply with the FTC Endorsement Guides. Since Coldest Water did not respond to NAD's request for information, NAD referred the matter to the FTC.
Now, just a month later, the FTC has posted a closing letter on its site indicating that "after [FTC] alerted The Coldest Water to NAD's referral to the FTC, the company agreed to engage with NAD." Reportedly, the advertiser is now "actively cooperating" with NAD. Accordingly, FTC determined that no further action was warranted at this time.
What does this mean? Exactly what FTC staff lawyers always say in ad law conferences and what NAD practitioners always tell their clients: a referral from NAD will get the FTC's attention. At a minimum, it means that the advertiser will hear from the FTC. And whatever it is the advertiser is hearing, it's usually enough to convince it to go back to NAD.
Stay tuned for more developments on this matter. And to keep track of the outcome of referrals from BBB National Programs (including NAD) to the FTC, bookmark this page.
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