Releases for Advertising and Promotion

Using names and photos of people in advertising, product publicity, and promo­tions requires special handling and extra legal attention. These situations are not the same as the "implied consent" that is given when someone poses for a news story in the organization's employee magazine or newsletter.

The courts have consistently ruled that a person's right of privacy is violated when photos or names of individuals are published without prior written consent for commer­cial purposes or purposes of trade.

This situation reinforces the point that everyone whose picture, quote, or name is being used in an advertisement or a sales brochure must give explicit written consent. Courts have also ruled that product news releases are primarily for "purposes of trade" and are covered under many of the same guidelines applied to advertising.

In addition to a signed consent form, individuals are usually offered a cash pay­ment. If the person is prominent, the fee may be large, perhaps thousands of dollars. Celebrities and professional models, who are often used in advertisements, usually have agents who negotiate substantial fees.

Signed consent forms and releases usually cover a specified period of time that the person's name or photo image can be used — as little as only six months or as long as ten years. In the case of employees, it's always wise to have materials dated.

Consent forms for advertising can be complex. For most public relations purposes, however, a simple release will probably suffice, and pads of standard photo release can be purchased at camera stores. Your legal counsel may be able to provide forms tai­lored to your organization.

You do not need a release when the photo records a public event and a consider­able number of people are involved. But if that picture is later used for promotional purposes and individuals are identifiable, you should have releases.

Regulations of Government agencies

Releasing false or misleading information can get you in trouble with government regulatory agencies. State agencies are empowered by law to enforce regulations about the distribution and content of financial and product information. They may issue cease-and-desist orders or injunctions. Fines can be levied, and adverse publicity can appear in the media. Also, people who feel that they have been injured or deceived can file lawsuits and collect damages.

False information can be either misrepresenting facts or misleading someone into believing something that is not quite true. Any information affecting the value of a security must be made known to the owners. This is done by filing certain annual and quarterly reports, highlights of which are often included in news releases.

In general, a company whose stock is publicly traded must immediately release the following kinds of news:

• Dividends or their deletion

• Annual or quarterly earnings

• Preliminary but audited interim earnings

• Stock splits

• Mergers

• Changes in top management

• Major product developments

• Major expansion plans

• Change of business purposes

• Defaults

• Dispositions of major assets

• Proxy materials

• Purchases of its own stock

In financial information, accuracy is imperative. Public relations firms have been held responsible for releasing false and misleading information even though they were told by their clients that the supplied facts were correct. Anyone preparing or releasing financial news is responsible for making a reasonable effort to ascertain that the informa­tion is accurate. You don't have to be an accountant, but you should know how to read a balance sheet and determine if the information presented is logical and reasonable.

Often a company is tempted to report only the good news and bury the bad news. Although this sounds like a good idea to executives interested in the image of the corporation, it is dangerous when it comes to financial news.

A company and its public relations firm may be held liable even if each individual release or other statement is literally true when examined separately.

In other words, companies should avoid the temptation to paint a rosy picture of financial stability if in fact there are problems that stockholders and potential investors need to know in order to make an informed judgment. For example, a company should not announce a new product that is still in the research stage and will not be available to the public for another year.

In advertising and publicity the areas where deception can occur are these:

• Unsubstantiated claims — statements that you cannot prove

• Ambiguous claims — statements that are confusing

• Fraudulent testimonials — statements that were never actually made.

• Puffery and exaggeration — stretching the truth

• Deceptive pricing — concealment of true cost

• Deceptive demonstrations — apparent proof that is not really proof

• Deceptive survey — for example, "independent" surveys that you have paid for.

• Unsound surveys — surveys that are not statistically valid

• Fraudulent contests — contests that were rigged in some way

• Deceptive illustrations — pictures that convey a false impression

• Nonexistent authority — for example, "Doctors recommend..."

• Unfair or misleading comparisons — inaccurate portrayals of superiority over other products.

In summary, a public relations firm and its writers have a responsibility to know all pertinent regulatory guidelines. A number of court cases have determined that you, as the writer, can be held liable for disseminating false and misleading information on behalf of a client. Be cautious about the information and documentation supplied to you by employers or clients.