On June 7, 2019, the U.S. Food and Drug Administration ("FDA") and the Federal Trade Commission ("FTC") together issued four warning letters to companies manufacturing and marketing flavored e-liquid tobacco products in connection with their failure to include required nicotine warning statements in social media posts. Under the Federal Food, Drug and Cosmetic Act (the "Act"), any advertising of tobacco products must include the following warning statement:
WARNING: This product contains nicotine. Nicotine is an addictive chemical.
Failing to provide this warning statement amounts to product misbranding that violates the Act. The FTC warned that this is also a violation of the FTC's prohibition on unfair and deceptive practices because the social media posts at issue failed to disclose material health and safety risks. In the warning letters, the FTC details that all social media posts must disclose the material relationship between companies and their respective endorsers. The FTC Endorsement Guides Concerning the Use of Endorsements and Testimonials in Advertising ("Endorsement Guides") advise of the proper way to disclose relationships in order to avoid any unfair or deceptive practices.
What are the FTC and FDA requesting?
Structuring Advertising Around the Endorsement Guides
Recently, we have blogged about what the Endorsement Guides require when a relationship exists between a social media influencer and an advertiser. Specifically, where any material connection between an endorser and an advertiser exists (whether through a business or family relationship, monetary payment, or the promise of a free product, for example), the relationship has to be clearly and conspicuously disclosed to the public, unless it is obvious from the context of the applicable communication that a relationship already exists.
Responding to the Warning Letters
The FDA and FTC have directed the subject companies to respond to the letters within 15 working days. In their written responses, the companies are required to disclose all steps that they have taken to correct any violations, or, if they believe that no violation has occurred, provide reasoning and supporting documentation to prove their compliance. In addition to correcting any violations, the FTC and FDA recommend that the companies consult the Endorsement Guides and construct internal social media policies that address their relationships with endorsers.
To avoid risk of serious legal and regulatory consequence, companies should ensure that their advertising and endorsement practices comply with applicable law and regulation.
Related Blog Posts:
Mosquito Repellent Marketers Allegedly Violated Product Endorsement Law, Enter into Consent Decree
Legal Concerns for Social Media Influencers: Product Endorsements
Sweepstakes Endorsements and Testimonials: What's Not to Like?
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