FTC, FDA, & Social Media Regulations

John and Sherry Petersik run a very successful DIY & home improvement blog called, "Young House Love." Since 2007 they have opened up their home and their family for the internet, chronicling their wedding, the birth of their first child, and their first book deal, all while completing projects throughout three houses that are affordable and unique. They receive over 5 million blog hits per month and have become the golden standard by which all other DIY blogs are based upon.

Can you even imagine what their reviews do for a product? Thankfully, the Petersiks post disclaimers at the beginning of every blog post even remotely connected to an endorsement. However, many bloggers don't.

The corporate advertising world is no different. Many companies use false testimonials and other similar tactics, including:

• unfairness
• omitting information
• making insignificant information seem significant
• substantiation

The Federal Trade Commission (FTC) was created to regulate this type of untrue influence that advertisers try to have on consumers. It was originally created in 1914 to "police unfair methods of business competition," but has since evolved into a commission "primarily concerned with commercial speech that misleads the public"(Gower, 2008).

Substantiation, perhaps the most frequently targeted use of deceptive advertising, can be detailed by the FTC's case against POM Wonderful. The latest fad beverage in anti-aging/anti-wrinkle/anti-every-disease-ever hit the shelves a few years ago with advertisements proclaiming that "just 8oz. a day can cure prostate cancer, erectile dysfunction, and heart disease!" The FTC ruled their advertising was misleading and they had no scientific studies to prove the claims. POM Wonderful tried to argue the ruling, saying that it violated their First Amendment rights, but was swiftly rejected.

The Food and Drug Administration (FDA) works similarly to the FTC, but is "concerned with the promotion of prescription drugs through the mass media, whether via advertising or PR activities" (Gower, 2008). Through the Federal Food, Drug, and Cosmetic Act, the FDA can "seek injunctive relief, seize offending products, and issue criminal penalties" (Gower, 2008).

For example, in 2011, the FDA issued a warning to food manufacturers that any food labeled "natural" or "all-natural" would be considered false or mis-branded if it contained anything other than natural ingredients. In today's Whole Foods-obsessed society, this warning is a major blow to food manufacturers who claim to be all-natural. Many have filed class action suits against the FDA, but thus far, the courts have upheld many of their rulings. In the continuing battle against the obesity epidemic in this country, the FDA has introduced a new weapon.

So how does all of this apply to bloggers? FTC guidelines say that any connection between an endorser or seller requires full disclosure, but there is no specific definition of "connection," nor is there any specific example of "full disclosure." And while there hasn't been a major lawsuit between the FTC and bloggers, there is a belief that there is "no significant distinction between a major brand and a blogger." It is only a matter of time before the worlds of the FTC, FDA, and the blogosphere collide and the means of online advertising in changed forever.

As PR professionals, the only absolute way that we can protect ourselves, our clients, and our companies is to tell the truth. Don't try to unnecessarily exaggerate, leave out important information, or lie about secondary connections. Our job is to maintain positive relationships rooted in trust. If our publics - which includes consumers - feel as if they have been lied to or cheated in any way, the relationship is broken.

Remember when your mother used to say, "I'm not mad, I'm disappointed?" When it comes to deceptive advertising, consumers, the FTC, and the FDA are your mother, and you will most certainly go to bed without dinner.

References

Federal Trade Commission. (2013). FTC Commissioners Uphold Trial Judge Decision that POM Wonderful, LLC; Stewart and Lynda Resnick; Others Deceptively Advertised Pomegranate Products by Making Unsupported Health Claims. [Press release] Retrieved from http://www.ftc.gov/opa/2013/01/pom.shtmhttp://www.ftc.gov/opa/2013/01/pom.shtm

Gower, Karla. (2008). Legal and ethical considerations for public relations. Long Grove, IL. Waveland Press, Inc.

PRLOG: Press Release Distribution. (2011). FDA Rules against False "All Natural" Food Claims as Class Action Law Suits Multiply. [Press release]. Retrieved from http://www.prlog.org/11743506-fda-rules-against-false-all-natural-food-claims-as-class-action-law-suits-multiply.html

Social Media Examiner. (2011, October 4). Are You Disclosing? What You Need to Know About FTC Rules and Social Media. Retrieved from http://www.socialmediaexaminer.com/are-you-disclosing-what-you-need-to-know-about-ftc-rules-and-social-media/

Young House Love. Retrieved from http://www.younghouselove.com/

Privacy Laws and Social Media Ethical Issues in Public Relations

“Invasion of privacy is the intrusion into the personal life of another, without just cause, which can give the person whose privacy has been invaded a right to bring a lawsuit for damages against the person or entity that intruded. It encompasses workplace monitoring, Internet privacy, data collection, and other means of disseminating private information” (uslegal.com). Since 1960 there are four torts of privacy invasion which have been determined in order to protect citizen’s rights to privacy; Intrusion, appropriation, false light and public disclosure of embarrassing private facts. Even though public relations professionals so not have any formal laws or regulations for the field, in order to avoid any violations of privacy laws it is imperative for public relations professionals to fully understand these torts and other privacy regulations which could cause law suits.

