Tenth Circuit Rejects 'Two-Click' Safe Harbor for Hyperlinks
A company may be liable for false advertising claims on third-party websites it links to as part of its promotional messaging, a federal appeals court held.
In KetoNatural Pet Foods v. Hill’s Pet Nutrition, the US Court of Appeals for the Tenth Circuit rejected the informal “two-click rule,” a long-standing assumption that companies could avoid liability for claims made on third-party websites. The court held that a business can be liable for false advertising under the Lanham Act when it intentionally incorporates third-party content into its marketing through hyperlinks, effectively adopting the linked material as its own commercial speech. The ruling replaces the simplistic 'click-counting' framework with a functional test: whether the linked content is part of the company's promotional message. This decision has broad implications beyond competitor advertising disputes, creating potential new risks for companies regulated by the FDA and FTC, as well as those facing state consumer protection laws and class actions. Companies in sectors like dietary supplements, food, and pharmaceuticals, which often link to scientific literature, face heightened scrutiny. The key takeaway is that click distance no longer provides a reliable safe harbor. Counsel should advise marketing teams to review all hyperlinked third-party content with the same rigor as claims made directly on company-owned properties.