Fundamental Issues in the Ethics of Marketing

Fundamental issues in the ethics of marketing [edit]Frameworks of analysis for marketing ethically Possible frameworks: ?Value-oriented framework, analyzing ethical problems on the basis of the values which they infringe (e. g. honesty, autonomy, privacy, transparency).

An example of such an approach is the AMAStatement of Ethics. [1] ? Stakeholder-oriented framework, analysing ethical problems on the basis of whom they affect (e. g.

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consumers, competitors, society as a whole). ?Process-oriented framework, analysing ethical problems in terms of the categories used by marketing specialists (e. g. research, price, promotion, placement).None of these frameworks allows, by itself, a convenient and complete categorization of the great variety of issues in marketing ethics. [edit]Power-based analysis Contrary to popular impressions, not all marketing is adversarial, and not all marketing is stacked in favour of the marketer.

In marketing, the relationship between producer/consumer or buyer/seller can be adversarial or cooperative. For an example of cooperative marketing, see relationship marketing. If the marketing situation is adversarial, another dimension of difference emerges, describing the power balance between producer/consumer or buyer/seller.Power may be concentrated with the producer (caveat emptor), but factors such as over-supply or legislation can shift the power towards the consumer (caveat vendor). Identifying where the power in the relationship lies and whether the power balance is relevant at all are important to understanding the background to an ethical dilemma in marketing ethics. [2] [edit]Is marketing inherently evil? A popularist anti-marketing stance commonly discussed on the blogosphere[3] and popular literature[4] is that any kind of marketing is inherently evil.The position is based on the argument that marketing necessarily commits at least one of three wrongs: ? Damaging personal autonomy. The victim of marketing in this case is the intended buyer whose right to self-determination is infringed.

?Causing harm to competitors. Excessively fierce competition and unethical marketing tactics are especially associated with saturated markets. ?Manipulating social values. The victim in this case is society as a whole, or the environment as well. The argument is that marketing promotes consumerism and waste.

See also: affluenza, ethical consumerism, anti-consumerism. Marketing has a major impact on our self-images, our ability to relate to one another, and it ruins any knowledge and action that might help to change that climate. ?Marketing/Advertising creates artificiality and influences sexual attitudes. [edit]Specific issues in marketing ethics [edit]Market research Ethical danger points in market research include: ?Invasion of privacy. ?Stereotyping.

Stereotyping occurs because any analysis of real populations needs to make approximations and place individuals into groups. However if conducted irresponsibly, stereotyping can lead to a variety of ethically undesirable results.In the American Marketing Association Statement of Ethics, stereotyping is countered by the obligation to show respect (“acknowledge the basic human dignity of allstakeholders”).

[5] [edit]Market audience Ethical danger points include: ?Excluding potential customers from the market: selective marketing is used to discourage demand from undesirable market sectors or disenfranchise them altogether. ?Targeting the vulnerable (e. g. children, the elderly). Examples of unethical market exclusion[6] or selective marketing are past industry attitudes to the gay, ethnic minority and obese (“plus-size”) markets.

Contrary to the popular myth that ethics and profits do not mix, the tapping of these markets has proved highly profitable. For example, 20% of US clothing sales are now plus-size. [7] Another example is the selective marketing of health care, so that unprofitable sectors (i. e. the elderly) will not attempt to take benefits to which they are entitled.

[8] A further example of market exclusion is the pharmaceutical industry’s exclusion of developing countries from AIDS drugs. [9] Examples of marketing which unethically targets the elderly include: living trusts, time share fraud, mass marketing fraud[10] and others. 11] The elderly hold a disproportionate amount of the world’s wealth and are therefore the target of financial exploitation. [12] In the case of children, the main products are unhealthy food, fashionware and entertainment goods.

Children are a lucrative market: “… children 12 and under spend more than $11 billion of their own money and influence family spending decisions worth another $165 billion”,[13] but are not capable of resisting or understanding marketing tactics at younger ages (“children don’t understand persuasive intent until they are eight or nine years old”[13]).At older ages competitive feelings towards other children are stronger than financial sense. The practice of extending children’s marketing from television to the schoolground is also controversial (see marketing in schools). The following is a select list of online articles: ? Sharon Beder, Marketing to Children[14] (University of Wollongong, 1998).

?Miriam H. Zoll, Psychologists Challenge Ethics of Marketing to Children, (2000). [15] ? Donnell Alexander and Aliza Dichter, Ads and Kids: How young is too young? [16] ? Rebecca Clay, Advertising to children: Is it ethical? 17] (Monitor on Psychology, Volume 31, No. 8 September 2000), American Psychological Association ? Media Awareness Network. How marketers target kids. [18] Other vulnerable audiences include emerging markets in developing countries, where the public may not be sufficiently aware of skilled marketing ploys transferred from developed countries, and where, conversely, marketers may not be aware how excessively powerful their tactics may be.

See Nestle infant milk formula scandal. Another vulnerable group are mentally unstable consumers. 19] The definition of vulnerability is also problematic: for example, when should endebtedness be seen as a vulnerability and when should “cheap” loan providers be seen as loan sharks, unethically exploiting the economically disadvantaged? Chris Akabusi is the leading academic author of Marketing Ethics and his theories are widely debated. [edit]Pricing ethics This section requires expansion. List of unethical pricing practices. ?Bid rigging ?Dumping (pricing policy) ?Predatory pricing ?Price discrimination ?Price fixing ?Price skimming Price war ?Supra competitive pricing ?Variable pricing [edit]Ethics in advertising and promotion [edit]Content Ethical pitfalls in advertising and promotional content include: ? Issues over truth and honesty. In the 1940s and 1950s, tobacco used to be advertised as promoting health.

[20] Today an advertiser who fails to tell the truth not only offends against morality but also against the law. However the law permits “puffery” (a legal term). [21] The difference between mere puffery and fraud is a slippery slope: “The problem.

.. s the slippery slope by which variations on puffery can descend fairly quickly to lies. “[22] See main article: false advertising. ?Issues with violence, sex and profanity.

Sexual innuendo is a mainstay of advertising content (see sex in advertising), and yet is also regarded as a form of sexual harassment. [23] Violence is an issue especially for children’s advertising and advertising likely to be seen by children. ?Taste and controversy. The advertising of certain products may strongly offend some people while being in the interests of others.Examples include: feminine hygiene products, hemorrhoid andconstipation medication. [24] The advertising of condoms has become acceptable in the interests of AIDS-prevention, but are nevertheless seen by some as promoting promiscuity.

Some companies have actually marketed themselves on the basis of controversial advertising – see Benetton. Sony has also frequently attracted criticism for unethical content (portrayals of Jesus which infuriated religious groups; racial innuendo in marketing black and white versions of its PSP product; graffiti adverts in major US cities). 25] ? Negative advertising techniques, such as attack ads. In negative advertising, the advertiser highlights the disadvantages of competitor products rather than the advantages of their own. The methods are most familiar from the political sphere: see negative campaigning.

