Just before Christmas, the Federal Trade Commission issued consent decrees with six companies resolving proceedings alleging that their marketing of CBD products was deceptive.  The consent decrees included monetary penalties as high as $80,000 and compliance plans to ensure that the named companies would not engage in future marketing of unproven health benefits of CBD products.  The FTC issued a press release on the consent decrees (links to the decrees and related documents can be found on the same webpage as the press release).

Some of the health claims that the FTC found problematic were very specific, suggesting that CBD could aid in the treatment of specific diseases and medical conditions.  Other claims found to be improper included more general claims that CBD was effective for “pain relief” and that the products are safe for all users.  As noted in the FTC documents, only proven health claims for CBD can be included in marketing material – and so far, the proven health benefits have been limited to those provided by specific FDA-approved anti-seizure medications.  While these decrees were with companies selling CBD products, rather than media companies that ran their ads, as we have noted before, broadcasters and other media companies should be alert to advertising messages that exceed permissible guidelines.  While the FDA has promised further guidance on the sale and marketing of CBD products, action has likely been stalled by the agency’s concentration on pandemic-related issues. 
Continue Reading More FTC Consent Decrees Emphasize Prohibitions on Advertising of Unproven Health Benefits of CBD Products

Here are some of the regulatory developments of the last week of significance to broadcasters, with links to where you can go to find more information as to how these actions may affect your operations.

  • The FCC, at the last of its monthly open meetings of 2020, voted to adopt new rules for Broadcast Internet

Last week, there was much written in the press about the MORE Act passing in the House of Representatives, taking actions to decriminalize marijuana under federal law.  This would include removing marijuana from Schedule I, which is the list of drugs whose use for almost all purposes is prohibited in the United States.  The passage of this bill through the House, though, should not be taken as a sign to start running marijuana advertising on your broadcast station – though there are some signs that the day on which that advertising can be run may be in sight.

First, it is important to remember that this bill passed only in the House of Representatives.  Without also being approved by the Senate and being signed by the President, the House’s action had no legal effect.  Because of the way that Congress works, if the bill does not pass the Senate in the current legislative session, which ends in the first few days of January 2021, the whole process must start over again – bills do not carry over from one Congressional session to another.  So, to become law in the new year, a new Congress would have to start with a new bill, and a new House of Representatives and a new Senate would both have to vote to adopt the legislation.
Continue Reading MORE Act Passes House – But Don’t Rush to Run Marijuana Ads on Your Broadcast Station

Perhaps some of the most controversial areas in broadcast advertising are those surrounding the advertising of cannabis products. While many states claim to have legalized marijuana, either for medical or recreational purposes, the Federal government still considers its possession and distribution a felony, and has specific laws that criminalize the use of radio frequencies, the Internet, and publications to promote its use. At the same time, the Federal government has recently decriminalized the possession of various hemp-based products with less than .3% THC (the psychoactive ingredient in marijuana) in the 2018 Farm Act. This has led to an explosion in the sale of CBD products – even though the production of such products is, for the most part, to only be conducted after either the adoption of state laws approved by the US Department of Agriculture or under Federal rules that the USDA is supposed to approve – none of which has happened yet. With all these issues outstanding, I was recently asked to talk about the advertising issues surrounding these products before a continuing legal education seminar sponsored by the New York State Bar Association. The slides from my presentation are available here.

As we have advised broadcasters before, because they are Federal licensees, and marijuana is still a federally prohibited substance, there is substantial risk in running any advertising for products supposedly “legal” in the state in which they are being used. These ads are particularly of concern during the license renewal cycle that begins next month, as objections from anti-marijuana activists could put this issue directly before the FCC. Even though states may have adopted rules governing advertising for these products, the federal law still poses great risks for broadcast licensees – just as it does for other federally-regulated entities. That is one of the reasons that federally-chartered and insured banks have stayed away from taking deposits from marijuana-related businesses (a bill is presently pending in Congress to allow banks to take deposits, but its prospects are uncertain).
Continue Reading Looking at “Legal” Marijuana and CBD Advertising – A Presentation on the Issues

The developments surrounding the regulation of cannabis products, and the impact of that regulation on the ability of broadcasters and other media companies to run ads for these products, continue on an almost daily basis.  Of course, the developments don’t all point in a single direction.  As described below, at the same time as the FDA schedules a hearing to look at cannabis products and the rules that should apply to them, the FTC and FDA together have written warning letters to CBD marketers advising them to stay away from making specific health claims about their products and to avoid promoting edible products.  What does this mean for media companies that have been approached to advertise these products?

We very recently wrote about the murky state of the law on CBD advertising (mentioning our continuing concerns about marijuana advertising even in states where it has been “legalized”).  In that article, we warned that broadcasters should be particularly concerned about selling advertising that markets CBD products to be ingested, or advertising which makes unsupported health claims.  In a joint action announced last week, the FTC and the FDA wrote letters to three sellers of CBD products, warning those companies that their marketing raised legal issues.  In these letters, the FTC expressed concern that the marketing contained health claims that could not be substantiated, and the FDA was concerned about the marketing of supplements and other CDB products to be taken orally that had not been approved by the FDA as either foods or medicines.  At least one of the letters cited a “salve” that presumably was not to be ingested, so the concern there seemed to be solely the specific health claims made for the product.  These letters reinforce the concerns that we expressed about advertising that contains specific health claims or which deals with products to be taken by mouth (either as dietary supplements, medicines or in other foods) – so stations should be especially wary of such ads. 
Continue Reading FDA Schedules Hearing on Cannabis; FTC and FDA Send Cease and Desist Letters to Sellers of CBD Products – What is the Effect on Advertising?

