FTC Puts The Brakes On Deceptive Online Acai Berry Advertisements

Man, and just when I pumped all my money into those acai berries.  Now how am I supposed to lose those extra pounds before swimsuit season?

Just kidding, we all know the key to weight loss is and always has been magic.

In all seriousness though, if you haven’t heard the news already about the latest Federal Trade Commission crackdown, then you might be surprised to hear that the FTC has just succeeded in permanently shutting down those annoying acai berry pop-up ads you see online.  The ads usually were fashioned to look like official news reports and contained logos from well-known news organizations including ABC, FOX News, CNN and so forth – an example to your right.  The advertisement exalted the miracles of the acai berry as a natural weight loss solution.

And looking at the ads, it’s easy to see how people would be fooled into thinking the claims in them were pure truth rather than puffery.  That, of course, was also the FTC’s problem with them and about nine months ago the agency began putting their plan to stop these deceptive practices into action.  Fast forward nine months later and the FTC has entered into settlement agreements with six acai berry marketers to stop the sneaky ads and also to pay damages of $500,000 under a federal false advertising statute.

Personally I’m quite glad to see these acai berry advertisers go down.  In all honesty, even I was fooled the first time one of these ads popped up on my screen.  The illusion was all the more convincing in my case since at the time I was also browsing through a legitimate news site and assumed the ad was a special report.  Thus you can probably see why they were probably a bad thing.

Though, interestingly enough some in the blogosphere seem to be opposed to the FTC’s actions.  Their main beef seems to be that they think the FTC’s restrictions on the acai berry advertisers violate the First Amendment’s freedom of speech protection.  As we all know, the First Amendment does indeed grant anyone, even businesses, the right to say what they want.  Therefore, this sub-group of people (who probably also hold stock in acai berries) believe that by the FTC cracking down on how these advertisers present their information, it in fact infringes upon their First Amendment rights.

Wow, some people can be real whack-jobs, huh?  Fortunately though, none of the comments I’ve read so far have been crazy enough to argue that the ads aren’t in violation of federal false advertisement laws, because for the reason that, well, they clearly are.

Under current federal law, false advertising comes in two flavors: fraudulent content, which is when the statements made in an ad are false beyond mere marketing puffery, and deceptive practices, which is when the ads are presented in a way that will trick consumers into think it’s something else other than an advertisement.

The acai berry ads clearly fall into the latter category, and arguably also the first, but let’s not split hairs about whether or not acai berries can really help a person lose weight.  The acai berry ads were designed to look like news articles.  The ads had headlines and even author bylines, the formatting and fonts look like they were ripped straight out of CNN, not to mention all the legitimate news organization logos all over the place.  To any objective person the ads at first blush would seem like real news stories and not advertisements.  Therefore, they’re deceptive ads.

But back to the original question, did the FTC violate these advertiser’s first amendment rights?  Well, the answer is still no.  This will be a good lesson to any people out there who are thinking about launch ad campaigns similar to the acai berries.  That’s because while it’s true the First Amendment protect one’s freedom of speech, when that speech is commercial in nature, than the speech may be regulated if it is found to be false or deceptive.

See the beautiful circle here?  Because the acai berry advertisements are clearly deceptive under federal law, then the ads aren’t afforded First Amendment protection.  But let’s just say for argument sake that they aren’t deceptive.  Even in that circumstance the government still has a right to restrict commercial speech if the government can prove that the restriction would serve a substantial government interest, directly advance that interest, and the restriction itself isn’t beyond what’s necessary to advance that government interest.

Now I won’t bore you with a long dissertation of what is a “substantial government interest”, but suffice to say that if you’re running a business, an easier way to think about how you advertise is that you better not say anything fraudulent or deceptive because it’s pretty easy for the government to restrict commercial speech.