October 20, 2009 5:55 PM

Mixed Results for Manatt on Qwest Ad Attack

Posted by Zach Lowe

Qwest Communications executives were not happy when they saw television ads from two competitors claiming Qwest automatically locked customers into long-term contracts and charged hefty termination fees. The execs eventually retained Manatt, Phelps & Phillips to file complaints against the two competitors--Comcast and Cox Communications--not in court, but instead in front of the National Advertising Division (NAD), a section of the Better Business Bureau that serves as the ad industry's self-monitoring police. 

Qwest also took issue with claims from Comcast and Cox that their PowerBoost cable modem services allow for faster downloading. The NAD announced its mixed decision today: The Comcast and Cox claims about PowerBoost are (mostly) justified, but the criticisms of Qwest are inaccurate and should be removed from future ads. The NAD's rulings do not have the force of law, but the organization can forward complaints to the Federal Trade Commission should any company violate its recommendations, according to lawyers involved in this and similar matters.

Christopher Cole, the Manatt partner who advised Qwest on the disputes with Cox and Comcast, says the competitors may not have made the false claims about Qwest had they performed complete due diligence before releasing the ads. Cole, a former environmental lawyer with a degree in marine biology, consults some of Manatt's regular clients as they craft new advertising campaigns. He advises them on (among other things) the types of tests they must perform to back up certain claims, how big the font should be in any on-screen disclaimer, and when a disclaimer should air on a television ad. "We agonize over all of those things," Cole says.

That work paid off perhaps most famously in Miller Lite's controversial campaign in which Miller's parent company (now MillerCoors) claimed its light beer tasted better than Bud Light. Bud's parent company at the time, Anheuser-Busch, challenged the claims in various out-of-court venues, but authorities ultimately ruled that Miller had performed enough sound taste tests to back its claims, Cole says. 

Scott Dailard of Dow Lohnes advised Cox in the NAD proceeding. Loeb & Loeb advised Comcast. Like Cole, Dailard devotes his full practice to advertising law, though that wasn't his original career plan. The transition for Dailard happened organically, growing out of his representation of several large telecom companies in IP and antitrust matters. As comparative advertising--in which companies name rival brands, presumably in a less favorable light--has become more common in recent years, Dailard's practice has shifted more into advertising. His non-litigation work includes advising clients on how to conduct direct marketing campaigns without violating federal and state laws, such as do-not-call regulations. 

Dailard says he expects the focus of his practice to shift again soon, this time to text message advertising and online ads tailored to a particular user's Web surfing habits. Imagine walking by a Starbucks, for instance, and getting a text message offering you a coupon for a cup of coffee. That sort of geographically-based ad campaign raises all sorts of privacy and regulatory issues, Dailard says. 

This is perhaps not exactly the sort of career Cole had in mind when he finished his degree in marine biology and began a career as an environmental lawyer at Kirkland & Ellis and then at Paul, Hastings, Janofsky & Walker. He switched to advertising "by accident," he says, after his science background made him an asset when Paul Hastings defended Clairol in a dispute with L'Oréal over claims Clairol made about (no joke) the gentleness of its hair coloring treatment, Cole says. Suddenly, being able to read scientific reports and understand double-blind experiments set him on a new career path. 

Cole's practice is evenly split between litigation and work before the NAD, he says. Clients typically pursue litigation in cases in which the disputed advertising claim is so serious and potentially detrimental that a client demands a preliminary injunction, he says. 

Like Dailard, Cole says he expects to remain busy as advertising evolves.

"I had every intention of being an environmental lawyer," Cole says. "But this is a fun practice with a lot of heavy technical issues. And I get to watch a lot of commercials." 

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