Interview: Lesley Fair of the FTC

A real treat today in my occasional interview series!

Lesley Fair is a Senior Attorney with the Federal Trade Commission’s Bureau of Consumer Protection, where she has led numerous investigations of deceptive advertising. She now specializes in industry education and compliance with the FTC’s Division of Consumer & Business Education. Lesley has been on the adjunct faculty of the Catholic University School of Law since 1984 and holds the title of Distinguished Lecturer. In 2009 she joined the adjunct faculty of the George Washington University Law School, teaching Consumer Protection Law.

Before coming to the FTC, Lesley clerked for United States District Judge Fred Shannon in the Western District of Texas, served as a staff counsel to the United States Court of Appeals for the Fifth Circuit, and was a fellow at Georgetown’s Appellate Litigation Clinical Program,. She graduated from the University of Notre Dame and the University of Texas School of Law.

Important note: As always, the opinions expressed in this interview are Ms. Fair’s alone, and not those of the FTC.

Q: How did you get into advertising law?

You know those people who say “I don’t pay much attention to ads”? That’s not me. I’ve always loved advertising. In second grade, the teacher made a TV out of a refrigerator box and had us advertise make-believe products. I pitched a headache remedy called End-A-Pain. (It may be the only analgesic the FTC didn’t sue in the 60s.) The best ad was for a dog food called Fido Feed-o: “Feed your fido Fido Feed-o. Every night-o feed your fido Fido Feedo.” That creative genius is now an obstetrician in Boston. What a loss to the advertising world.

But the real answer to your question is that in law school I worked for the state headquarters of the legal service programs in Texas and got interested in consumer issues – landlords who wouldn’t fix the heat, used car dealers that didn’t honor their warranties, and payday lenders who charged soldiers interest rates that sounded more like Hall of Fame batting averages. When I heard about a vacancy with the FTC’s Bureau of Consumer Protection, I thought it was my dream job. And 25 years later, it turns out I was right.

Q: Tell us about some favorite advertising cases.

The case that had the most profound effect on me was the first-year chestnut, Williams v. Walker Thomas Furniture. My daily commute used to take me past the boarded-up Walker Thomas building, which somehow seemed appropriate. As for recent cases, Chief Judge Easterbrook’s opinion in FTC v. QT, Inc., is something to behold: Donizetti’s L’elisir d’amore, “Beneficent creatures from the 17th Dimension,” and the old joke “Why are you snapping your fingers? To ward off elephants. But there aren’t any elephants around here. See? It works.” – all in one amazing sliver of F.3d.

(photo by cowtools)

Q: What emerging trends in advertising law should advertisers be watching?

Perhaps the real emerging trend is that there aren’t really any emerging trends. Volume 1 of F.T.C. Reports has it all: Cheap coffee beans deceptively advertised as mocha java, rayon labeled as “cilk,” and a vacuum cleaner company that published the 1917 equivalent of an “independent” product review blog and touted its own brand. The 23 words of Section 5 were so well-crafted and decisions from federal courts and the Commission have been so forward-thinking that I can’t come up with an innovation in advertising – not TV, not the Internet, not social media – where Section 5 hasn’t seamlessly applied. As for my prediction about what advertisers can expect from the FTC, to quote Bob Dylan, “You don’t need a weatherman to know which way the wind blows.” A look at recent cases, speeches, and workshops suggests that health claims, kids and marketing, privacy promises, environmental issues, advertising using social media, and promotions directed to people in financial distress are all important issues.

Q: What’s the biggest mistake you see advertisers make in their dealings with the FTC?

Not being candid with staff from the start.

Q: What is your advice for a law student who wants to practice in the advertising field? Given that most schools don’t teach advertising law (at least until the casebook I am writing with Eric Goldman comes out), what are the best courses to take?

Administrative Law, Trademarks, and First Amendment courses are all helpful, but what law students do outside of class may be even more important. Get clinical experience. Volunteer for a judge. Intern at the state AG’s office. Spend one afternoon a week fielding complaints at the county consumer affairs office. Take advantage of those “free admission for law students” events and get to know people who do what you want to do. Ask for their advice. Not many people find attorneys all that fascinating, so when somebody expresses an interest in our work, we can’t shut up – my answers to these questions being Exhibit A.

Q: What’s your advice for someone looking to move into the government side of consumer protection law?

If this field is what you’re passionate about, make that clear. When I used to be involved in recruiting, my first question was “Name an ad that made you say ‘The FTC ought to be investigating that.’” You’d be surprised how many people didn’t have an answer. So I guess I’m saying that it helps to watch a little late night TV, scan annoying pop-ups, and read those entertainment magazines while you’re waiting for a bus. This is a great job, isn’t it?

