The Federal Trade Commission ("FTC") announced the results of a study it commissioned, which
indicates that many consumers understand "up to" claims
as promising maximum results. The FTC believes the study will
help guide advertisers to avoid the use of misleading "up
to" claims.
In announcing the results of the study, the FTC stated that the
study "reinforces the FTC''s view that advertisers
using these claims should be able to substantiate that consumers
are likely to achieve the maximum results promised under normal
circumstances." The FTC's position seems to be a departure
from the standard set forth by many states and in the Better
Business Bureau's Code of Advertising, that advertisers must
support "up to" claims with evidence that the maximum
comprises "a significant percentage, typically
10%." The guidance announced by the FTC -- that
advertisers should be able to substantiate that "consumers are
likely to achieve the maximum results" -- appears to be more
stringent than the commonly used "significant percentage"
standard. This announcement may have widespread consequences
for those making "up to" claims, at least with respect to
savings claims.
The FTC's study was conducted in conjunction with
investigations of five companies that settled allegations in
February that they made false claims about how much money consumers
could save on their heating and cooling bills by having certain
windows installed.
Click here to read our prior alert about FTC's settlement
with window marketers over environmental claims.
This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.