[edit]Delivery channels ?Direct marketing is the most controversial of advertising channels, particularly when approaches are unsolicited. TV commercials and direct mail are common examples. Electronic spam andtelemarketing push the borders of ethics and legality more strongly. Shills and astroturfers are examples of ways for delivering a marketing message under the guise of independent product reviews and endorsements, or creating supposedly independent watchdog or review organisations. For example, fake reviews can be published on Amazon. [26] Shills are primarily for message-delivery, but they can also be used to drive up prices in auctions, such as Ebayauctions.

[27] [edit]Deceptive Advertising and Ethics Another breach of marketing ethics has to do with the use of deceptive advertising.This form of advertising is not specific to one target market, and can sometimes go unnoticed by the public. There are a number of different ways in which deceptive marketing can be presented to consumers; one of these methods is accomplished through the use of humor.

In a study conducted by Hassib Shabbir and Des Thwaites, 238 advertisements were assessed and 73. 5% of them were found to have used deceptive marketing practices. Of those advertisements that were conducted deceptively, 74. 5% of them used humor as a masking device in order to mislead potential customers.Part of what drives this study is the idea that humor provides an escape or relief from some kind of human constraint, and that some advertisers intend to take advantage of this by deceptively advertising a product that can potentially alleviate that constraint through humor. Through the study it was also found that all types of humor are used to deceive consumers, and that there are certain types of humor that are used when making certain deceptive claims. It is important to understand that humor is not the only method that is used to deter consumer’s minds from what a product actually offers.

Before making important purchases, one should always conduct their own research in order to gain a better understanding of what it is they are investing in. ][28] [edit]The use of ethics as a marketing tactic Business ethics has been an increasing concern among larger companies, at least since the 1990s. Major corporations increasingly fear the damage to their image associated with press revelations of unethical practices. Marketers have been among the fastest to perceive the market’s preference for ethical companies, often moving faster to take advantage of this shift in consumer taste.This results in the expropriation of ethics itself as a selling point or a component of a corporate image.

?The Body Shop is an example of a company which marketed itself and its entire product range solely on an ethical message. ?Greenwash is an example of a strategy used to make a company appear ethical when its unethical practices continue. ?Liberation marketing is another strategy whereby a product can masquerade behind an image that appeals to a range of values, including ethical values related to lifestyle and anti-consumerism.

29] “Liberation marketing takes the old mass culture critique — consumerism as conformity — fully into account, acknowledges it, addresses it, and solves it. Liberation marketing imagines consumers breaking free from the old enforcers of order, tearing loose from the shackles with which capitalism has bound us, escaping the routine of bureaucracy and hierarchy, getting in touch with our true selves, and finally, finding authenticity, that holiest of consumer grails. ” (Thomas Frank)[30] [edit]Marketing strategy The main theoretical issue here is the debate between free markets and regulated markets.

In a truly free market, any participant can make or change the rules. However when new rules are invented which shift power too suddenly or too far, other participants may respond with accusations of unethical behaviour, rather than modifying their own behaviour to suit (which they might not be able to anyway). Most markets are not fully free: the real debate is as to the appropriate extent of regulation. Case: California electricity crisis, which demonstrates how constant innovation of new marketing strategies by companies such as Enron outwitted the regulatory bodies and caused substantial harm to consumers and competitors.A list of known unethical or controversial marketing strategies: ? Anti-competitive practices ?Bait and switch ?Planned obsolescence ?Pyramid scheme ?Vendor lock-in / Vendor lock-out ?Viral marketing / guerilla marketing Controversial marketing strategies associated with the internet: ? Embrace, extend and extinguish ?Search engine optimisation ?Spamdexing ?Spyware / Adware [edit]Further issues in marketing ethics Marketing ethics overlaps with environmental ethics in respect of waste problems associated with the packaging of products. 31] Some, such as members of the advocacy group No Free Lunch, have argued that marketing by pharmaceutical companies is negatively impacting physicians’ prescribing practices, influencing them to prescribe the marketed drugs rather than others which may be cheaper or better for the patient. [32] Ethically thinking is responding to situations that deal with principles concerning human behavior in respect to the appropriateness and inappropriateness of certain communication and to the decency and indecency of the intention and results of such actions.In other words, ethics are distinctions between right and wrong.

Businesses are confronted with ethical decision making every day, and whether employees decide to use ethics as a guiding force when conducting business is something that business leaders, such as managers, need to instill. Marketers are ethically responsible for what is marketed and the image that a product portrays. With that said, marketers need to understand what good ethics are and how to incorporate good ethics in various marketing campaigns to better reach a targeted audience and to gain trust from customers.Marketing ethics, regardless of the product offered or the market targeted, sets the guidelines for which good marketing is practiced. When companies create high ethical standards upon which to approach marketing they are participating in ethical marketing.

To market ethically and effectively one should be reminded that all marketing decisions and efforts are necessary to meet and suit the needs of customers, suppliers, and business partners. Ethical behavior should be enforced throughout company culture and through company practices. [edit]Regulation and enforcement This section requires expansion.Marketing ethics and marketing law are related subjects. Relevant areas of law include consumer law which protects consumers and antitrust law which protects competitors – in both cases, against unethical marketing practices. Regulation extends beyond the law to lobbies, watchdog bodies and self-regulatory industry bodies.

?Advertising regulation ?Consumer protection [edit]See also ?Consumerism ?Customer relationship management ?Ethical marketing ?False advertising ?List of business ethics, political economy, and philosophy of business topics ? Marketing ?Marketing warfare strategies ?Media ethics Propaganda [edit]References 1. ^ American Marketing Association Statement of Ethics (2004) 2. ^ Lizabeth England,Marketing With A Conscience: Sales and Ethics, US Dept.

of State. 3. ^ A. J.

Kandy, Is marketing evil? , King Marketing, 2004; William DeJong, Marketing Gets Unfairly Branded as Evil, Youth Today; Kathy Sierra, You ARE a marketer. Deal with it, 2005. 4. ^ The vastness of the literature on this topic is perhaps best conveyed by D. Slaters 1999bibliography of consumer culture with over 1500 items. W.

R. Childs (Ohio State University) has posted a shorter bibliography of consumer culture. . ^ American Marketing Association Statement of Ethics 6. ^ The term “selective marketing” is preferred.

The term market exclusion is normally used in the different context of a cartel of suppliers excluding newcomers from distribution chains. 7. ^ CBS News, Plus-Size People, Plus-Size Stuff, Nov 10, 2003 8.

^ Mark H. Waymack, The ethics of selectively marketing the Health Maintenance Organization, Journal of Theoretical Medicine and Bioethics, Issue Volume 11, Number 4 / December, 1990, Pages 301-309 9. ^ Ruairi Brugha, Antiretroviral treatment in developing countries, BMJ 2003;326:1382-1384 10.

Senior Journal, Hundreds Arrested in Mass-Marketing Fraud Targeting Senior Citizens, May 24, 2006 11. ^ Washington State Department of Financial Institutions, Frauds That Target The Elderly, July 11, 2006 (Originally from: Federal Deposit Insurance Corporation Consumer News) 12. ^ US Federal Trade Commission, Consumer fraud against the elderly. 13.

^ a b Tom McGee and Kevin Heubusch, `Getting Inside Kids’ Heads’, American Demographics, Vol. 19, No. 1 (1997), quoted in Sharon Beder, Marketing to Children, University of Wollongong, 1998. 14. ^ UOW. edu.

au 15. ^ Mediachannel. org 16. ^ Mediachannel. rg 17.

