FTC warns 32 companies using environmental 'green' seals

By Annie Hunt | Jan 13, 2016

WASHINGTON, D.C. (Legal Newsline) — In September, the Federal Trade Commission issued warning letters to five manufacturers of environmental certification seals and 32 businesses that use those seals, cautioning that the certifications do not comply with the FTC’s “Green Guides.”

“We hope to raise awareness and prevent problematic claims,” said Hampton Newsome, of the FTC's Bureau of Consumer Protection.

“It is part of FTC efforts to ensure that advertisers are aware of FTC guidelines of deceptive claims.”

The FTC uses its Guides for the Use of Environmental Marketing Claims to monitor how and what products are deemed “green.”

The Guides were first issued in 1992, then revised in 1996, 1998, and 2012. They exist to provide guidance on how Section 5 of the FTC Act works to protect consumers from false green advertisements.

“Problematic green claims can apply to any type of company. Those who use the green seal should be careful about the claims they make. Sometimes the message they convey is too broad. They should try to contain specificity about what the product actually does,” Newsome said.

The FTC stresses details when marketing and using the environmental certification seals. For example, listing that a product is recyclable, biodegradable, and compostable are all acceptable terms that would justify a green certification, contingent on the company’s ability to substantiate the claims.

Any general or vague advertisements that appear deceptive are red flags to the FTC. Those are precisely the types of ads that prompted the warning letters, Newsome said.

Newsome added that he hopes they will serve to promote awareness and avoid future lawsuits.

“The order prohibits them from further penalties. In some cases, generally speaking with advertisement cases we can seek injunctive relief; that depends on the level of consumer harm. Some businesses may not be aware of the fact that their green claim is too general,” Newsome said.

While the FTC hopes the letters will be a sufficient reprimand to prompt the companies to resolve the deceptive marketing, they are prepared to take further action to protect consumers. Such action was required in October 2013 when the FTC issued six enforcement actions on companies whose products allegedly promoted unsubstantiated biodegradable plastic claims.

The 2013 complaints against ECM Biofilms, American Plastic Manufacturing, CHAMP, Clear Choice Housewares, Carnie Cap and AJM Packaging Corporation all dealt with allegedly false claims that their products were made with degradable plastic, which was a violation of a 1994 FTC order that prohibited the unsupported green claims. For its alleged violation, AJM was issued a $450,000 penalty, which it agreed to pay under the terms of settlement.

According to a statement on their website, the FTC has not determined if the letter recipients’ claims are in violation of the law, but it requested communication with the companies to ensure their products and future marketing will have the green light.

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