False Statement in Advertising Act

Minnesota’s False Statement in Advertising Act (“FSAA”) prohibits an advertisement which “contains any material assertion, representation, or statement of fact which is untrue, deceptive or misleading.” Minn. Stat. § 325f.67. There are two issues under the FSAA regarding the scope of the statute. First, the conduct must be an advertisement disseminated to the public. Second, the defendant must have advertised with the intent to induce consumption.

Advertisement to the Public

The FSAA is very broad regarding what type of advertising is regulated by the statute. Basically, anything the seller is advertising is covered within the scope of the FSAA. Minnesota courts have held that any representations placed before the public are considered advertisement within the meaning of the FSAA. Various types of representations have been considered advertisements under the meaning of the FSAA. In Kociemba v. G.D. Searle & Co., 707 F.Supp. 1517 (D. Minn. 1989). The Federal District Court of Minnesota found that a package insert by a physician constituted an advertisement that was placed broadly before the public, therefore the FSAA applied. On the other hand, if there are isolated representations to an individual consumer, then the FSAA does not apply to the representation. In other words, any dissemination of a representation must be made to the general public. Lastly, for the FSAA to apply the false representation that was disseminated to the public must have occurred in Minnesota.

Intent to Increase Consumption or Induce Obligation

In a majority of FSAA cases the issue of intent is heavily litigated and most likely arises when the defendant is not the seller of the product. In Jenson v. Touche Ross & Co., 335 N.W.2d 720 (Minn. 1983). The Minnesota Supreme Court stated that plaintiffs could not bring an FSAA claim against an accounting firm whose audit report was cited in an advertisement by a company that it had audited because there was no intent to increase consumption in the advertisement. The court found that the accounting firm did not have the requisite intent to increase sales or advertise for its client that it had audited.

Leave a Public Comment