Ads & Brands Law Digest: September 2021

Advertising & marketing

ISBA issues guidelines on influencers

The UK's leading trade body for advertisers, the Incorporated Society of British Advertising, has launched a new Code of Conduct for Influencer Marketing which comes down firmly on the side of #ad as their preferred way to disclose influencer marketing in social media.

The Code also covers other areas, setting out best practice for advertisers and brands, talent agencies and influencers respectively. For example, the Code requires influencers to act with trust and integrity; to disclose any historic content that could embarrass the brand; to desist from inflating the number of their followers; to ensure their content is not misleading and that claims are substantiated; and not to use filters, photoshopping, or editing techniques to create misleading impressions about products or their benefits.

For more information, see here.

CAP issues guidance on substantiation

CAP has issued guidance on how marketers should ensure they can substantiate their claims. It points out that around 70% of the complaints received by the ASA are about misleading advertising. To establish whether a claim is misleading, the ASA will often need to assess evidence. The requirement for evidence can arise in any number of scenarios, from how long a company has been trading, to their prices, to the validity of the efficacy claims they make for their products.

The key points are to hold evidence before you make the claim. Often marketers try to make the evidence fit the claim – it has to be the other way round! The evidence must be commensurate with the claim being made. The claim also needs to be substantiated so that consumers understand it. Obvious exaggerations, claims that are unlikely to be taken literally and clear statements of opinion are unlikely to need substantiation. However, difficulties can arise when a claim which a marketer intended as puffery is actually one which the ASA considers is likely to be understood as objective.

For more information, see here.

CAP issues guidance on social media promotions

Following some recent ASA rulings, CAP has issued some guidance detailing key findings about prize promotions run on Instagram, Facebook and Twitter.

Running prize draws which ask followers to complete certain actions, such as like, tag, follow or comment on a post or social media page to enter, may be a good way to encourage followers to engage with your brand, but you should think carefully about how you plan to administer the promotion and select winners, and make sure there is a fair and robust process in place.

The guidance covers issues such as ensuring winners are chosen randomly, that the promoter can independently check that an entrant has fulfilled the entry requirements, that a bonus entry increases an entrant’s chances of winning, and that all significant conditions of entry are presented to potential entrants.

For more information, see here.

CAP issues guidance on delivery charges

CAP has issued guidance on delivery charges. It says that with internet shopping becoming part and parcel of everyday life, it is crucial that advertisers are clear about any charges that might apply when delivering products to consumers.

It sets out guidance on stating delivery charges, what should happen if the charges apply per product and conversely per order, what happens if an advertiser cannot calculate charges in advance and what happens if you cannot deliver to a certain location or it costs more to deliver there. It also deals with when you can say that delivery is free (and if the product is free but postage is not).

Finally, it points out that the ASA is unlikely to look favourably on those charging excessive postage or packaging fees, if this does not reflect the true cost of postage, as this can make any product price claims misleading. Whatever amount you charge, make sure it’s clear, honest and fair.

For more information, see here.

CAP issues guidance on country of origin claims

Following the UK’s departure from the EU, CAP has said that consumers may be keen to support the UK economy by purchasing products manufactured in Britain from British-based companies.

The guidance mentions practices such as depicting flags and emblems, using co.uk web addresses, and making clear your company’s geographical location. It says:

• Do not present yourself as being a UK company if this is not the case

• Consider your use of national flags and emblems

• Comply with rules regarding the use of Royal Arms and Emblems.

For more information, see here.

Regulatory

ASA issues guidance on in-app game advertising

The ASA has issued guidance for advertisers to help them ensure that in-game purchases are marketed responsibly. The guidance aims to ensure consumers are better protected, amidst increased awareness of concerns about the potential for in-game purchasing to mislead consumers. It also clarifies how advertisers of games with in-game purchasing should seek to ensure that their ads are not misleading, including by: making it easy for consumers to understand how much they are spending on in-game transactions; being clear before purchase or download of a game whether it contains in-game purchases and whether that includes loot boxes; and ensuring that ads for games are clear about what content primarily relies on making extra purchases. The majority of the guidance relates to in-game advertising and associated online or in-game ‘storefronts’ through which digital items can be purchased.

Other aspects of it apply to ads for in-game purchases that are external to the game (eg an email announcing new items for sale) or for games that include in-game purchasing (eg a TV ad for a game). The ASA realises that some changes to in-game content will be required, so will deal with complaints on an informal footing for a period of six months for in-game content and three months for all other ads covered by the guidance. After this it will return to its usual procedures for determining whether to pursue cases formally.

For more information, see here.

CMA issues guidance on “greenwashing”

The CMA has warned businesses they have until the New Year to make sure their environmental claims comply with the law.

To help businesses understand how to communicate their green credentials while reducing the risk of misleading shoppers, it has published the Green Claims Code. This focuses on six principles which are based on existing consumer law. It makes clear that advertisers making green claims “must not omit or hide important information” and “must consider the full life cycle of the product”.

The CMA is concerned about people being misled by environmental claims and also wants to ensure that businesses feel confident navigating the law in this area.

Following an initial bedding-in period, the CMA will carry out a full review of misleading green claims, both on and offline (eg claims made in store or on labelling), at the start of 2022.

It will prioritise which sectors to review in the coming months, which could include industries where consumers appear most concerned about misleading claims – textiles and fashion, travel and transport, and food and beverages, beauty products and cleaning products. However, any sector where the CMA finds significant concerns could become a priority.

