* Del Monte Corp. advertised that its canned vegetables "are as nutritious as the vegetables you buy fresh and cook at home."
* The National Coffee Association said the caffeine-filled beverage "lets you calm yourself down."
* Coca-Cola Co. launched an ad campaign proclaiming that Diet Coke was flavored "Now with NutraSweet," when the soft-drink also contained saccharin.
A nonprofit consumer group charges that these ads deceived consumers about the products and should have been challenged by the Federal Trade Commission.
Eventually, each of the ads was modified or discontinued under pressure from state law enforcement officials, industry review organizations, or a television network.
The Center for Science in the Public Interest (CSPI), a Washington-based research organization, and other critics of the FTC complain that the agency is ignoring a growing wave of misleading national food advertising. They charge that the FTC is wasting its resources on small, insignificant cases of fraudulent advertising and turning a blind eye to major corporations making questionable claims designed to appeal to the public's heightened concern about health and nutrition.
This, in turn, has left state agencies and private business groups with the costly job of combatting deceptive national advertising, increasing the danger of conflicting rules and spotty consumer protection, critics say.
The FTC's Consumer Protection Bureau and some business organizations disagree. They argue that the national advertisers' self-regulation system works well and that the FTC properly focuses its attention on clear-cut cases of fraud that cannot be remedied by the private sector.
Major corporations value the public's confidence and seek to preserve it by cooperating in a self-regulating system that is bolstered by the threat of FTC legal action, say representatives of the Council of Better Business Bureaus and the Association of National Advertisers.
This allows the FTC to concentrate on advertisements "that could result in the most consumer harm," economically or physically, said Wallace S. Snyder, associate director of the agency's division of advertising practices.
The CSPI does not criticize the agency for the number of actions, but rather the targets. The agency's advertising actions are "almost all against very small companies, guilty of blatantly fradulent behavior, letting large, national advertisers off the hook," said Bruce Silverglade, CSPI director of legal affairs.
CSPI points to several cases, including the three above, in which it has petitioned the FTC to take action against national ad campaigns by major corporations and found remedies elsewhere.
The center said Del Monte's claim about the nutritive value of its canned vegetables was "deceptive and dishonest," charging that most of the products contain five to 300 times as much sodium as fresh vegetables, that a government study found more vitamins in fresh cooked vegetables and that the ads implied that none of the nutrients in raw vegetables are lost during the canning process.
CSPI's petition is "under investigation" at the FTC, Snyder said. However CSPI considers their complaint resolved, following action by the National Advertising Division (NAD) of the Council of Better Business Bureaus, which acts as an industry-review organization.
Del Monte presented studies which it believed supported the ad's claim. NAD found "that some results were in conflict" with the advertising claims and recommended modifying the ad. Del Monte told NAD in April that the campaign had "expired" and that it "would, in the future, give consideration to the concerns raised by NAD," the NAD case report said. The National Broadcasting Corp. in January also required Del Monte to alter its TV commercial, CSPI noted.
Concerning the coffee advertisement, CSPI complained that the campaign was "dishonest and dangerous" because "the caffeine in coffee is a stimulant of the central nervous system and promotes anxiety, jitters and insomnia -- not calmness and serenity."
The coffee association said it meant to imply that a coffee break is relaxing. The NAD recommended changes in the ad. CSPI appealed NAD's decision to the National Advertising Review Board. The coffee association dropped the ad campaign in September 1984 after the NARB agreed to hear the appeal.
The FTC denied CSPI's petition after NAD resolved the matter.
CSPI asked the FTC to take action against ads for Diet Coke, Diet Pepsi and Diet Rite Cola, calling them "deceptive and potentially dangerous because they tout the use of the sweetener NutraSweet (aspartame) without disclosing the presence of saccharin, an artificial sweetener that promotes cancer." None of the ads mentioned the use of saccharin, but the ingredient was included on the can labels, which included a warning that the substance has been found to cause cancer in laboratory animals.
Meanwhile, the New York attorney general's office threatened to sue the soft-drink companies and in March of 1984 reached agreements with the makers of Diet Coke, Diet Pepsi and Diet Seven-Up, who agreed to prominently display the label "NutraSweet Blend" and to pay $30,000 each to cover the states's costs.