Intrusion can come in the form of physical, electronic or mechanical intrusion on another’s privacy. The defense to intrusion is consent, given either explicitly or implied. Explicit means that the property owner gave permission for others to be on the property and implied is inferred permission, but not stated.

Appropriation is the use of the name or the likeness of someone without consent for commercial exploitation or purpose. The use of names in a news story is not considered commercial so for appropriation to apply, the name or likeness must be used in an ad or a promotional piece. The best way to avoid violating this is to obtain consent from subjects being used in campaigns or other promotional events, which protects professional from appropriation lawsuits, unless the use exceeds the consent given.

False light is information that puts an individual into a false light that is highly offensive to a reasonable person. It is an inoffensive false statement. False light most often arises in fictionalized situations. Plaintiffs involved in matter of public concern must prove actual malice to win false light actions. False light is very close to libel, so the defenses are the same with consent, truth and qualified privilege.

Public disclosure of embarrassing private facts requires disclosure of such private information that its violates the average person’s sensibilities. Publication to a broad audience is required for this tort and newsworthiness is a strong defense. Although public disclosure of private facts usually involves journalists because it requires publication for a public audience, public relations professionals need to keep the tort in mind when preparing materials involving sensitive issues.

Laws that require professionals to uphold the rights to privacy are those like FERPA and HIPAA. The Family Educational Rights and Privacy Act is a Federal law that protects the privacy of student educational records. These rights transfer to the student when he or she reaches the age of 18 or attends a school beyond the high school level. Generally, schools must have written permission from the parent or students in order to release any information from a student's education record. Schools may disclose"directory" information such as a student's name, address and telephone number. However, schools must tell parents and eligible students about directory information and allow parents and eligible students a reasonable amount of time to request that the school not disclose directory information about them.

The Health Insurance Portability and Accountability Act (HIPAA) provides rights and protections for individual's health insurance records. You have the right to access your medical records at any time, and HIPAA laws prevent those without your permission from gaining access to your records. Medical providers must protect your privacy and keep your medical records secure. Your health information cannot be used or shared without your written permission.

In order to gain access to these examples of protected records for students and patient information in an ethical way, professionals must determine the newsworthiness of stories or collaborate with a the proper authorities in order to protect the patient’s privacy. Understanding the privacy torts and regulations like FERPA and HIPAA will help you avoid activities that are likely to trigger complaints.

Public relations professionals will most often be faced with issues over appropriation and informational privacy. Professionals must also be conscious when working with internal relations. An employee should always be asked before information about that employee is used in the newsletter, published in an external publication or posted on a company Web site. Just because a person is an employee of your organization it does not dismiss their right to privacy. Generally employee information that may be made public without the employee’s consent is confirmation of employment, job title, job description, date hired, and date employment terminated.

Violation of privacy laws are not the only violations public relations professionals must be aware of when conducting business. In the midst of the rise of the internet age, a new level of unethical behavior has arisen. A number of Web sites and deceptive social networking postings have surfaced such as the use of false identities and misleading information by organizations to better their image and their campaigns. These examples of unethical conduct have ranged from, “A public relations firm is hired to post favorable comments on Wikipedia about a number of clients. She 
poses as a neutral, third-party to post the comments”, to “an agency creates a fake identity and uses the identity to post favorable comments about a client’s social responsibility activities on a number of blogs and social networking sites” (prsa.org). "PRSA members should not engage in or encourage the practice of misrepresenting organizations and individuals through the use of blogs, viral marketing, social media and anonymous Internet postings" (prsa.org).

As an unaccredited field it is up to professionals to not only adhere to governmental laws but to also uphold our field's code of ethics. Professional values to always have in mind in order to avoid invading any privacy issues are, honesty, fairness and advocacy (PRSA). It is our job to provide a voice for our clients in their various industries in order to present ideas, facts, and messages to inform the public. Practicing ethical public relations will help reduce the likelihood of harming others through violating their privacy's, damaging their reputation or supporting the presentation of false information.

