A San Francisco appellate court has ruled that Disney's Buena Vista Books unit is not entitled to First Amendment protection for allegedly fraudulent claims it made in the jacket copy of its Beardstown Ladies' Investment Club books.
Deeming that promotional copy is "commercial speech, which, when false or misleading, is entitled to no First Amendment protection at all and may be entirely prohibited," California's First Appellate District ruled that a false advertising lawsuit against the publisher may proceed.
The decision sets a legal precedent in California and will likely affect the way publishers promote books, videos and CDs in the state. Publishers with national distribution will also be forced to take a hard look at the way they sell any titles that make their way into the California market, particularly in the get-rich-quick and lose-weight-fast genres, where inflated cover copy is common.
Hyperion, the Buena Vista imprint that has published five Beardstown Ladies' Investment Club books, refused to comment on the case. Hyperion sold more than 800,000 copies of The Beardstown Ladies' Common-Sense Investment Guide after heavily promoting the club's spectacular 23.4% performance claims. When those claims were challenged by Chicago magazine, and outside auditors revealed the rate to be just 9.1%, Hyperion sent correction slips to booksellers stocking the Beardstown titles.
Russell Keimer, who filed the suit against Disney on behalf of the general public on April 2, 1998, claims Disney still uses exaggerated language to sell the books; he hopes to force Disney to publish retractions and corrections. Though the suit was dismissed by a Superior Court when Disney claimed that the jacket and video covers used the same language as the internal contents, the appellate court ruled that Disney was responsible for its own advertising copy in conformity with California's Unfair Trade Practices Act, saying that "Disney cannot shield itself from the statute's mandates by linking its advertising to the book's content."