^ PA. org 18. ^ Media-awareness.

ca 19. ^ Deborah Josefson, Marketing of antipsychotic drugs attacked BMJ 1998;316:645 20. ^ Chickenhead Productions, Truth in Advertising. 21. ^ Lew McCreary, Lies, Damn Lies and Puffery: Is it OK to bend the truth if no one believes you anyway? , CMO Magazine, July 2005. 22. ^ S. Gilman, Ethics Today Newsletter, September 17, 2003 23.

^ S. J. Gould, Sexuality and ethics in advertising: A research agenda and policy guideline perspective, Journal of Advertising, Sep 2004. 24. ^ David S. Waller, What factors make controversial advertising offensive? ANZCA04 Conference, Sydney, July 2004 25. ^ Vladimir Cole, Sony’s fony graffiti sparks lashback, Joystiq, Dec 3, 2005 26. ^ Richard Monson-Haefel, Amazon.

com reviews are a farce, Jave. net, Nov 16, 2003. 27. ^ Shill Bidding Exposed in E-Bay Auctions, Consume Affairs, November 2004.

28. ^ Shabbir, H. , & Thwaites, D. (2007). THE USE OF HUMOR TO MASK DECEPTIVE ADVERTISING. Journal Of Advertising, 36(2), 75-85. 29. ^ Liberation Marketing and Consumer Society, KLM Inc.

, 2001. 30. ^ Thomas Frank, Liberation Marketing and the Culture Trust, (date unknown). 31. ^ Definition f marketing ethics (in German), excerpted from: Bruhn, M. , Homburg, C.

: Gabler Marketing Lexikon, Wiesbaden 2001. 32. ^ Brendan I. Koerner. Dr.

No Free Lunch. Mother Jones, March/April, 2003. Retrieved on 2007-10-06. [edit]Bibliography ?Davidson, D. Kirk (2002). The Moral Dimension of Marketing: Essays on Business Ethics. South-Western Educational.

ISBN 0-87757-300-X. ?Murphy, Patrick E. ; Gene R. Laczniak, Norman E. Bowie (2004).

Ethical Marketing. Prentice Hall. ISBN ISBN 0-13-184814-3. OCLC 54805964. [edit]External links ?American Marketing Association Statement of Ethics (2004) ? “Ethics in Marketing. Encyclopedia of Business and Finance.

Mohandeep Singh. Thomson Gale, 2001. eNotes. 2006. 16 Oct, 2006 ? Marketing Ethics Resources from the Center for the Study of Ethics in the Professions, Illinois Institute of Technology. ?Direct Marketing Association, Guidelines for Ethical Business Practice (September 2006) ? The Catholic Church’s Handbook on Ethics in Advertising ?Federal Trade Commission, FTC Guidelines on Advertising [hide]v • d • e Ethics Philosophers Plato • Aristotle • Confucius • Mencius • Mozi • Augustine of Hippo • Thomas Aquinas • Baruch Spinoza • David Hume • Immanuel Kant • Georg W.

F.Hegel • Arthur Schopenhauer • Jeremy Bentham • John Stuart Mill •Soren Kierkegaard • Henry Sidgwick • Friedrich Nietzsche • G. E. Moore • Karl Barth • Paul Tillich • Philippa Foot • John Rawls • Bernard Williams • J. L. Mackie • Alasdair MacIntyre • Peter Singer • Derek Parfit •Thomas Nagel • more…

Theories Consequentialism • Deontology • Virtue ethics • Ethics of care Concepts Freedom • Autonomy • Conscience • Good • Evil • Value • Morality • Care • Justice • Principles • Virtue • Happiness • Norm • Suffering or Pain • Equality • Trust • Free will • Consent • Right • Wrong • Just War •Axiology • more…Related articlesApplied ethics • Descriptive ethics • Religious ethics • Christian ethics • Jewish ethics • Islamic ethics • Medical ethics • Meta-ethics • Normative ethics • Professional ethics False advertising or deceptive advertising is the use of false or misleading statements in advertising. As advertising has the potential to persuade people into commercial transactions that they might otherwise avoid, many governments around the world use regulations to control false, deceptive or misleading advertising.Truth refers to essentially the same concept, that customers have theright to know what they are buying, and that all necessary information should be on the label.

False advertising, in the most blatant of contexts, is illegal in most countries. However, advertisers still find ways to deceive consumers in ways that are not illegal. Contents [hide] •1 Pricing-based methods o1. 1 Hidden fees and surcharges o1. 2 “Going out of business” sales •2 Other deceptive methods o2.

1 Manipulation of standards o2. 2 Adulterants and oversized packaging o2. Undefined terms •3 Regulation and enforcement o3. 1 United States advertising regulations o3. 2 State advertising regulation o3. 3 California advertising regulation •4 See Also •5 External links •6 References [edit]Pricing-based methods [edit]Hidden fees and surcharges Service providers often tack on the fees and surcharges that are not disclosed to the customer in the advertised price.

One of the most common is for activation of services such as mobile phones, but is also common in broadband, telephony, gym memberships, and air travel.In most cases, the fees are hidden in fine print, though in a few cases they are so confused and obfuscated by ambiguous terminology that they are essentially undisclosed. Hidden fees are frequently used in airline and air travel advertising. [1] In the case of motor vehicles, hidden charges may include taxes, registation fees, licences, insurance or other costs associated with getting a vehicle on the road. [2] Airlines and car hire firms that disadvange customers through[3]: ? Unfair contract terms, notably with respect to consumer compensation.

Use customer data for purposes other than they were obtained for. ?Apply unfair fees, charges and penalties on transactions. ?Place artificial restrictions on the time period during which customers can submit claims. [edit]”Going out of business” sales In many cases, liquidators which are hired to sell merchandise from a closing store will actually raise the prices on items that were already marked-down on clearance.

For items already marked-down to 100% off, this means the liquidator is doubling the price (quadrupling it for a 100%-off price), and then “discounting” it from there.Also common is for the sale prices at a retail chain’s other stores to be lower than the liquidator’s prices at the closing stores. Both of these were proven to be the case in November 2008, with the same liquidator (Hilco) committing both offenses: the markups at Linens ‘n Things, and the higher prices on around one-third of the items compared to other Circuit City stores remaining open. Additionally, liquidators refuse to accept returns, so if a customer does find he or she has been overcharged, there is no apparent recourse. 4] This is used by most advertisers trying to prove the acceptability of their products. [edit]Other deceptive methods [edit]Manipulation of standards Sellers may manipulate standards to mean something different than their widely understood meaning.

One example is with personal computer hard drives. While a megabyte has always meant 220(1,048,576) bytes in computer science, disk manufacturers began using the metric system (SI) prefix meaning of 106 (1,000,000). By stating the sizes of hard drives in ‘megabytes’ of 1,000,000 bytes instead of 1,048,576, they overstate capacity by nearly 5%.

