FTC Guidelines on Endorsements and Testimonials- Regulation of Advertising

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I. FTC REGULATION OF ADVERTISING.

Under Section 5 of the Federal Trade Commission Act, the Commission has broad authority to prohibit "unfair or deceptive acts or practices" in interstate commerce. 15 U.S.C. § 45. This is the statute that gives the FTC authority to regulate deceptive advertisements. An advertisement is considered deceptive if it contains a misrepresentation or an omission that is likely to mislead consumers who are acting reasonable under the circumstances, and the consumers are injured through the deception. Deceptive claims must be material to the consumer's decision to buy, but the FTC does not need to prove actual injuries. Deception Policy Statement, appended to Cliffdale Associates, Inc. 103 F.T.C. 110, 174 (1984).

Visit www.mlmlegal.com for more information on the direct selling industry.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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