Grey Advertising, Inc

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IN THE MATTER OF GREY ADVERTISING, INC.

CONSENT ORDER, ETC., IN REGARD TO ALLEGED VIOLATION OF SEC. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket C-3690. Complaint, Oct. 30, 1996--Decision, Oct. 30, 1996 This consent order prohibits, among other things, the New York-based advertising agency, that handled the Hasbo, Inc., paint-sprayer toy account, from using deceptive demonstrations or otherwise misrepresenting the performance of any toy.

Appearances For the Commission: Rosemary Rosso and Michael Ostheimer. For the respondent: Leonard Orkin, Kay, Collyer & Boose, New York, N.Y.

COMPLAINT The Federal Trade Commission, having reason to believe that Grey Advertising, Inc., a corporation ("respondent"), has violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, alleges:

PARAGRAPH 1. Respondent Grey Advertising, Inc. is a New York corporation, with its principal office or place of business at 777 Third Avenue, New York, N~w York.

PAR. 2. Respondent, at all times relevant to this complaint, ·was an advertising agency ofHasbro, Inc., and prepared and disseminated advertisements to promote the sale of Colorblaster Design Toys, spray painting toys.

PAR. 3. The acts and practices of respondent alleged in this complaint have been in or affecting commerce, as "commerce" is defined in Section 4 of the Federal Trade Commission Act. PAR. 4. The Colorblaster Design Toy consists of a plastic drawing tray with an oblong plastic air tank underneath. An attached handle is used to pump up pressure inside the air tank. Special color pens are inserted into a sprayer connec~ed to a hose attached to the air tank. Several sets of stencils, four color. pens and blank paper are included with the toy. The enclosed instructions state: "Fully extend Complaint 122 F.T.C. handle and pump it quickly 50 strokes .. . The more you pump, the more you spray:" .

l i PAR. 5. Respondent has disseminated or has caused to been disseminated advertisements for the Colorblaster Design Toy I' ("Colorblaster"), in~luding but not necessarily limited to the attachedI I Exhibits A and B. These advertisements contain the following statements and depictions:

A. VIDEO AUDIO Children playing with a Colorblaster. ~: It's a blast! Tight shot of hand spraying stencil and Sung: Something hip just blew into removing it to reveal a picture of a car town spraying art.with a blast of air. followed by a scene of children using It's the Colorblaster. the Colorblaster. · Girl: Nothing like it anywhere! Hand pumping toy four times. ~: It's a blast! Several scenes of the Colorblaster Song: PPPump, pump ... spraying stencils and quickly creating Song: Spray. Blast away. Spray':ri multi-colored pictures. stencils. Hot designs. Spray cool Girl pumping toy twice. colors.' Pictures so fine. Red spray filling screen. ~:Wild! (Exhibit A, television advertisement). Song: It's the Colorblaster. Spraying art with a blast of air.

B. VIDEO AUDIO Hand pumping toy four times. Announcer: Get the feel... ~: FEEL ~:REAL Announcer: of the real... Close-up of the Colorblaster Announcer: Colorblaster. Tight shot of hand spraying car stencil Song: The super hot way to spray and removing stencil to reveal multi- with a blast of air. colored picture of car followed by shot ~:Wow! of boy free spraying the car picture. ·Song: Pump, pump. Spray. Split-screen image of hand pumping Sung: Blast away. The real toy four times. Col orb laster. Several scenes of the Colorblaster spraying stencils and quickly creating Ii. I multi-colored pictures. I I Hand pumping toy three times.

~:FEEL Announcer: Get the feel... ~:REAL Announcer: Of the real... l ! The Colorblaster. Announcer: Colorblaster. (Exhibit B, television advertisement).

