As the Gatorade Company recently learned, the California Attorney General views statements that allegedly “disparage” the consumption of water to be a violation of California’s consumer protection statutes.
On September 21, 2017, the California Attorney General announced that it had filed a complaint on behalf of the people of California alleging that the Gatorade Company made false and misleading statements in an “advergame” – a downloadable or internet-based videogame that features a brand-name product. The premise of the advergame – titled “Bolt!” – is that the player controls a cartoon version of Olympic sprinter Usain Bolt, who runs to collect gold coins stolen by pirates. Players are encouraged to “Keep Your Performance Level High by Avoiding Water.” Thus, upon touching a Gatorade icon, the cartoon Bolt runs faster and his “fuel meter” increases; conversely, upon touching a water droplet, Bolt slows down and the “fuel meter” decreases.
According to the California Attorney General, these features and messages “inaccurately and negatively depicted [water] as hindering” athletic performance, and the Gatorade Company thus violated California’s False Advertising Law and Unfair Competition Law. There was no allegation that anyone was actually misled by the game to believe that drinking water is unhealthy. But as California class action practitioners are aware, the threshold for liability is whether a statement is “likely to deceive” a reasonable consumer. This threshold was allegedly met by a video game that allowed a cartoon avatar to run faster if it drank Gatorade instead of water.
The Gatorade Company agreed to settle the California Attorney General’s claims for $300,000, some of which will be used to fund research and education regarding water consumption and the nutrition of children and teenagers. The Gatorade Company also agreed to: (1) no longer make statements that disparage water or the consumption of water, (2) no longer make “Bolt!” or similar advergames available for download, (3) disclose endorser relationships in any social media posts, and (4) not advertise its products in media where children under age 12 comprise more than 35 percent of the audience.
As the Gatorade settlement illustrates, legal pitfalls abound in California, which has the broadest consumer protection statutes in the nation. Companies should beware that their marketing is under constant scrutiny from governmental authorities and plaintiffs’ firms for any hint of a possibly misleading statement.