False advertising can hurt consumers and companies

by | Jan 21, 2016 | Business Litigation |

Businesses in Cincinnati and elsewhere have an obligation to their customers to be honest about the services or products they sell. In fact, to knowingly advertise false information is against the law. False advertising has the potential to rob consumers of their money and time. It can also cause harm if the products’ claims could affect customers’ health or safety.

What is false advertising? According to the Federal Trade Commission, a company’s advertisements should not trick or mislead consumers into thinking a product can do something an ad claims. When necessary, the marketing should include scientifically-backed information. Truth in advertising is especially important for such products as medications and health supplements, tobacco, alcohol and food. The FTC also strictly enforces advertising related to the Internet and technological products.

A class-action lawsuit against the Dannon yogurt company illustrates a typical false advertising claim. The company claimed that its Activia product had special scientifically-proven benefits, when in actuality, it was the same as any other yogurt product. According to Business Insider, the company paid customers damages of $45 million. Another well-known claim involved eye cream manufactured by Olay. The product’s advertising promised dramatic wrinkle reduction, but it was found that the photos of the older model in the ads were retouched.

In addition to potential lawsuits, companies that make false advertising claims may face having their assets frozen and court actions to immediately desist perpetuating scams. Ensuring that advertising is truthful and accurate is in a company’s best interests, as well as those of customers.

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