Legal Question in Business Law in Virginia

Re: Undercover Marketing

In the examples that you give, there is no deception that is relevant to the product. The deception is only about the identity of the speaker.

If a company is dishonest about what you are buying, then that is fraud. Or if they trick you into spending money by using the cell phone, that could be fraud.

However, the examples you give are simply using ways to attract your attention. If they are accurate and truthful about the product, then there is no fraud an dnothing illegal (unless a city or town has rules against solicitation in particular areas). One of the conditions for fraud is that you relied upon the statements of the person in making your decision to buy, and your reliance was a reasonable thing to do. In the examples you give, the identity of the salesperson would make no difference to what you are buying. It doesn't change what you buy or what you know about what you bought. The product is the same no matter who is telling you about it.

On the other hand, if you were told something like "this is the phone that Michael Jordan uses," and that is untrue, that could be fraud.

The key is whether a false statement is related to what you are buying (what you think you are buying) and your decision to buy. If a falsehood is a side issue, then it is not fraud and there is nothing illegal about it.

Of course, there are special rules that apply to telemarketing in many States. Those specific rules in some States DO require a caller to accurately identify who they are, their role (e.g., paid caller) and who they are working for. But that involves a specific rule that covers telemarketing in some States.

Re: Undercover Marketing

I think if this type of thing ever catches on people will invent their own creative countermeasures. "Oops, I'm so sorry I dropped your brand new cell phone in front of that bus." I also think cigarette giveaways are already illegal or subject to one of the consent decrees in the tobacco industry litigation.

Re: Undercover Marketing

It depends entirely on the industry in question. Securities traders would go to jail for selling you a mutual fund that way, a pop-corn vendor would not. We would need to know exactly what product or service you are marketing in order to provide you with a legal opinion. Any contact with our firm after a relationship has been established is confidential and would not jepordize your idea.

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