When Vibram, the “FiveFinger” shoe company, was hauled into federal court in Boston in late March, it became the latest prominent business swept up in the growing wave of consumer class actions based on false advertising claims. That wave does not yet appear to have reached its crest, and with recent revisions to the “green” labeling guidelines, it may be far from its peak. Ultimately, no matter what products or services your company sells—whether it is shoes, razors, baby formula, dietary supplements, juice, cat litter, wireless telephone service, cleaning supplies, or yogurt—advertising content can leave you awash in class action lawyers—and more importantly, can lead to tens of millions of dollars in exposure to damages for false or misleading advertising claims.
It’s not just the class action lawyers that in-house counsel need to worry about—competitors also sue over unfavorable product comparisons. If they win, they stand to recover substantial monetary damages, including the disgorgement of profits and attorneys’ fees under the Federal Lanham Act.
