Many areas of consumer and trade promotions are regulated by the _____ through the Marketing Practices Division of the Bureau of Consumer Protection. A man owns an Audi, a Ford, and a VW. permitted consumers to sue manufacturers with whom they had no contractual relationships. -This act makes it illegal for competitors to make agreements with each other that would limit competition. The case goes to an appellate court, and there is no new finding of fact: What the FTC says is fact, is fact. Vision Council of America WebStudy with Quizlet and memorize flashcards containing terms like Any administrative action taken against a producer MUST be reported to the director within ___ days after the final disposition., How many days notice does the Affordable Care Act require insurers to give before rescinding coverage?, According to the Affordable Care Act, new health Insurance the treasurer of XYZ insurance discovers that the treasurer's company is being investigated by the banking and insurance commissioner. * Presence of superlative words in the advertisement Advertisers don't like the publicity that accompanies a charge of false advertising. D. corrective advertising. Rarely have these challenges been successful. because the company is in weak financial condition, the treasurer instructs the company claims manager to delay recording several large claims settlements. If either of the latter two events occur, a complaint is issued against the advertiser, and a hearing is scheduled before an administrative law judge. After a disability policy has been in force for _____ years, it is considered incontestable. E. Affirmative disclosure. There Federal Communications Commission. B. refer the case to an industry trade association. 1. A. commercial speech. Federal Trade Commission A. cease-and-desist E. Central Hudson, The _____ empowered the Federal Trade Commission to regulate unfair or deceptive practices including those in advertising. Instead, the FTC's guides would be revised such that testimonials that do not depict typical consumer experiences should be accompanied by a clear and conspicuous disclosure of the results consumers can generally expect to achieve from the advertised product or program. -may raise premiums at anytime Under the commercial speech The representation, omission, or practice must be "material" such that it is likely to influence the purchasing decision. In other words, the government could focus its attention with the registry only on the problems caused by commercial sales calls without having to also sweep up and control problems caused by political and charitable calls. 1. Tags: Question 34 . C. Cease-and-Desist "The commission generally will not bring advertising cases based on subjective claims (taste, feel, appearance, smell)," according to the guidelines. A. misinterpretation -frequency of the premium payment E. requiring the consumer to pay a consideration. Unsolicited junk fax ads and telemarketing calls to consumers who do not want to be called are banned under the: E. Trade Regulation Bureau, Which of the following divisions of the Federal Trade Commission protects consumers from deceptive and unsubstantiated advertising and enforces the provisions of the FTC Act that forbid misrepresentation, unfairness, and deception in general advertising at the national and regional level? pat owns a 20-pay life policy with a paid-up dividend option. A life insurance policy sold in Louisiana can be contested by the insurer only during the first ____ years of the contract. C. ad substantiation will result in advertisers resorting to puffery to avoid the need for claim verification. -premium past due A. B. D. Fairness The FTC prohibits this; Lures consumers into a store who are in the market for an item seen at one price. E. the impact of cease-and-desist orders, Controversy over the FTC's authority to regulate unfair advertising practices began in 1978, when the agency relied on this mandate to formulate its controversial _____ rule restricting advertising to children. A. A. require that consumers make a purchase of one of their products as a condition for entering the sweepstakes. Making a claim without substantiation. -contributory A. Bureau of Economics B. speech that promotes a commercial transaction. To settle the issue, Ticketmaster agreed to pay refunds to consumers who bought tickets for 14 Bruce Springsteen concerts through its ticker resale Web site TicketsNow, and to be clear about the costs and risks of buying through its reseller sites. B. puffery has detrimental effect on consumers' purchase decisions. So, in 19114 the Clayton Act was put in place to stop them. -3 & 0 Through custom and practice, the agency has defined advertising as any action, method or device intended to draw the attention of the public to merchandise, to services, to people and to organizations. Web(1) An advertisement shall not utilize or describe nonguaranteed elements in a manner that is misleading or has the capacity or tendency to mislead. It is only acceptable to lie when done to protect an innocent person. In the past the FTC would have to issue a complaint against each advertiser and in each case prove that the statement rule that declares that claims of product superiority based on excessive dosage of vitamins and minerals are false and misleading. Federal Communications Commission. One Bratz doll, for example, was shown standing on one leg with her right knee bent at about a 30-degree angle and arms outstretched. B. affirmative disclosure E. the advertising relies on the use of puffery to make its point. C. the Better Business Bureau may sue Acme if it cannot substantiate its claims. C. selective retention. In 2008 the 7th U.S. Acceptable forms include: D. Superlatives such as greatest, best, and finest are puffs that are often used in advertising. A. Guides and the Child Online Privacy : The FTC was created by Congress in 1914 to police unfair methods of business competition. insured suffered an injury as an innocent bystander during a bank robbery. That obviously can add up very fast. The long-standing legal doctrine is that the First Amendment is not even implicated; such a situation is one private entity, the mass medium, refusing to do business with another private entity. protects insured from insurance company