Are Trade Associations Liable for Influencer Posts?

Answer: yes.

According to Sam Levine, Director of the FTC's Bureau of Consumer Protection:

    * “It's irresponsible for any trade group to hire influencers to tout its members' products and fail to ensure that the influencers come clean about that relationship.”

    *  “That's certainly true for health and safety claims about sugar and aspartame, especially when made by registered dieticians and others upon whom people rely for advice about what to eat and drink.”

In November 2023, the FTC sent penalty notice letters to two associations:

    *  American Beverage Association, and

    *  The Canadian Sugar Institute.

Warning letters were also sent to the individual persons who made social media posts for the two trade associations.

The warning letters pointed out specific penalty offenses for which the recipients could face civil penalties of up to $50,120 for each violation.

Specific penalty offenses included:

    *  “Material connection” disclosures were either missing or inadequately prominent (they should be “difficult to miss” and “easily understandable by ordinary consumers”).

    *  Where there is both a text and a video post, the FTC expects the disclosure to appear in both the text and in the video itself.

    *  Disclosures should be immediately visible without having to expand the post, typically meaning that it should be made very early in the text so it's visible when the post is truncated.

    *  The FTC did not view the platforms' “Paid Partnership” disclosures as sufficient stating: “We think it is too easy for viewers to miss seeing the ‘Paid Partnership' disclosure in these posts.”

Takeaway

It's clear that the FTC is sending the message that they are planning on enforcement actions consistent with the penalty notice letters.

Trade associations acting as advertisers and their influencers had better tighten up compliance or expect enforcement actions seeking civil penalties.