Law, Regulation, and Ethics

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Ethics of Advertising
Two ways to think about this:
Government Intervention (FTC, FCC, FDA) Self-Regulation

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Government organizations
FTC (Federal Trade Commission)
Is the major regulator of advertising

FDA (Food & Drug Administration) Regulated advertising related to the labeling and packaging of food, cosmetics, medicines and therapeutic devices
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The Federal Communications Commission (FCC)

FCC (Federal Communications Commission) Indirect control/influence over broadcast advertising FCC has a direct influence on media ownership

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Ethics of Advertising Self-Regulation

Non-government Regulation
BETTER BUSINESS BUREAU 1. National advertising review council (national advertising division (NAD) monitors advertising practices and reviews complaints (national advertising review board (NARB) appeals board for complaints

Self-Regulation
self regulation reduces the need for government regulation and maintains the integrity of advertising ( YEAH damn obvious la)
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Government Regulations
First Amendment Central Hudson Test __> regulation can occur if ad is illegal __> regulation when ad is considered misleading __> regulation: defined to narrowly serve gov interest __> regulation more extensive than necessary
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Regulation Advertising Issues

Deceptive advertising anything that may mislead a reasonable consumer Unfair advertising advertising that can cause substantial injury to the consumer Bait Advertising The offer is alluring but insincere to sell a product or service which the company does not intend to sell
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Example of Misleading: McNeil-PPC vs. Pfizer, Inc.

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Response to violations
Substantiation Consent Decree Cease-and-desist order Corrective advertising

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Other Issues & Examples

Other Issues
Tobacco Advertising Children & Advertising Online Advertising

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Tobacco Advertising
Government regulation Free speech???

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Children & Advertising

Children s Advertising Review Unit (CARU)

Children s Television Act (1990)

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Online Advertising
Laws & Regulations

Unique cases

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