Sheppard Mullin – Lumos Labs recently paid $2 million to the FTC to settle claims that it deceived consumers about its brain training application’s ability to increase cognitive function. According to the FTC, the company alleged that its app, called Lumosity, provided many beneficial effects including the ability to improve users’ school and work performance, delay the onset of age-related cognitive disorders and help restore brain function lost as a result of brain trauma and other health conditions.
According to the FTC, the company did not have sufficient scientific data to back up the claims made in its ads. The FTC also claimed that the company did not disclose that it solicited consumer testimonials about the effectiveness of the product via a contest that offered users the chance to win iPads and other prizes.
In a prepared statement, the company stood by the scientific basis for its brain-training methods and asserted that the settlement was a result of its marketing language that has since been discontinued.
The use of games for “good” causes, such as education, health and training is known as “serious games.” The potential for these types of games to help people in a variety of ways is immense. The number of these games is growing rapidly.
Makers of these games must be mindful not to overreach in the claims of what these games can do. The FTC has been active in policing unsupported claims by app makers.
Additionally, the FTC has been enforcing its endorsement guidelines which require disclosure when a company provides some compensation or financial incentive for endorsements or testimonials. Here, the fact that users had a chance to win valuable prizes in exchange for providing testimonials apparently was not disclosed.
Serious games and other apps have tremendous opportunity to provide beneficial results. However, it is important for makers of these games and apps to understand and comply with the various legal issues that are relevant to these offerings. It is advisable to seek legal review of all serious games and apps and their marketing plan before they are released to identify potential legal issues.