180 POINTS : 9 QUESTIONS, EACH WORTH 20 POINTS.

1. Best Body Cosmetics is marketing a new skin care product called, SMOOTH SKIN. Both print and television advertising for the product contains the following claims:

"Now, thanks to SMOOTH SKIN Research, no woman has to resign herself to unattractive ripples, bumpy texture, and slackness caused by cellulite."

"SMOOTH SKIN attacks your cellulite problems two ways: first, it increases skin circulation to help disperse toxins and excess water that contribute to cellulite pockets, and second, it builds sub-skin tissue strength and tone for smoother support."

"SMOOTH SKIN Shield blocks 99 percent of the sun's damaging rays from reaching your skin."

"8 out of 10 skin care consultants recommend SMOOTH SKIN to their clients."

The FTC charges that the SMOOTH SKIN ads are deceptive.

a. List the materials claims made in the ads.

b. What level of substantiation must Best Body Cosmetics demonstrate to support the each of the listed claims?

20 Pts if complete list of claims + reasonable basis + Revson

18 Pts if complete list of claims + reasonable basis

15 Pts if complete list of claims + "level of proof"

FOR FULL CREDIT THE ANSWER SHOULD STATE THAT THE AD CLAIMS THAT SMOOTH SKIN WILL REDUCE CELLULITE, CLEANSE SKIN IMPROVE THE TEXTURE OF SKIN AND PROTECT FROM SUN. [10 PTS]

[Do not be too strict here. If the answer lists a number of the claims give the full credit]

This is a case on the Home page from which I lifted most of the language:

In Charles Revson, Inc. , 1993 FTC LEXIS 328, ( November 17, 1993), the FTC charged that the above claims contained the folowing material claims:

a. Anti-cellulite body complex significantly reduces cellulite;

b. Anti-cellulite body complex reduces skin's bumpy texture, ripples or

slackness caused by cellulite;

c. Anti-cellulite body complex helps disperse toxins and excess water from

areas where cellulite appears;

d. Anti-cellulite body complex increases sub-skin tissue strength and tone;

e. PhotoAging Shield blocks all of the harmful rays which cause photoaging.

b. What level of substantiation will Best Body Cosmetics have to demonstrate to support the claims?

IN REVSON, THE FTC SAID THE UNDERLINED CLAIMS REQUIRED A "REASONABLE BASIS" LEVEL OF SUBSTANTIATION. THE "BLOCKS 99 PERCENT AND THE "8 OUT OF 10 SKIN CARE CONSULTANTS RECOMMEND" ARE "LEVEL OF PROOF," CLAIMS [10 PTS]; "PUFFING [0 PTS]

In 1994, the Oregon Bar Association received an anonymous mailing containing a copy of Litigant's yellow pages ad and her business card. The Bar Association began disciplinary proceedings against Litigate for violating its ban on the use of terms such as "CPA" and "CFP" in advertising.

Litigant brought suit claiming that the Bar's advertising ban infringed her First Amendment right to advertise. She claims that the ban fails the Central Hudson test. Will Litigant's suit be successful? YES or NO? EXPLAIN YOUR ANSWER.

YES [5 pts.]

Litigate is clearly engaged in a legal practice, therefore the Central Hudson test is the appropriate means to determine the constitutionality of the state's regulation of her commercial speech. [4 pts.]

Since the fact situation here can't be distinguished from IBANEZ v. FLORIDA (U.S. 1994), that case is the ruling precedent here.

In IBANEZ v. FLORIDA (U.S. 1994), the Supreme Court used the Central Hudson test to find that that a regulation identical to the one in the case problem was unconstitutional.

REGULATION DIRECTLY ADVANCES THE STATE'S INTEREST: The Court said that the state must, "demonstrate that the harms it recites are real and that its restrictions will in fact alleviate them to a material degree. See, e.g., Edenfield v. Fane, 507 U.S. ___, ___," and that the state had failed to meet that burden. [5 pts.]

NARROWLY DRAWN: Also, the Court held that the regulation failed because the Board has not shown that the restrictions burden no more of Ibanez' constitutionally protected speech than necessary." [5 pts.]

While in jail Kop signed a book contract to do a novel based on her life undercover. When she got out of jail, Kop divorced Narc, moved to Portland and wrote the novel "FAST LIFE." It was a great success. Before it was published she signed a $1 million movie deal and a Book-of-the-Month contract for another $500,000.

Shortly after publication Narc filed suit against Kop claiming appropriation. While Narc is not named in the book, many people who know him recognize the character "Larry Louse" in the book as being based on Narc. In the book Louse is an undercover police officer who becomes a drug addict, is thrown off the police force for accepting bribes and is convicted of perjury.

