Consumers Sue Brand and Influencers for Lack of Disclosure – Tricia Meyer
By Tricia
My posts may include paid links for which I earn a commission. I frequently discuss FTC disclosure guidelines and affiliate marketing. I maintain a running post of significant updates and FTC actions related to these guidelines. There is no distinction in the rules between affiliates and influencers, so this post primarily focuses on influencers, but the principles apply to anyone who promotes products online or through social media for compensation.
Brief Overview
Brands and influencers face not only FTC scrutiny but also consumer lawsuits filed under state laws mirroring the FTC Disclosure Guidelines. If consumers win these class-action suits, it could encourage more people to file similar claims when they feel misled by influencer endorsements or affiliate marketing without proper disclosure.
Case Details (Sava v. 21st Century Spirits, LLC)
A complex case involving Blue Ice Vodka is working its way through the courts (Sava v. 21st Century Spirits, LLC). It includes allegations unrelated to influencer marketing but highlights key aspects:
- Blue Ice Vodka pays several influencers to promote their products.
- Influencers "tag or recommend" Blue Ice products without disclosing their compensation.
- Consumers purchase recommended products based on these endorsements.
- Viewers claim the products did not meet the influencer’s reviews and they wouldn’t have bought them if they knew about the payment.
Key Takeaways for Affiliate Marketers:
- The lawsuit was filed by consumers, not government agencies.
- Claims were brought under Florida, Illinois, and California consumer protection statutes (the "Little FTC Acts").
- Some claims are based on an influencer campaign.
What Are the Little FTC Acts?
These are state laws modeled after federal FTC disclosure rules, allowing individual consumers or competitors to file lawsuits if they suspect deceptive marketing practices. The court in the Blue Ice Vodka case stated these state laws incorporate the FTC Act and its guidelines, which could lead to interpretations of FTC disclosure rules determining the outcome of such cases.
Implications for Affiliate Marketing:
While brands and influencers worry about FTC penalties for inadequate disclosure, they might not be considering potential class-action lawsuits from consumers who feel misled by undisclosed endorsements.