By: Diana Adjadj, Esq.
June 08, 2022
False advertising and similar regulatory laws fall under consumer protection laws. These consumer protection laws are enacted to prevent false advertising, prohibit the publication of false information, and otherwise ban the dissemination of misleading, or confusing information to promote the sale and marketing of products, goods, or services.
False advertising laws fall under consumer protection, geared to prohibit the publication of false advertisements and misleading information. Typically states adopt their own body of laws to prohibit false advertising, and these laws are passed to protect consumers from deceptive business practices and otherwise for the benefit of the public. In California, some of regulatory laws passed to prevent false advertising are codified in § 17500 of the California Business and Professions Code.
“It is unlawful for any person, firm, corporation or association, or any employee thereof with intent directly or indirectly to dispose of real or personal property or to perform services, professional or otherwise, or anything of any nature whatsoever or to induce the public to enter into any obligation relating thereto, to make or disseminate or cause to be made or disseminated before the public in this state, or to make or disseminate or cause to be made or disseminated from this state before the public in any state, in any newspaper or other publication, or any advertising device, or by public outcry or proclamation, or in any other manner or means whatever, including over the Internet, any statement, concerning that real or personal property or those services, professional or otherwise, or concerning any circumstance or matter of fact connected with the proposed performance or disposition thereof, which is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading, or for any person, firm, or corporation to so make or disseminate or cause to be so made or disseminated any such statement as part of a plan or scheme with the intent not to sell that personal property or those services, professional or otherwise, so advertised at the price stated therein, or as so advertised. Any violation of the provisions of this section is a misdemeanor punishable by imprisonment in the county jail not exceeding six months, or by a fine not exceeding two thousand five hundred dollars ($2,500), or by both that imprisonment and fine.”
The above quoted business and professions code, broadly prohibits advertising and marketing materials that are not only false, however prohibits the dissemination of material that although true would mislead, deceive, or confuse the public.
When determining whether an advertisement is false or misleading courts have taken several different approaches to this issue. Some jurisdictions require the plaintiff or injured party to present a consumer survey or extrinsic evidence establishing that the public is likely to be misled by a representation. Conversely, in California, a plaintiff does not need extrinsic evidence to prevail on a false advertising claim; rather, the advertisement or marketing material itself is the primary evidence used to establish whether or not an advertisement is false, misleading or deceptive. In other words, the court in California looks to the words, facts and the content itself to determine whether an advertisement or the marketing material is false, misleading or has a tendency to deceive or confuse the public.