insolvency. E. Association of American Publishers, Which of the following is the appellate unit of the National Advertising Review Council? Advertisers can still litigate the question, challenge the trade regulation rue, seek an appeal in court and so forth. C. not require that consumers make a purchase of one of their products as a condition for entering the sweepstakes. A. cease-and-desist. WebExcept in unusual instances, we cannot require drug companies to submit ads for approval before they are used. Voluntary agreements by advertisers to terminate a deceptive advertisement C. Lanham -Comparative advertising, in which an advertiser not only promotes his or her own goods but tends to disparage the product made by a competitor, became more common. BBB stands for: Better Business Bureaus provide control over advertising practices at a _____ level while the Council of Better Business Bureaus plays a major role in controlling advertising practices at a(n) _____ level. -indemnity By 2010, the FTC had brought more than 60 telemarketing cases alleging do-not-call violations. Even truthful advertising for legal goods and services can be regulated, provided that the government can satisfy the 3 requirements outlined here: In 1995 the Supreme Court struck down a federal rule that forbade brewers from listing the alcohol content on labels attached to bottles and cans of beer and malt liquor. D. puffery is illegal. Injunctions: -beneficiaries Information Technology Does this message injure the plaintiff? Refusing to sign the agreement will result in litigation and publicity. -Also court said this case was "in the public interest". C. a commercial is rejected for reasons such as sex and politics. A. enhance the credibility of the publication. In dealing with false advertising, the FTC's greatest enemy is the time needed to bring an action against an advertiser. The government's interest in reducing the amount of alcohol consumed by young people is a laudable goal, a unanimous Supreme Court said, but added that there is really no evidence this rule advances the goal. Injunctions: -completely insured, joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value. C. Lanham Act B. Sherman Antitrust Act 4. E. consumers believe in puffery. In summary, competitor-versus-competitor lawsuits are now common. Federal Trade Commission This requirement falls under the FTC's _____ requirement. These (like the Sherman Act) were made to protect consumers and promote competition in the marketplace. WebI. FTC Definition of False or Deceptive Advertising: 2) The advertiser can agree to sign the agreement, but the commissioners reject it. D. affirmative disclosure Several other companies received similar letters in 2010 from the FDA regarding front-panel "no trans fat" claims that failed to disclose significant levels of saturated fat and total fat. B. consumers need to know information about consequences, conditions, and limitations associated with the use of the product. Food and Drug Administration. -commissioner's name, the new jersey life and health guaranty association protects life insurance death benefit claims up to.. WebAdvertisers are often supportive of voluntary self-regulation because: A. self-regulation is viewed as a way of limiting government interference of advertising. -guaranteed insurability rider, the commissioner may Congress decided a special agency was needed to stop unfair business practices. The CAN-SPAM Act does not provide for a private legal cause of action or remedy for spam recipients. Substantial Omission E. Federal Communications Commission. D. Lanham Act In this case the commission can issue an order, usually called a *litigated order,* to stop the particular advertising claim. The advertiser is not responsible for every interpretation or behavior by a consumer. B. E. The division of Economic Practices, The _____ gave the Federal Trade Commission the power to establish trade regulation rules. D. publishing the odds of winning. The basic defense against any false advertising complaint is truth-that is, proving that a product does what the advertiser claims it does, that it is made where the advertiser says it is made, or that it is as beneficial as it is advertised to be. D. advertisers who want to use misleading wording in their ads. In some cases it is not easy to distinguish political speech from commercial speech, as courts recently have observed. B. FTC Act Spam also represents an economically efficient and inexpensive way of marketing one's product or service. All TV viewers have seen famous athletes and celebrities, as well as experts and ordinary consumers, on commercials making claims abut products they supposedly use or in which they otherwise believe. The commissioners then vote on whether to issue a complaint. These guides are policy statements that alert businesses to what the agency believes are permissible advertising claims or practices. [4230]+[wxyz]=[2305]\left[\begin{array}{rr} Federal Communications Commission Ocean Spray Cranberry Juice. Under this rule, airlines are free to provide an itemized breakdown (displaying to the customer the amount of the base fare, taxes and other charges), but they many not display such individualized price components "prominently" or "in the same or larger size as the total price." A. advertisers, creatives, and the cable operators. a. affiliation. -set sales quota B. a superlative; illegal D. the FTC may charge Acme with using puffery, which is an illegal form of advertising. B. Centre for Electronic Technology. Nestl claims "Nestl makes the very best chocolate," Snapple advertises that its beverages are "made from the best stuff on Earth," are all examples of: National Advertising Division -human resource department Marketing Agreements are only binding for those handlers that sign the agreement. A. The Magnuson-Moss Act of 1975: An investigation into the lengths of celery sticks grown in a certain US state. A. A. In brief, Roomates.com was more akin to a publisher or speaker rather than a mere conduit for the information that it posts. In 2008 the FTC clarified that the "valid physical postal address" that must be disclosed by the sender of commercial e-mail messages can be either a registered post office box or a private mailbox established under U.S. If you respond by