Consumer Protection Conference: Dana Rosenfeld

The ABA Antitrust Section’s Consumer Protection Conference is coming up: June 18-19 at Georgetown. It’s going to be focused on issues of consumer protection, and it’s got a great lineup at a time when we can expect renewed focus on consumer protection enforcement at the FTC. (Disclosure: I’m helping organize the conference.) I wanted to introduce some of our many qualified panelists.

Today:

Dana Rosenfeld, who will be moderating our timely panel on consumer protection in financial transactions, practices at Bryan Cave in the areas of consumer protection, privacy and data security, and advertising. She represents clients before the Federal Trade Commission and State Attorneys General, provides ongoing compliance advice, and assists in the development of legislative policy positions and self-regulatory and corporate responsibility programs. She served as the assistant director of the Federal Trade Commission’s Bureau of Consumer Protection from August 1998 to October 2001. She played a major role in developing the FTC’s privacy initiatives, including the promulgation of the Children’s Online Privacy Protection Act Rule and the Gramm-Leach-Bliley Act Privacy Rule.

I asked Ms. Rosenfeld some of the same questions I’ve asked prior interviewees:

Q: How did you get into advertising law?

I began my career at the FTC in 1991 and was immediately assigned to work on the agency’s investigations of weight loss companies, most of which were resolved by administrative consent orders. One matter involved a weight loss clinic in California. Because the company was engaging in fraudulent practices, we sought and obtained a Temporary Restraining Order and Preliminary Injunction, and the company eventually ceased operations.

Q: What emerging trends in advertising law should advertisers be watching?

New forms of media, such as blogs, networking sites, “buzz” or “word of mouth marketing” are creating new issues for advertisers and regulators. In addition, “green” or environmental advertising is on the rise. I would expect the FTC to start aggresively pursing law enforcement actions in these areas among others.

Q: What is your advice for a law student who wants to practice in the field? Given that most schools don’t teach advertising law, what are the best courses to take?

I would recommend taking classes in Administrative Law, Legislation, Federal Courts and First Amendment. These will give students the fundamentals needed to understand basic concepts in advertising. In addtion, I would highly recommend an internship at the FTC or Attorney General’s office, or with a consumer group.

Interview: John Villafranco of Kelley Drye & Warren

I am pleased to present the next interview in my occasional series on advertising lawyers. Today's subject is John Villafranco.

Here's his introduction: I am a partner at Kelley Drye & Warren and provide litigation and counseling services to corporations involved in advertising and marketing. My practice focuses on Lanham Act litigation, consumer class action defense, representation of clients in advertising substantiation proceedings and investigations conducted by the Federal Trade Commission and state attorneys general, and representation of challengers and advertisers before the National Advertising Division. I am co-Editor-in-Chief of the ABA's Consumer Protection Law Developments treatise, which will be published in the Fall of 2008, and I am immediate past Chair of the ABA Section on Antitrust Law Consumer Protection Committee.

Q: How did you get into advertising litigation?

I started in 1991 as a first year associate in the antitrust section at Collier Shannon Rill & Scott which, at the time, was perhaps the most prolific antitrust practice in the United States. I liked but did not love antitrust law, and I made myself available to work on advertising cases that were being handled by Judith Oldham (a gifted attorney and my eventual mother-in-law). When Bill MacLeod joined the firm after leaving his position as Director of the FTC’s Bureau of Consumer Protection, our advertising case load increased. I never worked on another antitrust case – it has been advertising all the time – and it has been a lot of fun.

Q: Tell us about some favorite advertising cases.

There have been many, but my favorite may be the Joe Camel case, which we litigated against the FTC in 1998 before Administrative Law Judge James Timony. The case was hotly contested with 17 FTC lawyers filing notices of appearance. Complaint Counsel relied on its unfairness authority under Section 5 of the FTC Act, alleging that the cartoon camel was a “substantial contributing factor” to smoking initiation among teens. I was a senior associate and it was my first meaningful opportunity to devise case strategy, present oral argument, and otherwise manage a case. And this one had a little bit of everything – pre-trial publicity, surprising documents (for both sides), and novel theories. After a few weeks of trial and immediately after we finished the successful cross examination of the FTC’s causation experts (they never could, in my mind, establish that the cartoon camel caused substantial injury), Complaint Counsel surprised everyone by telling the judge that they were withdrawing the complaint. They asserted that the issue was moot as a result of the multi-state settlement agreement that had just been negotiated between the states and the tobacco companies. There was some truth to that, but we did not see it that way. They brought the complaint, litigated it, then withdrew it right when the case was breaking our way. No FTC order, no injunctive relief. We celebrated as if it was a clean win.

