§708-871  False advertising.  (1)  A
person commits the offense of false advertising if, in connection with the
promotion of the sale of property or services, the person knowingly or
recklessly makes or causes to be made a false or misleading statement in any
advertisement addressed to the public or to a substantial number of persons.



(2)  "Misleading statement" includes
an offer to sell property or services if the offeror does not intend to sell or
provide the advertised property or services:



(a) At the price equal to or lower than the price
offered; or



(b) In a quantity sufficient to meet the reasonably-
expected public demand, unless quantity is specifically stated in the
advertisement; or



(c) At all.



(3)  False advertising is a misdemeanor. [L
1972, c 9, pt of §1; gen ch 1993]



 



Cross References



 



  Action to enjoin violation, see §603-23.5.



  Unfair trade practices, see chapters 481 to 481B.



 



COMMENTARY ON §708-871



 



  This section covers any false or misleading statement, made
in any advertisement addressed to the public (or to a substantial number of
persons), when the statement is made in connection with the promotion or sale
of goods or services.  Such conduct probably does not in itself constitute
theft by deception, but would rather be considered only preparatory thereto. 
The requisite culpability, knowledge or recklessness, extends both to the
making of the statement and to the deceptive quality thereof.  Commonly
accepted "puffing," the advertising exaggerations presumed harmless
in §708-800, is not intended to be included within the ambit of this section.



  Subsection (2) is intended to cover advertising which may not
be false on its face, but which is intended as a "bait" or
"come- on" to attract the unwary.[1]  A person may be liable under a
combined reading of subsections (1) and (2) if the person offers goods or
services with intent (a) to charge a higher price than that advertised, (b) to
offer in a quantity insufficient to meet reasonably-expected demand, or (c) not
to sell them at all.  Note that under §702-206, hope that the vendor will not
have to sell as advertised suffices to fulfill the requisite culpability of
intent.  Thus merchants who advertise with hope of persuading customers not to
purchase the advertised bargain fall within the ambit of subsection (2).



  The non-culpable medium or agent publishing false advertising
is not liable under this section.  The requisite culpability applies to the
deceptive quality of the advertisement, so that independent publishing agents
who are not culpable with regard to the falsity of the advertisement do not
fall within the scope of this section.



  Previous Hawaii law dealt with false advertising at
considerable length, and was an excellent example of the kind of
"telephone book" legislation which seeks to provide in advance for
all possible individual contingencies, rather than to provide a general
proscription.[2]  The false advertising provisions in the prior Hawaii statute
required about three-and-a-half pages of print.  Substantively, the Code, in
its abbreviated and simplified form, is quite similar to the previous law,
except for the Code's somewhat stronger misdemeanor penalty (as opposed to
low-grade misdemeanor previously provided).



 



Case Notes



 



  In class action brought against major cigarette
manufacturers, tobacco trade associations, and the industry's public relations
firm, first amended complaint asserted violations of federal RICO statutes;
Hawaii's RICO statute, §842-2; federal antitrust statutes; Hawaii's antitrust
act, chapter 480; various state common-law torts; and false advertising under
this section; defendants' motion to dismiss for failure to state a claim
granted, where injuries alleged by plaintiffs trust funds in first amended
complaint were not direct; even if remoteness doctrine did not bar claims,
claims failed for other reasons. 52 F. Supp. 2d 1196.



 



__________



§708-871 Commentary:



 



1.  Prop. Mich. Rev. Cr. Code, comments at 291.



 



2.  H.R.S. §§747-14 through 747-19.