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1 Melvin H. Orlans & Robert Cheek, Trade Regulation Rule concerning Food Advertising 1 (1982)

handle is hein.usfed/trrcfdav0001 and id is 1 raw text is: MEMORANDUM To: Commission- From: Melvin H. Orlai , Robert Cheek; Division of Advertising.-Practices Subject: Trade Regulation Rule Concerning Food Advertising Dated: September 29, 1982 In his recent memorandum, the Bureau Director opposes the issuance of the Food Advertising Rule. After considering the Bureau Director's arguments and evaluating the Rule's. weaknesses as well as its strengths, and despite some reservations of our own, we continue to believe the Rule should be promulgated in the form tentatively approved by the Commission two years ago. In the subsequent discussion, we shall attempt candidly to discuss the Rule and,, in some instances, to suggest additional options for Commission consideration. I. Introduction Although the Bureau Director raises specific concerns with respect to each section of the Rule, his opposition essentially stems from the failure of the record to meet the evidentiary standard he espouses. We believe, however, that the standard of hard or convincing evidence developed by the Bureau Director is unduly restrictive, inflexible, and legally inappropriate. Indeed, we question whether any rule could satisfy this standard as the Bureau Director has formulated it. Under the Bureau Director's approach, expert testimony and testimony by consumer representatives, industry representatives, and individual consumers are all entitled to little or no weight. Instead, acceptably hard or convincing evidence can generally be provided only by statistically projectable consumer surveys. For example in the present proceeding, the Bureau Director's approach would require at least three projectable surveys and a systematic market study for each of the Rule's three sections. Randomized surveys would have to have been conducted on consumer interpretation of advertisements and claims, on consumer behavior (ea., purchasing behavior and usage), and on the effectiveness of the remedy. A marketing study would have been required to systematically monitor advertising over numerous media and to gather other information on advertising campaigns and expenditures. It seems clear from past experience that these four studies could be expected to cost $75,000 each, for a total of $300,000 for each -1-

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