With gigabytes, the error increases to over 7% (1,073,741,824 instead of 1,000,000,000), and nearly 10% for the newer terabyte. Seagate Technology and Western Digital, were sued in a class-action suit for this. Both companies agreed to settle the suit and reimburse customers in kind, yet they still continue to advertise this way. [5][6] To help combat this problem, a number of standards and trade organizations approved standards and recommendations in 2000 for a new set of binary prefixes, proposed earlier by the International Electrotechnical Commission (IEC), that would refer unambiguously to powers of 1024.These new units are numerically identical to the established computer science convention, easing transition. Apple Inc’s OS X operating system does not use the new units and instead measures disk memory in metric, covering up the disk manufacturer’s statements regarding capacity. Other operating systems either continue to use the older computer science convention (Microsoft Windows), or have switched to the new units (GNU/Linux), which are numerically identical to the older convention. Thus disk hardware on these systems still reports the actual capacity, which is lower than advertised.

edit]Adulterants and oversized packaging Some products are sold with adulterants, which increase the legal weight of the product with something that costs the producer very little compared to what the consumer thinks that he or she is buying. Food is an example of this, where meat is injected with broth or even brine (up to 15%), or TV dinners are filled with gravy or other sauce instead of meat. Malt and Cocoa Butter have been used as a color filler in peanut butter. [7] [edit]Undefined terms Listerine advertisement, 1932Many terms do have some meaning, but the specific extent is not legally defined, leading to their abuse. A frequent example (until the term gained a legal definition) was “organic” food. “Light” food also is an even more common manipulation. The term has been variously used to mean low in calories, sugars,carbs, salt, texture, thickness (viscosity), or even light in color. Tobacco companies, for many years, used terms like “low tar”, “light”, “ultra-light”, “mild” or “natural” in order to imply that products with such labels had less detrimental effects on health.

but in recent years it was proved that those terms were considered misleading. [citation needed] Another example is the United Egg Producers’ “Animal Care Certified”[8] logo on egg cartons which misled consumers by conveying a higher level of animal care than was actually the case. Both the Better Business Bureau and the Federal Trade Commission found the logo to be deceptive and the original logo can no longer be used. [edit]Regulation and enforcement [edit]United States advertising regulationsAdvertising is regulated by the authority of the Federal Trade Commission, a United States administrative agency, to prohibit “unfair and deceptive acts or practices in commerce. “[9] While it makes laymen’s sense to assume that being deceptive is being unfair, deceptiveness in practice has been treated separately by the FTC, leaving unfairness to refer only to other types.

[10] All commercial acts may be deceptive, not just advertising, but noncommercial activity such as advertising for political candidates is not subject to prosecution under the FTC Act.The 50 states have similar statutes, which generally are very similar to that of the FTC and in many cases copied so closely that they are known as “Little FTC Acts. ” While the terms “false” and “deceptive” are essentially the same for most, being deceptive is not the same as producing deception. What is illegal is the potential to deceive, which is interpreted to occur when consumers see the advertising to be stating to them, explicitly or implicitly, a claim that they may not realize is false and material.The latter means that the claim, if relied on for making a purchasing decision, is likely to be harmful by adversely affecting that decision.

If an ad is implicitly false, evidence must be obtained for what consumers saw the ad saying, and for the materiality of that, and for the true facts about the advertised item, but no evidence is required that actual deception occurred, or that reliance occurred, or that the advertiser intended to deceive or knew that the claim was false.The goal is prevention rather than punishment, reflecting the purpose of civil law in setting things right rather than that of criminal law. The typical sanction is to order the advertiser to stop its illegal acts, or to include disclosure of additional information that serves to avoid the chance of deception. Corrective advertising may be mandated,[11][12] But there are no fines or prison time except for the infrequent instances when an advertiser refuses to stop despite being ordered to do so. 13] The actual statute defines false advertising as a “means of advertisement other than labeling, which is misleading in a material respect; and in determining whether an advertisement is misleading, there shall be taken into account (among other things) not only representations made or suggested by statement, word, design, device, sound, or any combination thereof, but also the extent to which the advertisement fails to reveal facts material in the light of such representations or material with respect to consequences which may result from the use of the commodity to which the advertisement relates under the conditions prescribed in said advertisement, or under such conditions as are customary or usual.

” [14] [edit]State advertising regulation In addition to federal laws, each state has its own unfair competition law to prohibit false and misleading advertising. 15] In California, one such statute is the Unfair Competition Law [hereinafter “UCL”], Business and Professions Code §§ 17200 et seq. The UCL “borrows heavily from section 5 of the Federal Trade Commission Act” but has developed its own body of case law. [16] [edit]California advertising regulation History of the UCL California Civil Code § 3369, enacted in 1872, was California’s early unfair competition statute. It “addressed only the availability of civil remedies for business violations in cases of penalty, forfeiture, and criminal violation. ”[17] A 1933 amendment expanded the law to prohibit “any person [from] performing an act of unfair competition. ”[18] This amendment did not, however, extend UCL protection to consumers. This limitation was in response to the U.

S.Supreme Court’s 1931 decision in FTC v. Raladam. [19] In Raladam, the Court held that a FTC Act Section 5 violation must show actual injury to competition. [20] This ruling prevented individual consumers from suing under the FTC Act. [21] Following this rationale, California applied the UCL to unfair business practices that affected business competitors, not consumers.

[22] In 1935, consumers, not just business competitors, were given the opportunity to sue under the UCL. [23] The Supreme Court of California clarified the statute in American Philatelic Soc. v. Claibourne, stating that “the rules of unfair competition” should protect the public from “fraud and deceit. [24] In 1962, a California appellate court reiterated this rule by stating that the UCL extended “equitable relief to situations beyond the scope of purely business competition. ” [25] In 1977, the legislature moved the UCL to the California Business and Professions Code § 17200. [26] In 2004, California voters enacted Proposition 64, which limited UCL standing to individuals who suffered financial/property loss because of an unfair business practice. [27] Section 17200 standing to sue The UCL confers standing on both private parties and public prosecutors.

[28] Section 17204 authorizes the Attorney General, district attorneys, county counsels and city attorneys to file lawsuits on behalf of injured citizens. 29] Prior to Proposition 64, any consumer, regardless of whether they were adversely affected by unfair business acts, could bring a UCL action. [30] In addition, any consumer could act as a representative and file a class action lawsuit against a business committing unfair competition. [31] Proposition 64 allows only private plaintiffs who have “suffered injury in fact and lost money or property as a result of such unfair competition” may file suit,[32] while “unaffected” plaintiffs now lack standing. [33] Furthermore, the California Supreme Court expanded this amendment to class actions in Arias v. Superior Court by holding that “unaffected” plaintiffs no longer may bring a class action lawsuit unless they satisfy the regular requirements laid out in Cal.

Civ. Code § 382. 34]The requirement does not apply to all class members, however; only class representatives must meet these requirements. [35] Overview of the UCL California’s UCL is broadly written. [36] Section 17200 includes five definitions of unfair competition: (1) an unlawful business act or practice; (2) an unfair business act or practice; (3) a fraudulent business act or practice; (4) unfair, deceptive, untrue or misleading advertising; or (5) any act prohibited by Sections 17500-17577. 5.