PAR. 6. T.through the use of .the statements and depictions contained m the advertisements referred to in paragraph five, GREY ADVERTISING, INC. 345 343 Complaint including but not necessarily limited to the advertisements attached as Exhibits A and B, respondent has represented, directly or by implic3:tion, that the demonstrations in the television advertisements of the operation of the Colorblaster Design Toy were unaltered and that the results shown accurately represent the performance of actual, unaltered Colorblaster Design Toys under the depicted conditions. PAR. 7. In truth and in fact, the demonstrations in the television advertisements of the operation of the Colorblaster Design Toy were not unaltered and the results shown do not accurately represent the performance of actual, unaltered _Colorblaster Design Toys under the depicted conditions.-. Among other things, the Colorblaster Design Toy depicted in the ·advertisements was not manually pumped to provide the air pressure necessary to operate the paint sprayer. Instead, a motorized air·compressor was attached to the Colorblaster Design Toy to provide the air pressure necessary to operate the paint sprayer, making it appear that children can operate the Colorblaster Design Toy and complete multi-part stencils with a small amount of pumping and little effort. Therefore, the representations set forth in paragraph six were, and are; false and misleading. PAR.. 8. Through the use of the statements and depictions contained in the advertisements referred to in paragraph five, including but not necessarily limited to the advertisements attached as Exhibits A and B, respondent has represented, directly or by implication, that children can operate the Colorblaster Design Toy and complete multi-part stencils with a small amount of pumping and little effort.

PAR. 9. In truth and in fact, children cannot operate the Colorblaster Design Toy and complete multi-part stencils with a small amount of pumping and little effort. To operate the Colorblaster Design Toy and complete multi-part stencils, children must engage in substantial pumping and significant manual effort. Therefore, the representation set forth in paragraph eight was, and is, false and misleading.

PAR. 10. Respondent knew or should have known that the representations set forth in paragraphs six and eight were, and are, false and misleading.

PAR. 11. The acts and practices of the respondent as alleged in this complaint constitute unfair or deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act.

Complaint 122 F.T.C. EXHIBIT A PRODUCT ~ENNER COlORBlAS TER TITLE· ' SOMETHING HIP' PROGRAM MUPPET BABIES v ·~; 91 JC STATION. WNYW :NEWYORKI 2 54?M ·•r•...,...~->lll'.~ /....-· "'{",;.,..

..,..,.·~ ·'-- ----- BOY: 11'1 a blast! MAN SINGS: Something hip just art with a blast of air. blew into town, spraying \ CHORUS: lt'sthe'Colorbluterl MAN: Pump, pump spray. blast MAN SINGS: Spray 'n stencils hot GIRl: Nothing like it anywhere I away, designs. spray cool colors. o~cr~,r~s BOY'S VOICE: It's a blast I so fine! BOY: Wildl CHORUS: It's the Colorblasterl MAN SINGS: Spraying an w •th ' blast of 3ir.

AN NCR: Elmira pens ond stencils BOY'S VOICE: Colorblasterl sold separately.

ExhibH A ALIO AVAILAet.l IN COLOa V'tDIO·fA .. t CAIIITTI ...,._n,_,.......,... .. _...,.~,_..,....._t..,c~M~ I.__.-'•~ GREY ADVERTISING, INC. 347 343 Complaint EXHIBITB PRODUCT KENNER COLOR BU.STEi< TITLE:

PROGRAM STATION BREAK ::o p Q:! STATION WP\X (NE\N YORK}R1V (MUSIC} ANNCR: Get the feel of the reel to spray with a blast of air. BOY: Color Blaster! CHORUS: The super Wow I MEN SING: Pump pump. hotwev spray, _ ,.r·-" . ..... . ,;::,~-~ ....~ . . . • ~ ..

"~~- blast away. CHORUS: The real Color Blaster. Get the feel of the real Color AN NCR: Extra pel)s and hot new Blaster. !MUSIC OUTo stencils sold separately, Exhiblt 8 .\1.10 AV&U.A8LI IN COLOa VIDIO~t&PI CAIIIf'l ~ t-6. rtt...,.., ......, .. trw! .....lV'Wf., ..,.,.,., .... ., ................... ,. W\lllll:ft .... .... Decision and Order 122 F.T.C. DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft complaint which the Bureau of Consumer Protection proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violation of the Federal Trade Commission Act; and The respondent, its attorney, and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondent of all the jurisdictional facts set forth in the aforesaid draft complaint, a statement that the signing of the agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission's Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondent has violated the Act, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of sixty ( 60) days, now in further conformity with the procedure prescribed in Section 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order:

1. Respondent Grey Advertising, Inc. is a-corporation organized, existing and doing business under and by virtue of the laws of the State ofNew York with its principal office or !}lace of business at 777 Third Avenue, New York, New York.

