Revising the Green Guides has taken many years. FTC employed a national effort to obtain public input and collect industry comments regarding the proposed revisions.

In conjunction with FTC’s Green Guides, the FTC has taken on the issue of defining carbon offsets, the use of green certification and seals, defining of renewable energy and renewable material claims.

FTC Chairman Jon Leibowitz has stated that “the introduction of environmentally friendly products in the marketplace is a win for consumers who want to purchase greener products and producers who want to sell them. But this win-win can only occur if marketers’ claims are truthful and substantiated. The FTC’s changes to the Green Guides will level the playing field for honest business people, and it is one reason why we had such broad support”.

It is interesting to note that these revised Green Guides fail to take on some of the more thorny issues. The FTC failed to provide guidance on the use of the terms “sustainable”, “natural”, and “organic”. The FTC has suggested that the term organic has already been sufficiently defined by the U.S. Department of Agriculture.

A review of FTC’s enforcement history indicates that they have brought claims for deceptive use of the terms; recyclability, and biodegradable. FTC has raised questions regarding the environmental certification program. Given the introduction of these new Green Guides, it is a clear indication that the FTC will increase enforcement activity in this area.

I have written on this topic before and the potential legal pitfalls for companies making environmental representations regarding their products. Careful consideration is necessary when using what I refer to as “eco-logos” as proof of the “greenness” of your company’s products. Given the significance of these issues several blog entries will be posted in the future on various key provisions of the revised Green Guides.

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1. Degradable – Let’s take a brief look at what constitutes degradable according to the FTC’s Green Guides. The FTC takes the position that one needs to clarify in an advertisement whether the product and/or the package is degradable. Degradation can occur through the process of biodegradation, oxo-degradation, oxo-biodegradation, or photodegradation. In any case, it is up to the company that is marketing the product to have reliable scientific evidence that the item in its entirety will break down and return to nature and be degraded into elements found in nature.

To have this positive attribute, degradation of the product must occur within a reasonably short time after customary disposal. As a rule of thumb, items that do not completely decompose within one year after customary disposal should not be advertised as degradable without clarification. Furthermore, if the product does not degrade in a customary disposal (such as a typical landfill) setting, it would be deceptive to advertise this benefit.

Anything short of complete degradation within one year following disposal must be clarified and qualified in the advertisement. These qualifications or limitations on the representation that the product is degradable must be prominent and clearly understandable by the average consumer.

2. Compostable – An alternative to being degradable, are products that are advertised as compostable. Again, the marketer making the claim that the product is compostable must have competent and reliable scientific evidence that all the materials in the item will break down or otherwise become part of a usable compost (such as soil enhancement or mulch) in a safe and timely manner. This decomposition must be done at an appropriate composting facility or in a home compost unit.

It is considered deceptive to not qualify the representation if adding the product to the compost pile will not be broken down in a safe or timely manner. It could also be deceptive if the claim suggests introducing this material into a landfill has environmental benefits.

As a general rule, a marketer cannot represent that its product is appropriate for compost if such a composting facility is not readily available to a substantial majority of consumers where the product is sold. The FTC suggests that such facilities should be available to at least 60% of the consumers.

It would be deceptive under the FTC’s Green Guides if in the process of introducing the materials into a composting facility, the product actually releases toxins or other chemicals which prevents the compost from being usable.

In either case, when a manufacturer would like to advertise that its product is biodegradable or compostable, this should only be done if there is competent and reliable scientific support for such a claim.

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Unbiased, scientific support?

Manufacturers of products should take a closer look at the types of certifications and seals of approval it places on their products and packages. The FTC considers it deceptive to suggest that a product, package or service has been endorsed or certified by an independent third party unless there is nonbiased scientific data, that is accepted in the scientific community that supports that assertion. In addition, the manufacturer must be aware that obtaining third party certification does not relieve the manufacturer of its obligation to ensure that the advertisement of the product are supported by scientific evidence, and that the seal is consistent with the message being communicated by the certification.

Implied Environmental Benefits

If the seal of approval suggests that a product has an overall general environmental benefit without any clarification as to the basis for that certification, this is seen as suspect by the FTC. To avoid such a claim of deception, the manufacturer should, in a clear and prominent way, convey that the seal refers to a specific or limited environmental benefit and it is not an approval of a broad general benefit. This qualifying language must appear within the advertisement and it is not sufficient to refer the consumer to a website for additional details.

Trade Associations

The manufacturer may also need to clarify that the seal was obtained from an industry trade association. If the trade group uses an independent certifier that consents to established testing procedures with an independent auditor, then the use of an industry trade association’s certification may be proper. If the seal of approval refers to an industry association, it must be clear that the product has been certified by an industry certifier, and that certification was not awarded by an independent certifying association.

Industry organizations that control the certification process may be considered by the FTC as deceptive seals of approval. If there is a material connection between the company and the certifying organization it would be deceptive to not reveal this relationship to the consumer. There should be no material connection between the product and the company issuing the seal of approval, without revealing the connection.

Qualifying Statements

Another type of certification and seal of approval that can create confusion among consumers are those issued by membership only associations. The FTC suggests that the use of such seals could be deceptive and that a membership seal should be accompanied with a qualifying statement. An example of such qualifying language is; “our company is a member of the EcoFriendly Association, but it has not evaluated this product”.

So when in doubt, always have sufficient independent scientific data to support any advertisements, even when a product was awarded a seal of approval.

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In October of 2009 the FTC updated the Guide Concerning the Use of Endorsements and Testimonials in Advertising. (16 CFR 255) It is FTC’s position that regardless of whether the endorsement is made by a consumer or an expert, there are still guidelines as to those communications. Just because a green product is promoted in an informal blog or on a Facebook page, the promoter of the product must still disclose any important connection, that exists between the company and the endorser. For example, if the company gave a blogger a free product in exchange for a review, the blogger must reveal that they received the product for free.

If someone blogs about their experience with a green product or service, the communication must include a clarification as to what the average consumer can expect. Merely stating that the blogger’s experience may not be typical, may not constitute a safe harbor from a claim of deceitful advertising by the FTC.

Individuals and companies that rely upon various social media platforms that have significant space restraints (such as Twitter), are also not relieved of their duty to reveal their relationship with the manufacturer and disclose any limitations regarding the product’s positive environmental benefits.

FTC makes it clear that regardless of the casual or informal nature of discussing products in social media, the same burdens of disclosure exists. Bloggers must reveal their relationships with the company and have the same supporting scientific data, as the manufacturer has to support its own advertisements. Blogging and the use of social media cannot be used to promote products in a manner inconsistent with FTC’s Green Guides. As a general rule, a blogger with corporate ties cannot promote a product, if that same communication would be considered deceitful if it appeared in the manufacturer’s own advertisement.

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