The advertising for the book says: "FAST LIFE--A novel based on the true life story of two cops who went bad--It doesn't get any more real than this." In print ads published in newspapers and magazines, a picture of Kop and Narc taken while they were on the police force is used with the names of the fictional characters in the book. In media interviews Kop acknowledges that the Larry Louse character is based on Nathan Narc.

Does Narc have grounds for an Appropriation suit? YES OR NO? EXPLAIN YOUR ANSWER.

Appropriation:

YES OR MAYBE [5 pts.]

If the claim is based on the novel, Narc would have to show that the book is a commercial use, that is, transactional speech. The precedent clearly establish that novels are not commercial speech. [5 pts.]

If his claim is based on the advertising for the book, he would have to show that, (1) he is identified; (2) No consent was granted; and (3) that the commercial use is incidental to the editorial use. The picture of Narc used in the print ads might be the basis for a successful appropriation claim, since he is identified and it appears that no consent was granted. The use of the fictional names does not negate the photo identification.

Absent the picture, the advertising would not give rise to an appropriation claim, but identifying Narc in the advertising is not incidental since he is not a character in the book; therefore he may have a valid appropriation claim. [10 pts.]

The "DONE DEAL" segment showing the raid and arrest at the Deal house aired on COP VIDEO three weeks later. The next day the Deals filed an intrusion suit against the television show and all members of the camera crew. At the same time the Deals filed appropriation and publication of private facts suits. Is it likely that any of the suits will be successful? YES or NO? EXPLAIN YOUR ANSWER.

APPROPRIATION: NO [2pts.]

"DONE DEAL" is an editorial, not a commerical use. [3 pts]

PRIVATE FACTS: NO [2pts.]

Since the Oregon Supreme Court held in ANDERSON v FISHER BROADCASTING (Or. 1986) that the plaintiff must show that THE INFORMATION "WAS EITHER OBTAINED OR BROADCAST IN A MANNER OR FOR A PURPOSE WRONGFUL BEYOND THE UNCONSENTED PUBLICATION ITSELF, " the publication of the information would not provide the basis for a successful suit. Broadcasting the "Done Deal" segment is an acceptable use of newsworthy material. The existence of private facts is also less than clear. [6 pts.]

INTRUSION: YES [2pts.]

In Oregon, to win an intrusion suit the plaintiff must show that the intrusion would be highly offensive to a reasonable person. A jury would very likely find breaking into the property and hiding in the bushes to be a case of a highly offfensive intrusion. [5 pts.]

LOCAL FIRM TO BE CHARGED IN SCAM

Emerald Empire, Inc. , a manufacturing firm in Junction City, faces criminal fraud charges according to a source in the Attorney General's office. After several months of investigation, the state will charge Sam Sleeze, the company's vice president for sales, with bilking customers of over $100,000 in a sophisticated double billing scheme....

Using a company computer program, Sleeze sent customers two different bills for the same shipment of parts from Emerald Empire. The scam was discovered during a routine audit of one of Emerald Empire's customers in 1993, but sources say Sleeze has been running the scam since at least 1987....

"Everyone knew Sleeze was doing something illegal, but the company didn't care," Carrie Count, a former Emerald Empire employee, said....

Harry Builder, president of Emerald Empire, said the company was not responsible for the errors and promised full cooperation with the police....

[end of quotes from story]

Builder immediately sent the Gazette a retraction demand, which the paper rejected. Several weeks later, Builder and and Emerald Empire, Inc. filed libel suits against the Gazette.

As the litigation moved forward, the following facts were established:

1. Sam Sleeze was charged with criminal fraud.

2. No criminal charges were filed against Emerald Empire; however the federal Securities and Exchange Commission started an investigation into the company's management based on possible false statements in its annual filings with the SEC.

3. While Emerald Empire has been cleared on any direct involvement in Sleeze's double billing scheme, the company's unconventional billing practices and the lack of adequate supervision in the billing department created the opportunity for Sleeze to engage in illegal activities.

The Gazette moves for dismissal of both Builder's and Emerald Empire's suits claiming that the story was essentially true. Should either suit be dismissed? YES or NO? Explain your answer.

Builder: NO [2 Pts]

As the president of the company, Builder would have a cause of action if the story falsely accused him or his company of engaging in illegal practices or of being charged with or investigated for illegal activity. Company executives will have a cause of action even when not identified if the story alleges company involvement, since they are responsible for company actions. [4 pts.]

The story says that Emerald Empire "faces criminal fraud charges," when the only pending investigation involves the SEC. That investigation could result in a variety of different actions short of a "criminal fraud charge." The claim appears to be broader than the facts will support. [4 pts.]

