If You're Not Sure, Add a Disclosure

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If You're Not Sure, Add a Disclosure

May 10, 2018

Counter Strike Logo | For noncommercial use

Chiara Ferragni, Kayla Itsines, Kourtney Kardashian. Odds are if you're into fashion or fitness or reality TV, then you've heard of all of those influencers. And if you're into gaming, then odds are you've heard of Trevor Martin and Thomas Cassell, two social media influencers with millions of YouTube subscribers in the online gaming sphere. They decided to create their own website called CSGOLotto, where gamers who play Counter-Strike: Global Offensive (CS:GO) can gamble using virtual weapons skins. A cool idea if you're into CS:GO, so where did it go wrong?

Both Martin and Cassell started promoting their website on their YouTube channels but didn't mention the fact that they owned the site or were even connected. Cassell did include a statement that his videos were sponsored by the website, but it was below the fold in the description. Martin didn't even mention a connection at all in the description. They also made no mention of the fact that they were gambling with free skins their company gave to them.

That would be problematic on its own, right? But even worse, they hired other influencers to promote CSGOLotto, and those influencers either didn't disclose the sponsorship or disclosed it below the fold. The other influencers were paid and prohibited from saying anything negative about the website but didn't tell consumers that.

As you can probably guess from reading our other blog posts, the FTC wasn't very happy with Martin and Cassell. There were three issues with what they did: they made it seem like the reviews were from impartial users, they didn't tell consumers that CSGOLotto was their own company, and they didn't tell consumers that the endorsers were paid. The FTC extended the rules they came up with for brands to Martin and Cassell since they were running their own separate company. A couple of the rules we talked about previously applied here:

  • Don't misrepresent that an endorser is an independent user or ordinary consumer
  • Do disclose any material connections between endorsers and yourself, your company, any other entity affiliated with your product or service, or the product or service itself
  • Do provide endorsers with clear statements of endorsement to include in their promotions
  • Do create a monitoring system to make sure that the rules are being followed
  • Do terminate endorsers who don't follow the rules

Just remember: if you're not sure, add the disclosure!

Jon Pfeiffer is an experienced entertainment and copyright trial attorney practicing in Santa Monica. Jon is also an adjunct professor at Pepperdine University in Malibu, California where he teaches Media Law. COM 570 covers First Amendment issues as well as copyright, defamation, and privacy.

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