Page 299 - The Handbook of Persuasion and Social Marketing

Social Marketing and the Law 275

consumption. Similarly, antiabortion social marketing programs may wel-
come the sale of condoms and other forms of birth control, and sellers of
energy-efficient products are helping to achieve the social goal of reducing
energy consumption and society’s carbon footprint.
However, U.S. law has been clear since 1976 that commercial offerings
of products are regulated as commercial speech, receiving only limited
protection under the freedom-of-speech provisions of the First Amendment
(Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council,
1976). Four years later, in Central Hudson Gas & Electric v. Public Service
Commission of New York (1980), the U.S. Supreme Court announced that
commercial speech (defined as speech relating solely to the economic in-
terests of the speaker and the speaker’s audience) is not protected if it
concerns illegal activity or is misleading.
Similarly, the FTC can regulate nonprofit entities if they work to make
a profit for their members. For example, the FTC successfully sued a non-
profit trade association for making misleading claims about egg nutrition.
In National Commission on Egg Nutrition v. FTC (1977), the Seventh Circuit
Court of Appeals largely upheld the FTC’s cease-and-desist order despite
arguments that the Egg Commission’s paid advertising was more akin to
paid political advertising than paid commercial advertising. The court
disagreed, noting that the ads purported to make factual statements (rather
than statements of opinion) in order to sell eggs.
Thus, the First Amendment allows both the FTC and private parties
(i.e., injured competitors) to bring lawsuits to regulate false, misleading,
and unsubstantiated commercial speech. Unlike securities marketers, ad-
vertisers are not required to provide all material information about their
offerings to consumers, but the FTC does require information disclosure
when needed to prevent severe consumer injury or deception (e.g., a salty,
low-fat food labeled “heart healthy” because it is low in fat must also dis-
close that it is high in sodium, which may cause high blood pressure). As
noted above, the FTC assumes consumers are rational, so it generally pur-
sues deceptive factual claims about products and cases where there is de-
ception about whether a communication is commercial advertising versus
an image or nonfactual marketing appeal (Petty, 1997). The FTC may also
pursue deception when it involves disguising commercial advertising to
appear as some other form of speech (Petty & Andrews, 2008).
Although the First Amendment provides no protection for false or mis-
leading commercial speech, regulatory concerns often go beyond falsity to
issues of solicitation method and content. The Central Hudson decision
(1980) set up a three-part test to judge the constitutionality of such restric-
tions. First, the state must assert a substantial interest that justifies the