[37] Section 17203 allows the court to order injunctions and other equitable defenses to prevent the unfair competition. [38] Elements of a false advertising claimMost false advertising litigation involves definitions four and five listed above because they both specifically prohibit false advertising. [39] To prove a violation under the fourth definition of unfair competition, the plaintiff must show that (1) the defendant engaged in unfair, deceptive, untrue or misleading advertising and (2) the plaintiff suffered injury in fact and lost money or property. [40] California courts have interpreted “advertising” to include almost any statement made in connection with the sale of goods or services. [41] For example, Chern v. Bank of America held that a loan officer’s statement over the phone about interest rates was “advertising.

”[42] Conversely, Bank of the West v.Superior Court implied that advertising might require “widespread promotional activities directed to the public-at-large” and that mere “personal solicitations are not advertising. ”[43] To determine whether advertising is misleading, California’s courts evaluate the advertisement’s entire impression, including words, images, format and product packaging.

[44] Courts have held that advertising is misleading if “members of the public are likely to be deceived. ”[45] However, because of Proposition 64, the plaintiff now has to show that they were actually misled by the advertising and suffered an injury as a result. To further complicate matters, the courts are split on whether “omissions of material facts” that mislead or confuse the public violate the UCL. 46] To prove a violation under the fifth definition, the plaintiff must show that section 17500 was violated. [47] This “sweep up” provision ensures that any acts mentioned in section 17500 also violate section 17200 and that the plaintiff receives remedies under both statutes. [48] In many cases, liquidators which are hired to sell merchandise from a closing store will actually raise the prices on items that were already marked-down onclearance.

For items already marked-down to 100% off, this means the liquidator is doubling the price (quadrupling it for a 100%-off price), and then “discounting” it from there. Also common is for the sale prices at a retail chain’s other stores to be lower than the liquidator’s prices at the closing stores.Both of these were proven to be the case in November 2008, with the same liquidator (Hilco) committing both offenses: the markups at Linens ‘n Things, and the higher prices on around one-third of the items compared to other Circuit City stores remaining open. Additionally, liquidators refuse to accept returns, so if a customer does find he or she has been overcharged, there is no apparent recourse. [49] This is used by most advertisers trying to prove the acceptability of their products. Relationship between section 17200 and other California consumer protection statutes Most plaintiffs allege violations of section 17200 and 17500 concurrently.In fact, courts often do not distinguish between these definitions of unfair competition, despite important differences between these two sections. A violation of section 17200 may not always trigger a violation of 17500.

Section 17500 prohibits any untrue or misleading statements made in connection with the sale of goods or services, which is narrower standard than section 17200. [50] For example, section 17500 only concerns advertising of property or services while section 17200 has no such limitation. Section 17500 only prohibits advertising, but section 17200 also forbids “fraudulent business acts or practices” unconnected with advertising.

51] Another major distinction is that section 17500 requires that the advertiser knew or should have known that the advertising was false or misleading. Section 17200 is a strict liability statute that has no such requirement. [52] In addition, section 17500 carries criminal penalties, whereas only civil remedies are available for section 17200 violations. Plaintiffs suing under Sections 17200 or 17500 often also assert violations of the California Consumers Legal Remedies Act (“CLRA”), set forth in Cal. Civ. Code § 1750 et seq. [53] The CLRA protects consumers against 23 specific activities that it defines as unfair and deceptive business practices. [54] Many of those activities are also prohibited by section 17500.

55] For example, it is unlawful under both statutes to advertise goods with the intent not to sell them as advertised or to misrepresent a product’s price or source. [56] Plaintiffs typically simultaneously plead violations of each statute because the remedies are cumulative. For example, the CLRA provides for attorney’s fees, punitive damages, and statutory damages. [57] Exemptions and defenses The UCL requires that lawsuits be brought within four years after the cause of action accrued. [58] The UCL postpones accrual of the cause of action until the plaintiff “discovers” the problem. [59] Section 17500 does not have an express statute of limitations.

[60] Thus, California Code of Civil Procedure section 338(h), which specifies a three-year limitation, ordinarily should apply to section 17500.However, as section 17500 is cross referenced in section 17200, and as virtually all false advertising claims are litigated simultaneously with UCL claims, the limitations period for “false advertising claims is effectively four-years. ” [61] Judges can use their equitable powers to dismiss a UCL claim or deny injunctive relief. [62] For example, in competitor-vs. -competitor lawsuits, the defendant may assert unclean hands if it believes the plaintiff has engaged in serious misconduct that relates to the subject of relief being sought. In other words, a “plaintiff must not behave inequitably with respect to the rights being asserted in the case.

[63] Because the UCL is a strict liability statute, other equitable defenses such as “good faith, mistake of law and lack of wrongful intent are generally inapplicable [to] a UCL action. ” [64] Remedies available under the UCL The UCL allows the court to prevent the use of unfair competition and to restore money or property to victims of unfair competition. [65] Essentially, this provision allows for both monetary damages and injunctive relief where necessary. [66] When an injunction is issued pursuant to section 17200, penalties of up to $6,000 per day for intentional violations are authorized. [67] Restitution and disgorgementof profits are used primarily to deter future violations. 68] Courts use various factors to determine the amount of the penalty, including “the nature and seriousness of the misconduct, the number of violations, the persistence of the misconduct, the length of time over which the misconduct occurred, the willfulness of the defendant’s misconduct, and the defendant’s assets, liabilities, and net worth.

”[69] Civil penalties, up to $2,500 for each violation, are allowed when a lawsuit is brought by an authorized government agency. However, the UCL does not permit punitive damages awards. [70] [edit]See Also ?Consumer Protection [edit]External links ?ftc. gov – Advertising FAQ for small businesses ?alphaila. com – Fast Food: Ads vs. Reality ?OECD Consumer Policy Toolkit Report ?About Econsumer.

gov, a portal for consumers to report complaints concerning online and related transactions with foreign companies ? International Consumer Protection and Enforcement Network (ICPEN) ? Consumers International [edit]References 1. McArthur, D (April 30, 2008). “How does a $224 flight end up costing $826? [Internet”]. Toronto: Globe and Mail. 2. ^ “Small Business”. The San Francisco Chronicle.

3. ^ The Sydney Morning Herald. 2010-10-23. http://www.

smh. com. au/travel/travel-news/airlines-hire-cars-targeted-over-hidden-fees-20101022-16wy4. html.

4. ^ “MercedSun-Star. com Forums”. Sunspot. mercedsunstar. com. Retrieved 2009-11-03. [dead link] 5.

^ “Seagate settles suit over disk capacity”. Neowin. net. 2007-11-03. Retrieved 2009-11-03. 6.

^ “Western Digital pays up in class action lawsuit”. Neowin. net. 2006-07-18. Retrieved 2009-11-03. 7. ^ Wallechinsky, David (1975).The People’s Almanac.

Garden City: Doubleday. p. 1010. ISBN 0385040601.

8. ^ Barrionuevo, Alexei (2005-10-04). “Egg Producers Relent on Industry Seal”. The New York Times.

Retrieved 2010-03-27. 9. ^ 15 U. S.

C. § 45. 10. ^ Richards, Jef I. , Deceptive Advertising, Erlbaum (1990), at p. 20. 11. ^ Johar, Gita, “Intended and Unintended Effects of Corrective Advertising on Beliefs and Evaluations: An Exploratory Analysis”, Journal of Consumer Psychology, 1996, 5(3), 209-230.

