Learning Lessons From NAD
Ensure substantiation is suitable for each claim
I usually write about FDA warning letters, but today I will highlight a recent National Advertising Division (NAD) decision. NAD is a self-regulatory body under Better Business Bureau (BBB) programs, and I enjoy reading NAD cases to look for clues about claims substantiation and enforcement.
Here are some marketing pieces NAD took issue with in this case.
👉From NAD complaint. "posts referenced the … Health Start Study, communicating that children taking …. visited the doctor less, missed fewer days of school, took fewer over-the-counter or prescription drugs and consumed less fast food/prescription drugs. DSSRC determined that the … Health Start Study was not the type of competent, reliable scientific evidence required for such claims and recommended that the claims be discontinued in the context in which they were communicated."
Asa commentary: This shows that statements like "missing fewer days of school" are considered marketing claims and that these types of studies are insufficient substantiation.
👉From NAD complaint. "For the long-form videos shared on …., which include doctors making broad health claims related to use of the product, DSSRC determined that they may conflate certain health-related messages and that claims communicated in the videos are not supported by evidence in the record. DSSRC recommended that …. remove these videos or redact the portions of the video that make reference to the unsupported claims."
Asa commentary: This shows that long-form videos will be scrutinized for marketing claims. These can be difficult to control because conversational discussions about product claims can easily cross the line.
🔷A little more about NAD.
🔹NAD reviews advertising disputes between competitors and other claims it becomes aware of. It is where companies can challenge each other's claims they feel are affecting their sales. NAD evaluates the truthfulness and accuracy of advertising and offers a streamlined resolution process to address advertising disputes. However, unlike a regulatory court, NAD cannot enforce its decisions, but if a company doesn't comply with NAD's recommendations, NAD can refer the case to the appropriate governmental regulatory authority, such as the Federal Trade Commission (FTC). This can also alert plaintiff attorneys.
🔹Interestingly, this complaint was not brought by a competitor but by a non-governmental advocacy group (NGO). The company in this complaint is an MLM which seems to attract more NAD scrutiny than other traditional supplement marketing channels.
Read more about the case here.
Disclaimer: The educational information provided here is for informational purposes only. Contact an attorney for specific legal advice. Rule #1 in compliance is to ensure marketing is truthful and not misleading.