The most damaging statement in the article is Carrie Count's. Builder could certainly argue that her statement accuses him of allowing Sleeze's illegal activity. This is defamatory and there is no factual basis for it. The Gazette motion would not be successful. [4 pts]

Emerald Empire: NO [2 Pts]

The corporation's suit would also survive the motion for summary judgment for the same reasons. [4 pts.]

6. The U.S. Congress is considering a bill to ban all advertising for alcoholic beverages targeted at college students. According to the bill's sponsors, binge drinking is a major problem on college campuses and banning beer advertising targeted at college students will help solve the problem.

Under the proposed legislation, beer companies would no longer be able to advertise in college publications, no beer advertising would be allowed at sporting events, and all promotional advertising by beer companies at "college-oriented" events would be banned. KEEP OUR BEER ADS (KOBA), an advocacy group, claims that the proposal violates the First Amendment rights of advertisers

Is KOBA right? Is the proposal in conflict with the First Amendment? YES or NO? EXPLAIN YOUR ANSWER.

NO or Probably Not. [2 pts]

A standard Central Hudson analysis would appear to support the ban; however, given the Court's recent use of Central Hudson, it is possible that a case could be made against the ban.

Central Hudson:

6 points per prong.

(1) State Interest: To discourage underage drinking by under-21 college students and to promote moderation among over-21 college students. Given the extensive documentation of binge drinking, it is safe to assume that the state could demonstrate that the problem does exist. [6 pts]

(2) Advertising Directly Advance the State Interest: The Courts have long accepted a strong relation between the amount of advertising and consumption. While decisions last term suggest that the Supreme Court will take this prong more seriously and require stronger evidence of the link, the weight of the existing precedent argues that the asserted relation would be accepted.

Following RUBIN v. COORS BREWING CO. (1995), an argument might be made that the regulation would be ineffective and therefore it fails Central Hudson.

[6 pts]

(3) Narrowly drawn, reasonable relation, less restrictive: The ban does not totally ban advertising about beer or deny college students access to beer advertising generally, it merely bans advertising targeted at the college audience. The ban appears reasonable on its face and there are no more obvious regulations that would achieve the same purpose.

Following RUBIN v. COORS BREWING CO. (1995), an argument might be made that the regulation would be ineffective and therefore it fails Central Hudson and that the large percentage of legal-age drinkers in the college population makes the regulation over-broad.

[6 pts]

7. Some advocates of legislation to restrict sexually explicit material on the Internet argue that the Internet should be viewed as being more like the broadcast medium than the print medium. Why do advocates of content regulation on the Internet want to apply a broadcast rather than a print First Amendment framework to the Internet?

The discussion should clearly define the differences between the "print" model and the "broadcast" model as set in Miami Herald v. Tornillo, 418 U.S. 241 (1974) and Red Lion Broadcasting v. FCC, 395 U.S. 367 (1969) and the possible results of applying either to the Internet. [10 pts.]

The remainder of the points will be based on the quality of the discussion. [10 pts.]

8. As a result of controversy over some of the Measure 16 television ads in the 1994 election, KUAK-TV's advertising department decided that it is going to review and edit all political advertising in the 1996 campaign season. If political advertisers refuse to allow the station to edit the ads, then the station will not run them.

When Vicky Votegetter, a candidate for U.S. Congress, learns of KUAK's new political advertising review policy she informs the station that it must accept her ads and run them as submitted.

Is Votegetter right? Is the station required to accept and run her ads without editing? YES OR NO? EXPLAIN YOUR ANSWER.

YES. [5 pts.]

Under Sec. 312, the station is required to provide access to federal candidates. [10 pts.]

While the station may refuse to accept certain formats at certain times (e.g. 1 hour block on Sunday afternoon), it may not assert editorial control over the content of candidates' advertising (See Pember's discussion of Sec. 315). [5 pts.]

"Over the last year and a half your coverage of this issue has lacked any sense of balance. I've kept a log and of the 142 minutes of news programming devoted to this very important controversy, over 100 minutes favored the University's position. You keep quoting University officials and ignoring the people on the other side of the issue. If you are going to quote the UO president then you have to quote the leader of the opposition.

I am a loyal listener, but I am going to file Fairness Doctrine and Equal Time Rule complaints with the FCC. The lack of balance in your coverage is an outrage!"

You are KWAK-AM's station manager. Briefly outline the points you would make in writing a response to the legal issues raised in Loudmouth's letter.

Fairness Doctrine:

The FCC repealed the Fairness Doctrine in 1987. Even if the FD was in place, it required fair and balanced coverage, not equal time. [10 pts.]

Equal Time Rule:

The Equal Time Rule is triggered when one legally qualified candidate for a public office uses a stations facilities. While the issue in question is an important public issue, the uses cited in the letter do not involve candidates for office; therefore the Equal Time Rule does not apply. [10 pts.]

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