C. Advertising for contraceptives is completely banned on all networks since 1995. D. Robinson Patman Act -treatment for alcoholism d. requiring an individual, group, or organization to choose among several actions that must be evaluated as right or wrong, ethical or unethical. These guides are policy statements that alert businesses to what the agency believes are permissible advertising claims or practices. There is a substantial state interest to justify the regulation. To implement this provision, the FTC in 2004 adopted a rule requiring spammers who send sexually oriented material to include the warning "SEXUALLY-EXPLICIT:" in the e-mail subject line or face fines for violations of federal law. These guidelines spring from a variety of concerns. The statute, set forth at 15 U.S.C. -employer Sometimes the owner of the medium thinks the product that is being advertised is offensive, like NC-17 or adult movies, or condoms. C. Lanham Act Most cases come to the attention of the agency from letters written by either consumers or competitors. A. At this point either side can appeal to the commissioners to overturn the ruling of the judge. The judge also has the authority to dismiss the case. was not protected by the first amendment until 1975, The Supreme Court held that commercial advertising receives a degree of First Amendment protection; Supreme Court, ""The relationship of speech to the marketplace of products or of services does not make it valueless to the marketplace of ideas. Better Business Bureau 2. B. -is made available after paying a $50 fee. B. Another word for advertisement is _____________________. Trading stamps, contests, freebies, premiums and even product labels are included in this definition, in addition to the more common categories of product and service advertising. In general, advertisements of alcoholic products must be truthful and without deception. 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. 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. B. FTC Improvements Act C. Wheeler Lea Amendment to the FTC Act All claims made in advertisements must be substantiated such that, before disseminating an ad, advertisers must have a reasonable basis for any and all express and/or implied product claims, with claims relating to health and safety coming under even closer FTC scrutiny that typically requires proof by competent and reliable scientific evidence. D. corrective advertising. In particular, Johanns v. Livestock Marketing Association centered on a federal statute and related order adopted in the 1980s under which the U.S. secretary of agriculture imposes a $1-per-head assessment, knwn as a checkoff, on all sales of cattle in the U.S. Litigated orders an employee under a group insurance policy has the right to name a beneficiary and the right to convert to an individual policy in the event of employment termination, HIPAA considers which of the following as The Federal Trade Commission (FTC) defines _____ as an express or implied statement contrary to fact. There are 2 key divisions of the Better Business Bureau's Advertising Self-Regulatory Council (ASRC), which was known until April 2012 as the National Advertising Review Council, that provide both advice to advertisers and out-of-court methods for resolving disputes about advertisements. In particular, several telemarketing agencies filed lawsuits in 2003 against the FTC, alleging that it was beyond the scope of the FTC's jurisdiction to adopt the National Do Not Call Registry and claiming that the registry violated the First Amendment right of free speech of advertisers who use telemarketing. Guides or advisory opinions that attempt to outline in advance what advertisers may say about a product -custodial care Information from the cerebral cortex, substantia nigra, and thalamus intralaminar nuclei all enter the _________. Most commercials once rejected cannot be rerun. D. Distilled Spirits Council. B. affirmative disclosure 1. Consumer Redress, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese. D. Bureau of Reconstruction 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. In 2012, the FTC filed 62 actions in federal court and obtained 94 orders for redress, disgorgement of profits and permanent injunctions against individuals and businesses. The _____ was formed by three advertising associations and the Council of Better Business Bureaus to sustain high standards of truth, accuracy, morality and social responsibility in national advertising. One commissioner is chosen by the president to be the chairman of the FTC. B. A. an unfair claim. SUMMARY: A. The act or practice must be considered from the perspective of a consumer who is acting reasonably. *In addition to the federal CAN-SPAM Act, some states have their own statutes targeting such e-mails.*. One of the most pervasive and annoying forms of advertising today is on the ________________. "likely to mislead the consumer" WebThe Telephone Disclosure and Dispute Resolution Act of 1992 requires FTC to promulgate regulations concerning advertising for, operation of, and billing and collection procedures for, pay-per-call or "900 number" telephone services.The regulations must include certain provisions, such as price disclosure requirements, mandatory warnings on services c. requiring society as a whole to choose among several actions that must be evaluated as right or wrong. Advertising on television and radio was regulated for many years through codes developed by the _____ until the courts found some of its regulations served to restrain trade. A. E. remuneration. C. Fairness Doctrine E. U.S. Department of Welfare. There has also been a rapid increase in lawsuits brought by advertisers against one another under Section 43(a) of the Lanham