Environmental and consumer rights groups have issued advisory standards prescribing what is out of bounds or inappropriate when advertising “green” claims. While there is no federal or state law that specifically regulates these sorts of claims, there are two federal statutes, the Lanham Act and the Federal Trade Commission Act (among others) that have been interpreted to govern these sorts of claims. In fact, the FTC has recently promulgated regulations guiding businesses in their eco-marketing. The Government has concluded that advertising or marketing that is imprecise, misleading, inaccurate, vague and outright untrue violates federal law. Claims such as “eco-friendly,” “green,” “up to X% recyclable content” are simply too vague or ambiguous to stand under federal law. These may seem somewhat obvious but the FTC went even further, concluding that claims of recyclability where no recycling facilities exist or are available similarly violates the law, even if the item can be recycled. The FTC has begun to take administrative action against companies that it catches in such practices. Companies can be cited and, if found guilty of these practices, fined. A few examples will help illustrate the pitfalls for over exuberant marketers. The FTC has cited companies for: (1) advertising that a percentage of their proceeds would be donated to environmental charities when they weren’t; (2) claiming that a specific formulation of anti-freeze could be mixed with conventional antifreeze in recycling when it actually could not and doing so damaged the recyclers; (3) claims that clothing was made of bamboo fiber when they were actually made of rayon (even if some small amount of bamboo content was included when it was so processed that it did not retain any of its natural properties); and (4) stating that paper products, such as paper plates, were biodegradable when they were not.

There are a number of rating and labeling agencies that, upon provision of sufficient information, will certify products and services as environmentally sound. These require research and documentation and can be expensive and time consuming. However, having third party certification is certainly one way of ensuring that the federal government shouldn’t come knocking at your door for claiming that something is “green” when that’s just the color of its box.

Arthur Siegal is a partner with Michigan-based Jaffe Raitt Heuer & Weiss. Jaffe is recognized throughout the nation as a relationship-based, highly qualified, full-service business law firm. With an outstanding reputation for providing sophisticated legal services and counsel to businesses of all sizes, family-owned enterprises, individuals and entrepreneurs, Jaffe has more than 100 attorneys in its Southfield, Detroit, Ann Arbor, Naples and Jerusalem offices.
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