Ads & Brands Law Digest: March 2021

Advertising & Marketing

ASA ASA rules on prize draw that wasn’t a prize draw

A recent TV ad for Hells Beer by Camden Town Brewery offered “free beer…from your telly”. Significantly, it was shown during Champions League matches with a large audience and also promoted on social media, which further inflated the audience.

The ASA received a complaint saying the promotion was misleading because after scanning a code, the complainant was placed in a virtual queue for over an hour before being told the promotion had ended due to high demand. The ASA upheld the complaint and the ruling serves as a reminder that promoters need to make a real effort to estimate demand accurately and to ensure they are able to meet forecast demand.

The ruling also highlights the need for promoters to fully understand the structure of their promotions. Promoters often confuse gifts and prizes and draws and giveaways. In this case, Camden Town had called the promotion a prize draw, but the ASA said that it was a product giveaway.

For more information, see here.

Half price TV not all it seemed

The ASA has recently upheld complaints about two ads for Currys PC World which illustrate the importance of ensuring that “win your money back” and price promotions are both carefully structured and communicated.

Currys PC World issued a TV ad which said that consumers could get a television for half price, with a one-in-twenty chance to get their money back. They had a similar message on their website. People believed that the ad suggested that the TV was being sold at half price when they understood that consumers could only get the half the price back through the promotion, so they challenged whether the TV ad was misleading. Another complainant challenged whether the website ad was misleading.

Currys PC World was not selling the product for half price. Rather, viewers had the opportunity to win half their money back. Therefore, to have a chance to obtain the product for half price, viewers were first required to pay the full cost of the product. Because viewers were likely to understand that the product was being sold for half price, when that was not the case, the ASA considered that the ad was misleading and breached the BCAP Code.

For more information, see here.

Another ruling on influencers

In a ruling that illustrates many of the pitfalls that can arise with a promotion or brand activation, the ASA has upheld complaints about a prize draw carried out by the influencer Molly-Mae Hague (MMH).

An Instagram post by MMH promoted a prize draw to give away £8,000 worth of luxury gifts. They were bought by MMH and she said that she was not affiliated with the brands and that it was not a paid partnership.

The ASA received 12 complaints from people who believed that not all entrants were included in the ‘final draw’ and so did not have an equal chance of winning. They challenged whether the prize was awarded in accordance with the laws of chance and whether the promotion was administered fairly.

The ruling illustrates the importance of estimating demand for a promotion and being able to cope with the numbers of entrants. It also shows that, as well as having a fair process in place for selecting winners, the process must also be auditable. MMH said that she had had a fair process in place, but the ASA was not convinced by the evidence it received.

For more information, see here.

Competition Law & Regulatory

ASA influencer report published

The ASA has published a report showing that the proportion of influencers sticking to the rules about ensuring advertising is identifiable as such is far below what the ASA would expect.

In summary, the ASA found:

• Inconsistent disclosure across Stories - when a piece of ad content spans a number of consecutive Stories, unless it is absolutely clear that this is part of the same posting, each Story must be disclosed as an ad;

• Inconsistent disclosure across Stories, IGTV, Reels, posts – the ASA noted instances where a post would be accurately disclosed as an ad but a corresponding Story was not;

• Visibility of ad labels – where Stories were labelled as ads, the ASA noted labels were sometimes in a small font, obscured by the platform architecture or otherwise difficult to spot; mainly due to being in a very similar colour to the background of the Story where it was placed;

• Affiliate content is still an ad – the ASA noted the use of #affiliate or #aff with no additional upfront disclosure; those labels are not likely to be enough on their own to disclose to users the advertising nature of the content; and

• Own-brand ads – influencers should not rely on bios or past posts to make it clear to consumers that they are connected to a product.

The ASA says that it has contacted all the influencers, as well as a number of brands, and if it finds further problems, it will take enforcement action. That might include promoting their non-compliance on a dedicated page on the ASA’s website, promoting their non-compliance through its own targeted paid search ads and working directly with the platforms and the CMA on further enforcement action.

For more information, see here.

DCMS Committee launches influencer inquiry

Hot on the heels of the ASA’s report on influencers, and adjudications about influencer advertising, the DCMS Select Committee has launched an inquiry on influencer culture.

The inquiry will examine the power of influencers on social media, how influencer culture operates, and will consider what the Committee calls the absence of regulation on the promotion of products or services, aside from the existing policies of individual platforms. It refers to the ASA’s investigation which found that more than three-quarters of influencers “buried their disclosures within their posts”.

It will also assess influencer impact when it comes to media and popular culture as well as the positive role they can play, such as raising awareness for a campaign addressing vaccine hesitancy among people from ethnic minority backgrounds.

