Key Points
- AT&T is seeking declaratory relief from a federal court in Texas over its Luke Wilson ad that challenges T-Mobile’s marketing.
- The request comes after the NAD of the BBB National Programs sent a cease-and-desist letter over the ad spot.
- The NAD contends the ad violates the policies of the organization, which helps companies like AT&T and T-Mobile self-regulate their ad and marketing initiatives.
Wireless giant AT&T has filed a federal lawsuit against the National Advertising Division (NAD) of the BBB National Programs, accusing the program of needlessly attacking it over a national ad spot that calls out T-Mobile for perceived misrepresentations in its marketing tactics.
The lawsuit does not seek monetary damages against the NAD, and only came after the organization sent AT&T a cease-and-desist letter and issued a subsequent press release about its recent commercial, which features actor Luke Wilson reading a fake newspaper that accuses T-Mobile of running “deceptive ads.”
The newspaper characterizes T-Mobile as the “most-challenged” for its advertising claims, a reference to AT&T and Verizon’s complaints against the wireless giant that have been filed with the NAD over the past few years.
The NAD is an organization rooted in the notion that its members, like the three wireless providers, can self-regulate their own advertising and marketing based on a core set of principles. When the companies don’t live up to certain standards, the NAD accepts complaints from other members and arbitrates those matters, offering recommendations that companies accept or decline.
T-Mobile has been on both ends of the table, filing complaints and being subjected to them in recent years. In some cases, the NAD recommended T-Mobile modify certain claims associated with its wireless plans and services; in others, the NAD upheld T-Mobile’s marketing initiatives.
The NAD prohibits companies from leveraging those findings in its own promotional efforts — a policy that the group accused AT&T of violating with its ad featuring Wilson. While AT&T never explicitly referenced the NAD in the spot, the connections were clear, and the organization issued a cease-and-desist letter last week demanding AT&T stop running them.
AT&T’s lawsuit on Thursday does not seek monetary damages; instead, the company said it was applying for declaratory relief in anticipation of a lawsuit being filed by NAD — in other words, it wants a judge to pre-emptively find in its favor before the NAD can take the matter to court.
“The facts surrounding T-Mobile’s historical advertising strategy — and NAD’s fruitless
efforts to correct it — illustrate the absurdity of NAD’s criticism of AT&T,” the company said in a complaint first obtained by The Desk.
AT&T said NAD’s process is “often slow,” which allows T-Mobile to continue running problematic ads for its services while going through certain appeals processes, which allows “T-Mobile to continue misleading consumers while avoiding meaningful consequences.”
“Unfortunately, NAD’s adjudication process is broken,” lawyers for AT&T said. They contend NAD often failed to elevate certain complaints and findings to the Federal Trade Commission (FTC), even though the NAD’s own policy requires it.
“The public deserves to know the truth, so AT&T’s advertisements provide that truth,” its lawyers said. “The fact that a lawsuit against AT&T for truthful speech would be dead on arrival
doesn’t mean NAD won’t file one.”
A spokesperson for the NAD said the organization was aware of the complaint, but declined to comment. AT&T continues to make the ad in question available online.
AT&T and T-Mobile are highly competitive in the wireless space, often trying to poach each other’s customers with service and sales incentives.
By revenue, AT&T is the larger company, earning $30.7 billion during its most-recent financial quarter, compared to T-Mobile’s $22 billion.
