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A Gala Day for Comparative Advertising

By Jonathan E. Moskin
July 12, 2004

Given the expense and burden of resolving false advertising cases in federal court, the promise of an expedient and less expensive alternate forum invites attention. Adding to speed and thrift an assurance that ads will be assessed by experts in the field makes the forum more interesting still. What is this alluring avenue of adjudication? For 33 years, the National Advertising Division of the Better Business Bureau (NAD) has sought to provide just such a mechanism. Yet, even for long-time veterans of federal proceedings, the NAD may be terra incognita. One recent decision by the NAD, In re Distillerie Stock USA Ltd., NAD Case No. 4197 (June 2004), reveals both benefits and drawbacks of the forum, particularly in how some familiar yet some unique allocations of the burdens of proof can produce results both similar to and quite unlike those in federal court.

Distillerie Stock recently retained the well-known taste-testing service, Beverage Testing Institute (BTI), to conduct blind taste tests comparing its GranGala triple orange liqueur, the second best selling brand in the United States, with number one Grand Marnier and virtually all of the other premium orange liqueurs available in this country. (As reported in another recent NAD decision, In re Sidney Frank Importing Co. Inc., NAD Case No. 4016 (Feb. 2003), the BTI has achieved remarkable consistency in its taste tests, far exceeding what a cynic might dismiss as an inherently subjective subject.) In relevant part, the test showed a marked preference for margaritas mixed with GranGala liqueur over Grand Marnier, numerically ranked at 94 to 86. Stock promptly produced print advertising promoting the comparative product rankings. “We Came, We Mixed, We Won” announced one such promotional item that also reported the test score. Marnier Lapostolle and its U.S. distributor, Schieffelin, objected ' first threatening suit, but ultimately opting instead to mediate the matter before the NAD.

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