12. ^ Johar, Gita Venkataramani and Carolyn J. Simmons, “The Use of Concurrent Disclosures to Correct Invalid Inferences,” Journal of Consumer Research, 2000, 26(4), 307-322. 13. Richards, id; Policy Statement on Deception, 103 FTC Decisions 110 (1984), appendix to Cliffdale Associates; originally a letter from FTC Chairman James C.

Miller to Rep. John D. Dingell (Oct. 14, 1983). For the history of changing from deception to deceptiveness as the standard, see Preston, Ivan L. , The Great American Blow-Up: Puffery in Advertising and Selling, University of Wisconsin Press, revised ed. (1996), at Ch.

8. 14. ^ Wilson, Lee. “The Advertising Law Guide: A Friendly Desktop Reference for Advertising Professionals. ” Allworth Press, NY, NY.

2000. 25. 15. ^ See e. g. N. Y. ISC.

Law §§ 2401-2409. 16. ^ California Antitrust & Unfair Competition Law (Third), Volume 2: Unfair Competition (State Bar of California, 2003 Daniel Mogin & Danielle S. Fitzpatrick, eds. ) at pg. 9. 17. California Antitrust & Unfair Competition Law, supra note 2, at 4.

18. ^ Cal. Stat.

1933 ch. 953, § 1, p. 2482. 19. ^ FTC v.

Raladam, 283 U. S. 643 (1931). 20. ^ Id. at 647-49. 21.

^ See id. 22. ^ Cal. Stat. 1933 ch. 953, § 1, p. 2482. 23.

^ California Antitrust & Unfair Competition Law, supra note 2, at 5. 24. ^ American Philatelic Soc. v.

Claibourne, 3 Cal. 2d 689, 698 (1935). 25.

^ People ex rel. Mosk v. National Research Co.

, 201 Cal. App. 2d 765, 770 (1962). 26. ^ Stop Youth Addiction, Inc.

v. Lucky Stores, Inc. , 17 Cal. 4th 553, 570 (1998). 27. ^ Cal. Bus. & Prof.

Code § 17203 (2010). 28. ^ Id. 29. ^ Id. 30. ^ Cal. Bus.

