Do you aspire to be green? Avoid Common Advertising Pitfalls | Coie Perkins
The brands recognize that consumers value sustainability and continue to promote the green and eco-friendly qualities of their products and services. In fact, a recent study found that on average, three in five consumers (64%) say products marked as environmentally sustainable or socially responsible accounted for at least half of their last purchase, and 51% say environmental sustainability is more important to them today it was 12 months ago. However, with growing popularity comes greater scrutiny, and “green claims” are increasingly being challenged by regulators, competitors and class action plaintiffs.
The risk of challenge is often present even when brands use ambitious claims (e.g. “we strive to be carbon neutral”) or make without reservation environmental claims (for example, “environmentally friendly” or “green”). This article shares key principles of truthful green advertising, highlights recent challenges against ambitious and broad and unqualified environmental claims, and offers tips for reducing the risk of challenge.
The Federal Trade Commission (FTC) has issued the Guides to using environmental marketing claims (Green Guides) to prevent brands from making false and misleading green advertising claims. In last year’s sustainability summer serieswe covered the basic principles of the Green Guides, including that brands should:
- Support green advertising and other technical and scientific claims with competent and reliable scientific evidence.
- Clearly and prominently disclose necessary clarifications and qualifications in a way that is easy to find and understand.
- Do not overstate the claimed environmental attribute or benefit.
- If the environmental claims only apply to part of the product or packaging, clearly and prominently convey this information to consumers.
- Meet guidelines for a variety of specific environmental claims, such as advertising carbon offsets, the ability to compost a product or packaging, “non-toxic” claims, and “ozone-friendly” claims or “safe for the ozone layer”, to name a few. .
Brands that follow these guidelines are less likely to have their claims challenged. And, if a dispute arises, they will be in a better position to successfully defend their claims.
Ambitious green claims
Brands sometimes seek to reduce risk by releasing forward-looking or ambitious statements about green or environmental benefits such as “we hope to be carbon neutral by 2025”. However, recent rulings from the National Advertising Division (NAD) indicate that making “ambitious” claims may not constitute a safe harbor. The following NAD decisions serve as examples of ambitious claims that brands had to substantiate:
- A poultry supplier has defined the goal of its sustainability program as “saving the planet”. Butterball, LLC (NAD 6930, August 2, 2021).
- Food chain suppliers advertised that they were “more organic” and “less carbon emitting”. Mexican Chipotle Grill, Inc.. (NAD 7020, February 28, 2022).
- A clothing company said it was 90% on track to its goal of eliminating “virgin plastic from our entire supply chain by 2021”. Everlane, Inc. (NAD 7019, October 26, 2021).
Although these decisions are not treated as precedents by the courts, the NAD is a self-regulatory body that specializes in analyzing advertising claims and substantiating claims and resolving misleading advertising issues between competitors. The NAD may also initiate its own trademark challenges, and refer trademarks that do not comply with its rulings to the FTC. And, of course, ambitious unsubstantiated claims run the risk of being challenged by creative class action plaintiffs and public relations problems. Brands therefore need to ensure that their ambitious green claims are backed by tangible milestones and progress towards stated goals.
Unqualified Green Claims
Brands should be wary of unqualified claims about environmental benefits, such as “sustainable”, “green” or “eco-friendly”. The FTC expressly cautions against the use of such claims and finds it generally difficult for marketers to substantiate everything reasonable interpretations of such broad terms, and courts have also found unqualified claims problematic.
In recent consumer class action lawsuits, courts have ruled that certain general, unqualified environmental claims do not guarantee a speedy exit from a plaintiff’s class action complaint. For example, citing Green Guides, the United States District Court for the Northern District of California determined that the phrase “reef-friendly” when used by a sunscreen brand was not inflated. but probably conveyed environmental benefits that need to be justified. White c. The Kroger Co. et al, no. 3:21-cv-08004, 2022 WL 888657 (ND Cal. 25 Mar 2022). The United States District Court for the Southern District of New York also ruled that a claim that the eggs were “free-range” was not inflated. Mogull vs. Pete and Gerry’s Organics, LLC, no. 7:21-cv-03521, 2022 WL 602971 (SDNY 28 February 2022). Both courts dismissed the motions to dismiss on this basis, allowing the false advertising lawsuits against the defendants to proceed. Likewise, the NAD recommended that a claim that a certain cleaning product is “better for your home and our planet” needs proper substantiation. One Home Brands, Inc. d/b/a Blueland (NAD 6416, September 25, 2020).
In short, brands will reduce the risk of litigation if they craft their sustainability, green and eco-friendly claims in such a way that they are closely tied to specific environmental benefits backed by credible evidence.
To reduce the risk of challenge, brands should carefully craft their eco-friendly advertising claims and ensure they have credible evidence (often competent and reliable scientific evidence) to support those claims. Brands should also be careful when making ambitious unsubstantiated green claims and focus on specific, substantiated claims rather than broad, unqualified messaging. Taking these steps requires advance planning, but will go a long way in mitigating risk. Additionally, the FTC plans to review the Green Guides this year for potential updates, so brands should keep a close eye on the FTC and litigation and enforcement developments in this area.