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Consumer promotions have come under increased scrutiny by the increasingly powerful National Association of Attorneys General. The NAAG has been aggressive and organized in the area of consumer protection, particularly on Internet promotions.
Internet "swat teams" troll the Web for promotions in violation of state and federal laws, and has been responsible for lawsuits filed against hundreds of online companies, said Alan Hock, an attorney with Moritt Hock Hamroff & Horowitz, who heads the firm's direct marketing, advertising, trademark and Internet and new media practice areas. NAAG is working in coordination with the Federal Trade Commission.
He said legal problems can be avoided by making a few small changes to copy and by ensuring that the copy is screened by an attorney skilled in this area. "There are plenty of companies out there making outrageous unsubstantiated claims," Hock said. "Keep your promotions reasonable, yet powerful, and you can stay under the regulatory radar."
Hock also reviewed advertising injury insurance coverage, a provision that has not been used often until recently. The provision covers copyright, patent and trademark claims. He said that such a provision is often included in Comprehensive General Liability Insurance policies, but that many companies and their attorneys don't even know they have it. The provisions cover legal fees and damages owed resulting from such claims, even unfair competition, he said.
"Know your policy," he said. "Get it. Read it. Send it to your attorney."
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