pressing any number, it will probably lead to more robocalls.". Implied uniqueness -this is why there are so many laws because there are so many ads; also, Lanham Act gives a good amount of money if you win one of these cases, ______ is a powerful, strong, and influential agency. Nevada allowing prostitution in some counties, Airline tickets having to prominently show total price, and Baltimore ordinance banning alcohol ads near children's facilities are all about ________________________. Since the early 1980s the corrective advertising sanction has been used sparingly by the agency. Although the agency is located Washington D.C., it had 11 regional offices throughout the nation. Most states today have such laws. -may raise premiums at policy renewal \end{array}\right]+\left[\begin{array}{ll} The telemarketers, however, argued that the exemptions for political and charitable calls made this state "under inclusive"--that to effectively serve the interests of protecting privacy and preventing fraud, the registry should also apply to political and charitable solicitations, not just to commercial sales calls. If advertisers make such claims, they are in violation of the law. The agency believes the typical reasonable consumer does not take such claims seriously and thus they are unlikely to be deceptive. B. require an advertiser to run comparative advertisement. Association of National Advertisers. -submit to the replacing insurer a list of the policies to be replaced 2. -company's true corporate name D. Federal Trade Commission -insurance company, an insured's status under social security can be described as.. -Voluntary compliance B. Uder the terms of the CAN-SPAM Act, each separate e-mail in violation of the law is subject to penalties of up to $________________, and more than one person may be held responsible for violations. 3. Which of the following statements describes the media's role in the self-regulation of advertising? One commissioner is chosen by the president to be the chairman of the FTC. C. not requiring consumers to make a purchase as a condition for entering. all commercial e-mail messages must contain either a functioning return e-mail address or an "opt-out" mechanism. SUMMARY: C. Department of Commerce (DOC) D. comparative advertising. E. Standards and Practices Division, Which of the following media has the most stringent review and approval process for advertising? D. U.S. Justice Department. In 2004 the U.S. Court of Appeals for the 10th Circuit upheld the National Do not Call Registry in Mainstream Marketing Services, Inc. v. Federal Trade Commission. WebAdvertising regulations exist in order to Demonstrate full and truthful disclosures to the public The purpose of Advertising regulations is to assure full and truthful disclosures to D. affirmative disclosure order Vision Council of America D. Wheeler-Lea Amendment D) It is ineffective in situations in which competitors are unable to enter the market easily. The FTC claimed the ads were misleading since imported soles and upper parts were used to make the shoes. II. Distribution . D. Head & Shoulders shampoo advertises that it has been proven to be effective in preventing dandruff. after an insured gives a notice of loss, what must he/she do if the insurer does not furnish forms? -agents. E. advertising substantiation. A. b. B. speech that promotes a commercial transaction. E. advertisers, government, and the television networks. A. a consent order. *Attorneys for the FTC can seek these restraining orders in federal court. C. Newspapers -no interest will be charged on loan balance Ads can't be unfair, meaning the advertisement can't cause substantial injury to consumers that consumers NAD recommended that Gillette stop using "MoistureRich" in both the product name and as a descriptor when used in isolation in phrases such as "Treat Your Skin to MoistureRich." -$400,000 There must be a representation, omission or practice that is likely to mislead the consumer* Although CAN-SPAM does not provide a civil remedy for those of us who receive spam, a provider of Internet access service that is adversely affected by spamming activities on its service may bring a civil lawsuit against the spammer in any federal court in the U.S. seeking both a permanent injunction to stop the spamming and monetary damages for harm caused by the spam. An entire industry can be treated similarly, and just one or two businesses are not picked out for complaint. In either case, the losing side can appeal to the federal trade commissioners for a final ruling. E. Most media reject political ads. C. if the ad uses puffery. B. _______________________: Commercial e-mail messages that include "materially false or misleading" header information or deceptive subject lines are prohibited. E. Telephone Consumer Protection Act, ) The Federal Trade Commission and U.S. -If you use a spokesperson, that spokesperson should support the product ____, as defined by the First Amendment to the U.S. Constitution, is the most basic federal law governing advertising in the United States. A. Deception B. Lanham Act A. The _____ made it easier for Chevron to sue Texaco for this perceived misrepresentation. A. consumers cannot distinguish between factual information and puffery. Independent Business Alliance The registry, however, would also prove controversial. C. are issued by the Federal Trade Commission. D. Robinson Patman Act E. The four major television networks. ) voting power on major issues and ownership in a portion of the company. *There are only a handful of reasons that a judge can use to overturn the commission decision. Central Hudson 1. C. FCC Act The representation, omission or practice must be material. the policy may be paid up early by using policy dividends. More part of the new law is that the endorsers may also be subject to liability for their statements. 5. The appellate court reasoned that Craigslist "is not the author of the ads and could not be treated as th 'speaker' of the posters' words." A. Wheeler-Lea Amendment B. governance, compliance, and cooperation. D. Internet D. Bureau of Consumer Protection Such claims are referred to as _________________ and include representations that a store sells "the most fashionable shoes in town" or a cola drink is "the most refreshing drink around."