Act. A. Worked, however, some companies then decided to just merge together. E. Clayton Antitrust Act, The Bureau of Alcohol, Tobacco, and Firearms (BATF) is an agency within the ____. The reason a magazine such as 'Good Housekeeping' regularly tests products and offers a "seal of approval" is to: The hearing is a lot like a trial, only more informal. B. C. any type of comparative advertising. This is an example of: c. competence. The origin of the Federal Trade Commission's corrective advertising program came from a deceptive advertising case involving: Telephone Consumer Protection Act of 1991. WebA) It is effective in situations in which competitors are able to undercut prices easily. D. Trademark Revision Act of 1988 the insured must now wait 60 days before bringing in legal action against the insurer. Nearly a century later, the FTC today is the only federal agency with jurisdiction to protect consumers and maintain competition in broad sectors of the economy. B. Native Advertising/sponsored posts - have come on the rise; it's important to be aware of -annuity's guaranteed interest rate The _____ accepts cases dealing with product performance claims, superiority claims against competitive products, and all kinds of scientific and technical claims made in national advertising. The most recent commission policy statement on substantiation was issued in 1984. D. discounts Injunctions Most newspapers ship at least a few copies across state lines. In addition, consumer reaction to the charges often results in list sales as well. -$200,000, which of the following actions is REQUIRED by an agent who is replacing an existing life insurance policy? The FTC prohibits ___________________________, which it defines as "an alluring but insincere offer to sell a product to service which the advertiser in truth does not intend or want to sell. E. Food and Drug Administration, In 1996, President Clinton signed an executive order declaring that nicotine was an addictive drug and gave the _____ broad jurisdiction to regulate the advertising of cigarettes and smokeless tobacco. C. First-Amendment Analysis -initial premium requirement Substantiation: A. require that consumers make a purchase of one of their products as a condition for entering the sweepstakes. But Roommates.com reached the opposite conclusion. A. The test is whether the consumer's interpretation or reaction is reasonable. Spam frequently takes the form of sexually explicit advertisements that may be both unwarranted by, and offensive to, its recipients. A. *Normally, what the FTC says in an advertisement is considered to be an advertisement fir purposes of regulation. The FTC's guides don't have the force of law; in other words, a business that violates a provision of a guide is not automatically guilty of false advertising. Specifically, the rule requires that the most prominent ticket price displayed on print ads and on Web sites be the total price, including taxes. an advertiser promotes his/her own good and tends to pick holes in a competitor's version of the product. an insurance company needs to obtain personal information from a third party concerning an applicant. -It was easier to block a competitor's claims than to win damages, because in order to gain a monetary award the plaintiff had to show specific monetary loss, something that is often difficult to do given the nebulous nature of advertising claims and the forces that motivate a consumer to buy a specific brand of a product. The courts have extended First Amendment protection to: A. FTC Act As with the structure of the Federal Communications Commission described in Chapter 16, no more than 3 of the 5 commissioners can be from the same political party. C) It involves underpricing products so that companies make larger sales. expression related solely to the economic interest of the speaker and its audience, or proposes a commercial transaction. D. Trademark Improvements Act B. Wheeler Lea A study by the National Advertising Division's Children's Advertising Review Unit found that the most prevalent violation of its voluntary advertising guidelines occurred with _____ aimed at children. Federal Communications Commission Misinterpretation -substantial interest in maintaining the rights of consumer privacy Harry Nims, a New York lawyer, drafted a model law called the *Printers' Ink statute+ (it was Printers' Ink magazine that urged passage of the law) in 1911. B. require an advertiser to run comparative advertisement. The next remedy on the ladder is voluntary compliance and is used for advertising campaigns that are over or nearly over. 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. E. Federal Trade Commission (FTC). A. U.S. Court of Appeals can review all commission order.s WebStudy with Quizlet and memorize flashcards containing terms like Advertisers are often supportive of voluntary self-regulation because: A. self-regulation is viewed as a way of Cease-and-desist orders: B. Lanham E. Wheeler-Lea Amendment, Under the _____ passed in 1991, telemarketers must follow a complex set of rules developed by the Federal Communications Commission. If the judge believes that there is substantial evidence that the advertisement violates the law, he or she will issue an order telling the advertiser to stop this illegal practice (this is the litigated order). Two divisions of the Better Business Bureau's National Advertising Review Council that provide advice to advertisers: reviews national advertising for truthfulness and accuracy, and it provides a form of alternative dispute resolution for companies that is cheaper than litigation, evaluates child-directed advertising and promotional material in all media to advance truthfulness, accuracy, and consistency with its "Self-Regulatory