Ads & Brands Law Newsletter: August 2024

Advertising and regulatory developments

ASA issues reminder about joint partnerships on Instagram clearly identifying ad

The Advertising Standards Authority has published an article on joint partnerships on Instagram.  The article talks about its rationale for a ruling about complaints made against ads from TALA, an active wear company owned by Grace Beverley. Beverley published four TikToks and jointly published two Instagram reels with TALA. The ASA upheld complaints and said they were not obviously identifiable as ads.
 
The decision attracted some criticism from commentators. The ASA has explained that the joint publishing feature on Instagram allows two accounts to simultaneously post the same content.  This means that brands and influencers can seamlessly combine editorial and advertising into streamlined content for multiple audiences.  Therefore, the lines between editorial and advertising are blurred and viewers don’t know immediately that they are looking at an ad.

In addition, the ASA highlighted that both the influencer and the brand are responsible for clearly stating the ad is an ad and making it identifiable as an ad.  The onus is not on the public to work out if social media content is advertising or not. The ASA also explained different scenarios according to context where an ad could be deemed obviously identifiable without adding any extra ‘ad’ label.

Vinted agrees to make (some) consumer protection commitments

The guidance advises these sites to ensure accuracy in their claims, implement proper checks on traders, and establish transparent complaint procedures. The consultation was due to end on 16 August 2024, after which final advice will be issued.

CMA issues update in Wowcher “dark patterns” investigation

The CMA has updated its investigation into Wowcher's use of "dark patterns," specifically regarding misleading urgency claims and pre-ticked boxes for VIP memberships. 

Wowcher has agreed to use accurate countdown timers, ensure truthful marketing claims about product availability and demand, and provide over £4 million in refunds to customers who signed up to VIP membership via pre-ticked boxes without understanding what they were signing up to. Wowcher will also remove its permanent homepage countdown timer and cease using pre-ticked boxes. 

The CMA will monitor Wowcher's compliance over the next year.

Welsh Government consults on HFSS advertising restrictions

The Welsh government is seeking feedback on draft regulations for restricting the marketing of foods high in fat, sugar, and/or salt. The regulations propose location restrictions in stores and online, volume price promotion restrictions, and free refill restrictions. Enforcement will focus on compliance, with local authorities overseeing the regulations. 

Additionally, the Welsh government is gathering evidence on children's consumption of energy drinks, following mixed responses to a proposed sales restriction.

The ASA has also published a statement on the new guidelines.  

In addition, also on the subject of telecoms advertising, CAP has issued a reminder about speed claims in broadband advertising.

Among other things, the government plans to regulate tobacco, vapes, and junk food advertising. We will keep you posted!

A discriminatory advert is an advert which restricts jobs, goods, facilities or services to people with protected characteristics, such as to men or to people in a particular age group. They are unlawful except in very limited circumstances where the Act allows such a restriction if it can be objectively justified.

Any part of an advert could be discriminatory. For example, descriptors, job titles, illustrations and pictures which relate to particular protected characteristics may be discriminatory as they may imply that only people with those characteristics are eligible for the job or service being advertised. 

Trade marks developments

Court of Appeal confirms relevance of a “crowded market” for assessing trade mark distinctiveness (and potential for confusion)

When choosing a trade mark, or going to court to resolve a dispute over similar trade marks, it might seem common sense that if there are lots of businesses all using similar marks for similar goods or services then the likelihood of one of those similar marks really standing out for consumers (or being strongly “distinctive” in legal terms) will be reduced. But this common sense viewpoint has now been given legal weight by the Court of Appeal, which has confirmed that the existence of a “crowded market” of similar marks can be taken into account in infringement litigation, when deciding how distinctive the claimant’s mark really is.

The judgment was made in the context of a long-running dispute between the owners of the Beverly Hills Polo Club marks on the one hand and the Royal County of Berkshire Polo Club on the other (a real polo club), Beverly Hills claiming that Berkshire had infringed its marks. To show infringement under section 10(2) of the Trade Marks Act (or its EU equivalents) it is necessary to persuade the court that without the proprietor’s consent the defendant is using an identical or similar mark on identical or similar goods or services, and that there is a resulting likelihood of confusion on the part of the public (i.e. consumers). In this case there was little dispute that the Beverly Hills and Berkshire marks related to the same type of goods (clothing, footware, fragrances, luggage and watches) and that the marks had similarities (the words “polo club” but also a figurative element of a polo player on horseback with mallet raised).  The marks were far from being identical, however, and so in deciding whether there was a “likelihood of confusion”, the court had to take account of all relevant factors through the eyes of an average consumer.

This was where the relevance of the “crowded market” came into play, as the Court of Appeal confirmed that it was objectively true that there were plenty of other (third party) players in the market for goods with “polo club” branding, not least Polo by Ralph Loren and the US Polo Association.  This was relevant in the context of deciding whether there was a “likelihood of confusion” between the Beverly Hills and the Berkshire marks in particular, as the effect of the crowded market would be that the Beverly Hills trade marks would in practice be less distinctive to consumers than if there were just two “polo club” brands at play.  Beverly Hills had argued that this information about the surrounding market conditions wasn’t relevant to its particular dispute with Berkshire Polo Club, but the Court of Appeal disagreed. 

The judgment clearly reinforces the “common sense” approach when choosing a trade mark, to avoid unnecessary similarities (in wording or figurative elements) to existing brands providing similar goods and services. But it also clarifies for brand-owners who already find themselves operating in a “crowded market” of similar brands for similar goods or services (or for new entrants in such a market) that distinctiveness – and likelihood of confusion – may be correspondingly reduced.