& Prof. Code § 17204 (2003). 31. ^ Id. 17203 (2003). 32. ^ Cal. Bus. & Prof. Code § 17204 (2010). 33. ^ Id. 34. ^ Arias v. Superior Court, 46 Cal. 4th 969, 980 (2009). 35. ^ In re Tobacco II Cases, 46 Cal. 4th 298, 315-17 (2009). 36. ^ Flamingo Industries (USA) Ltd. v. United States Postal Service, (9th Cir. 2002) 302 F. 3d 985 (9th Cir. 2002), rev’d on other grounds in, United States Postal Service v. Flamingo Industries (USA) Ltd. , 540 U. S. 736 (2004). 37. ^ Cal. Bus. & Prof. Code § 17200 (2010). 38. ^ Id. § 17203. 39. ^ California Antitrust & Unfair Competition Law, supra note 2, at 27. 40. ^ Buckland v. Threshold Enterprises, Ltd. , 155 Cal. App. 4th 798, 819, (2007). 41. ^ See Chern v.Bank of America, 15 Cal. 3d 866, 875-76 (1976). 42. ^ Id. 43. ^ Bank of the West v. Superior Court, 2 Cal. 4th 1254, 1276-1277 fn. 9 (1992). 44. ^ Committee on Children’s Television, Inc. v. General Foods Corp. , 35 Cal. 3d 197, 210 (1983). 45. ^ Id. at 211. 46. ^ Kasky v. Nike, Inc. , 27 Cal. 4th 939, 951 (2002). 47. ^ Cal. Bus. & Prof. Code § 17200. 48. ^ See California Antitrust & Unfair Competition Law, supra note 2, at 60-62. 49. ^ “MercedSun-Star. com Forums”. Sunspot. mercedsunstar. com. Retrieved 2009-11-03. [dead link] 50. ^ Cal. Bus. & Prof. Code § 17500. 51. ^ See id § 17200. 52. ^ South Bay Chevrolet v. General Motors Acceptance Corp. , 72 Cal. App. 61, 877 (1999). 53. ^ Cal. Civ. Code § 1750 et seq. 54. ^ Hogya v. Superior Court, 75 Cal. App. 3d 122, 135 (1977); Wang v. Massey Chevrolet, 97 Cal. App. 4th 856 (2002). 55. ^ Cal. Civ. Code § 1770. 56. ^ Id. § 1780(2),(9), & (20); Cal. Bus. & Prof. Code § 17500. 57. ^ Cal. Civ. Code § 1780. 58. ^ Cal. Bus. & Prof. Code § 17208. 59. ^ Glue-Fold, Inc. v. Slautterback Corp. , 82 Cal. App. 4th. 1018, 1029 (2000). 60. ^ See Bus. & Prof. Code §§ 17500-17577. 5 61. ^ See California Antitrust & Unfair Competition Law, supra note 2, at 72. 62. ^ Cortez v. Purolator Air Filtration Product Co. , 23 Cal. 4th 163, 179 (2000). 63. ^ WILLIAM M. TABB & ELAINE W.SHOBEN, REMEDIES 52 (Thomson West 2005). 64. ^ Id. at 50. 65. ^ Cal. Bus. & Prof. Code § 17203. 66. ^ See id. 67. ^ Id. § 17207. 68. ^ California Antitrust & Unfair Competition Law, supra note 2, at 32-33; Bank of the West, 2 Cal. 4th at 1266-67. 69. ^ Cal. Bus. & Prof. Code § 17206(b). 70. ^ California Antitrust & Unfair Competition Law, supra note 2, at 32-33; Bank of the West, 2 Cal. 4th at 1266-67. [hide] ?v ?d ?e Psychological manipulation Positive reinforcement Attention • Bribery •Charm offensive • Flattery • Giving gifts • Grooming (adult • child) • Ingratiation • Love bombing • Praise • Seduction • Smiling • Superficial charm • Superficial sympathy Negative reinforcementAnger • Character assassination • Crying • Emotional blackmail • Fear mongering • Frowning • Glaring • Guilt trip • Inattention • Intimidation • Nagging • Nit-picking criticism • Passive aggression • Punishment •Relational aggression • Shaming • Silent treatment (blanking) • Sulking • Swearing • Threats • Victim blaming • Victim playing • Yelling Other techniquesBait-and-switch • Deception • Denial • Deprogramming • Disinformation • Distortion • Diversion • Double bind • Entrapment • Evasion • Exaggeration • Gaslighting • Good cop/bad cop • Indoctrination •Low-balling • Lying • Minimisation • Moving the goalposts • Pride-and-ego down • Rationalization • Reid technique • Setting up to fail • Trojan horse ContextsAbuse • Advertising • Bullying • Confidence trick • Interrogation • Media manipulation • Mind control • Mind games • Mobbing • Propaganda • Salesmanship • Scapegoating • Smear campaign •Social engineering (blagging) • Spin • Whispering campaignRelated topicsAssertiveness • Blame • Dumbing down • Enabling • Fallacy • Gaming the system • Gullibility • Impression management • Machiavellianism • Narcissism • Personal boundaries • Personality disorders •Persuasion • Projection • Psychopathy • Self-esteem • Sheeple • Sycophancy • Vulnerabilities • Weasel words • Whistleblowing MyLife (formerly Reunion. com) is a social network service founded in 2002 by Jeffrey Tinsley after meeting his wife at their high school reunion. The company began with the acquisition of highschoolalumni. com and PlanetAlumni. com. [1] The website claims to help members find and keep in touch with friends, relatives and lost loves. In August 2007, Reunion. com claimed to be the 6th top social networking site with 28 million users, growing by nearly 1 million new members each month,[2] mostly in the United States and Canada. Quantcast estimates MyLife has 4. 2 million monthly unique U. S. visits. 3] The site ranks as the 7th largest social network in the U. S. with 10. 8 million weekly visits. [4] On April 30, 2007 Reunion. com announced that it had signed an agreement with Wink to provide Wink’s people profiles (from on-line social networks and other sources on the web) to Reunion’s members. Then on August 20, 2007 Reunion. com announced an agreement with ZoomInfo to provide ZoomInfo’s business related people profiles to Reunion. com members. Contents [hide] •1 Privacy •2 E-mail spoofing •3 Ownership •4 Financing •5 Business model •6 Better Business Bureau •7 References •8 External links [edit]Privacy Although member privacy is protected through a blind relay e-mail system reventing that e-mail addresses and contact information is revealed, it is possible to allow Reunion to access email addresses stored on a computer upon registration. These e-mail addresses are then used to solicit more members. [5] [edit]E-mail spoofing People who subscribe to MyLife. com may allow Reunion to access all email addresses stored in their free e-mail accounts. These are then used to solicit more members under their name by altering the sender address and other parts of the email header to appear as though the email originated from the person who subscribed. [5] This practice has resulted in lawsuits against the company. [6] [edit]Ownership MyLife, Inc. is privately owned.The original investors, making a total investment of $1. 4 Million in angel financing, included Jeffrey Tinsley, former founder and CEO of GreatDomains. com and current CEO of Reunion. com; Richard Rosenblatt, co-founder, chairman and CEO of Demand Media and the former Chairman of MySpace; and Andy Mazzarella, CEO of eForce Media and former CFO ofiMall. [edit]Financing On April 16, 2007, the company announced that it received $25 Million in venture funding from Oak Investment Partners[2] in the largest series A venture financing in a social networking company to date[citation needed]. The percent ownership stake that Oak received for their investment has not been reported. [edit]Business modelThe company’s business model is based on user-generated content and revenue from paid subscriptions and advertising sales. 90% of the firm’s revenue is from paid subscriptions. [7] [edit]Better Business Bureau This company practices what the Los Angeles Better Business Bureau (BBB) calls “negative option cancellation”. In this sales strategy, customers agree to pay for services unless they cancel within a specified period of time. Members are required to cancel prior to the initial anniversary date to avoid continuing annual charges to their credit cards. [8] Complaints from customers not resolved in a satisfactory manner caused the Los Angeles Better Business Bureau to rate Reunion. com ‘F’ in late 2008. 9] The BBB was concerned that the company used misleading advertising practices by e-mailing customers advising them that people ‘may’ be searching for them, and offers them to become paid members to find the identity of any people that may search for them in the future. In its FAQ section, the Reunion. com site describes this feature as follows: “‘Who’s Searching For You’ will reveal the listed names of the specific users who have performed a search using your first and last (current or maiden) names and your age range within 5 years of your listed date of birth and is still saved in their Search History’. [10] By late 2010, the rating had gone to ‘A+’, and the following summary and analysis of customer complaints and company responses was given: “Complainants generally allege that the company automatically renews memberships and debits accounts.Some customers report signing up for the service based on a low monthly rate but are charged for a non-refundable yearly or a lesser term subscription up-front. In some cases, complainants are dissatisfied that their information is posted on the company’s website and request its removal. The company generally responds by providing refunds and states that accounts are set to auto-renew at the end of the subscription term, unless the customer disables the auto-renew feature before the renewal is processed. In response to the amount of the charges, they state that customers signed up for a term account with a monthly subscription rate billed up-front for the entire term and is listed in several places on the order page.The company promptly removes profiles when requested and also states that the information was gathered from public sources. [11] ” Less than a year later, the rating again went to ‘F’ and the company’s accreditation was revoked, with the following factors cited as reasons:[12] ? BBB Accreditation was revoked because business failed to honor its accreditation agreement with BBB ? 