The summer of 2014 may be remembered as the “ALS Ice Bucket Challenge” summer. This social media campaign went viral leading teens, celebrities, world leaders, and perhaps even you, to dump ice cold water on your head and donate some money to the ALS Association. While everyone enjoyed watching George W Bush, Bill Gates, and Jennifer Lopez drenched to the bone, ALS raised millions of dollars. Beyond the fun, the campaign raises some important legal lessons for cause marketers and their commercial co-venturers.
1. COMMERCIAL CO-VENTURERS
Spurred by the popularity of the “Ice Bucket Challenge” campaign, commercial entities may want to capitalize on the concept of viral community action. Let’s assume that a clothing retailer calls on the public to purchase its jeans and then create a video wearing the jeans and following certain directions. For every purchase and video made, the retailer promises to donate a dollar to a charity. In so doing, the retailer would become a commercial co-venturer with its chosen charity, making it subject to a variety of laws.
At least half of the states have commercial co-venturer (CCV) laws within their charitable solicitation statutes. While definitions vary from state to state, generally, a CCV is described as an entity regularly and primarily engaged in commerce other than in connection with raising funds for charities that conducts a charitable sales promotion. A charitable sales promotion typically represents that the purchase or use of goods or services offered by the CCV will benefit charitable organization or purpose. Some of the states, including California, specifically delineate in their definitions of CCV that a co-venturer is one who advertises that the purchase of the goods or services will benefit a charity. The Attorney General of each state enforces the CCV statutes through fines. Some statutes also authorize private rights of action, including class actions. A small number of states require the CCV to register with the state.
- Commercial Co-Venturer Lesson: Before a for profit company launches a cause marketing campaign, it should vet the concept and its advertising with legal to ensure it is not in violation of the CCV laws.
The ALS Association was not the first to use the phrase “ice bucket challenge.” Nonetheless, in the waning days of August, the charity sought trademark protection for “Ice Bucket Challenge” and “ALS Ice Bucket Challenge.” The nonprofit explained that it sought protection for these phrases “in good faith” to prevent their misuse. The public outcry was immediate. Many felt that ALS Association was looking to profit unfairly from its own viral success by preventing others from launching their own ice bucket challenges. Within one week, the Association withdrew its trademark applications.
It is unclear whether these trademark applications would have been successful in the long run. After all, the charity did not coin “Ice Bucket Challenge,” and the phrase is descriptive, meaning at first glance it is not capable of registration. At the same time, given the viral popularity of the campaign, there is little doubt that the phrase “ice bucket challenge” developed some secondary meaning that associated it with the ALS Association during the summer of 2014, giving it some arguments to make in favor of registration.
While we will never know whether that secondary meaning was sufficient to result in trademark protection, we do know that the public tends to turn against those who appropriate phrases of good will for themselves. After the Boston Marathon bombing, some companies tried to trademark “Boston Strong” and they faced a similar outcry and, in some instances, denial by the United States Patent and Trademark Office. If your brand wants to launch its own viral challenge to raise money for a charity, consider the long term implications of the campaign’s name.
- Trademark Lesson: Pick a name or hashtag for your fundraising campaign that is singularly original. Remember to conduct a comprehensive search to determine its availability before you launch. If your campaign goes viral and develops secondary meaning, you will be in a better position to claim a trademark.
Could the clothing retailer in our example above retweet or post a video of a celebrity participating in its challenge? It depends. Remember Katherine Heigl’s lawsuit against Duane Reade for retweeting the image of her shopping at the drugstore?
The difference in our scenario is that the celebrity who participates in our clothing retailer’s video challenge does so knowing the public will view her video. Katherine Heigl was just out shopping with no expectation of having her photo snapped and repurposed as advertising by Duane Reade. If our clothing retailer issues a single retweet of a celebrity jeans video with a nod of thanks, that retweet may not violate the celebrity’s rights of privacy or publicity. If, however, the brand takes the celebrity video and works up an entire marketing campaign that features that video without celebrity permission, that could violate the celebrity’s rights as well as FTC laws and guides on deceptive advertising.
- Celebrity Lesson: Tread carefully when using celebrity images, even if the celebrity acts first in reaching out to you. Sometimes, celebrities do this as a way of testing the waters to see if an endorsement deal is possible. Do not mistake their participation in your cause marketing campaign as an invitation to use their image to market your goods or services.
4. NATIVE ADVERTISING
What if the clothing retailer wants to use a consumer video? Perhaps, the retailer also ran a contest judging all the consumer videos, choosing a winner based on bona fide criteria, such as creativity, appropriateness to the theme, etc. If there is a prize attached to winning, then the retailer has to contend with the FTC Endorsement & Testimonial Guidelines before disseminating the video in its advertising because there is a material connection between itself and the consumer.
What if the clothing retailer takes the winning video and embeds that video in a newsfeed so it looks like news about the charity rather than advertising for its jeans? Then, in our hypothetical, if the consumer were to click on the link for the video, perhaps his browser would be automatically redirected to the retailer’s online store. In May, 2014, The National Advertising Division of the Council of Better Business Bureaus (NAD) opined on the thorny issue of “native advertising” in the Congoo, LLC v Taboola, Inc. case. The NAD recommended in part, that “to the extent Taboola may link consumers… a site that appears to be a news source but is maintained by an advertiser, that Taboola discontinue such links or modify its disclosures to disclose that the link is to an advertisement.”
In short, native advertising or advertising disguised as editorial content needs special legal vetting to ensure that consumers are not deceived and can recognize the advertising for what it really is, commercial speech.
- Native Advertising Lesson: Think carefully before using viral videos in a manner that looks like they raise awareness about a charity but are really directing traffic to a for profit site. Talk to your legal team about how you can implement these marketing strategies and what disclosures you need to make. (And if you are still confused about what native advertising is, take a look at John Oliver’s hilarious definition.)
Viral cause marketing is an enticing way to build attention for a brand. Before you embark on a strategy that seeks to copy the summer phenomenon of the ALS Ice Bucket Challenge, consider the legal ramifications.
© Kyle-Beth Hilfer, P.C. 2014
DISCLOSURE: This article does not constitute legal advice. If you have legal questions about your cause marketing programs, please contact this post’s author or another attorney.