What Does it Mean to “Disseminate” an Internet Advertisement?

October 20, 2009

By Ricardo Carvajal

The Chief Administrative Law Judge (“ALJ”) at the Federal Trade Commission (“FTC”) has issued a decision that, if upheld by the Commissioners of the FTC, would dismiss an FTC complaint which alleged that a marketer of dietary supplements “disseminated” or “caused to be disseminated” false advertisements on an internet website in violation of sections 5(a) and 12 of the Federal Trade Commission Act.  The challenged advertisements were alleged to falsely represent that the supplement prevented, treated, or cured cancer.  However, the ALJ did not reach the question of whether the advertisements were false or misleading because he ruled that the FTC staff lawyers prosecuting the case failed to meet their burden of demonstrating that the respondents “disseminated” or “caused to be disseminated” the advertisements.  The ALJ found in part that (1) there was no evidence that respondents had created or played a role in creating the advertisements, (2) merely referring consumers to a website did not constitute “dissemination” of the advertisements on that website, and (3) neither unsupported assertions that respondents participated in the website nor assertions that they had a business relationship with the supplement manufacturer were sufficient to give rise to liability for false advertising on the website.