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American video advertising is a virtual minefield of different laws organized in patchwork form. Yet, it’s important to be mindful of the most important laws. Violations can lead to steep civil penalties and lawsuits. Criminal violations are possible, but the chances of criminal prosecution are low when advertisers are making a good faith attempt to follow the law.
This article focuses on some of the key laws and how to ensure compliance. These laws include the copyright laws, truth-in-advertising laws, laws applied to influencers, along with other ethical concerns.
There are many rules applicable to video advertising. These rules range from federal false advertising statutes, e.g., 15 U.S. Code §53, to state unfair and deceptive practices (UDAP) laws, to state ethical rules imposed on lawyers for legal advertising. This article will touch on an array of laws, but can’t possibly cover them all because there are 50 states — each having a unique set of laws.
On the federal level, the Federal Trade Commission (FTC) enforces most advertising laws.
Truth in advertising is a key concern anyone in video marketing should have. Some of the relevant laws are at 15 U.S. Code §§52–55. So, what is false advertising? The short interpretation is, don’t publish an advertisement that misleads potential customers. The long, legalese version is at 15 U.S. Code §55. It defines false advertising in the following way.
The term “false advertisement” means an advertisement, other than labeling, which is misleading in a material respect; and in determining whether any advertisement is misleading, there shall be taken into account (among other things) not only representations made or suggested by statement, word, design, device, sound, or any combination thereof, but also the extent to which the advertisement fails to reveal facts material in the light of such representations or material with respect to consequences which may result from the use of the commodity to which the advertisement relates under the conditions prescribed in said advertisement, or under such conditions as are customary or usual.
Notice the words, “there shall be taken into account (among other things) not only representations made or suggested by statement, word, design, device, sound, or any combination thereof” In the third through fifth lines of the statutory definition. That very broad language includes video, images, and audio. And, it applies to these mediums when published over the internet.
Violation of false advertising rules can lead to civil and criminal liability. The takeaway to comply with false advertising laws is simple. Make sure you can substantiate the claims made in the advertisement. Also, make sure you have omitted nothing that could mislead consumers.
Use of influencers in marketing has grown popular in the past few years. What is an influencer? Merriam-Webster defines an influencer as:
A person who can generate interest in something (such as a consumer product) by posting about it on social media.
Celebrity appearances in advertisements and endorsements go back to the beginning of advertising. In recent years, these influencers have built followings on social media that generate the same buzz celebrities do.
Internet reviews have become increasingly important to consumer buyer decisions in the past few years. Congress and the FTC have noticed the trend of influencers, endorsements, and reviews. They have responded.
The FTC has released its Disclosures 101 for Social Media Influencers and regulations addressing testimonials and reviews. Congress has passed the Consumer Review Fairness Act.
These laws and regulations have a common goal: ensure honesty with opinions and disclosure of relationships with a brand that might bias opinions.
The main points of the Consumer Review Fairness Act are:
· A party to a contract with a company should not be leaving reviews for the company’s products, services, or conduct
· A company can’t impose a penalty or fee against someone who gives it a review
· A person has no intellectual property rights, i.e., a copyright, in reviews left on company websites
Ethics in advertising is an even broader subject than legal issues. For example, the FTC promotes standards for food marketing to children to reduce childhood obesity. It encourages self-regulation in this area since it has no enforceable legal mandate to prevent advertisers from targeting children with unhealthy food.
Another example that has some enforcement teeth would be the requirement by state bar associations to include a disclaimer stating that the lawyer is no better than other lawyers. There’s no law requiring the lawyers to comply with this rule. But the state bars do self-regulate and can impose penalties on lawyers who don’t comply with their rules.
Copyright laws are what advertisers are often most concerned about. If you use video, audio, or images that are copyrighted by someone else, and you don’t have their express written permission to use the material, you could have trouble. The rest of this article will focus on copyright issues common to advertisers.
The U.S. Copyright Office defines a copyright as a form of protection grounded in the U.S. Constitution and granted by law for original works of authorship. Copyrights apply to both published and unpublished works. The protected original works include videos, images, audio, and much more. The owner of the copyright is often the creator of the work, but not always.
A copyright attaches the moment the owner creates the work. The right is automatic. Until recently, copyright owners could sue you for copyright infringement even if they had not registered with the copyright office. This changed with a 2019 court ruling.