1185 complaint(s) filed against business ?Business has failed to resolve underlying cause(s) of a pattern of complaints ? Advertising issue(s) found by BBB The advertising issue was explained by the BBB as follows: “On June 20, 2011, we wrote to this company asking them to modify their website disclosures to more clearly advertise the cost of their services.Customers generally complain that they are charged for the annual membership fee rather than the monthly amount displayed on the webpage. The current offer does not display an asterisk to alert the member of additional conditions associated with the price offer. The asterisk that is on the webpage is not in close proximity to the price offer, and is in microscopic print on a gray background using gray font. We believe that the information referenced by asterisks should be clearly and prominently disclosed. The explanation of the asterisks is below the pricing information and is obviously confusing to consumers as delineated by the complaints we receive. The company submitted a response on July 13, 2011.The company generally disagrees with the BBB that their pricing methods are deceptive, and feels that the disclosures the BBB felt were questionable adequately convey the terms and conditions of the offer. [12] ” Defamation [edit]McLibel (UK) Main article: McLibel In 1990, McDonald’s took environmental campaigners Helen Steel and Dave Morris to court after they distributed leaflets entitled “What’s Wrong with McDonald’s? ” on the streets of London. The high-profile trial, which came to be known as the McLibel Case, lasted seven and a half years, the longest in English legal history. An anti-McDonald’s leafletting campaign in front of the McDonald’s restaurant in Leicester Square, London, during the European Social Forum season, 2004-10-16.Though a High Court judge eventually ruled in favour of McDonald’s, it was something of a Pyrrhic victory. The extended legal battle was a PR disaster, with every aspect of the company’s working practices being scrutinised and the media presenting the case as a David and Goliath battle. Additionally, the damages received were negligible compared to the company’s estimated ? 10 million legal costs because the court ruled in favour of a number of the defendants’ claims, including that McDonald’s exploited children in its advertising, was anti-trade union and indirectly exploited and caused suffering to animals. McDonald’s was awarded ? 60,000 damages, which was later reduced to ? 40,000 by the Court of Appeal.Steel and Morris announced they had no intention of ever paying, and the company later confirmed it would not be pursuing the money. Steel and Morris went on to challenge UK libel laws in theEuropean Court of Human Rights, claiming that the lack of access to legal aid and the heavy burden of proof that lay with them, as the defendants’ requirement to prove their claims under UK law was a breach of the right to a fair trial and freedom of expression. The court ruled in their favour[4] and the UK Government was forced to introduce legislation to change defamation laws. [citation needed] [edit]Trademark and copyright [edit]MacJoy (Philippines) In 2004, McDonald’s sued Cebu-based fast food restaurant MacJoy for using a very similar trade name.In its defense, MacJoy insisted that it was the first user of the mark under the title “MACJOY & DEVICE” for its business in Cebu City which started in 1987, five years before McDonald’s opened its first outlet in the same city. MacJoy stated that the requirement of “actual use” in commerce in the Philippines before one may register a trademark pertains to the territorial jurisdiction on a national scale and is not merely confined to a certain locality or region. It added that “MacJoy” is a term of endearment for the owner’s niece whose name is Scarlett Yu Carcel. In response, McDonald’s claimed that there was no connection with the name Scarlett Yu Carcel to merit the coinage of the word “MacJoy” and that the only logical conclusion over the name is to help the Cebu restaurant ride high on their (McDonald’s) established reputation.On February 2007, the Philippine Supreme Court upheld the right of McDonald’s over its registered and internationally-recognized trademarks. [5] As a result, the owners of MacJoy, the Espina family, was forced to change its trademark into MyJoy,[6] which went into effect with the re-opening of its two branches in Cebu City on August that year. [edit]McCoffee (US) In 1994, McDonald’s successfully forced Elizabeth McCaughey of the San Francisco Bay Area to change the trading name of her coffee shop McCoffee, which had operated under that name for 17 years. “This is the moment I surrendered the little ‘c’ to corporate America,” said Elizabeth McCaughey, who had named it as an adaptation of her surname. [7] [edit]Norman McDonalds’ Country Drive-Inn (US)From the early 1960s to the mid 1980s, Norman McDonald ran a small “Country Drive-Inn” restaurant in Philpot, Kentucky called simply “McDonald’s Hamburgers; Country Drive-Inn”, which at the time also had a gas station and convenience store. As a play on the real McDonald’s, Norman also included a couple of lit “golden arches”. McDonald’s the restaurant chain forced Norman to remove the arches and add the full Norman McDonald’s name to its sign so customers would not be confused into thinking the restaurant was affiliated with the McDonald’s restaurant chain. The restaurant is still open to this day (though it no longer has the gas station) and is located in front of the Daviess County Fairgrounds. [edit]McChina Wok Away (UK)In 2001, McDonald’s lost a nine-year legal action against Frank Yuen, owner of McChina Wok Away, a small chain of Chinese takeaway outlets in London. Justice David Neuberger ruled the McChina name would not cause any confusion among customers and that McDonald’s had no right to the prefix Mc. [8] [edit]McMunchies (UK) In 1996, McDonald’s forced Scottish sandwich shop owner Mary Blair of Fenny Stratford, Buckinghamshire to drop McMunchies as her trading name. Mrs. Blair did not sell burgers or chips. She said she chose the name because she liked the word munchies and wanted the cafe to have a Scottish feel. The cafe’s sign reflected this, featuring a Scottish thistle and a St Andrew’s flag. But in a statement to Mrs.Blair’s solicitors, McDonald’s said if someone used the Mc prefix, even unintentionally, they were using something that does not belong to them. [9] [edit]McDonald’s (UK) McDonald’s filed a lawsuit against McDonald’s Family Restaurant, located in Grand Cayman. McDonald’s lost the case, and in addition, was banned from ever opening a McDonald’s location on Grand Cayman. This ruling still stands today. [edit]McAllan (Denmark) In 1996, McDonald’s lost a legal battle at the Danish Supreme Court to force Allan Pedersen, a hotdog vendor, to drop his shop name McAllan. [10] Pedersen had previously visited Scotland on whisky-tasting tours. He named his business after his favorite brand of whisky, MacAllan’s, after contacting the distillery to see if they would object.They did not, but McDonald’s did. However, the court ruled customers could tell the difference between a one-man vendor and a multi-national chain and ordered McDonald’s to pay 40,000 kroner ($6,900) in court costs. The verdict cannot be appealed. [edit]McCurry (Malaysia) In 2006, McDonald’s won a five-year legal battle in Malaysia against a small restaurant named “McCurry”. The defendant claimed that McCurry stood for Malaysian Chicken Curry, but a High Court judge ruled that the prefix Mc and the use of colors distinctive of the McDonald’s brand could confuse and deceive customers. [11] In April 2009, however, McCurry won the case after a retrial.Again in September 2009, McDonald’s lost an eight-year trademark battle in a precedent-setting judgment by Malaysia’s highest court. The Federal Court ruled that McDonald’s cannot appeal against another court’s verdict that had allowed McCurry to use “Mc” in its name. The ruling by a three-member panel of the Federal Court ends all legal avenues for McDonald’s to protect its name from what it said was a trademark infringement. “On the basis of unanimous decision, our view is that McDonald’s plea to carry the case forward has no merit,” said chief judge Arifin Zakaria. “It is unfortunate that we have to dismiss the application with costs,” he said.McDonald’s will have to pay RM10,000 to McCurry, a popular eatery in Jalan Ipoh on the edge of Kuala Lumpur’s downtown. [12][13] McDonald’s lawyers refused to comment, except to say the company will abide by the judgment. A three-member Appeal Court panel had ruled in favour of McCurry Restaurant in April, 2009, when it overturned a 2006 High Court ruling that had upheld McDonald’s contention. Arifin said McDonald’s lawyers were unable to point out faults in the Appeal Court judgment, which had said there was no evidence to show that McCurry was passing off McDonald’s business as its own. The Appeals Court also said McDonald’s cannot claim an exclusive right to the “Mc” prefix in the country. [edit]South African trademark lawApartheid politics had prevented earlier expansion into South Africa, but as the apartheid regime came to an end in the early 1990s, McDonald’s decided to expand there. The company had already recognized South Africa as a potentially significant market and had registered its name as a trademark there in 1968. Under South African law, trademarks cease to be the property of a company if they are not used for a certain amount of time. McDonald’s had renewed the 1968 registration several times, but missed a renewal deadline. The registration expired and McDonald’s discovered two fast food restaurants in South Africa were trading under the name MacDonalds. Moreover, a businessman had applied to register the McDonald’s name.Multiple lawsuits were filed. The fast food chain was stunned when the court ruled it had lost the rights to its world-famous name in South Africa. However, the company eventually won on appeal. [14] [edit]The real Ronald McDonald (US) The company waged an unsuccessful 26-year legal action against McDonald’s Family Restaurant which was opened by a man legally named Ronald McDonald in Fairbury, Illinois in 1956. [15] Mr. McDonald ultimately continued to use his name on his restaurant, despite objections by the franchise. [16] [edit]Cases brought against McDonald’s [edit]H. R. Pufnstuf / McDonaldland In 1973, Sid and Marty Krofft, the creators of H. R.Pufnstuf, successfully sued McDonald’s, arguing that the entire McDonaldland premise was essentially a ripoff of their television show. In specific, the Kroffts claimed that the character Mayor McCheese was a direct copy of their character, “H. R. Pufnstuf” (being a mayor himself). McDonald’s initially was ordered to pay $50,000. The case was laterremanded as to damages, and McDonald’s was ordered to pay the Kroffts more than $1 million. McDonaldland itself, as it was depicted in the commercials, was a magical place where plants, foods, and inanimate objects were living, speaking characters. In addition to being the home to Ronald and the other core characters, M