Is Fiji Trying to Fool You?

On May 26, 2011, a California court ruled on the legal sufficiency of a complaint alleging false and deceptive advertising brought by class action attorneys under California’s consumer protection laws.

The case was brought against Fiji Water Company, by a plaintiff alleging that Fiji used the image of a green drop of water on the label of their bottled water to suggest that the products were environmentally superior to the Fiji’s competitors.  The plaintiff argued that this suggestion was false, because Fiji bottled water products “cause as much, if not more, environmental damage” as the water sold by Fiji’s competitors.

This gave rise to claims under California’s Unfair Competition Law, False Advertising Law, and Consumers Legal Remedies Act, along with a claim for common law fraud thrown in for good measure. The trial court dismissed an amended complaint and denied further leave to amend.

On appeal, the California Court of Appeal affirmed the decision to dismiss the case, ruling that the Plaintiff’s interpretation of the meaning behind the green drop of water does not satisfy the “reasonable consumer” standard of determining whether a claim constitutes false advertising under California consumer protection laws and FTC guidelines, which require a plaintiff to show potential deception of not just any potential consumer, but only those “acting reasonably in the circumstances.”

What exactly does this mean?  The court gave some guidance, stating that under California law, the standard for determining whether an ad is deceptive is not whether a “least sophisticated consumer,” would be fooled, unless the advertising is specifically targeted to such consumers.  Although the court did not provide examples of ads that are specifically intended for stupid people, I assume they were referring to ads for products like Shake Weights and Chia pets.

The test for deception also does not take into account the unwary consumer, stating that a reasonable consumer “need not be exceptionally acute and sophisticated” and not overly suspicious of advertising claims.

The court went a step further, noting that in an age where blogs criticizing nearly every aspect of every company and every product abound, a reasonable consumer also does not include one who is overly suspicious. In other words, “reasonable consumers” are expected to view any comments or criticisms regarding a product with a sensible grain of salt, and aren’t paranoid conspiracy theorists.

Applying this standard, the court concluded that a reasonable consumer would not likely think that the green drop on Fiji water bottles means that the product had been endorsed as environmentally superior.

Despite this eminently sensible interpretation, advertisers are nevertheless cautioned to review each and every aspect of their labeling, just to be certain that class action attorneys and their paranoid clients won’t read more into it than intended.

 



Author: Seth Heyman
Seth D. Heyman is a California attorney with extensive experience in advertising and marketing law, corporate law, contracts, governmental regulations, international business, and Internet law. He has counseled numerous successful companies, both public and private, and was responsible for regulatory compliance, contract management, corporate governance, and HR best practices for multiple organizations in many diverse industries, including marketing, telecommunications, energy, and technology development. He offers insight and guidance on federal and state direct mail, TV, radio, telemarketing, and Internet marketing laws, as well as online promotions, Internet privacy, data protection regulations, and similar matters.

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