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Ads & Brands Law Digest: May 2019

30 May 2019

Welcome to the May 2019 issue of our monthly Ads & Brands Law Digest. We have selected the legal and regulatory developments from the month that we think are most likely to be of interest, with a very brief summary and then a link to the original and official source or full text of the item.

Advertising & Marketing

High Court upholds ASA’s approach to the understanding of the “average consumer” in judicial review of ASA ruling on the use of the term “fibre” in broadband ads

Judicial review proceedings were brought by CityFibre Ltd on the grounds that the ASA had (they argued) wrongly adopted an approach to claims made in ads for broadband services that permitted the use of the terms “fibre” or “fibre broadband” to describe services that were only partially delivered by fibre technology. CityFibre argued that such uses of the term “fibre” would thus mislead consumers, given that the performance of pure fibre connections was superior to part-fibre. But the ASA Council had decided, to the contrary, that “ads that refer to part-fibre broadband services as ‘fibre’ broadband are unlikely to mislead consumers.”

The legislation under-pinning much of the CAP & BCAP Codes and the ASA’s approach to their enforcement is the Consumer Protection from Unfair Trading Regulations, and those Regulations provide that the test for whether particular practices are misleading must be based upon whether the “average consumer” would be misled, such a consumer being “reasonably well-informed, reasonably observant and circumspect”.

The judge concluded that the ASA had taken a perfectly proper approach to deciding what the reasonably informed “average consumer” should be taken to know about broadband technology – it is a matter of qualitative judgment for the regulator, but can be informed by independent research such as the ASA had commissioned in this case. The ASA was thus entitled to conclude that such an average consumer would not have much knowledge or concern about the “fibre” terminology used, and therefore would not be misled by its broad-brush application in ads. - Read more here

ASA uses monitoring technology to combat online gambling ads targeted at children and plans roll-out to other sectors

The ASA and CAP announced at the beginning of April 2019 that they have been using new technology – in the form of child “avatars” (i.e. online profiles that simulate the browsing activity of children) – to monitor the compliance of advertising served to children online. The first deployment of this technology was across 24 children’s websites and 20 open-access YouTube channels, with over 10,000 ads from 43 gambling operators being served to the “child” avatars during a 2 week period. In the case of 5 of the gambling operators, there was sufficient evidence for the ASA to conclude that they were in breach of CAP Code rules against the targeting of gambling ads to under-18s.

The use of the avatars was featured in the recently published ASA annual report, and so it seems likely that this more pro-active approach will continue. CAP and the ASA are now looking at whether the same type of monitoring and enforcement could be extended to logged-in environments such as Facebook, Instagram, YouTube and Twitter, and also whether to apply it to monitor the exposure of children to HFSS and alcohol ads, as well as gambling. - Read more here

ASA ruling on iSpyEyes in association with Marnie Simpson of 29th May 2019 – celebrity’s Instagram posts were directed at UK and potentially unsafe & misleading regarding supply of zero-powered contact lenses without specialist advice

The reality TV personality Marnie Simpson had mentioned her range of zero-powered contact lenses (for changing eye colour) in a series of Instagram posts in autumn 2018. But a complainant objected that the advertised supplier – iSpyEyes – could not legally sell such lenses in the UK without the supervision of a suitably qualified eye specialist. On behalf of Marnie it was argued that her Instagram posts were global rather than being directed at the UK, and thus not subject to the CAP Code, but the ASA found numerous grounds to disagree, not least the celebrity’s UK origins and fan-base, and the use of sterling prices and “UK next working day delivery” on the iSpyEyes website. The advertiser argued that zero-powered contact lenses could be safely and legally supplied without the supervision of a suitable practitioner, but the relevant legislation and advice from eye-care specialists all pointed in the other direction. The ASA therefore found that the Instagram posts had breached the CAP Code in respect of legality, potential harm and misleading advertising. - Read more here

Trading Standards in Wales secures £60,000 fine against H Samuel jewellers in prosecution for misleading use of reference prices in breach of CPRs

When promoting a “Forever Diamond” range of rings on its website, the trader H Samuel had used reference prices to demonstrate the alleged good value of the rings, but had failed to tell customers about lower intervening prices and had run the price promotions in question for materially longer periods than the higher prices had been in place.

Following an investigation by Torfaen Council’s trading standards team, and the launch of criminal enforcement proceedings, H Samuel pleaded guilty to 17 breaches of the Consumer Protection from Unfair Trading Regulations, and promised to improve its systems to prevent any repetition. It was fined £60,000 by the court, which gave credit for the guilty pleas, good character and co-operation of the defendants. - Read more here

Data & Privacy

ICO launches consultation on Age-appropriateness Code of Practice for Information Society Service providers

As required by the Data Protection Act 2018, the Information Commissioner’s Office is consulting until 31st May on a new Code to protect children’s privacy online, made up of 16 standards. The idea is to encourage designers of apps, connected toys, social media platforms, online games, streaming services, educational websites, etc, to “build in” the protection of children’s privacy rather than trying to bolt it on after the event. The Code aims to ensure high levels of privacy, including that: settings should be “high privacy” by default; only the minimum amount of personal data should be collected; children’s data should not usually be shared; profiling and geolocation should be switched off by default (an operator would need to be able to demonstrate compelling reasons to justify profiling or geo-location services); and nudge techniques should not be used to encourage children to provide unnecessary data or weaken their privacy settings. - Read more here

Bounty UK fined £400,000 for sharing personal data unlawfully

Bounty had been collecting personal data for the purposes of membership of its pregnancy and parenting club, but had not been sufficiently clear with people that it would also share their data with third parties via its in-house data broking service for the purposes of electronic marketing and credit referencing. The personal data shared was not only of the mothers but also of their very young children, including the birth date and sex of the child. The size of the fine reflected both the unprecedented scale of the unlawful sharing of data – over 34.4 million records, relating to over 14 million individuals – and the deliberate and systematic way in which it had been conducted. - Read more here

Trade Marks & Passing Off

Court of Appeal issues reminder that cyber-squatting in itself does not amount to passing off unless all elements of the tort are made out

In order to use the common law action of passing off against a “cyber-squatter” who has registered a domain name that includes a mark belonging to the claimant, it is necessary to make out all three elements of passing off, i.e. goodwill, misrepresentation and damage. In this case the judge had relied upon the earlier case-law (British Telecommunications v One in a Million) to leap from cyber-squatting to a finding of passing off without assessing whether the claimant had actionable reputation or goodwill. An appeal was allowed in part, as no use had been made of one of the marks and thus no goodwill could have been built up upon which to found a passing off action against the “cyber-squatter” in that respect. - Read more here

IPEC finds infringement of stag's head logo based upon artistic copyright

This Intellectual Property Enterprise Court ruling was based upon infringement of artistic copyright in the claimant’s logo (rather than an action for trade mark infringement or passing off). In light of the very high level of similarity between the two stag-head logos, and the fact that the defendants had admitted looking at hundreds of stag logos online during the course of developing their design, the judge found that it was more likely than not that the defendants had copied the claimants’ logo, and thus infringed their copyright. - Read more here

New service alerts EU TM owners & applicants to registrations of identical .eu domain names

With effect from 18th May 2019, holders of and applicants for an EU Trade Mark can opt-in to receive an alert if a .eu domain name is registered that is identical to their EUTM or application. This speedy alerting process reduces the risk that previously existed whereby cyber-squatters could register (in bad faith) and establish a domain name based upon early EUTM applications. - Read more here

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