On November 28, 2022, the Federal Trade Commission (“FTC”) and seven state attorneys general announced that they reached settlements with Google LLC and iHeartMedia, Inc., to resolve claims that the companies aired deceptive advertisements promoting Google’s Pixel 4 phone by arranging for iHeartMedia radio personalities who never actually used the phone to personally endorse it. The companies agreed to pay a combined $9.4 million to the states to settle these allegations.
According to the FTC’s complaint, Google paid iHeartMedia more than $2.6 million to have iHeartMedia radio personalities record endorsements promoting Google’s Pixel 4 phones on iHeartMedia stations. The FTC claimed that Google and iHeartMedia violated the FTC Act by falsely representing in the ads that the radio personalities owned or regularly used the phones. Google provided scripts to iHeartMedia, which included statements like “It’s my favorite phone camera out there, especially in low light, thanks to Night Sight Mode.” The complaint also alleged that Google paid other radio personalities not affiliated with iHeartMedia to make similar claims.
The proposed consent orders against Google and against iHeartMedia prohibit each company from making misrepresentations that endorsers have owned or used their products or services, or about an endorser’s experience with them.
These settlements follow on the heels of other FTC enforcement actions in the area of endorsements and testimonials. For example, in February 2022 the FTC returned more than $930,000 to consumers who purchased products that Teami, LLC marketed and sold using allegedly deceptive endorsements. The FTC took action against Teami and its owners in March 2020, alleging that the company paid prominent social media influencers for endorsements without adequately disclosing that the influencers were paid to promote its products. In addition to bringing such enforcement actions, the FTC in October 2021 distributed Notices of Penalty Offenses to over 700 companies, putting them on notice that engaging in deceptive or unfair conduct concerning endorsements and testimonials could subject them to civil penalties of up to $43,792 per violation.
The proposed FTC consent orders are subject to a 30-day public comment period following publication in the Federal Register.