Google, iHeartMedia Pay FTC $9M Penalty For Deceptive Ads

Google's Pixel 4

The Federal Trade Commission and state attorneys general announced lawsuits against Google LLC and iHeartMedia, Inc. for airing nearly 29,000 deceptive endorsements by radio personalities promoting their use of and experience with Google’s Pixel 4 phone in 2019 and 2020. The proposed FTC orders and the state judgments settling the allegations bar Google and iHeartMedia from similar misrepresentations, and the state judgments also require them to pay $9.4 million in penalties.

“Google and iHeartMedia paid influencers to promote products they never used, showing a blatant disrespect for truth-in-advertising rules,” said Bureau of Consumer Protection Director Samuel Levine. “The FTC will not stop working with our partners in the states to crack down on deceptive ads and ensure firms that break the rules pay a price.”

“It is common sense that people put more stock in first-hand experiences. Consumers expect radio advertisements to be truthful and transparent about products, not misleading with fake endorsements,” said Massachusetts Attorney General Maura Healey. “Today’s settlement holds Google and iHeart accountable for this deceptive ad campaign and ensures compliance with state and federal law moving forward.”

But for the “majority” of Pixel 4 ads, hosts were not given Pixel 4s before they recorded the ad spots, according to the FTC’s press release — despite iHeartMedia asking for phones ahead of recording in October 2019, as noted in the complaint. iHeartMedia later asked again for phones after Google requested additional ads in January 2020, and Google eventually sent just five, or one for each market where the ads would be recorded. Nearly 29,000 of the deceptive ads aired in 2019 and 2020, the FTC says.

Google is a multinational technology company that specializes in internet-related services and products. iHeartMedia, headquartered in San Antonio, Texas, is the nation’s largest radio station owner, with more than 850 AM and FM radio stations and an internet radio network that collectively reach more than 245 million listeners each month.

According to the FTC, in 2019, Google hired iHeartMedia and 11 other radio networks in ten major markets to have on-air personalities record and broadcast endorsements of the Pixel 4 phone. Google provided iHeartMedia with scripts that included lines about the Pixel 4 phone like, “It’s my favorite phone camera out there, especially in low light, thanks to Night Sight Mode,” “I’ve been taking studio-like photos of everything,” and “It’s also great at helping me get stuff done, thanks to the new voice activated Google Assistant that can handle multiple tasks at once.” However, the on-air personalities were not provided with Pixel 4s before recording and airing the majority of the ads and therefore did not own or regularly use the phones.

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The agency’s administrative complaint alleges that the companies’ misrepresentations violated the FTC Act.