Refresh the page, check Medium 's site status, or find something interesting to read. In January 2016, the makers of popular brain-training app Luminosity were given a $2 million fine from the Federal Trade Commission, which said the company deceived players with unfounded advertising claims. On top of the fine of $45 million, Dannon was ordered to remove clinically and scientifically proven from its labels, according to ABC. Red Bull released this statement following the settlement: Red Bull settled the lawsuit to avoid the cost and distraction of litigation. The tagline, which the company has used for nearly two decades, went alongside marketing claims that that the caffeinated drink could improve a consumer's concentration and reaction speed. However, they were still making factual claims that couldnt be backed up by science. Kellogg agreed to pay $2.5 million to affected consumers, as well as donating $2.5 million worth of Kellogg products to charity, according to Law360. Read our privacy policy for more information. However, unless these claims are backed up by genuine research, theyre considered false. Classmates.com eventually agreed to pay out a $9.5 million settlement $3 for every subscriber who fell for the dirty trick to resolve the case, according to the Business Journal. False advertising has been known to cause major headaches on companies that committed them. If you're interested in learning more about the legal framework for truth in advertising, so you can walk the line as closely as possible without creating problem for your brand, the Federal Trade Commission has a helpful outline on the subject. Jessica Rich, a director at the FTC said: Lumosity simply did not have the science to back up its ads. Wal-Mart staff allegedly lied about the reasons for the price-hike, telling customers that New York has a "sugar tax," according to Corporate Crime Reporter. Food giant Kellogg's has been banned from telling consumers that its Special K cereal is "full of goodness" and "nutritious" in UK ad campaigns. However, Red Bull maintains that its marketing and labeling have always been truthful and accurate, and denies any and all wrongdoing or liability. Beganin Caraethers was one of several consumers who brought the case against the Austrian drinks company. Wrigley denied wrongdoing, but was ordered to pay more than $6 million to a fund that would reimburse consumers up to $10 each for the misleading product, in 2010. Equal waslooking for$200 million from Splenda in the settlement for unfair profits. The lawsuit against Dannon began in 2008, when consumer Trish Wiener lodged a complaint. You should do your research to learn how the product accomplishes its claims, especially if the product seems too good to be true. Make sure you check sources beyond the manufacturer to get unbiased research. The British advertising regulator ASA banned the ad, after Liberal Democrat lawmaker Jo Swinson gathered more than 700 complaints against it. The maker of penis enlargement pill Extenze agreed to pay $6 million to settle a class action lawsuit in 2010, according to CBS. The toning sneaker claimed to use hidden board technology and was advertised as calorie burners that activated the glutes, quads, hamstrings and calves. They were worth up to $225. Last April, the Kellogg Company settled FTC charges over false advertising claims for another popular breakfast cereal Frosted Mini-Wheats. On March 29 this year, the Federal Trade Commission (FTC) filed a lawsuit against Volkswagen, which claimed that the car company had deceived customers with the advertising campaign it used to promote its supposedly Clean Diesel vehicles, according to a press release. AUM: $252 million. Red Bull released this statement following the settlement: "Red Bull settled the lawsuit to avoid the cost and distraction of litigation. The FTC alleged that Volkswagen deceived consumers by selling or leasing more than 550,000 diesel cars based on false claims that the cars were low-emission, environmentally friendly. Ads for Dannon's popular Activia brand yogurt landed the company with a class action settlement of $45 million in 2010, according to ABC News. The FTC alleged that "Volkswagen deceived consumers by selling or leasing more than 550,000 diesel cars based on false claims that the cars were low-emission, environmentally friendly.". These Sisters Quit Their Jobs Mid-Pandemic to Risk It All for Their Brand. Millions of people lit up when Classmates.com sent them an email saying old friends were trying to contact them, promising to rekindle old friendships and flames if subscribers upgraded to a "Gold" membership.But with the upgrade, the expected reunions never came. They claimed that Mini-Wheats improved children's attentiveness, memory and other functions. The ad campaign claimed that the breakfast cereal could improve a child's focus by nearly 20%. November 6, 2012. It turned out the ads were retouched, according to The Guardian. The lawsuit against Dannon began in 2008, when consumer Trish Wiener lodged a complaint. It turns out the social networking site used the ploy to get users to give up extra dollars. Phrases similar to "clinical studies show" were deemed permissible. In 2008, one miffed user filed a suit alleging the deceptive emails were false advertising. 