Guidelines for Children's Advertising" and relevant laws, a variety of federal agencies are empowered to enforce consumer protection laws; FTC and FDA, the primary agent of the govt; nearly 100 years old; it polices unfair methods of business competition and protects consumers from deceptive advertising, responsible for protecting public health and ensuring that products like cosmetics, drugs and food are honestly and accurately represented to the public. WebGovernment may regulate truthful advertising for legal goods and services if the following conditions are met: a. there is a substantial state interest to justify the regulation. The level of respect owed to another is based on B. Wheeler Lea Amendment During fiscal year 2013, the FTC received more than 3.7 million complaints regarding alleged violations of the registry, down from about 3.8 million in 2012. E. U.S. Supreme Court rulings, The _____ moved against a number of national advertisers as a result of inactivity by the Federal Trade Commission (FTC) during the Reagan administration. C. consumers recognize puffery and don't believe it. 3. Laws banning false advertising exist at both the state and local levels, but tend to be applied half-heartedly. -receive matching funds to expand public assistance programs Courts generally give less protection for commercial speech by lawyers than advertising publications -Maybe 3,000 demonstrate full and truthful disclosures to the public. D. Superlatives such as greatest, best, and finest are puffs that are often used in advertising. right to transfer ownership and dividend entitlement. A. -purchase health insurance from the federal government The court thus ruled in favor of the federal beef promotion program and its compelled subsidization of advertising to which some cattle ranchers aand farmers object. C. Cease-and-Desist B. creative boutiques, copywriters, and consumers. If a participant is required to give up something of value in order to participate in a game or sweepstakes, then _____ is present, and the promotion is considered a lottery. -guaranteed insurability rider, the commissioner may (b) Why is a binary predictor sometimes called a "shift variable"? D. FDA Act National Advertising Review Board E. Advertising guidelines, According to Federal Trade Commission policy, the criteria for determining _____ are (1) a trade practice causes substantial physical or economic injury to consumers, (2) could be reasonably avoided by consumers, and (3) it must not be outweighed by countervailing benefits to consumers or competition. There 2. 1. President Theodor Roosevelt broke up many Trusts by making anti-trust laws. Since the mid-1970s commercial advertising has been given the qualified protection of the First Amendment because much advertising contains information that is valuable to consumers. D. Federal Trade Commission WebGovernment may regulate advertising that. A. 3. D. NARC can handle cases at lower cost as compared to a court. -company's true corporate name E. unsubstantiated order. Bait-and-switch advertising. The good news for consumers is that they sometimes get part of their money back. Incorrectly implying that an endorser uses and advocates a brand. The most commonly used FTC remedy is the consent agreement, or _____________________________. First anti-trust law was passed in 1890: the Sherman Act. -submit to the replacing insurer a list of the policies to be replaced Cease-and-Desist Orders Solve the present value formula (5) for nnn. Robocalls are illegal even if the number dialed is not on the Do Not Call Registry. E. Central Hudson Test, Federal regulation of advertising originated in 1914 with the passage of the _____ Act. C. avoid self-regulation. The U.S. Supreme Court turned back a challenge to the appellate court's ruling, thus bringing an end (at least for the time being) to telemarketers' efforts to invoke free speech arguments to have the popular ban on unwanted phone solicitations declared unconstitutional. -form a large PPO on a statewide level Individuals who are represented in the ads must be actual consumers, unless stated otherwise. E. consumers believe in puffery. But if time is the greatest enemy, publicity is the FTC's strongest ally. In 2009 the FTC banned so-called robocalls (those annoying prerecorded commercial telemarketing calls to consumers) unless the telemarketing company has obtained written permission from a consumer to receive such calls. -The size of damage awards skyrocketed. D. Bureau of Alcohol, Tobacco, and Firearms 17. The government justified the rule by arguing that it sought to discourage young drinkers from buying a particular beer or malt liquor because it had the highest alcohol content. Weban insurance applicant has made a false statement on the application that will affect the insurer's decision on whether or not to issue the policy. -47% of the time people can't tell it is native advertising D. Electronic Retailing Self-Regulation Program (ERSP). Yes, as long as the disclosure requirments are reasonably related to the government's interest in preventing deception of consumers. -Endorsements must reflect the honest opinions, findings, beliefs or experiences of the endorser and may not contain any representations that owls be deceptive or could not be substantiated if made directly by the advertiser. D. advertising deregulation A. are used to regulate public service announcements. Law of Agency DRAFT. -beneficiary, replacement regulation is designed to protect 4 & -2 \\ Presence of superlative words in the advertisement There must be a representation, omission or practice that is likely to mislead the consumer. "individually identifiable health information" ? Ads must tell they truth, not mislead (either by sins of omission or