And then came the fast food wars. In 2001, Truett Cathy, the founder of Chick-fil-A sought a preliminary injunction in Chick-fil-A, Inc. v. Burger King Corp., attempting to prevent Burger King from describing its first chicken sandwich as “the original chicken sandwich.” The claim was self-comparative, in that Burger King had just launched its BK broiler chicken sandwich and needed to call the existing chicken sandwich something. Mr. Cathy did not see it that way. He asserted that he was the true inventor of the chicken sandwich -- the very first human being to put chicken between two slices of bread -- and therefore Burger King could not claim that they had “the original.” A Library of Congress search yielded recipe books from the 1800s that included chicken sandwiches and the motion was denied.

Three years later, in Steak ‘n Shake Co. v. Burger King Corp., Burger King found itself defending motions for a TRO and preliminary injunction seeking to enjoin Burger King's launch of its new “steak burger” sandwiches. Steak ‘n Shake alleged violations of federal and state trademark and anti-dilution statutes. They claimed (you guessed it) that they invented the steak burger and that consumers associated “steak burger” with Steak ‘n Shake. Same result – motion denied.

Another favorite was BellSouth Telecommunications, Inc. v. Hawk Communications, LLC, a 2004 Lanham Act case that we brought in the Northern District of Georgia. In that case, BellSouth – the largest ISP in the region – sought a preliminary injunction to stop Hawk from advertising that its narrowband internet service allowed consumers to “Dial Up at DSL Speed.” Hawk advertised heavily all over the southeastern United States, including on billboards right outside the BellSouth headquarters, and it was driving BellSouth crazy. We had previously prevailed on all issues before the National Advertising Division, but Hawk chose to ignore the NAD decision. In granting our motion for preliminary injunction, Judge Shoob credited the NAD decision (a precursor to Judge Carter’s decision in the November 2007 case Russian Standard Vodka (USA), Inc. v. Allied Domecq Spirits & Wine USA, Inc., which I recently heard described as a “love letter to the NAD”), and extended the doctrine of necessary implication into the Eleventh Circuit.

Q: What are the emerging trends in advertising law?

When I started in 1991, advertising was neatly categorized under the headings of print, television, and radio. Today, it is all over the place: viral and buzz marketing, product placement, mobile marketing, consumer-generated content, and who knows what’s next. This is one aspect of the practice that I love – it’s on the move.

Q: Over the past several years, an increasing number of courts have both expressly recognized that prudential standing limitations apply to false advertising actions under the Lanham Act and have applied those limitations to bar certain plaintiffs from pursuing claims. Last year, the Eleventh Circuit’s decision in Phoenix of Broward, Inc. v. McDonald’s Corp. granted McDonald’s’ motion to dismiss for lack of prudential standing, and the Eleventh Circuit affirmed (joining the Third and Fifth Circuits in holding that prudential standing limitations applied to false advertising claims under the Lanham Act). Do you expect this trend to continue in other circuits?

I do. The courts are already overburdened; tossing cases where a judge can reasonably conclude that the plaintiff is not the litigant best suited to assert a claim is an easy way to lighten the load. I expect we will continue to see the courts express skepticism about expansive standing under the Lanham Act, especially where the plaintiffs are corporate customers or suppliers. Having said that, we are not at a point where a precise showing of injury is required, nor will we ever be. As I learned in the Joe Camel case, showing that an advertisement actually caused injury is a very difficult thing to do.

Q: What is your advice for a law student who wants to practice in the field? Given that most schools don’t teach advertising law, what are the best courses to take?

The Federal Trade Commission’s Bureau of Consumer Protection would be the ideal place to start a career in advertising law. If you intend to start in private practice, then I would suggest that you focus your job search on the leading advertising law firms. There are only a handful with sizeable practices that will provide a steady diet of advertising work: Kelley Drye (of course), Mannat Phelps, Reed Smith, Davis & Gilbert, Frankfurt & Kurnit, Venable, Loeb & Loeb. Interested students will want to get a summer associate position with one of these firms. As for recommended course work, I would not worry too much about it – this is an area that is better learned in practice than in the class room -- although classes that focus on unfair competition and trade regulation would not hurt. And of course, if you are at Georgetown, any class taught by Professor Oldham (my father-in-law) will ensure that you are ready for the rigors of the practice. You just can’t get enough Lord Mansfield.