1. Extenze agreed to pay $6 million to settle a false advertising class action lawsuit. The war imprinted on the new State a mentality that expressed itself in grotesque ways in the Kerry Babies scandal. In 2013, UK supermarket chain Tesco was criticized after it ran a "misleading" ad campaign in the wake of its horse meat scandal, according to The Telegraph. Energy drinks company Red Bull was sued in 2014 for its slogan "Red Bull gives you wings." According to the FTC complaint, Volkswagen promoted its supposedly "clean" cars through a high-profile marketing campaign that included Super Bowl ads, online social media campaigns, and print . We found 18examples of false advertising scandals that have rocked big brands some are still ongoing and not all companies have had to pay up, but each dealt with a fair amount of negative publicity. The most blatant kind of fraudulent advertising occurs when a brand simply lies. On August 20, 2012, New Balance agreed to pay a settlement of $2.3 million, according to The Huffington Post. Millions of people lit up when Classmates.com sent them an email saying old friends were trying to contact them, promising to rekindle old friendships and flames if subscribers upgraded to a "Gold" membership.But with the upgrade, the expected reunions never came. You can learn more about standing up to deceptive companies by scheduling your consultation with a false advertising lawyer today. Kellogg's Frosted Mini-Wheats. Lumos Labs said Luminosity could help prevent Dementia. FTC consumer protection laws vary from state to state. Phrases similar to "clinical studies show" were deemed permissible. An ad was considered "false" if it made a claim for which there was no supportive evidence. In 2007, a resulting lawsuit led by the makers of rival sweetener Equal, settled against Splenda. The maker of penis enlargement pill Extenze agreed to pay $6 million to settle a class action lawsuit in 2010, according to CBS. The Federal Trade Commission ordered Kellogg to halt all advertising that claimed that the cereal improved a child's immunity with "25 percent Daily Value of Antioxidants and Nutrients Vitamins A, B, C and E," stating the the claims were "dubious.". Marketing of the product claimed that it helped ward off harmful bacteria and germs, preventing everyday ailments like the flu and common cold.There were no studies to support Airborne's effectiveness claims that met scientific standards so the Center for Science in the Public Interest (CSPI) got involved. When the FTC stepped in, the brand was banned from using any anti-aging claims or the phrase clinically proven without substantial and reliable scientific evidence. The digitally-altered spots were deemed to give a "misleading impression of the effect the product could achieve. Brand Finance could have a point. In total, the Avon entities will pay $67,648,000 in criminal penalties. It turns out the social networking site used the ploy to get users to give up extra dollars. The high-profile scandal ended with a huge settlement, with Airborne having to pay $23.3 million in the class-action lawsuit, and an additional $7 million settlement later, according to NPR. Jessica Rich, a director at the FTC said: "Lumosity simply did not have the science to back up its ads.". They were not using explicit language that was easily falsifiable. A lawsuit alleged that Taco Bell was falsely advertising its beef. ", Tesco was criticised for an ad in response to the horsemeat scandal, which suggested the problem affected "the whole food industry.". In its defense, Kellogg said that the ad campaign ran four years previously and that it had since adjusted its claims about the cereal. I understand that the data I am submitting will be used to provide me with the above-described products and/or services and communications in connection therewith. According to the FTC, the claims were false and unsubstantiated. The supermarket chain had advertised a nationwide sale on the soft drink in 2014, where 12-packs would cost just $3.oo. The brand has advertised these lines as being proven to boost genes and make skin look visibly younger in just a week. The company agreed to pay $4 million for false advertising claims it made about Frosted Mini-Wheats. According to the lawsuit reported in AdAge, the "seasoning" used was oat filler which means the meat isn't seasoned beef at all, according to USDA standards. Plaintiffs in the lawsuit claimed to have been harmed and misled by the sneaker company. It complained that the tagline was misleading, and that the sweetener is nothing more than highly processed chemical compound made in a factory, CBS reported. Phrases similar to "clinical studies show" were deemed permissible. The makeup brand LOreal faced significant fraudulent advertising charges in 2014 regarding its claims that its Lancme Gnifique and LOral Paris Youth Code skincare products were clinically proven to do certain things. The class action lawsuit was on behalf of around 840,000 people who bought the 1996 to 2002 models of the Hyundai Elentra sedans and the Tiburon sport coupes. A Nov. 7, 2018 email from Vanessa Mathisen, an immigration attorney with World Relief Spokane, stated that "many of our clients are unwittingly getting registered to vote when they get their IDs, apply or receive any state benefits. The manufacturer ended up offering full compensation packages to the 600,000 US Volkswagen owners affected by their deception. VW's settlement of Dieselgate could total $15 billion. On top of potential fines for false advertising, the company could have to pay out up to $61 billion for violating the Clean Air Act, according to Wired. Wal-Mart falsely advertised the price of Coke in New York. The major faux pas earned it a $2 million fine, though that's not much more than a drop in the bucket for the deep-pocketed Cupertino company. In 2001, the Korean Ministry of Construction and Transportation had uncovered the misrepresentation, which, for some models, overstated horsepower by 10%. According to the FTC, the claims were "false and unsubstantiated.". On March 29 this year, the Federal Trade Commission (FTC) filed a lawsuit against Volkswagen, which claimed that the car company had deceived customers with the advertising campaign it used to promote its supposedly"Clean Diesel"vehicles,according to a press release. Marketing of the product claimed that it helped ward off harmful bacteria and germs, preventing everyday ailments like the flu and common cold.There were no studies to support Airborne's effectiveness claims that met scientific standards so the Center for Science in the Public Interest (CSPI) got involved. The suit alleged that the franchise had been tricking its consumers into thinking its products were of a higher grade than they actually were. Once the fast-food giant was taken to court, it was established that the "seasoning" in question wasn't beef but oat filler.