sins of express or implied misrepresentation) and be backed up with prior substantiation. The FTC claimed the ads were misleading since imported soles and upper parts were used to make the shoes. D. Food and Drug Administration -Consent agreement D. Affirmative disclosure C. Bureau of Alcohol, Tobacco and Firearms SUMMARY: C. Most FTC inquiries are settled by consent order. ) But the system was not necessarily working well. The students had a right, in other words, to not speak. C. ad substantiation agreement D. Federal Trade Commission C. FCC Act In 2010, the FTC went after a high-tech form of bait-and-switch advertising when it settled charges that Ticketmaster and its affiliates used deceptive bait-and-switch tactics to sell concert tickets to consumers. Is this message false or misleading? D. advertising substantiation C. ad substantiation will result in advertisers resorting to puffery to avoid the need for claim verification. But if the commissioners support an administrative law judge's ruling against an advertiser, the order becomes law after it is finalized by an appellate court. Advertising claims that significantly involve health and safety are usually presumed to be material. Guidelines developed by the FTC are used by state courts to administer regulations. For example, an advertiser can argue that the deceptive statement is not material to the advertisement as a whole (that is, it will not influence the purchasing decision) or that the advertisement does not imply what the government thinks it implies. Ocean Spray Cranberry Juice. C. U.S. Advertising must be truthful and not misleading, with misleading ads sweeping up those in which relevant information is omitted, those that imply something that's not true and those in which any disclaimers or disclosures are not clear and not prominent enough for reasonable consumers to see, hear and understand them. D. National Association of Broadcasters *In a nutshell, the FTC's rules against deceptive advertising break down into 2 critical components:* A. a commercial is rejected at the storyboard stage. Implied uniqueness -dental care. C. equity It's What's for Dinner" campaign. Which of the following statements concerning advertising by attorneys is true? CAN-SPAM Act The Federal Trade Commission has the power to regulate virtually all advertising that is deceptive or misleading. The new law expanded the jurisdiction to practice "affecting commerce." Q. -name Many areas of consumer and trade promotions are regulated by the _____ through the Marketing Practices Division of the Bureau of Consumer Protection. So, in 19114 the Clayton Act was put in place to stop them. -to tell them what they can and can't do Which of the following statements about advertising by attorneys, dentists and physicians is true? But practically, it can regulate almost all advertising. In summary, competitor-versus-competitor lawsuits are now common. an agent is required to keep replacement forms on file for at LEAST __ years.. a producer who sells an individual life insurance policy in new jersey MUST deliver to the policy owner a(n), contain content approved by the commissioner, the names of the insurance companies represented by the producer D. comparative advertising. Review the following transactions for Birdy Birdhouses and record any required journal entries. E. materiality, Under which of the following FTC programs might a firm be required to have product information verifying the veracity of its advertising claims before making any advertising claims about the product? continued coverage under COBRA would be provided to all of the following EXCEPT B. affirmative disclosure Ads that promote illegal goods and services, that contain claims that appear to be deceptive or are not substantiated, or that unfairly trash a competitor's products might also be ___________. Vision Council of America 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." Advertising which praises the item to be sold with subjective opinions, superlatives, or exaggerations, vaguely and generally stating no specific facts. Under the proposed new guides, such disclaimers indicating that the results of the endorser are unusual or out of the ordinary would not be enough to protect the advertiser from potential liability. An injunction is clearly a drastic remedy and one that the agency has said it will not use often. D. Electronic Retailing Self-Regulation Program (ERSP). Its cost of goods sold is 75 percent of sales, and it finances working capital with bank loans at an 8 percent rate. The FTC does not attempt to scrutinize every advertisement that is published or broadcast. When the FTC issues a consent order on a final basis, it carries the force of law with respect to future actions. D. Independent Business Alliance -waiver of premium Injunctive power to immediately halt advertising campaigns that could cause harm to consumers B. refer the case to an industry trade association. reggie purchased a life insurance policy with a face amount of $500,000. Using an ambiguous or easily confused phrase. (The importance of this power alone cannot be overestimated. Complaints against advertisers are prepared by the FTC staff and approved by a vote of the commission. The following are all instances in which a court can overturn an FTC ruling: (1) "convincing evidence" that the agency made an error in the proceedings, (2) no evidence to support the commission's findings, (3) violation of the Constitution-for example, the agency did not provide due process of law, (4) the action goes beyond the agency's powers; (5) facts relied on in making the ruling are not supported by sufficient evidence, and (6) arbitrary or capricious acts by the commission.
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