NAD Recommends LG Modify TV Claims

by Manatt, Phelps & Phillips, LLP

Manatt, Phelps & Phillips, LLP

LG Electronics should modify or discontinue certain claims for its Super UHD and OLED television sets, the National Advertising Division has recommended.

Samsung Electronics introduced a new line of televisions in 2017 dubbed QLED, marketing the line as a significant improvement in television technology and performance that eclipsed other products such as LG’s Super UHD and OLED sets.

LG responded with claims on its website in connection with advertising for its Super UHD television under a large bold heading reading “Question the Q.” The site stated that the name QLED was “created to confuse consumers,” that “Facts matter, and there are none that support it [QLED] being the next innovation in television” and “the ‘Q’ in QLED is just marketing.”

Samsung challenged the claims before the self-regulatory body, arguing that they were false and disparaging. LG countered that little about the QLED televisions was new or innovative and that reasonable consumers would consider the claims to be statements that reflected LG’s opinion, not facts.

“An advertiser’s right to tout the benefits of its product must be carefully balanced against a competitor’s right not to have its product falsely disparaged,” the NAD explained while considering the dispute. “Claims that either expressly or implicitly disparage a competing product will be carefully scrutinized to ensure that they are truthful, accurate and narrowly drawn.”

The claim that QLED’s name was “created to confuse consumers” reasonably conveys the message to consumers that Samsung is intentionally misleading and tricking consumers, the self-regulatory body said. “While LG argued that it is merely citing experts and that the full claim reads, ‘Experts say, QLED’s name was created to confuse consumers,’ NAD noted that advertisers may not make claims either through consumer testimonials or expert endorsements that could not be substantiated if made directly by the advertiser. Because there was no evidence in the record that Samsung is intentionally trying to confuse consumers, NAD recommended that the advertiser discontinue that claim.

While the NAD declined to find the “Facts matter” statement constituted ash-canning, it was “concerned that the advertiser’s statement was presented in a conclusory manner that would lead consumers to believe that there are literally no facts to support QLED as being the next innovation in television.” As Samsung provided evidence that its QLED product is an innovation, LG’s claim was contradicted by the record and should be modified or discontinued, the NAD said.

However, the NAD found that the final phrase—“the ‘Q’ in QLED is just marketing”—was “framed as a clear statement of the advertiser’s opinion.” Consumers would understand this statement to mean that it was LG’s opinion—and not a claim requiring support—that Samsung’s QLED television does not denote a significant technological advancement, according to the decision. Therefore, no recommendation was made with respect to this statement.

To read the NAD’s press release about the case, click here.

Why it matters: For advertisers, the decision reflects the delicate balance between advertising the benefits of a product and the right of a competitor not to have its product falsely disparaged. Since two of the three challenged statements were found to have crossed the line, the NAD recommended that they be modified or discontinued.


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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