The inquiry ends on 7 May 2021.

For more information, see here.

ICO plans to update anonymisation guidance

The ICO has outlined its plans to update its guidance on anonymisation and pseudonymisation, and to explore the role that privacy enhancing technologies might play in enabling safe and lawful data sharing. It recognises that questions about when data is personal data or anonymous information are some of the most challenging issues organisations face, this is also relevant for organisations which share data for marketing and advertising purposes.

The refreshed guidance aims to assist organisations in meeting these challenges. It will cover approaches like the spectrum of identifiability, and how these can be practically applied. It will provide advice on how to assess the appropriate controls that need to be in place and as well as advising practical steps organisations can take.

The key topics to be explored will be: anonymisation and the legal framework – legal, policy and governance issues around the application of anonymisation in the context of data protection law; identifiability – outlining approaches such as the spectrum of identifiability and their application in data sharing scenarios, including guidance on managing re-identification risk, covering concepts such as the ‘reasonably likely’ and ‘motivated intruder’ tests; guidance on pseudonymisation techniques and best practices; accountability and governance requirements in the context of anonymisation and pseudonymisation, including data protection by design and DPIAs; anonymisation and research - how anonymisation and pseudonymisation apply in the context of research; guidance on privacy enhancing technologies and their role in safe data sharing; technological solutions – exploring possible options and best practices for implementation; and data sharing options and case studies.

For more information, see here.

Intellectual Property

IP & Enterprise Court issues reminder that a newly-coined word is not automatically distinctive as a trade mark

It can be tempting to assume that a freshly coined, made-up word (neologism) is bound to be distinctive in trade mark terms, given that it is by definition novel and not being used by anyone else already. But this overlooks the fact that such neologisms can be constructed wholly or partly from descriptive elements, which may render the mark as a whole too descriptive to be registrable (unless it has become distinctive through use). Equally, if the neologism is used to describe a novel type of goods or service, that in itself may render it a descriptive word in the eyes of consumers.

An example of this issue came before the Intellectual Property and Enterprise Court in March 2021, where the defendant in an infringement action brought by the proprietor of the registered mark CRYPTOBACK argued that it was invalid, being descriptive of the services provided by the claimant (a credit card rewards scheme using bitcoins). As the judge put it, “cryptoback” was a contraction of “cryptocurrency cashback” and thereby was potentially descriptive. To add insult to injury, the defendants also said that it had been they or their associates, rather than the claimants, who had actually first coined the word “cryptoback” in the context of their own cryptocurrency cashback service, and thus they claimed to own goodwill in the mark rendering the claimants’ registration invalid.

The judge confirmed that a made-up mark (a neologism) is not inherently non-descriptive: it will always depend upon the facts of the case as to where the word lies “on the spectrum of descriptiveness”, taking into account the nature of the goods/services, the use of potentially descriptive elements within the neologism, and whether consumers take the neologism as a new word describing a new product or service. On the particular facts of this case, the validity of the CRYPTOBACK mark was actually upheld – the judge was persuaded that it was a sufficiently distinctive neologism, notwithstanding its arguably descriptive components, while the defendants failed to establish that they had goodwill in the word based upon prior use.

For more information, see here.

EU Court of Justice clarifies the law on framing of copyright content from another website

Previous case-law of the EU Court of Justice has established that copyright material made freely available on a website with the authority of the copyright owner will not usually be infringed by a third party linking to or framing that material on its own website. No infringing “communication to the public” is deemed to have been made, because the third party is not taken to be communicating the material to a “new public” that the copyright owner didn’t already have in mind when authorising the original website publication.

There has always been a question hanging over this analysis, however, as the Court had not expressly addressed the question of what happened if the copyright owner made its material freely available from one website, but at the same time expressly forbade third parties from linking to or framing its material on another. In a judgment handed down in March 2021 the Court of Justice has now clarified the situation in respect of copyright material embedded in a third party website by way of framing. If the original website making copyright material available with the authorisation of the copyright owner uses technological measures to prevent that material being framed on third party websites, then the circumvention of those measures by the third party site so as to frame the copyright material will infringe as a communication to the public. This is because a “new public” is involved – the copyright material is communicated not just to the visitors to the original website that the copyright owner had authorised, but also to the visitors to the third party website that it tried to prevent from framing the material.

Importantly, however, the Court held that infringement would only arise where such technological measures were in place – so there would be no infringing communication to the public for example if the authorised website had applied no technological measures, but simply published a notice forbidding any framing of the content.

The facts of the case were complicated and so we have not attempted to summarise them in this Digest, but for further details see here.