Interview: Larry Weinstein of Proskauer

Larry Weinstein of Proskauer Rose LLP kindly answered my interview questions, which I have edited to add a few links and a picture. Here is his brief biographical statement:

I am a senior intellectual property litigation partner at Proskauer Rose LLP in New York City, and co-chair of Proskauer’s Trademark and False Advertising practice group. I am a 1978 graduate of NYU School of Law, where I was Articles Editor of the NYU Law Review, Order of the Coif and a John Norton Pomeroy scholar. After a judicial clerkship with Judge James Hunter of the U.S. Court of Appeals for the Third Circuit, I began private practice in 1979, and was a partner at two New York City law firms before joining Proskauer Rose in 1999.

Q: How did you get into advertising litigation?

In the late 1980’s, I began doing trademark litigation for SC Johnson & Son, a large consumer products company in Wisconsin. After a few successful cases, they gave me a false advertising case, and then another and another. My work with that client led to false advertising cases with other clients, and by the mid-1990’s, I found myself spending most of my time litigating and counseling clients in the area of false advertising. That has continued to be the case ever since. I find this area of the law fascinating, so much so that I am one of the very few people around who pay close attention to commercials on days other than Super Bowl Sunday.

Q: Tell us about a favorite advertising case (or cases) you litigated.

I don’t really have a favorite case. For whatever reason, my current cases are always my favorites. If I really had to pick one, and this would be a close call, it would be the “Goldfish” false advertising case several years ago in the Southern District of New York and the Second Circuit. In that case, SC Johnson, the manufacturer of ZIPLOC food storage bags, brought a Lanham Act false advertising suit against its archrival Clorox, the maker of GLAD food storage bags, arising out of Clorox advertising featuring a talking Goldfish that portrayed the Ziploc bags as leaking a sieve. SC Johnson did not find the ads the least bit funny. We succeeded in getting the first ad enjoined after trial, and then won summary judgment enjoining a second ad. On appeal, the Second Circuit affirmed. The case ranks high on my list because we defeated a very good adversary, the case involved some fascinating legal issues, including the so-called “necessary implication” doctrine and whether visual images can be literally false, and because the Second Circuit (and other circuit courts) continue to cite that case, which turned out to be an important one in Lanham Act false advertising jurisprudence.

(Picture by colodio.)

Q: What are some hot legal issues in the courts? What emerging trends in advertising law should advertisers be watching?

In the Lanham Act area, there are several. One involves differences among the circuit courts concerning who has standing to sue under the statute. It is clear that consumers do not have standing, but some appellate courts limit standing to direct competitors, and others, including the First and Second Circuits, extend standing to non-competitors that suffered a business injury caused by the false advertising. And recently, the Eleventh Circuit held that a Burger King franchisee that was a direct competitor of McDonald’s lacked standing to sue McDonald’s for false advertising. That decision, which I was not involved in but have written about, was wrongly decided in my view. One of these days, the right case is going to cause the Supreme Court to grant cert. to decide this issue.

Another interesting issue which the courts have not yet fully dealt with involves statistical significance, particularly what statistical results do and do not enable an advertiser to claim parity.

Third, the necessary implication doctrine is being overextended by some courts to find literally false advertisements that are actually quite ambiguous. That is not a good development in Lanham Act law.

Finally, outside of the Lanham Act, there has been a steady proliferation of state law-based consumer class action false advertising suits. This could turn out to be a revolutionary development, and creates all sorts of different risks and costs for advertisers that has begun to affect how corporate legal advisers assess advertising copy.

Q: Courts have imposed a materiality requirement in Lanham Act false advertising cases, and some have even required specific evidence that a false statement is material – e.g., Pizza Hut Inc. v. Papa John's Int'l, 227 F.3d 489 (5th Cir. 2000). Should trademark law take a cue from false advertising law and require some showing of materiality, for example in source/sponsorship cases?

It’s an interesting question, but I wonder whether the absence of a formal materiality requirement in trademark cases is really a significant problem. Source or sponsorship confusion is typically demonstrated by consumer surveys, and where the confusion is reflected in answers to open ended questions, the importance of the confusion to the survey participant’s assessment of the marks in question is often apparent. It is true, I suppose, that this is not the case where the confusion is demonstrated by close-ended questions. However, the biggest problem with judicial reliance on close ended questions in this context is not materiality, but rather the fact that these questions are so leading. In other words, in my opinion, these questions do not provide an accurate reflection of the extent of consumer confusion at all, much less the extent of confusion likely to affect purchasing decisions.

Q: What is your advice for a law student who wants to practice in the field? Given that most schools don’t teach advertising law, what are the best courses to take?