Sources:

Gower, Karla. "Legal and Ethical Considerations for Public Relations". Chapter 4: pg. 81 - 93

http://www.ed.gov/policy/gen/guid/fpco/ferpa/index.html

http://www.hhs.gov/ocr/privacy/hipaa/understanding/index.html

http://www.prsa.org/AboutPRSA/Ethics/ProfessionalStandardsAdvisories/Documents/PSA-08.pdf

http://definitions.uslegal.com/r/right-to-privacy/

The Implications of Defamation Laws for Libel & Slander

In law, one of the most dangerous lawsuits to be thrust into is libel or slander. It is not only one of the hardest things to prove, but it can also be one of the most costly lawsuits. It takes a lot of hard evidence to prove that someone has committed libel or slander against you.
Many times, people claim libel or slander when it really isn't true. Defaming someone is a hard thing to prove because you have to prove that it has cost you financially and otherwise.

The legal dictionary defines defamation as "Any intentional false communication, either written or spoken, that harms a person's reputation; decreases the respect, regard, or confidence in which a person is held; or induces disparaging, hostile, or disagreeable opinions or feelings against a person. Defamation may be a criminal or civil charge. It encompasses both written statements, known as libel, and spoken statements, called slander" (http://legal-dictionary.thefreedictionary.com/defamation).

A large part of determining whether or not to award damages is whether or not the figure filing the suit is a public or private figure in the eyes of the law.

It was in 1964 that this was first established in New York Times v. Sullivan. Sullivan, the plaintiff and police official, claimed that false allegations about him appeared in the New York Times, and sued the newspaper for libel. The Supreme Court said that a public official suing for libel must prove actual malice, meaning the libelous information was intended to harm the person's reputation and the person writing or speaking the information knew it was reckless and false.

Public figures voluntarily put themselves in situations that call for close scrutiny (like athletes). Private citizens have more leeway with situations like that and their privacy is important in considering situations like that.

Such a situation happened recently when Jack Clark, a former baseball player and radio personality in St. Louis, told a story of when he heard Albert Pujols's trainer tell him Pujols had taken steroids. Clark had said this over the airwaves and Pujols, one of the premier players in the game, immediately called Clark a liar and said he would take legal action. Clark was fired and Pujols sued Clark for defamation.

Since then, Clark has said Pujols should take a lie-detector test. The only defense of defamation is absolute truth. If you can prove in a court of law that what you had said was truth, then defamation is thrown out.

In public relations, this is a very tricky issue. There is, of course, a fine line between a campaign that exaggerates the truth and one that is completely fictitious.

If you run a campaign aimed at taking down your competitor, you can only use the facts available to you. In political campaigns you often see this. People will dig up dirt on their opponents and use that against them. But you never see or hear of any lawsuits because what they are using is absolute truth, even if it seems a little immoral.

Defamation is a very hard thing to prove and if proven, can cost someone a career.

References:

Cornell University Law School. New York Times Co. v. Sullivan (No. 39)
273 Ala. 656, 144 So.2d 25, reversed and remanded. Retrieved from http://www.law.cornell.edu/supct/html/historics/USSC_CR_0376_0254_ZS.html

Free Online Law Dictionary. Defamation. Retrieved from http://legal-dictionary.thefreedictionary.com/defamation.

Nike v. Kasky and First Amendment Issues in Public Relations

Ask any elementary school student what amendments they know and I’d be willing to bet the response would include the First Amendment and how it grants us the freedom of speech. As we get older though, we learn this amendment is not a magical hall pass to say whatever we want; yelling fire in a crowded theatre, for example, is used an example of a restriction on free speech. Other restrictions include: “advocacy of illegal action, fighting words, commercial speech, and obscenity” (law.Cornell.edu, 2010). That list seems very straightforward, until you pause and realize how incredibly vague it is. There is no government list of “fighting words.” Obscenity which seems fairly basic has its lines blurred and is debated constantly. As frustrating and challenging as it may be, the First Amendment must have this ambiguity to some degree, because without it there would not be any freedom - just a list of things that are allowed. 

In the case of Kasky v. Nike, commercial speech was what was called into question regarding Nike’s practices. During the late 1990s, Nike began a public relations campaign to improve their image after heavy public scrutiny of their labor practices (reclaimdemocracy.org). Marc Kasky filed a complaint against this campaign alleging that “ In the course of this public relations campaign, Nike made a series of six misrepresentations regarding its labor practices...” (reclaimdemocracy.org). 

