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This is somewhat against Google’s policies: https://support.google.com/adspolicy/answer/6118?hl=en

WaPo might claim - “we’re not pretending to be CNN, we are accurately stating that we provide breaking news about CNN.” And with CNN often in the news these days, there is some validity to this position.

In general, you can’t even use ‘Coke’ in your ad if you’re Pepsi, as in ‘Tastes better than Coke - buy Pepsi.’

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Sure you can. But can you back it up? There really isn't a law preventing you from using a competitors name. Just as long as you don't make it look like you (that works be trademark infringement which is also against Google's policy) But if you use your competitors name, your claim has to be truthful. "Taste better"is subjective and is but a fact. But rather than deal with these issues and potential lawsuits, better to just buy mention the name.

Is that why they say "the leading competitor" and show a blank red can? I mean, we all understand who they're talking about, why do they have to be coy?

They do the leading competitor thing to avoid advertising for their competition. For example they don't want people saying, "Brand A says they're 25% better than Brand B, but Brand B is half the price..."

To avoid lawsuits.

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