I can answer the first question easily enough; the second question is tougher. Taking the latter first, a trademark or Lanham Act course would be the best substitute for a course on advertising law. Come to think of it, I wouldn’t mind teaching an advertising course if someone out there wants to offer one. As to the first question, the best advice is to find out through the law firm interviewing process which firms regularly practice in this field, and I emphasize the word regularly here. In fact, surprisingly few firms do. Of those few, New York City has the most, with the remainder primarily in D.C. and Chicago. If a student has the chance to interview with those firms, they should be upfront about their interest, and ask how easy it is to get slotted into this area. If any readers would like more detailed information about how to break into the field, they should email me at lweinstein (at) proskauer.com.

From RT: Thanks again to Larry; I hope to continue this as an occasional series, so reader suggestions are welcome!

Interview: Bruce Keller of Debevoise & Plimpton

I’m inaugurating a new occasional feature, interviews with lawyers whose practices include advertising law. I’m starting close to home, with Bruce P. Keller, a partner at Debevoise & Plimpton LLP (where I was an associate). At Debevoise, he supervises the firm’s Intellectual Property Litigation Group. Along with his extensive litigation experience, he has taught Internet Law at Harvard with his partner Jeff Cunard and published extensively. He was an advisor to the American Law Institute’s Restatement of the Law: Unfair Competition, and is the co-author, with David Bernstein, of an advertising law treatise to be published next year by Law Journals Press.

Q: How did you get into advertising litigation?

Keller: I had been interested in the field of advertising as an undergraduate, written some pares on the subject and continued this interest in law school, where I was fortunate enough to get a job as a research assistant to Professor David Rice, who had both authored a case book on consumer law and was a principal draftsman of Massachusetts’s Unfair and Deceptive Practices statute, Section 93(a). Based on that background, I was able to land a job out of law school with a firm that had a large Madison Ave. advertising agency as a client.

Q: Tell us about a favorite advertising case (or cases) you litigated.

Keller: I have several. One is the lawsuit the Times Square building owners brought against the producers of the first Spiderman motion picture (Sherwood 48 Associates v. Sony Pictures Entertainment, Inc., 213 F. Supp. 2d 376 (S.D.N.Y. 2002)). They alleged, among other things, that the battle scene with Green Goblin, depicting digitally altered billboard signs, falsely communicated their endorsement of the film. I like that one not only because I was a huge Spiderman fan as a kid, but also because I got to tell my son that Spiderman needed my help.

Another involved the short-lived product, Mylanta Night Time Strength Antacid (Novartis Consumer Health, Inc. v. Johnson & Johnson & Merck Consumer Pharmaceuticals, Co., 129 F. Supp. 2d 351, aff’d, 290 F. 3d 578 (3d Cir. 2002)).

It is a case that made new law and involved a false claim that was inherent in the name of the product. As a result, the injunction stopped both the advertising and the sale of the product itself.

My favorite case, though may be one of my first, back in 1986. It involved the false claim by E.P.T. that it was the fastest home pregnancy kit then on the market because it could tell a woman if she was pregnant in as fast as 10 minutes (Tambrands, Inc. v. Warner-Lambert Co., 673 F. Supp. 1190 (S.D.N.Y.1987)). In fact, although that was true if you were sufficiently far along in your pregnancy, you could never know you were not pregnant until a full 30 minutes had elapsed, making our client’s 20 minute, positive or negative, test faster by 10 minutes. I always thought that was a particularly clever false advertising claim and was relieved we could prove it false to the court.

Q: What are some hot legal issues in the courts? What emerging trends in advertising law should advertisers be watching?

Keller: Surprisingly, from time to time, first principle issues like materiality, admissible survey results, standing and the proper standard of proof still crop up in given cases. I don't know that it is possible to generalize beyond that.

Q: Are internet advertising and user-generated content changing advertising law?

Keller: Not so much in the area of false advertising law, because the principles are the same regardless of the medium. These changes relate more to how the business is conducted and, of course, raise a host of ancillary issues related to privacy, rights clearance, making sure contest and other rules are clearly spelled out and issues that do not turn on likelihood of confusion (the standard that must be met in false advertising cases).

Q: What is your advice for a law student who wants to practice in the field? Given that most schools don’t teach advertising law, what are the best courses to take?

Keller: Besides yours, you mean? Actually, don't worry too much about what you take in law school, just enjoy learning how to think like a lawyer. If you want to be regarded as a good adviser to clients in this area, it is helpful to have a basic background in IP law, but more because so much of advertising and marketing is built on either clearing or owning those assets. A solid understanding of what makes a client’s business “go” is always going to stand you in good stead.