Legal Aspects of Advertising and PR
Regulation of Advertising
• Self Regulation
o Agency Review Process
• Agency Self-policing
• Legal department that looks at ads to make sure they follow the law
• Internal approval cycle to make sure that what an ad agency says about
the firm's product is informed and confirmed
• Mandatories and Disclaimers: Carefully spell out to consumers the full
details of a particular offer.
o Competitive Rivalry
• Self Policing: Among companies lead to battles
• Self Regulation: "Blowing the whistle on the competition"
"Self policing" occurs when one advertiser tries to make trouble for
o American Advertising Federation AAF
• "Advertising code of American business"
• Truth: Advertising shall tell the truth and shall reveal significant facts, the
concealment of which would mislead the public.
• Responsibility: Advertising agencies shall be free of statement
illustrations or implications which are offensive to good taste or public decency
• Bait Advertising: Advertising LOOK ON BB***
o American Association of Advertising Agencies "four A's"
• Maintains a code similar to the AAF's called LOOK ON BB***
o BBB: National Advertising Division (NAD)
• Investigate dishonest advertising on a consumer's behalf.
• NAD contacts an offending advertiser to ask them to substantiate the
claim or otherwise resolve the issue.
• National Advertising Review Board (NARB)
• Country Time vs. Minute Maid
Minute Maid says: Thy have no real lemon juice
Country Time: says they tastes better than minute maid
NAD made them prove it and Country time did
o Regulation by media
• Protect audience from dishonest advertisers.
• Protect audience's values
Ex: Trojan Condoms (Rejected by CBS and FOX)
• Network Clearance: Not the same as a legal clearance
Network can refuse adv based on policy issue … condoms,
controversial issues, etc.
• Ex 2: Prince tennis ad: US Open tennis-- USA/CBS
• CBS refused to run ad on grounds of poor taste
(Tennis match with God)
• Ex3: Super Bowl ad rejected by NBC - PETA ad saying
"Vegetarians have better sex"
• Ex 4: Bud Light commercials (with guy licking magazine
and watching game with dog)
• How effective is self regulation? o Advocacy/Pressure Groups
• Center for Alcohol Marketing and Youth
Ansheuser Bush Bud Light Commercial
• Ad featured football referees stealing beer and running
• Parents Television Council
Hardee's "biscuit hole" spot
PTC objected to the "racy" and "brainless" nature of the biscuit
hole campaign and "sexually suggestive" Western Bacon Thickburger.
Inappropriate for family viewing
Hardee's seems intent on pushing bounders ****
Hardee's response: target audience is young hungry guys
o Local/State: Attorney General within the state
Federal: Federal Trace Commission (FTC)
"Unfair methods or competition in or affecting commerce, and
unfair or deceptive acts or practices in or affecting Commerce…"
Deceptive: If there Is a representation, omission or practice that is
likely to mislead the consumer acting reasonably.
1. Capacity to deceive - no intent necessary
1. Audience: who is the ad targeted to?
1. What is the meaning of the ad?
1. Ad considered as a whole - total impression governs
Who determines the meaning of the ad? FTC has authority to
determine meaning of ad
• Has burden of proof. HAS to prove that ad is