“So what’s the issue?” you may be asking. Nike made “misrepresentations” but those are not fighting words, and as long as they’re not advocating illegal activity or involve obscenities shouldn’t these misrepresentations be allowed? After all, the First Amendment doesn’t outlaw lying. This is where the issue becomes complicated. Kasky argued that Nike’s public relations campaign was commercial speech and was “based on negligent misrepresentation and intentional or reckless misrepresentation(reclaimdemocracy.org). It was also alleged that Nike engaged in business practices that were unlawful, and was a form of false advertising. 

Based on the definition of the First Amendment outlined earlier, this clearly falls into the commercial speech exception and obviously Kasky was right and Nike is wrong...but it’s not that simple. Nike argued that their statements were not misleading because they do make positive impacts on the world, and that the statements made were not intended “only for the purpose of making purchasing decisions” (reclaimdemocracy.org). This is what the courts were left to reason out. 

The Supreme Court agreed to hear the case, but then reversed its decision because the state court had not reached their decision (reclaimdemocracy.org). By a 4-3 vote the California Supreme Court concluded that Nike’s statements were commercial speech and could be punished if they were false or misleading. (Volokh, 2003). 

The issue here for public relations professionals is not whether corporations should be allowed to make false or misleading statements, the law is quite clear on that matter. The issue is whether public relations campaigns can be construed as “commercial speech” and therefore have limited First Amendment protections. This may be a difficult concept at first for a public relations professional; we are usually very vocal about the fact that PR is not advertising and we are quite different even if advertising is used as a PR tool. If PR isn’t advertising, then how can it be held under “commercial speech”? Those points were brought up during trials and Justices Stephen Breyer and Sandra Day O’Connor brought up the issue the speech should have been protected because the commercial message was mixed with political speech and presented outside of a traditional advertising medium (Volokh, 2003). 

A public relations campaign doesn’t necessarily guarantee an increase in sales and Nike’s claims that their statements were not intended only for consumers to base purchasing decisions off of could very well be argued. However, it can also be argued that despite Nike’s so called “intentions” why would they even engage in a public relations campaign if they did not expect it to positively affect the company in terms of sales and profits. Also, with media changing every day the term “traditional advertising media” is going to become increasingly vague in the coming years.

The case of Kasky v. Nike brought up many issues that directly affect public relations practice. Public relations is essentially the profession of argumentation, and what one person may consider highlighting the positives and carefully framing their campaign, another may consider negligent and intentionally misleading. As demonstrated in this post, the First Amendment was specifically designed to be broad to ensure freedom and even the courts have difficulty drawing hard lines on these issues. 

Based on this case, public relations professionals should operate under the assumption their communications will be taken as “commercial speech” and despite corporate personhood debates, will not be fully protected under the First Amendment as a private citizen would be. While this may present some strain and need for greater creativity in terms of handling a crisis, like Nike’s labor criticisms, it can also prevent ongoing legal battles.

Potential First Amendment Issues PR Professionals May Face:

-Blogs- corporate or private, there is much debate about whether bloggers are actually considered journalists or reporters. In addition to the ethical concerns over taking “deals” there is also legal debate about whether bloggers should be subject to campaign-disclosure legislation (firstamendmentcenter.org).

-Field Ambiguity- Public relations is not a licensed profession like a doctor or a lawyer. There is much debate about this and whether licensing professionals should even be allowed because it could potentially restrict First Amendment rights to communicate freely.

-Advertising Blur- While there is a separation between PR and advertising, PR does use advertising as a tool. When advertising is involved, legal and ethical considerations need to be taken into account because it is no longer purely a PR campaign.

Additional Links:

- YouTube- Ashley Horton http://www.youtube.com/watch?v=ouZRv9suDrA. Provides a brief summary of First Amendment limitations in regards to public relations

- A broader issue related to commercial speech is also the issue of whether corporations are people. Corporate personhood is a hotly debated topic and one that probably will never fully be put to rest. For additional reading on corporate personhood, check out (http://reclaimdemocracy.org/corporate-personhood/).

References

Cornell University Law School. (2010, August 27). First amendment: An overview. Retrieved from http://www.law.cornell.edu/wex/first_amendment

First Amendment Center. (2013). FAQ press. Retrieved from http://www.firstamendmentcenter.org/faq/frequently-asked-questions-press

Reclaim Democracy. (2013). Kasky v. Nike — do corporations have a right to lie?. Retrieved from http://reclaimdemocracy.org/nike/

Reclaim Democracy. (2013). Nike petition to US Supreme Court. nike . Retrieved from http://reclaimdemocracy.org/wordpress/wp-content/uploads/2012/08/nikeincpetition_toussupreme.pdf

Volokh, E. (2003, June 30). Nike and the free speech knot. The Wall Street Journal. Retrieved from http://www2.law.ucla.edu/volokh/nike.htm