FTC Finalizes Rules on 'Green' Advertising

Williamsburg, VA, Oct. 19, 2012 -- Marketers of consumer products touting various environmental-benefit claims finally have some closure on how to approach green advertising without running afoul of the Federal Trade Commission, said attorney Thomas A. Cohn during an Oct. 12 business-law conference.

According to Cohn, a LeClairRyan partner and 17-year Federal Trade Commission veteran, FTC’s finalized Green Guides do offer more clarity to sellers of packaged goods stamped with the likes of “recyclable,” “biodegradable” or “recycled content,” but they fail to offer guidance for other terms that are in widespread use.
 
“These terms include ‘sustainable,’ ‘natural’ and even ‘organic,’ ” the attorney noted in his presentation to the 42nd Annual Advanced Business Law Conference, a Virginia Continuing Legal Education event.

“Still, the top-level themes of the finalized Green Guides are consistent with the proposed revisions published two years ago—namely, that marketers should not make broad, unqualified, general environmental benefit claims, because such claims are nearly impossible to substantiate and are thus deceptive.”
 
The FTC announced the final Green Guides, which are designed to help marketers avoid making misleading environmental claims, on Oct. 1, and the agency is unlikely to revise the rules again for another 10 years, said Cohn.

Cohn said the FTC added guidance about the need for marketers to analyze any tradeoffs that might result from a particular product attribute that serves as the basis for an environmental benefit claim,” the attorney explained. “The agency is basically saying that if the benefit you want to highlight is true, but happens to come at a substantial environmental cost or harm, that tradeoff must be considered first.”
 
Packaging labeled “15 percent less content by weight,” “recycled content” or something similar, for example, might be deemed deceptive amid an untenable tradeoff. “If you have to get the content from halfway around the world, which involves a bigger carbon footprint, this may outweigh the benefit you are highlighting,” Cohn said.
 
In recent years the FTC has targeted companies that rely on bogus certifications to trump up their environmental benefit claims. In the final Green Guides, the agency offered further clarification regarding the use of such certifications and seals of approval, Cohn said.