The National Advertising Division (“NAD”) of the Better Business Bureau (also known as Advertising Self-Regulatory Council, or “ASRC”) is a self-regulatory forum for advertising litigation between companies over their national advertising. The advertising and product promotions at issue can appear on the internet, on television, and in printed form. Participants in this self-regulatory process include virtually every major company that advertises products or services nationally to consumers, or that promotes products nationally to professionals.
The NAD self-regulatory forum is highly valued by advertisers because it is a relatively cost-effective and faster alternative to difficult Federal Court litigation. SGR has deep experience in and has successfully handled, Lanham Act False Advertising cases in Federal Court, as well as consumer fraud class actions but when it comes to competitive challenges, resort to the NAD is more common.
The range of industries bringing disputes before the NAD is as vast as the products and services that companies advertise and sell. Companies making comparative/parity/superiority claims to attract buyers are often challenged by the affected competitor. Non-comparative “monadic” claims can be challenged as false and misleading, as well. A party may file a complaint with the NAD, or NAD staff may bring a proceeding on its own initiative, challenging the advertisement and the claims, and the advertiser must formally reply to the complaint presenting its legal position and substantiation for the claim. After Reply briefs by each party, the NAD renders a decision which is published in its Case Reports archive. NAD has the support and backing of the Federal Trade Commission (“FTC”) and other relevant regulatory agencies if an advertiser refuses to comply with a NAD decision.
In the past two years, SGR has been engaged by multiple advertisers to both defend and challenge competitive advertising claims in the areas of over the counter pharmaceuticals, nutritional supplements and veterinary/pet products, as well as in the emerging area of general internet advertising.
Companies that advertise nationally to consumers or professionals in any format and become embroiled in competitive advertising disputes can benefit greatly from SGR’s expertise in this area. The expert assistance we regularly provide in litigation extends as well to counseling on proposed claims and assisting with prior review of planned advertising and promotional campaigns. This is with a view to the avoidance of litigation and regulatory risk and compliance with FTC standards for advertising. In addition, SGR regularly oversees and coordinates “consumer-takeaway” litigation surveys, conducted by experts, both to confirm allegations that a challenged advertisement is misleading or to support the truthfulness of a client’s claim.
To view more about our Advertising capabilities in regards to Intellectual Property, click here.