The clearest lessons learned from the Volkswagen “clean diesel” lawsuits read like the popular “All I Really Need to Know I Learned in Kindergarten”: Play fair … clean up your own mess … say you’re sorry when you hurt somebody.
Most business owners think to themselves, “I would never act like Volkswagen did, so what can I learn from their experience?”
The answer? Plenty, at least when it comes to making claims about your products to consumers.
From 2009 through 2015, Volkswagen sold and leased more than 550,000 diesel cars. Volkswagen sold and leased the cars at least in part on the promise that they were “clean diesel” cars: low-emission, environmentally friendly vehicles that met emissions standards and would maintain a high resale value.
The promise was false. Volkswagen had installed a defeat device in these vehicles, which is illegal software designed to allow the vehicle to cheat emissions tests. And unless a consumer had sophisticated testing equipment, there was no way to detect the defeat device. In reality, these consumers were driving cars that emitted harmful pollutants, including nitrogen oxide, at rates up to 40 times the United States standards.
Not surprisingly, when Volkswagen was caught, it was sued — many, many times. The latest lawsuit, filed March 29, was brought by the Federal Trade Commission. This lawsuit is different from many of the others because it focuses on a much narrower issue: the false advertising Volkswagen used to sell these cars. And this is where business owners can learn deeper lessons from Volkswagen.
1. Humor is not a license to exaggerate: Many of the Volkswagen advertisements leaned heavily on humor to discuss claims with the consumer, including the very funny and popular Old Wives’ Tales campaign. For the “clean diesel” advertisement, the old wives’ tale taken to task was that “diesel is dirty.” Volkswagen demonstrated this was just an old wives’ tale by having one of the actors hold a white scarf to the tailpipe, which is then removed and is in pristine condition. The demonstration is followed up by the joke that “only your mind is dirty.” Funny, memorable — and exaggerated. But this humorous context does not relieve Volkswagen from the responsibility for proving that its diesel was as clean as demonstrated — so clean that a white scarf held to the tailpipe would emerge perfectly clean.
Lesson: Claims made, even in the context of humor, must still be true.
2. A picture is worth a thousand words — some of which you may not have intended. The white scarf trick was not the first time Volkswagen attempted a visual depiction of the cleanliness of its “clean diesel” exhaust. The visual was repeated in the TDITruthandDare.com campaign when Volkswagen placed clean white coffee filters on tailpipes to see which car was cleaner — the Volkswagen “clean diesel” or a traditional diesel vehicle. Both are powerful images challenging a commonly held belief about the dirtiness of diesel vehicles. By using such a powerful visual, Volkswagen chose to hold itself to the standard represented by that visual. In reality, the claim was that Volkswagen’s “clean diesel” engines simply reduced emissions — not eliminated them completely. But these visuals communicate much more than that and were used in the FTC’s complaint against Volkswagen to highlight the falsity of Volkswagen’s “clean diesel” claims.
Lesson: Product claims are not made just with words, but visuals, as well.
3. Green claims must be narrowly tailored and industry appropriate. Green claims are powerful, and the FTC understands this, going so far as to issue “Green Guides” for environmentally friendly marketing claims. The truth is that every industry is going to be able to make a different range of green claims, if any at all. And in the automotive industry, green claims are simply more difficult to make and will be scrutinized more closely.
Lesson: Tailor green claims appropriately to specific benefits and your industry.
While the biggest reminder from the Volkswagen clean diesel lawsuits is to simply “play fair,” business owners can take away deeper lessons for their product claims and marketing campaigns.
Janet L. Ramsey is a litigator at Warner Norcross & Judd LLP who regularly counsels clients on the pitfalls of false advertising claims. She can be reached at email@example.com.