2. The Federal Trade Commission has jurisdiction of the subject · matter_of this proceeding and of the respondent, and the proceeding is in the public interest.

GREY ADVERTISING, INC. 349 343 Decision and Order ORDER I.

It is ordered, That respondent Grey Advertising, Inc., a corporation, its successors and assigns, and its officers, agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with the advertising, promotion, offering for sale, sale, or distribution of any toy in or affecting commerce, as "commerce" is defmed in the Federal Trade Commission Act, do forthwith cease and desist from: A. In connection with any advertisement depicting a demonstration, experiment or test, making any representation, directly or by implication, that the demonstration, experiment, or test depicted in the advertisement proves, demonstrates, or confirms any material quality, feature, or merit of any toy when such demonstration, experiment, or test does not prove, demonstrate, or confirm the representation for any reason, including but not limited to:

1. The undisclosed use or substitution of a material mock-up or prop;

2. The undisclosed material alteration in a material characteristic of the advertised toy or any other matep.al prop or device depicted in the advertisement; or 3. The undisclosed use of a visual perspective or camera, film, audio, or video technique;

that, in the context of the advertisement as a whole, materially misrepresents a material characteristic of the advertised toy or any other material aspect of the demonstration or depiction. Provided, however, that notwithstanding.the foregoing, nothing in this order shall be deemed to otherwise preclude the·use of fantasy segments or prototypes which use otherwise is not deceptive. Provided further, however, that it shall be a defense hereunder that respondent neither knew nor had reason to know that the demonstration, experiment or test did not prove, demonstrate or confirm the representation.

350 FEDERAL TRADE COM:MISSION DECISIONS Decision and Order 122 F.T.C. B. Misrepresenting, in any manner, directly or by implication, any performance characteristic of any Colorblaster Design Toy or any other toy.

n.

It is further ordered, That respondent shall notify the Commission at least thirty (30) days prior to any proposed change in the respondent such as a dissolution, assignment, or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries, or any other change in the respondent which may affect compliance obligations arising under this order. · III.

It is further ordered, That respondent shall, within thirty (30) days · after service of this order, distribute a copy ofthis order to each of its operating divisions and to each of its officers, agents, representatives, or employees engaged in the preparation or placement of advertisements or other materials covered by this order. IV.

It is further ordered, That for five (5) years after the last date of dissemination of any representation covered by this order, respondent, or its successors and assigns, shall maintain and upon request make available to the Federal Trade Commission for inspection and copying:

1. All materials that were relied upon in disseminating such representation;

2. All tests, reports, studies, surveys, demonstrations, or other evidence in its possession or control that contradict, qualify, or call into question such representation, or the, basis relied upon for such representation, including complaints from consumers, and complaints or inquiries from governmental organizations; and 3. Any and all affidavits or certificates submitted by an employee, agent, or representative of respondent to a television network or to any -other individual or entity, other than counsel for respondent, which affidavit or certification affirms the accuracy or integrity of a GREY ADVERTISING, INC. 351 343 Decision and Order demonstration or demonstration techniques contained m a toy advertisement.

v.

This order will terminate on October 30, 2016, or twenty years from the most recent date that the United States or the Federal Trade - Commission files a complaint (with or without an accompanying consent decree) in federal court alleging any violation of the order, whichever comes later; provided, however, that the filing of such a. complaint will not affect the duration of:

A. Any paragraph in this order that terminates in less than twenty years;

B. This order's application to any respondent that is not named as a defendant in such complaint; and C. This order if such complaint is filed after the order has terminated pursuant to this paragraph.

Provided further, that if such complaint is dismissed or a federal court rules that the respondent did not violate any provision of the order, and the dismissal or ruling is either not appealed or upheld on appeal, then the order will terminate according to this paragraph as though the complaint was ~ever filed, except that the order will not terminate between the date such complaint is filed and the later of the deadline · for appealing such dismissal or ruling and the date such dismissal or ruling is upheld on appeal.

VI.

It is further ordered, That respondent shall, within sixty (60) days after service of this order, and at such other times as the Commission may require, file with the Commission a report, in writing, setting forth in detail the manner and form in which it has complied with this order.

Complaint 122 F.T.C.