Madison Ave Insights

POM Wonderful

Posted in Advertising, Marketing, Media

Guess what? When it comes to the claims you make in your advertising, substantiation matters – a lot. The FTC’s recent Final Order against POM Wonderful (POM) in which it found nearly 40 claims made by POM about its pomegranate juice products to be false and misleading based on the absence of proper substantiation, should leave no doubt that the FTC takes the issue of claim support very seriously. And the fact that most of POM’s challenged claims – claims regarding potential health benefits of the products, including that consumption could help treat, prevent, or reduce the risk of heart disease, prostate cancer, or erectile dysfunction – were not actually express claims, but rather implied claims (from both the wording and imagery of the ad), should be a reminder to us all that the entire advertisement and the overall “net impression” it conveys must be carefully considered.

A little background: In September 2010, the FTC issued an administrative complaint alleging that POM had disseminated advertising materials claiming health and disease prevention benefits from consumption of its pomegranate juice products without having a reasonable basis to make those claims. We all remember those ads, a beautifully shot bottle of POM with a broken noose around its neck and the headline “Cheat Death.” In its defense, POM argued that consumers did not take many of its ads literally, so that any perceived health claims in those ads were not material to consumers, and that when it made express health claims in ads, POM had substantiation for the claims, in the form of surveys and of studies done on animals. The FTC’s position was that all the health benefit claims made by POM – whether express or implied – were material to consumers and therefore required a “reasonable basis” of support, which POM lacked. In addition, where POM claimed to have clinical proof of the claim, the FTC argued that POM had no such proof. The FTC’s position was that for the types of health and disease prevention claims POM was making, a “reasonable basis” of support required a well-designed, well-conducted, double-blind, randomized controlled clinical trial (RCT). In fact it required two RCTs. And for the establishment claims, the FTC’s believed clinical proof also meant RCTs.

An administrative law judge (ALJ) heard the case and found against POM with respect to 19 of 43 challenged advertisements. But the decision was nevertheless a win for POM (and advertisers in general) in one respect, the ALJ found that while POM’s claims needed a “reasonable basis,” that only meant “competent and reliable scientific evidence,” which did not have to rise to the level of an RCT, let alone two. The ALJ found the same with regards to the establishment claims, holding that clinical proof did not necessarily mean an RCT. (The ALJ apparently used the “Pfizer” analysis to come to both conclusions.) That meant that advertisers would have a lot of flexibility in how they could substantiate health and disease benefit claims, rather than be forced to meet a very high standard set forth by the FTC.

The appeal was heard by the FTC Commissioners. In its Final Order the FTC found that 36 of POM’s claims (as opposed to 19) were false or misleading. And, importantly, the FTC found the ALJ to be wrong in not requiring RCTs. The FTC did not hold that it had the right to set the standard of substantiation, but rather that by using the “Pfizer factors” to determine a “reasonable basis,” and using the standards of the relevant scientific and medical communities to determine the support needed for the “clinical proof” establishment claims, RCTs would be required to substantiate POM’s health and disease benefit claims. The FTC did not opine on the issue of whether at least two RCTs were needed, as had been suggested in the original administrative complaint, since it found that POM did not have even one.

The Way I See It

  • I see the FTC continuing to aggressively focus on advertising for products that purport to benefit consumer’s health or help prevent certain diseases.
  • I see future battles with the FTC over substantiation – what is the applicable standard, and is there an adequate level of support for the claims being made?
  • I see claim substantiation for health and weight loss claims inextricably linked to the critical question, is a health claim actually being made in the advertising?