The State of New York has not reached a settlement with Royal Crown Cola Co., maker of Diet Rite, and filed suit against RC last summer, charging the company with misleading advertising.
In April, the FTC denied CSPI's petition to act in the matter, noting that soft-drink advertising was changing quickly, with companies rushing to emphasize the presence or absence of saccharin in their products compared to the competition.
Snyder said that "market movement," the presence of saccharin on the can labels, and the New York state action made further FTC action unncecessary.
Silverglade, of CSPI, said the diet-cola case "was a good illustration of why it is often difficult to completely rely on the marketplace to correct instances of deceptive and misleading advertising. Absent the catalyst provided by the New York State agreement, it is certainly questionable whether any products would have been reformulated and thus, whether comparative advertising among diet beverage manufacturers would develop.
"The central question which still remains . . . is why the commission failed to take the type of action commenced by New York State, on a nationwide basis. Advertisers need predictable, uniform regulatory requirements, and consumers in all states, not just certain areas of the country, deserve uniform protection," Silverglade said in a letter to Carol T. Crawford, director of the FTC's bureau of consumer protection.
The New York attorney general's office shares Silverglade's concern. "The FTC has not been as vigilant as in the past . . . leaving a vacuum in the regulation of advertising," said Peter Bienstock, assistant attorney general in charge of the consumer fraud and protection bureau. "We see a fair amount of petitions to the FTC. When people don't get results from the FTC, it's left to us."
The New York attorney general's office can have national impact because of the size of the state, and the difficulty of tailoring a national ad campaign to the different tastes of different states. "But the taxpayers of New York should not have to bear the burden for the whole country," Bienstock said.
Snyder, of the FTC, agrees that "it is better to resolve these matters on a national level so there is one standard." However the agency does not "accept the premise that the FTC has backed away from national issues," he said.
For example, Snyder said, the commission is now considering whether to require health warnings on smokeless tobacco labels. Last week, in response to an FTC request, U.S. Surgeon General C. Everett Koop appointed a panel to study the issue and report its findings to the FTC. In December, Koop said in a letter to the FTC that smokeless tobacco "does indeed pose a cancer threat and is associated as well with certain other pathologic oral conditions."
Snyder also said NAD and the FTC complement each other well, with the NAD working as a voluntary industry self-regulation mechanism and the FTC working as the federal law enforcement agency.
NAD, with a staff of 15 and a $750,000 annual budget, operates as part of the Council of Better Business Bureaus, monitoring national advertising and responding to complaints filed by consumer groups and companies.
NAD investigates an ad by asking the advertiser to substantiate explicit or implicit claims. The staff decides if the evidence supports the claim, publicizes its decision and may ask the advertiser voluntarily to modify or discontinue the ad. NAD decisions can be appealed to the National Advertising Review Board, composed of representatives of 30 companies, 10 ad agencies and 10 members of the public. A five-member panel reviews the appeal, and decides if the claim is supported, or if it should be modified.
Company compliance with NAD and NARB's recommendations is entirely voluntary and noncompliance "has never happened," said Lorraine C. Reid, senior vice president of the Council of Better Business Bureaus. Advertisers know that noncompliance would force the industry review board to turn its findings over to the FTC, she said. "It's important that the FTC be there as the law enforcement backup."
The FTC has the powers to order corrective ads or restitution to consumers, but "NAD can get things done very quickly," Snyder said.
NAD investigates 100 to 150 cases a year, only 2 percent of which go to the NARB, Reid said. "There's no point in the FTC wasting taxpayers' money on such matters."
Snyder said health claims are best approached on a case-by-case basis because they vary widely and simple messages may carry different meanings in different contexts. "It's better to spend time on important cases," he said.
For example, he said, the commission in 1984 forced PharmTech Inc. to halt an ad campaign for its Daily Greens vegetable supplement. The FTC concluded that the company had misrepresented findings by the National Academy of Sciences, falsely claiming that the product would reduce the risk of cancer.
Daily Greens, with annual sales of $20 million to $30 million, was not an insignificant case, Snyder said.
The FTC is suing General Nutrition Inc, a national health food chain with annual sales of about $320 million, over similar claims for its product Healthy Greens.
"We believe we are really active in food and drug advertising. We're doing the job," Snyder said.