The United States Supreme Court ruled in Fourth Estate Public Benefit Corp. v. Wall-Street.com LLC that the owner must register the copyright at the copyright office in order for the copyright owner to sue for copyright infringement. But, once the owner registers the copyright, they can sue for copyright infringement, occurring either after or before they registered their copyright.
So, you can’t feel safe just because a creator hasn’t registered their copyright. They can still register the copyright after you’ve infringed and sue you for that infringement.
The Copyright Act grants copyright owners several rights. The statutes explaining these rights and the limitations of these rights are at 17 U.S. Code §§106–122. The five primary rights granted in these sections are:
· The right to reproduce the work
· The right to create other works based on the work
· The right to distribute copies of the work
· The right to perform the work for the public
· The right to put the work on public display
The copyright owner enjoys these rights for the duration of their lifetime plus 70 years. If the work was anonymous or under a pseudonym, the copyright owner still can enforce their rights for 95 years from the publication date or 120 years from creation date — whichever first expires.
An advertiser can use copyrighted property if they own the copyright or if they have permission from the copyright owner. It’s best to get written permission. The copyright owner will usually charge a fee for using their copyrighted property.
Fair Use is another situation where others can use copyrighted property. The purpose of the use must be for educational, reporting, research, not-for-profit purposes, among other potential reasons. The fair use exception doesn’t apply when there is a profit motive. For this reason, the fair use exception doesn’t apply to most advertisements.
The creative common license is another way advertisers can use the copyrighted material owned by others. It’s important to read each creative common license because the creators can choose different requirementsfor their shared work. For example, they may demand only attribution. They may bar commercial use. Reading these licenses is important.
The copyright owner can sue an advertiser that infringes their copyright. There’s even the possibility of criminal prosecution. If you’re sued for copyright infringement, the court may award between $750 and $30,000 per infringement to the copyright owner. If the copyrighter owner proves you acted willfully, you could be liable for up to $150,000 per infringement.
Criminal copyright infringement can be a felony. Imprisonment and fines are a possibility. Criminal copyright infringement is willful infringement for financial gain. The authorities usually reserve enforcement of criminal copyright infringement for large-scale schemes such as video pirates selling bootlegged copies of movies.
The DMCA is a federal law passed in 1998 to bring copyright law into the digital age. With the internet and other means of rapid digital distribution, there was a need to upgrade the laws.
The DMCA gives copyright owners greater protections when distributing their work on the internet. It also makes it unlawful to provide false copyright information. Users cannot remove or alter the copyright information.
Most images you may find in Google Images Search are copyright protected. You can not use those images unless you fall under an exception mentioned above. But there are a few ways to use images without having to contact the copyright owner and get written permission.
You can buy stock photos or buy a subscription to a photo service. There are many of these available on the internet. Some options available include:
· Getty Images
There are sites where you can get free images. These include:
Neither of these lists are exhaustive. There are many such sites on the internet. The free sites usually have a much smaller selection than the paid sites.
The copyright laws apply to video just as they do to books and images. You can’t download someone else’s YouTube video and use it in an advertisement.
There are some sites where you can get free video without infringing on a copyright. Prexels is one such site.
One key factor with video that isn’t as prevalent with images is that some of the popular services have their own rules that apply.
Copyright laws apply to music and audio. There’s a twist in the law here, though. Each musical recording has two copyrights. The compositional copyright usually belongs to the writers of the lyrics and musical note arrangements.
There’s also a sound recording copyright. This copyright belongs to the artist or the record company. It only applies to a single recording of a song. If the same artist records two different versions of the same song, that artist holds two sound recording copyrights for that song.
You’ll need to get permission to use the copyright for the version of the song you want in your advertisement. You’ll also need to get permission from the songwriter. Sometimes, the publishing company handles all the permissions.
There are many things you should and should not do with advertising. You should be transparent about any contractual relationship between the company and an influencer that appears in the advertisement. You should always be able to substantiate the claims made in an advertisement. You should never mislead the public with an advertisement.
One of the biggest areas of concern is copyright laws. Make sure you’re always on firm legal ground when using copyrighted intellectual property. This includes video, images, and audio that’s owned by another.
If you have any doubts whether you’re in compliance with the law, it’s a good idea to consult with a copyright attorney or a marketing attorney.
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