Bragging Rights

Suppose you've been competing with another business for customers. You're frustrated about your paltry market share--and you're convinced your competitor's product is nowhere near as good as yours. Can you say so in your advertisements?

Yes, as long as you're prepared to substantiate everything you say. Federal laws governing advertising allow businesses to sue each other over false or misleading claims, whether they're about your own product or your competitors'. Whether you're advertising on radio or television, in print media or even on the Internet, if you disparage a competitor's product without solid evidence, you could be held liable for the competitor's losses.

Steven C. Bahls, dean of Capital University Law School in Columbus, Ohio, teaches entrepreneurship law. Freelance writer Jane Easter Bahls specializes in business and legal topics.

This article was originally published in the April 1998 print edition of Entrepreneur with the headline: Bragging Rights.