H&M sells a line of "conscious choice" clothing, which are clothes that are "created with a little extra consideration for the planet."  Is H&M misleading consumers about the environmental benefits offered by its conscious choice collection?  That was the issue in a recent case in federal court in Missouri. 

In the lawsuit, a consumer alleged that when he bought a turquoise sweater that was part of H&M's "conscious choice" collection, he was misled about the environmental attributes of the product.  The consumer claimed that H&M misled consumers my making statements on its website such as: 

• "The shortcut to more sustainable shopping";
• "You can identify our most environmentally sustainable products by looking out for our green Conscious hangtags"; 
• "[P]ieces created with a little extra consideration for the planet.  Each Conscious choice product contains at least 50% or more sustainable materials -- like organic cotton or recycled polyester -- but many contain a lot more than that.  The only exception is recycled cotton, where we accept a level of at least 20%"; and 
• "With new technological solutions and innovations, we're continually working to make our range even more sustainable." 

The consumer also pointed to the fact that H&M's hangtags promote its products' recycled content (such as "59% recycled polyester") and that some H&M marketing materials show models surrounded by greenery.  

Essentially, the consumer's argument here was that H&M misleads consumers about whether its products are truly more sustainable and environmentally friendly. The consumer alleged that the "conscious choice" products were not, in fact, "green" products, because they were made of high percentages of synthetic materials and that materials like recycled polyester are not a "more sustainable" material, since using recycled polyester for clothing is "a one-way ticket to a landfill, incineration or being dumped in nature." 

Similar to the standards applied by other states and the FTC, the plaintiff's false advertising claims ultimately came down to the question of whether a "reasonable consumer" would be misled.  

First, the court analyzed H&M's claims that its clothing contains "more sustainable materials" and that the "conscious choice" collection includes "its most sustainable products."  The court held that no reasonable consumer would understand these claims to communicate that H&M's clothes were inherently sustainable or environmentally friendly when, in fact, H&M never said that they were.  The court explained, "the only reasonable reading of H&M's advertisements is that the conscious choice collection uses materials that are more sustainable than its regular materials." 

Next, the court considered whether H&M's truthful claim that an item of clothing is "59% recycled polyester" is misleading.  The plaintiff argued that the claim is misleading because the use of recycled polyester is not "more sustainable" since it is sourced from recycled PET bottles.  That's because -- the plaintiff argued -- when PET is made into new bottles, they can continue to be recycled multiple times, but when PET is made into clothing, it's more likely not to be recycled again.  The court didn't think this was a relevant consideration, however, holding, "the relevant comparison is whether one garment using recycled polyester is more sustainable than another garment using non-recycled (also known as virgin) polyester."  

As additional support for its conclusion that H&M didn't make a misleading "more sustainable" claim -- and in what appears to be a holding that is directly at odds with Federal Trade Commission guidance in this area -- the court pointed to the fact that H&M provides information on its website about the environmental impact of its products and about why the products are more sustainable.  The court explained, "H&M disclosed on its website all of the information [the plaintiff] needed to determine the source, composition, and relevant comparison of the 'more sustainable materials' used by H&M in its conscious choice collection." 

The court also rejected the plaintiff's claim that H&M had failed to disclose material information about its products -- specifically, what the clothes are made of and why they are "more sustainable."  The court again determined that reasonable consumers wouldn't be misled by H&M's claims because of all of the information that H&M publishes about the environmental attributes of its products on its hangtags, on its website, and in other publicly available reports. The court explained, "reasonable consumers can ascertain the exact materials used in their garments before purchase, review H&M's discussion of the environmental impacts of those materials, and then independently verity whether these representations are consistent with other, publicly available data." 

Finally, the court addressed the plaintiff's allegations that H&M had engaged in "unfair" practices by violating the FTC's Guides for the Use of Environmental Marketing Claims (often referred to as the "Green Guides").  Under Missouri law, a practice can be unfair if it "offends any public policy as it has been established . . . by the Federal Trade Commission, or its interpretative decisions . . . ."

The plaintiff argued that H&M violated the Green Guides by making an unqualified "general environmental benefit claim" without "clear and prominent qualifying language that limits the claim to a specific benefit or benefits."  The court held, however, that H&M didn't, in fact, make any unqualified environmental benefit claims.  The court wrote, "Rather than representing the conscious choice collection is unconditionally sustainable, it has clearly qualified its use of such terms, explaining that its conscious choice items are made with 'a little extra consideration for the planet' because they use 'more sustainable materials' than its regular collection." 

The court also didn't think that H&M violated the Green Guides by promoting environmental benefits if the benefits were only "negligible."  Noting that clothing is only included in the "conscious choice" collection if the majority of the material in the item is "more sustainable," the court didn't think that the benefits were negligible at all. 

With increasing attention on climate change, and with marketers ramping up their environmental marketing efforts, lawsuits and increased regulatory attention are inevitable.  The good news for marketers, though, is this should lead to lots of new (if not entirely consistent) guidance about how to navigate this important and difficult area.  

Right now, all eyes are on Washington, D.C. as the FTC considers revisions to the Green Guides.  (Come join us in D.C. next Tuesday for the FTC workshop, Talking Trash at the FTC:  Recyclable Claims and the Green Guides.)

While we wait for new thoughts from the FTC, what are some important takeaways from this decision? 

• Making unqualified "sustainable" claims presents lots of risk.  This decision, at least, suggests that a claim like "more sustainable" -- when you can back it up -- is a much safer approach. 
• Although there's lots of talk globally about whether and in what circumstances a life cycle analysis is required before making an environmental benefit claim, the court here wasn't interested in going down that road.  In other words, it was okay to (truthfully) promote that a product was made of recycled content without examining that choice in a larger context. 
• The court put great weight on the fact that H&M published detailed information on its website about its environmental practices.  While it's a lot less likely that the FTC would agree that information presented on a company's website will have any impact on how marketers interpret claims appearing in other media, this case certainly suggests that there are significant benefits to putting the information out there. 
• Finally, although the Green Guides are not regulations and are not independently enforceable by the FTC (in other words, the FTC still has to prove deception or unfairness), this case is an important reminder that violating the Green Guides themselves could actually violate the law of a number of states.  

Lizama v. H&M Hennes & Mauritz, 2023 WL 3433957 (E.D. Mo. 2023).