Advertising plays a crucial role in marketing and promoting a business or brand. Every company needs to invest in branding and ad campaigns to educate the public about their products and services and to entice new customers or clients. But when it comes to promoting a business, it’s not uncommon to make an advertising mistake or error that results in a lawsuit.
For example, you may use a photo from the internet without realizing you had to pay royalties. Or, you may unintentionally insult a competitor’s product or service and make a false claim, so they sue you for slander. To make sure to avoid advertising injuries, you should first understand the common errors and how to avoid them:
Copyright Infringement
Copyright infringement occurs when copyrighted material is used or produced without the permission of the registered copyright holder. According to copyright.gov, creators can hold copyrights for “original works of authorship including literary, dramatic, musical, and artistic works, such as poetry, novels, movies, songs, computer software, and architecture.”
In the internet age, you need to take extra precautions to avoid accidentally violating a copyright. Whenever you use materials that you or another employee did not create themselves, you should:
- Always check for the copyright symbol.
- Read all usage and licensing rules before incorporating images, video, text, music, or code into your advertising materials.
- Understand free use and open source designations.
Slander
Slander occurs when oral defamation harms a person or business’s reputation. For a claim to be considered slander, it must be stated as a fact (not an opinion), proven false, and said to a third-party.
The best way to prevent slander is to practice caution when discussing your competition or avoid mentioning them altogether. Only allow well-trained designated spokespeople to make public statements on behalf of your company.
Libel
While slander pertains to the spoken word, libel refers to defaming statements that are published. In today’s day and age, companies need to monitor not only their print advertisements and digital ads but also their posts on social media. As a general rule of thumb, you can limit your liabilities in this area by avoiding campaigns that compare your company to specific competitors. If you do decide to take this route, be sure to confer with a legal professional before publishing anything.
Violation of Privacy
A violation of privacy occurs when you publish something without a person or business’s permission. For example, you may use pictures of customers for your salon’s advertisement. To avoid this, make sure that if you’re using someone else’s products, property, or anything that isn’t yours, you obtain permission from them first.
Protecting Your Business from Advertising Liabilities
If you find yourself in a situation where you may be liable for an advertising injury such as slander, libel, copyright infringement, invasion of privacy, or the misappropriation of advertising ideas, general liability insurance will help cover your legal expenses. However, you should know that this insurance generally does not protect you in cases of false advertising.
Understanding False Advertising
False advertising is when a business or organization publishes or broadcasts advertisements that contain false, untrue, and misleading statements made to promote goods or services. One of the most infamous cases of false advertising occurred when the Federal Trade Commission (FTC) filed a lawsuit against Volkswagen for advertising cars “fitted with illegal emission defeat devices designed to mask high emissions during government tests” as clean diesel vehicles.
In most situations, advertising injury coverage will not help your company pay for legal fees that result from a false advertising tort. To avoid making any false or misleading claims, you (and everyone on your advertising team) should familiarize yourself with the FTC’s Truth in Advertising guidelines and resources.
Advertising Advice
While general liability insurance may have your back should someone sue your business for advertising injury, you still need to take precautions to avoid potential lawsuits. Make sure that everyone who speaks or publishes materials on behalf of your company understands the rules and regulations of fair advertising and practices tact and discretion. If you have concerns about the legality of an advertising campaign, you’re better off consulting a lawyer before publication than having to hire one to represent you in a lawsuit.
