"Up To" No Good

August 21, 2012
Legal Alert

If it’s technically true, then I can get away with claiming it. Or can I? Not necessarily, according to the Federal Trade Commission.

In an action this past February, the FTC charged five window companies with making deceptive energy efficiency and cost savings representations, including energy savings claims of “up to” 50 percent. The government found such claims were misleading because they would not apply to most consumers. The mere possibility of achieving the represented reduction or savings is not sufficient to support this type of claim.

So what does this mean for you? What energy and cost saving claims can you make that fall within the acceptable bounds set by the FTC? According to the FTC’s decision and order, not as much as you might think, particularly when the seemingly straightforward phrase “up to” is used in marketing materials. While the intent behind the use of “up to” may seem clear to the marketer as indicative of a maximum amount, recent studies and the FTC order says otherwise.

In its settlements with the window companies, the FTC prohibited them from making any sort of representation that a consumer can achieve energy savings or reduction up to or a specified amount unless that representation is not misleading—and the company must be able to support the representation with “competent and reliable scientific evidence” that all or almost all consumers are likely to achieve the maximum amount. You should be familiar with the requirement for possession of competent and reliable scientific evidence supporting an energy saving representation at the time the representation is made, but the requirement that “all or substantially all” consumers must be likely to achieve the benefit is an important clarification.

From this we learn that use of the limitation “up to” in the context of energy efficiency and cost savings will not adequately qualify a claim or shield a company from the FTC. It is not enough that a few consumers would achieve the specified savings. Rather, energy savings and cost reduction claims must be representative of what “all or almost all” consumers can achieve. If you are driven to make overall energy savings claims, it is wise to revisit your marketing materials and inform your sales team of the FTC’s decision.

This Legal Alert is presented by Paul Gary, an attorney at the Gary Law Group based in Portland, Ore. The firm specializes in legal services for the window and door industry. More information is available at www.prgarylaw.com.  Contact Gary at paul@prgarylaw.com for further information or to receive the firm's "Risk in the Fenestration Industry” quarterly newsletter.