Are there legal implications to lying about your sponsors?

Question

Let's say I release a video where I say "sponsored by Company C" even though they never sponsored me.

Are there legal implications to lying about that, or is this action protected by the First Amendment?

At first, I thought that mentioning Company C is like doing free advertising for them, so why would they care. However, if Company C doesn't want to be associated with me, and the alleged association damages their reputation, then maybe this counts as slander:

oral defamation, in which someone tells one or more persons an untruth about another, which untruth will harm the reputation of the person defamed.

Since in this case, I wouldn't be blatantly saying a bad thing about the company (e.g. "their CEO is a murderer"), I imagine they would need to do a bit more work to prove to a court that their reputation was damaged.

(this is also assuming that slander applies to companies)

Answer 1

False statements are generally protected by the First Amendment.

If the video was an obvious gag or work of fiction, in which a reasonable person would understand that you were not truly endorsed, your false statement would almost certainly be protected by the First Amendment.

But many false statements are not protected, typically because of their negative effects on other parties. Classic examples include defamation, perjury, and fraud. A lie about an endorsement could easily fall on either side of that line.

If you are making the video in a context in which reasonable viewers would be led to believe that you truly were endorsed by that company, I could easily imagine a set of circumstances that would lead to liability:

• If you're releasing the video as part of a commercial endeavor, you're looking at possible claims for false advertising, unfair competition, and trademark violations (false designation, dilution, etc.).
• If your video is harmful to the company's reputation, you're facing a potential claim for product disparagement or trade libel. These are the corporate equivalents of the libel actions most people are more familiar with, and they generally require proving the same kinds of facts.
• A right of publicity/misappropriation of identity action is possible but very unlikely. Most states are very stingy about allowing businesses to bring these claims, so this one would probably be very jurisdiction-specific. Proving the case generally requires the company to show (1) that you made a commercial use of their identity, (2) that they did not authorize it, and (3) that the use caused economic harm.

Beyond those, there's a whole host of business torts that I could try to squeeze this into but that are probably less likely given the hypothetical you've presented.

I'd also note that your assumption about proving damages is not well-founded. Especially among the largest companies, businesses are very protective of their brands, and they invest absurd amounts of money to protect them. Pick any company with a high enough profile that someone would want to fake their endorsement, and I'd be willing to bet that their legal department could pretty quickly prepare a detailed estimate of the related damage to their brand. If a case went to trial, you'd normally expect to see an economist present an expert report calculating damages, which would begin (but not end) with any unjust enrichment you experienced because people thought you had the company's endorsement.

Answer 2

The person or company could sue you for defamation, and would have to show that they were harmed by your statement (which would not be in the realm of per se defamatory statements). Since this is a civil matter, they would not have to prove beyond a shadow of a doubt: documenting a drop in sales subsequent to the defamation would do it. See this article for discussion of standards of proof and the distinction between "preponderance of evidence" and "clear and convincing evidence". A right of publicity lawsuit might succeed, depending on the statement. See for example Cal. Civ. 3344

Any person who knowingly uses another's name... in any manner...without such person's prior consent...shall be liable for any damages sustained by the person

The court would have to find that the entity to whom the statement is falsely imputed is protected under the law. Corporations are people, or are not people, depending on what right you are speaking of.

You could also run afoul of federal trademark law (15 USC 1125), again depending on what you said (is it "on or in connection with any goods or services"?). The corporate name is likely a trademark.

Answer 3

Are there legal implications to lying about that, or is this action protected by the First Amendment?

Why do you think that lying - publishing false facts - is protected by the First Amendment? Speech is protected, yes; the factual content of that speech is the responsibility of the individual. If that speech is slanderous or libelous, it may still be free speech, but the speaker or publisher may also be subject to legal action by the other party. And in your example, that legal action would not be a form of slander (oral defamation); it would be libel, the publication of defaming information.

...I imagine they would need to do a bit more work to prove to a court that their reputation was damaged.

How can you prove you did not publish false facts, when the evidence - the printed paper, the video, etc. - points to the contrary? It's the choice of the company to pursue legal action, not yours. How much money do you have to defend against a libel action from the company?