In the last few months, we probably have had more questions about advertising for CBD products than any other topic. At this point, CBD products seem to be sold in nearly every state in the country, and discussions about CBD’s effectiveness seem to be staples on national and local television talk programs. Broadcasters naturally ask whether they can advertise these seemingly ubiquitous products. Unfortunately, the state of the law on CBD at the current time is particularly confusing, as discussed in this article.

First, a primer on terminology. CBD, short for cannabidiol, is a derivative of the Cannabis sativa plant. Industrial hemp is produced from portions of a strain of the same plant containing low concentrations of the psychoactive chemical known as THC, or tetrahydrocannabinol, and hemp can also be used to produce CBD. In contrast, recreational and medical cannabis, derived from the dried flowers, leaves, and stems of the female Cannabis plant (which we’ll call marijuana to distinguish it from hemp), contains higher concentrations of THC and lower concentrations of CBD. Preliminary clinical research has shown the potential benefits of using CBD to treat anxiety, cognition, movement disorders, and pain, and certainly these properties are attributed to the substance in popular culture. But is it legal?
Continue Reading Advertising for CBD – Safe for Broadcasters?

In recent months, there have been many calls to regulate e-cigs, and potentially to regulate the marketing of all sorts of vaping products, including a call last week by an FCC Commissioner in an op-ed article in USA Today.  As we wrote several months ago, these suggestions have been based in the fear that increased promotion of vaping products have led to an increase in tobacco use among children.  While the FDA has been taking efforts to crack down on flavored vaping products to reduce their appeal to kids, the makers of e-cigs still advertise, including on radio and TV.  And those advertisements bring us frequent questions about whether the FCC has rules about advertising these products.  So far, the FCC has had no real role in regulating these products.  In fact, one wonders if it really has any authority to take action against the advertising of e-cigs without Congressional action.

So far, all the limits on e-cig advertising have been imposed by other agencies – principally, the FDA.  The FDA requires a tag on all vaping ads, stating that these products contain nicotine, which is an addictive substance (see our articles here and here for more details about that requirement).  And these ads should not claim health benefits for vaping.  Given the FDA’s concern about children, any ads should also stay out of programming with a large audience of children.  Could the FCC itself do more?
Continue Reading A Call to Regulate E-Cig Advertising – What is the FCC’s Role in Regulating Advertising For the Vices?

As David Oxenford has previously commented, even in states where marijuana has been legalized, broadcasters should be cautious about accepting advertising for marijuana or related paraphilia.  Specifically, decisions by the FDA and the Department of Justice have done little to cut through the smoke shrouding the issue.  Now, perhaps the last United States agency that one might expect to have anything to say has weighed in as well, but the haze remains thick.

Specifically, the US Patent and Trademark Office is not viewed as a policy-making agency, charged with making decisions about what activities or behavior are permissible or impermissable.  Rather, it determines whether trademarks qualify for federal protection through registration, considering issues such as the distinctiveness of a mark and whether it is confusingly similar to a previously registered mark.  As we have discussed in our Trademark Basics for Broadcasters series and our follow-up free webinar, although the various factors seem cut and dried, there is often a great amount of subjectivity and discretion that goes into evaluating each factor.
Continue Reading Accepting Advertising for Marijuana or Marijuana Paraphernalia:  The Trademark Office Rules on a Related Issue that Provides More Reason For Caution

Last week’s letter from the FDA detailing its position that there should be no change in marijuana being classified as a Schedule I drug under Federal law reinforces the fact that, under Federal law, the drug is still illegal – no matter what certain states may do to legalize or decriminalize its use. As the FDA’s decision emphasizes that the sale and distribution of the drug is still not permitted under Federal law, we thought that we would rerun the advice that we gave to broadcasters – Federal licensees – about running advertising for marijuana. As we said in February when we first ran this article, advertising for marijuana is still a concern.  Here is what we said in February:

Broadcasters, like other federally regulated industries, continue to be leery about advertising for marijuana, even in states where cannabis dispensaries have been legalized for medical or even recreational use.  This week, the NY Times ran an article about companies trying to provide ways for dispensaries to use electronic payment systems, as federally regulated banks and credit card companies often refuse to deal with these businesses.  This is despite guidance given by the Department of Justice to banks about how to handle funds coming from such organizations.  Where the federal regulator (the FCC) has provided no advice whatsoever, broadcasters as regulated entities need to be very restrained in their desires to run ads for these dispensaries that appear to be legal under state laws.
Continue Reading FDA Continues to Schedule Marijuana as a Schedule I Drug – Doing Nothing to Clarify the Still Murky State of Broadcast Advertising