This is a new series called War Story Wednesdays. (We love a lot of alliteration.) War stories are cases that illustrate business law. First, we give you The War – those are the facts and the battle. Then, we give you The Winner – who won and why. Finally, we give you The Moral of the Story – the rule to take away.
THE WAR – FTC vs. Dannon
The FTC busted Dannon for its Activia yogurt ads. Specifically, Dannon claimed that eating its yogurt facilitates the morning constitutional. Dannon made it worse by claiming that Activia’s health benefits were scientifically proven. FTC charged Dannon with deceptive advertising because it did not have proof (a/k/a substantiation) for its claims.
The FTC – Dannon settled and agreed:
1. That anytime Dannon touts its yogurt’s cathartic properties, it must either confess that it takes 3 portions to get to the special moment or have 2 reliable, independent scientific studies proving that less than 3 portions will do the trick. And, any health promises also have to be supported by 2 reliable, independent scientific studies and be clear and fair.
2. The Food and Drug Administration has to approve any future claim by Dannon that its yogurt helps avoid a cold or flu (this is a huge concession).
3. To pay $21 million to 39 states that also sued over these ads.
THE MORAL OF THE STORY
With the FTC watching, you can’t get away with sh*t.
(Actually, the moral of the story is that substantiation for health claims = two reliable, independent scientific studies. But that’s not as funny as the pretend moral of the story above.)