Government Report: May 3, 2007

Contents:

DTC Bill Reaches Senate Floor
The U.S. Senate is considering legislation that contains the most restrictive advertising provisions considered by the Congress in many years. As written, S. 1082, the Food and Drug Administration Revitalization Act, would allow the Food and Drug Administration to impose a moratorium of up to two years on advertising for new pharmaceuticals and require that advertising be preapproved by the FDA prior to running in the media. Senator Pat Roberts, R-Kan., offered an amendment in committee to eliminate those provisions and grant the FDA, for the first time, the authority to impose civil penalties for false or misleading direct-to-consumer (DTC) advertising. The amendment was defeated by an 11–10 vote. Sen. Roberts is in negotiations with the sponsor of the bill, Sen. Ted Kennedy, D-Mass., to find acceptable compromise language for his amendment. Sen. Kennedy has reportedly agreed to drop the moratorium and preapproval provisions but has insisted that additional required warning language be included in advertisements. These requirements would likely eliminate radio and television broadcast DTC advertising. Local AAF members have been extremely active in contacting their senators urging support of the Roberts amendment.
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Utah Reconsiders Internet Keyword Search Law
The Utah legislature is reconsidering a recently enacted law that allows companies to register trademarks in order to prevent competitors from advertising alongside Internet searches for the trademark. Executives from major Internet search companies and online retailers met with members of the Utah House and warned that the registry created by the Trademark Protection Act (Senate Bill 236) would be harmful to their businesses and likely struck down in court. The two sides are working on a compromise. Because of these discussions, Utah has not taken steps toward creating the trademark protection registry authorized by the legislation.
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Dairy Companies Seek Advertising Labeling Requirements
A growing number of dairy companies have petitioned the Food and Drug Administration, asking the agency to create clear labeling requirements and enforcement of the advertising and marketing of milk. Many dairies are currently advertising their milk as "rBST-free," referring to a growth hormone that increases milk production and approved by the FDA in 1993. The companies petitioning the FDA say that such marketing is deceptive and misleading because it implies that rBST is unsafe. In 2003, the FDA sent warning letters to several diaries saying they could not advertise milk or other dairy products as "hormone-free" because of naturally occurring hormones in milk.
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Oregon Proposes Changes to Trade Practices Act
The Oregon Department of Justice has announced its intention to modify the definition of "free" goods and services under the state’s Trade Practices Act. The proposed amendment ensures that receiving a "free" item with the purchase of another item would not cost a consumer more than the regular price for the other item and requires disclosure of the terms of "free" offers. Additionally, the revised rule would add new prohibitions against unfair uses of rebate offers. Oregon is soliciting written comments on the proposal and will hold a public hearing on June 25, 2007. A copy of the proposal is available here.
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Government Affairs Conference a Success
The Joint National Advertising Government Affairs Conference, sponsored by the American Advertising Federation, American Association of Advertising Agencies and Association of National Advertisers was held this week at The Washington Post in Washington, D.C. Attendees of the conference heard insights on potential advertising regulation from House Energy and Commerce Committee Chairman John Dingell, D-Mich., and Federal Communications Commissioner Deborah Taylor Tate, as well as political trends and societal views from Pew Research Center President Andrew Kohut and Washington Post columnist David Broder. Highlights of the conference will be available soon at www.aaf.org/gac.
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