More automotive aftermarket suppliers are selling directly to consumers thanks to Amazon and other e-commerce platforms. With this newfound ability comes an increased risk of claims commonly brought by consumers and competitors. These claims provide legal recourse through a number of state and federal laws, including false advertising, false designation of origin, and deceptive trade practices, among others.
What to Know About the Lanham Act
One of the most common ways that aftermarket businesses find themselves defending false advertising claims is through a Lanham Act claim. While the Lanham Act protects federally registered trademarks from infringement, it also allows competitors to bring claims of false advertising or marketing.
The federal Lanham Act provides companies the legal authority to challenge competitors when a competitor’s statement is likely to deceive a significant portion of consumers about important features of a certain product. These statements in advertising or marketing often concern the product’s geographic origin, approval by certain organizations or figures, or overall qualities. Only products in interstate commerce are protected by the Lanham Act.
What makes the Lanham Act unique is that only competitors, not consumers, may bring false advertising claims under the law. The idea behind that is that competitors are uniquely positioned to recognize false marketing and unfair trade practices. However, it also means your competitors have their antenna up for the slightest misstep—whether or not it constitutes a legitimate claim. What’s more is that even true statements in your advertising that are otherwise misleading can bring about a legitimate Lanham Act claim.
State Laws Concerning False Advertising
Besides federal laws, automotive aftermarket companies must also contend with a wide array of state laws designed to protect consumers. These laws, such as the California Unfair Practices Act, are often enforced by attorneys general. In most states, the attorney general is an elected position. This sometimes provides outside pressure or incentives for these officials to pursue claims against companies.
Many states also have laws empowering both consumers and competitors to bring false advertising claims. Some e-commerce platforms even have in-house processes for policing competitors’ products.
The Importance of Proactive Legal Representation
Mere accusations of false advertising or unfair business practices can wreak havoc on automotive aftermarket businesses. You might find that even well-established retail and distribution partners are wary of working with your company after this type of claim is levied against you. Successful claims can easily sink the enterprise into which you’ve spent countless hours and capital building and cultivating.
Partner With a Knowledgeable Aftermarket Firm
Our legal team is aware of vulnerabilities many automotive aftermarket companies have in their marketing materials. From package labeling to online advertising, Aftermarket Law can help your business avoid common pitfalls and strengthen existing practices to reduce the risk of a false advertising claim. If your business has already become the target of a claim, we will vigorously defend you in and out of court. Get in touch with our firm to protect your company and livelihood.
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