What Does Caveat Emptor Mean?
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I want to bring to your attention an interesting paper by Robert Rabe about the origins of the FTC's jurisdiction over advertising.
The paper starts out with an insightful quote:
There is no duty resting upon a citizen to suspect the honesty of
those with whom he transacts business.
Laws are made to protect the trusting as well as the suspicious.
The rule of caveat emptor should not be relied upon to reward fraud and deception.
Justice Hugo Black
Think about that for a bit: there is no duty resting upon a citizen to "suspect the honesty" of those he or she is transacting business with.
Yet, the if citizen misunderstands, fails to inquire, or doesn't look too deeply into the terms of a deceitful franchise agreement, the law will proclaim "caveat emptor" or buy beware.
Robert Rabe traces the history of Federal control over advertising, and starts with observing that
"The period between 1900 and the mid-1930s stands out as a profoundly important era in the development of American advertising.
During this time, the nascent industry adopted innovative persuasive techniques based on new methods of applied psychology, contributed to its first war effort, formed its first professional organizations, and helped launch the modern consumer society.
One characteristic of advertising during these years was the movement to establish the trade as a profession and a reputable participant in economic and social life.
In doing so, the advertising industry staked its claim as a vital component to the economic health of the nation."
Doesn't sound like a century has made too much a difference, does it.
Read the entire paper, especially in light of the FTC's decision to hold meetings regarding its authority over misleading advertising.
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