by Jeff Sovern
I've gradually been making my way through Chris Hoofnagle's new book, Federal Trade Commission Privacy Law and Policy (more about that below). For those who want to sample the book before ordering it, Chris has posted the Introduction and an excerpt to SSRN here. The book opens with an interesting history of the FTC and advertising law generally. One of the remarkable things about that history, which I had not known, was that well into the Twentieth Century, advertising law was confined to mandating disclosure of ingredients. An excerpt from the book (footnote omitted):
* * * Arthur Kallet and Frederick J. Schlink shocked the public with the publication of their bestselling 1,000,000 Guinea Pigs in 1933. It illuminated the extent of dangerous products sold, the marketing of those products, and the weakness of federal regulation. The book, which underwent over a dozen printings and was widely read, led directly to the passage of stronger laws in 1938. Throughout the book’s anecdotes, a common theme emerged: individuals could become very affluent by experimenting on the public. When individuals were harmed, the government and victims could do little to remedy the problem because the law primarily was concerned with giving consumers notice of ingredients. If an experiment failed, the entrepreneur could simply move on to some other product. Kallet and Schlink saw the law as a license to kill. Consider these examples:
• Kopp’s Baby Friend, marketed as a soothing agent for babies, secretly contained morphine, and it led to the deaths of nine infants. The government’s remedy at the time was limited to prosecuting mislabeling. Thus, after a $25 fine, Kopp’s reappeared on the market, albeit with a disclosure of morphine as an ingredient.
• Entrepreneurs were free to create “cures” that were crude and dangerous experiments on the consumer. For instance, William J. A. Bailey marketed Radithor, water irradiated with radium, to affluent people. When a prominent patient died, Bailey told the New York Times that “I have drunk more radium water than any man alive and I never have suffered any ill effects.”
• Pebeco Toothpaste contained potassium chlorate (a poisonous, combustible chemical originally used to ignite bullets), so much that, “[i]n 1910, a German army officer committed suicide by eating the contents of a tube of Pebeco.”
While we have come a long way, it is interesting that the debate over disclosure versus other forms of regulation continues today.