LEGAL LIMITS AND RESTRICTIONS ON ADVERTISING 1. Restrictions of the Federal Government.—Ad vertising is relatively too new a branch of business to have become directly subject to Federal control. Altho Congress has the power to regulate interstate commerce and has complete control of the mails and of trade-marks, like the Dominion Parliament, it has used this power only for the following purposes: (1) to prevent lotteries; (2) to insure the sale of pure foods and drugs; (3) to prevent the mails from being used to perpetrate frauds. In the regulation of all these matters, however, restraint on advertising is incidental.
The Federal pure-food law limits the advertiser in making representations concerning the materials composing the food and drug products sold by him. The Food and Drugs Act of 1906 reads as follows: The term "Misbranded," as used herein, shall apply to all drugs, or articles of food, or articles which enter into the composition of food, the package or label of which shall bear any statement, design or device regarding such article, or the ingredients or substances contained therein which shall be false or misleading in any particular, and to any food or drug product which is falsely branded as to the state. ter ritory or country in which it is manufactured or produced.
The Canadian Adulterations Act provides heavy penalties in similar circumstances.
The term "lottery" .has been broadly defined as "a scheme for the distribution of prizes by lot or chance; a game or hazard in which small sums of money are ventured for the chance of obtaining a larger value, in money or other articles." Congress has passed statutes forbidding the use of the mails for sending a letter, postal card or cir cular "concerning any lottery." Advertising of any kind pertaining to lotteries is forbidden and penalties are prescribed for sending lottery advertisements into the United States or from one state to another. In Canada, the laws against lotteries are enacted by the Dominion Parliament as of right, and are very stringent.
The mere fact that all the purchasers of chances are, in any event, to receive a full return for their money will not make the plan legal. If it is likely that some purchasers may receive more than others, the scheme will be a lottery. When the distribution of prize offers is determined solely by skill or judgment, there will be no lottery; but this rule is violated if skill is apt to be thwarted by. chance. There is no lottery when no consideration is paid; but a consideration may consist in the rendering of services. Whether the filling in of a form on the part of the purchaser is a. sufficient consideration is doubtful, but to furnish the names of other prospects would probably be in defensible.
One of. the most effective means of conveying the idea of authenticity, or reliability, is to show a repro duction of an addressed envelop bearing the stamp and post mark, or the reproduction of the money that is to be paid.out in a prize offer. Such reproductions of stamps or money are considered illegal in the United States.
Altho the Federal law prohibiting representations of either United States money or postage stamps is supposed to be known by advertisers, in many in stances advertising matter has been held up because of the non-observance of this law. In one case the entire edition of a magazine was kept from transmis sion by mail until the representation of a postage stamp could be blotted out.
2. State regulations.—The states generally have passed laws governing the sale of foods and drugs. Those laws may be summarized as follows: (a) The label must describe the contents accu rately.
(b) It must contain a statement of the quantity or proportion of morphine, opium, etc.
Negative provisions: (a) The label must not contain anything which is false or misleading in any particular regarding the ingredients or contents.
(b) It must not bear the distinctive name of another article.