New Delhi: Reebok International Ltd’s $25 million (Rs 122.25 crore) settlement of US Federal Trade Commission’s (FTC) charges for misleading advertising over its EasyTone and RunTone shoes may cover consumers in India as well.
The request form on the company’s global website allows customers from more than 100 countries, including India, to apply for refunds.
FTC, the US competition watchdog and consumer protection agency, said the settlement had been reached in its pursuit of stemming “overhyped advertising claims”.
“Reebok has agreed to resolve charges that the company deceptively advertised ‘toning shoes’, which it claimed would provide extra tone and strength to leg and buttock muscles,” FTC said in a release on its website.
The $25 million “funds will be made available for consumer refunds either directly from FTC or through a court-approved class action lawsuit. Consumers who bought Reebok toning shoes or toning apparel can submit a claim here”.
Customers who bought Reebok’s EasyTone walking shoes, RunTone running shoes and EasyTone flip flops on or after 5 December 2008 can apply for a refund on the FTC website.
Reebok, which is a unit of German shoe company Adidas AG, started operating in India in 1995 and launched the EasyTone shoes in the country in 2010.
Reebok’s EasyTone footwear campaign in India, launched through McCann Erickson, was aimed at women. According to a media buyer, who did not want to be identified, Reebok spent an estimated Rs 12 crore on the print, television and outdoor campaign in India.
The company has stopped using ads that claim to “improve or increase muscle tone, muscle strength or muscle activation...or improve posture,” Reebok International chief executive and president Ulrich Becker told business partners and retailers as part of an Ohio court judgement on the FTC website. Becker has also asked retailers not to use posters, stickers and other point of sale material making such claims.
Subhinder Singh Prem, managing director, Adidas group, India, did not say whether the company will withdraw the advertising in India. “We stand behind our EasyTone technology—the first shoe in the toning category,” he said in an email. The EasyTone range will continue to be sold and developed further.
Reebok agreed to the settlement to avoid a protracted legal battle, he said. “Settling does not mean we agree with FTC; we do not.”
Advertising Standards Council of India (ASCI) secretary general Alan Colaco said it hasn’t received any consumer complaint against Reebok’s toning footwear. ASCI is the self-regulatory organization of the advertising industry.
As per ASCI guidelines, advertisers need to ensure truthfulness and safeguard against misleading advertisements.
Prasoon Joshi, executive chairman and CEO of McCann Erickson Worldgroup India, Reebok’s ad agency in the country, was not reachable for comment.