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False advertising as a deceptive trade practice

Starting and growing a business in California is challenging and time-consuming. One way many businesses attract customers is through different forms of advertising. Unfortunately, some companies use misleading information, or even outright lies, to gain unfair competition over others. The good news is there are both federal and state laws that prohibit this type of deceptive trade practice, and businesses can take legal action if they are a victim of these false ads.  

According to the Chron, there are a number of ways businesses promote themselves unethically. For example, using celebrity endorsement without his or her permission is considered false advertising. Some other types include:

  • Unsubstantiated claims - a company may not advertise atypical results unless it states they are not normal in the marketing materials
  • False client testimonials - a business changes a real customer testimonial or has an employee write one as the client 
  • Bait and switch - advertising a low-priced product and then up-selling the customer or not having the advertised product available 

According to FindLaw, California has specific laws prohibiting the use of deceptive trade practices such as false advertising. If a company is found guilty of these practices, it is considered a misdemeanor. The business may be required to pay a fine of up to $2500, serve jail time of up to six months or both.

If you have been a victim of false advertising, and it has affected your company's bottom line, you may be able to take legal action. Our intellectual property legal team can help protect your rights and potentially gain back what you have lost.  

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