By Chip Cooper, Esq.
Many online entrepreneurs write their own copy for
web site publication and advertising and promotion.
If you do your own copyrighting, you should avoid
the legal pitfalls associated with unsubstantiated
claims. Don’t wait until it’s too late.
The Prior
Substantiation Rule
Under the Prior Substantiation Rule, the Federal
Trade Commission (FTC) requires that all objective
product or service claims be substantiated by the
advertiser before public dissemination. To
understand how the Prior Substantiation rule affects
you, you need to have a clear understanding of what
constitutes a “claim”.
What is a Claim?
A
“claim” involves a statement about a product or
service upon which a consumer may reasonably rely in
making a purchase decision. Claims may involve
statements about product features, functionality,
performance, or quality. Statements may be claims
if, for example, they are statements about speed or
the results to be achieved through the use of the
product or service. Specific examples include:
“the fastest synchronization software on the
market”, or “backwards compatible with Windows 98”.
Also, claims are not limited to express language.
Statements creating claims may be implied from
graphic or pictorial representations if they provide
the "net impression" of statements about quality or
performance.
How Does the Prior
Substantiation Rule Apply?
Under the Prior Substantiation Rule, each and
every separate “claim” should be properly
substantiated before the claim is publicly
disseminated. If any advertisement, including web
site copy, incorporates a claim that is not properly
substantiated before public dissemination, the ad or
copy is deemed to be prima facie deceptive
and illegal. What’s more, this is true even if the
deceptive claim is substantiated at a later time.
The key to substantiation is to have a "reasonable
basis", such as reliable tests or surveys, to
support the truth of the claim prior to
dissemination.
General Advertising
Rules Apply
There is a well-defined body of law that regulates
advertising claims, and these laws apply to ads and
copy appearing on web sites, as well as to
advertisements in other media. Your customers,
competitors, and the FT C are all interested in your
strict compliance with these rules. Failure to
comply can lead to substantial liability.
Chip Cooper is
President & CEO of Digital Contracts, Inc., offering
its ContractMaker online contract drafting service
for IT and web-based businesses.
He is also an educator, author, and practicing
attorney in Atlanta in the areas of intellectual
property, licensing, distribution, and partnering
transactions. Visit
www.digicontracts.com
©
2001 Digital Contracts, Inc. All rights reserved
worldwide.
You may reproduce this article anywhere you wish,
free of charge. We require only that (i) you
include the author information found at the end;
(ii) you do not
make
any substantial editorial changes without prior
approval from Chip Cooper at
ccooper@digicontracts.com (or call at
770-664-8555); and (iii) any and all links within
the article or resource box may not be altered, and
must be 'clickable' on a web page.
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