Where there is clear evidence of breaches of consumer law, the CMA may also take action before the formal review begins.

The ASA has also issued a statement about its own work on the issue, with more guidance to come.

For more information, see here, here and here.

ICO fines well known companies for nuisance calls

The ICO has announced that it has levied fines totalling £495,000 to well-known companies that between them sent more than 354 million nuisance messages:

• We Buy Any Car was fined £200,000 for sending more than 191 million emails. It also sent 3.6 million nuisance texts.

• Saga Services Ltd and Saga Personal Finance were fined £150,000 and £75,000 respectively for instigating more than 157 million emails between them.

• Sports Direct has been fined £70,000 for sending 2.5 million emails.

None of the companies had permission from people to send them marketing emails or texts.

For more information, see here.

Copyright and moral rights

How to demonstrate that your work was “independently created”, rather than infringing copyright

Despite the clue in the name - “copyright” - it can be overlooked that in most infringement proceedings a claimant will need to demonstrate that actual copying took place (ie that the defendant copied from the claimant’s work). Unlike other IP rights, it is not sufficient just to show that the works are identical or very similar (in whole or in part). In theory, if two people completely independently come up with the same (or very similar) works – be it literary, musical, dramatic or artistic – neither will infringe the other, as neither was copied from the other.

In practice, however, this kind of “independent creation” defence to a copyright infringement claim can be difficult to run, particularly if the similarities between the works are extensive and complex. Not only are courts sceptical about the chances of two such works being independently arrived at, but inadvertent or subconscious copying is sufficient to infringe – eg the defendant saw the earlier work and mentally absorbed it, and this influenced their later work even though they had subsequently forgotten it. The burden of proof is on the claimant to show copying, but the courts will look at evidence as to whether the alleged infringer had access to the earlier work, giving the opportunity to copy it. If potential access can be demonstrated, and there are striking similarities between the works that are unlikely to have been arrived at independently, then this can lead to the court draw the inference that copying took place.

A recent case in the IP & Enterprise Court saw just such a scenario in respect of two pop songs, in which the lyrics and melody of the chorus of the later song (“Waiting All Night”, performed by Rudimental, which was a UK number 1) were said to have been copied from the song “Can You Tell Me” by a Kelly-Marie Smith, which had never been commercially published but had been made available several years earlier in a video on her MySpace page. In this case the Defendants were able to mount a successful defence of “independent creation”, the judge taking into account the following factors. First, although there were similarities in the lyrics and melody, the words used were commonplace and melody fairly simple, and so the judge felt it would not be hugely surprising for them to be arrived at independently. Secondly, although the writer of the Rudimental chorus could in theory have seen the earlier song on MySpace or been indirectly influenced by someone who had, there was no proof to that effect and the judge felt it was very unlikely. Finally, the writer of the chorus had kept a contemporaneous Voice Memo record of his creative process, which showed how the lyrics and melody had evolved by a process of “trial and error”. The judge felt that this gave strong support to a conclusion that the allegedly infringing lyrics and melody had in fact been independently created.

As well as being a reminder of the “copying” requirement for infringement, therefore, this case also flags up the potential benefits of keeping contemporaneous records of one’s creative process

For more information, see here.

Combatting claims for breach of the moral right to be identified as author

A recent High Court case has provided a case-study in how not to institute proceedings for moral rights infringement, but it also gives a useful reminder of some basic principles in respect of the “right to be identified as author”.

As part of some broader proceedings, an architectural firm claimed that its moral right to be identified as the author of certain plans and drawings for a residential development had been infringed, when those plans and drawings were subsequently used without giving them a credit. (Copyright in the plans and drawings had been assigned to the defendants, a different firm of architects, but it was argued that the moral rights remained with the original firm.) The judge rejected the moral rights arguments on three separate grounds, each of which would have been sufficient on its own to see the claim dismissed.

First, the original architectural firm (a corporate body) was putting itself forward as the moral rights claimant, but this was fundamentally misconceived. The UK moral rights system is there to protect the human creators of the relevant copyright works, in this case the individual architect who drew up the relevant plans and drawings. Such moral rights are personal to the author, and not assignable. So the only correct claimant would have been the individual architect who created the plans and drawings, but he was not a party to the proceedings.

Secondly, for the moral right to be identified as author to be infringed it must first have been “asserted” in accordance with s.78 of the Copyright, Designs & Patents Act 1988 (“the 1988 Act”). In this case the drawings and plans simply included “RRA” in a title block, an abbreviation for the name of the original firm of architects, but the judge held that a more positive assertion was required than this. (Many industries use a form of words such as “The Author hereby asserts his/her right to be identified as author…”) As the moral right had not been properly asserted, it could not be relied upon in the proceedings.

Thirdly, the moral rights sections of the 1988 Act also include some special rules regarding works that are created in the course of employment. (This was the case here, as the individual architect had created the plans and drawings in the course of his employment by the Claimant firm of architects.) While the first owner of copyright in such works will be the employer, the moral rights remain with the employee. But one of the special rules says that – if the work was created in the course of employment - the moral right to be identified does not apply to anything done by or with the authority of the copyright owner. The judge confirmed that this rule can be relied upon not only by the original copyright owner, i.e. the employer in whose employment the work was created, but also by subsequent assignees of the copyright. In this case the new architects (the defendants) had taken an assignment of copyright in the plans and drawings from the claimants. The moral right to be identified thus didn’t apply to anything done with their authority – so no credit to the original author was required when they re-used the plans and drawings.

Read more here