Current Commentary: In Hot Pursuit of Publicity BY Larry M. Elkin

Teams are in place in 35 Brazilian cities, ready to launch as soon as any of 50 global positioning devices begins to move. Technicians can follow the signal and arrive at any house in the country within days, sometimes hours.

“They may get to your house as soon as you do,” said Fernando Figueiredo, the head of the operation.

Figueiredo is not the chief of an elite crime fighting squad, and the  GPStrackers are not attached to weapons or drugs or counterfeit money. Figueiredo is the president of the promotions agency Bullet. His teams will be tracking laundry detergent.

The marketing campaign for Unilever’s Omo detergent aims to draw attention to a new stain-fighting version of the product. Customers who buy one of the GPS-tagged boxes will be surprised with a gift, a handheld video camera, personally delivered to their door. They will also be invited to a day of outdoor family fun, sponsored by the detergent company. Pictures of the lucky winners will be posted online.

In the United States, the winners of this contest would probably not feel so lucky. In fact, they just might decide to sue. In this country, there is a generally recognized right of publicity, which means that individuals control the right to profit from their own name, image or likeness. While statutes vary from state to state, generally the right of publicity guarantees that you cannot unwittingly become the unpaid spokesperson for a product.

If you have ever tried to walk down a street in a large city and accidentally stumbled through the set for a television ad, you know just how forceful the producers can be when they start waving waivers. Without your signature, they generally cannot use your image to promote their product.

Brazil also has privacy laws. Article 5 of the Brazilian Constitution establishes that, “The privacy, private life, honor and image of persons are inviolable, and the right to compensation for property or moral damages resulting from their violation is ensured,” and that “The home is the inviolable refuge of the individual.”

However, the leap from violation of privacy to lawsuit is much shorter in the United States than in most other countries, including Brazil. In the United States, heavy punitive damage awards are common in civil courts. An American suing over a promotion like Unilever’s would not only seek to receive payments for the unauthorized use of his or her image in  advertising, but for emotional distress as well. A U.S. attorney would also include a demand for punitive damages, reflecting no specific harm to the person bringing the suit, but to deter future corporate misdeeds.

Brazil’s constitution allows the country’s citizens to recover damages unlawfully caused by a third party, including “compensation for property or moral damages or for damages to the image.” However, “as a general rule non-material damages seldom achieve large amounts,” according to Guilherme C. Carboni, head of the intellectual property department of Tozzini Freire Teixeira e Silva Advogados in São Paulo, Brazil. Countries outside the U.S. rely more heavily on fines than punitive damages to deter civil wrongdoing. This, at least in theory, benefits everyone in society, rather than awarding a windfall to parties that litigate.

The contingent fee system, in which American lawyers commonly keep a large and uncapped percentage of whatever they recover for their clients, also helps make our society unusually litigious. Individual plaintiffs have nothing to lose, and lawyers with billable hours available can take speculative cases, often earning a settlement merely because it is less costly for a deep-pocketed target to settle than to defend a nuisance suit.

In Brazil, the party that loses a lawsuit typically pays the winner’s costs except in extenuating circumstances. That cuts down sharply on lawsuits that have little merit beyond their nuisance value.

The Omo promotion has drawn some international criticism, with some arguing that the campaign signals another loss in the ongoing battle for consumer privacy. But so long as the complaints come from news agencies, rather than angry consumers with lawyers at their sides, they may be just what Unilever had hoped for. Omo’s overall marketing budget is only about $23 million, so the company is probably happy for any free press it can get.

Omo detergent is already found in about 80 percent of Brazilian homes. The promotion was designed less as a way of getting new sales than as a way to get people to think and talk about a familiar product. Controversy over the marketing campaign could be just as effective as the campaign itself in getting people to notice the new “stain-fighting formula.”

It is no accident that Unilever is running this promotion in Brazil rather than in the United States. When those tracking teams surprise their customers on camera they want to be greeted with a smile, not a  civil court complaint.

Larry M. Elkin, CPA, CFP®, president of Palisades Hudson Financial Group a fee-only financial planning firm headquartered in Scarsdale, NY. The firm offers estate planning, insurance consulting, trust planning, cross-border planning, business valuation, family office and business management, executive financial planning, and tax services. Its sister firm, Palisades Hudson Asset Management, is an independent   investment advisor with about $950 million under management. Branch offices are in Atlanta and Ft. Lauderdale. Website:www.palisadeshudson.com.

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