As the summer closes and fall arrives, the FTC has been busy resolving a variety of actions within both the Bureau of Consumer Protection and Bureau of Competition, related to either purported false advertising or anticompetitive mergers. This and more, after the jump.
Monday, August 28, 2023
Bureau of Consumer Protection: Advertising and Marketing; Made in USA Claims
- The FTC issued a closing letter to Research & Mfg. Corp. of America, d/b/a Ramcoa, based on the company’s agreement to implement a remedial action plan. The FTC’s investigation regarded the agency’s concerns that Ramcoa’s marketing materials may have overstated U.S.-origin claims. The FTC emphasized that U.S.-origin claims suggest to consumers that the products advertised are “all or virtually all” made in the United States. Made in USA Labeling Rule, 16 C.F.R. § 323. The FTC stated “[M]arketing materials should not state or imply that products are wholly or partially made in the United States unless the Company can substantiate those claims.” As part of its remedial action plan, Ramcoa agreed to undertake a number of actions, including: 1) removing unqualified claims from marketing materials; 2) stickering over incorrect origin labels on current products; 3) introducing qualified claims where appropriate; and 4) training staff on U.S.-origin claims.
Tuesday, August 29, 2023
Bureau of Consumer Protection: Advertising and Marketing; Made in USA Claims
- The FTC finalized its order against a group of Massachusetts and New Hampshire-based clothing accessories companies, along with their owner, Thomas Bates. The companies falsely claimed certain products were manufactured in the United States. The FTC’s order stops the company from making deceptive claims about products being ‘Made in USA’ and requires the company to pay a $191,481 monetary judgment. The order also includes certain injunctive provisions, including: 1) a prohibition from making unqualified U.S.-origin claims for any product; 2) a requirement to include a clear and conspicuous disclosure about the extent of foreign production for any qualified U.S.-origin claims; and 3) a requirement that products with an assembly claim were last substantially transformed in the U.S. and principal assembly took place in the U.S. The FTC voted 3-0 to finalize the order.
Bureau of Competition: Horizontal Mergers; Vertical Mergers; Technology; Real Estate
- finalized a proposed consent order to resolve antitrust concerns surrounding Intercontinental Exchange, Inc.’s (ICE) proposed $13.1 billion acquisition of Black Knight, Inc. (BKI). The proposed order settles the FTC’s charges that the deal would have increased consumer costs, reduced innovation, and limited lenders’ choices for mortgage origination tools. The FTC alleged that the merger would combine the two leading mortgage technology companies. The proposed order addressed the FTC’s concerns by providing structural relief to preserve competition, such as BKI’s divestiture of Empower and Optimal Blue, which are two businesses that provide services in the mortgage origination process. Empower and Optimal Blue will be divested to Constellation Web Solutions, Inc., another provider of mortgage-related technology. Further, the consent order requires ICE and BKI to seek prior approval from the FTC before acquitting any divested asset or an interest in a loan origination system business for ten years. In March 2023, the FTC voted unanimously to issue a complaint challenging the BKI acquisition and subsequently filed a lawsuit in the Northern District of California. The FTC voted to accept the consent agreement 3-0.
Friday, September 1, 2023
Bureau of Competition: Horizontal Mergers; Vertical Mergers; Pharmaceuticals
- The FTC and attorneys general from six states announced a proposed consent order with Amgen Inc. settling the challenges to Amgen’s $27.8 billion acquisition of Horizon Therapeutics. The settlement additionally dismisses the related federal court preliminary injunction action. The consent order resolves the FTC and states’ allegations that Amgen’s acquisition of Horizon is anticompetitive, noting Amgen’s ability to leverage its portfolio of drugs against insurance companies and pharmacy benefit managers to favor Horizon’s products, specifically Tepezza and Krystexxa. The consent order prohibits Amgen from advantaging Horizon’s drugs, by actions such as bundling an Amgen product with either Tepezza or Krystexxa, or disadvantaging rivals to these two drugs in other ways. Tepezza and Krystexxa are Horizon’s medications used to treat thyroid eye disease and chronic refractory gout, respectively. Amgen is prohibited from acquiring any biosimilar products without FTC approval. The FTC voted to accept the proposed consent order 3-0. The FTC Chair Khan issued a statement noting the high and rising costs of pharmaceuticals that may be related to unfair methods of competition, and was joined by Commissioners Slaughter and Bedoya.
Thursday, September 7, 2023
Bureau of Consumer Protection: Health Privacy; Consumer Privacy
Bureau of Consumer Protection: Funerals
- The Federal Trade commission will host hybrid panel discussions in person and online with a set of experts to explore issues related to the Funeral Rule, including whether and how funeral providers should be required to provide pricing online.
Bureau of Consumer Protection: Health; Intellectual Property; Patents
- The Federal Trade Commission held an open meeting of the Commission on Thursday, September 14, 2023. The Commission meeting involved discussion of “Improper Listing of Patents in the Orange Book” and “Protecting Kids from Stealth Advertising in Digital Media.”
Friday, September 8, 2023
Bureau of Consumer Protection: Online Advertising and Marketing; Investment
- Stock trader for RagingBull.com, Kyle Dennis, was charged by the Federal Trade Commission with pitching bogus stock tips that cost consumers more than $40 million. Mr. Dennis will face a permanent injunction preventing him from making further false earnings claims or other false or misleading marketing claims. Dennis was charged by the Federal Trade Commission with pitching bogus stock tips that cost consumers over $40 million dollars. With the proposed order, the FTC continues its crackdown on actors preying on consumers with baseless earnings claims. RagingBull.com and its owners agreed to settle the FTC’s charges against them, agreeing to a court order that required them to pay $2.45 million, end the earnings deception, get affirmative approval from consumers for subscription sign ups, and provide them with a simple method to cancel recurring charges.
Bureau of Consumer Protection: Advertising and Marketing; Deceptive/Misleading Conduct
- In March 2022, the Federal Trade Commission issued an administrative complaint against Intuit Inc. alleging that Intuit misled customers with allegedly deceptive advertisements. On September 8, 2023, the FTC’s Chief Administrative Law Judge (ALJ) ruled that Intuit Inc. engaged in deceptive advertising in violation of Section 5 of the FTC Act and deceived consumers when it ran ads for “free” tax products and services when many consumers were ineligible. The ALJ’s order stated that Intuit is “prohibited from engaging in deceptive practices in the future.” It also barred the company from representing that any good or service is free, unless: 1) it is free for all consumers; 2) it clearly and conspicuously discloses any terms that would limit the offer and might be misunderstood by consumers; and 3) if the good or service is not free “to a majority of U.S. taxpayers,” this also must be disclosed in a clear and conspicuous manner. The ALJ’s initial decision is subject to automatic review by the full Federal Trade Commission.