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Legal Review: Implementing a Social Media Advertising Strategy

1 Aug, 2011 By: Benjamin Alexander, Gregory J. Sater Response


Gregory J. Sater and Benjamin Alexander
By Gregory J. Sater and Benjamin Alexander

In the February issue of Response, we wrote about the legal issues that can arise when your employees, agents or affiliates promote your products or discuss your competitor’s products through social media. This month, we write about what should go into a social media policy to address those issues.

First, however, a word of warning: it is not enough to have a social media policy. If the Federal Trade Commission (FTC) comes knocking, you must be able to show that you actually implemented and enforced it. You should put your social media policy in writing, and then implement procedures to ensure that anyone who falls within its scope is actually complying with it.

Terms re: Intellectual Property (IP)

No post or other online content (e.g., a Tweet or Facebook post) by any employee, online affiliate or anyone else with a material connection to you or your products should infringe a third party’s IP rights or disclose proprietary information, including:

  • No use of third-party text, photos, video, images or other copyrightable material or any third-party trademark without prior written permission from the holders of the rights thereto.
  • No use of third-party (or your company’s) proprietary or confidential information.
  • All use of your company’s trademarks and other intellectual property must comply with your guidelines.
  • To get written permission to use a third party’s intellectual property, there must be use of only your authorized form.

Terms re: Defamation, Rights of Publicity and Privacy and Other Torts

Your social media policy should prohibit posts or other online content that include, among other items:

  • False, misleading or defamatory statements about people or companies.
  • Use of anyone’s name, image, likeness or identity without that person’s prior written permission.
  • Disclosure of any information about any identifiable person without that person’s prior written permission.
  • Mentioning any content that breaches any third party’s contractual rights.

Terms re: False Advertising

Posts and other online content can qualify as advertising under the law, meaning they need to comply with state and federal laws governing advertising. Require that any statements made in a post be truthful, not misleading and substantiated.

Terms re: Endorsements and Testimonials

The FTC revised its Guide Concerning Use of Endorsements and Testimonials in Advertising in 2009, in part to address social media advertising. The Guide may only be advisory, but the FTC uses it to evaluate whether endorsements or testimonials have violated Section 5 of the FTC Act, which prohibits unfair and deceptive practices. Among the Guide’s requirements to incorporate into your social media policy are:

  • Endorsements must reflect the honest opinions, findings, beliefs or experiences of the endorser.
  • Endorsements may not contain any representations that, if made directly by the advertiser, would be deceptive or could not be substantiated.
  • Endorsers must disclose the existence of any financial or other “material connection” between them and the marketer.
  • Disclosures of material connections must be clear, conspicuous and near the endorsement.
  • Endorsements should not convey an endorser’s results unless it is known that those results are typical or the communication also discloses what the “generally expected results” are from using the product in the depicted circumstances.

No social media policy can preclude all liability that may arise for you. Always getting final clearance through your company’s legal counsel or a responsible manager for any decisions about or concerning these policies is crucial.

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