Philips Respironics has seen an onslaught of litigation related to its CPAP and BiPAP breathing machines, which it recalled in June 2021. For months following the recall, Philips was inundated with hundreds of consumer class action lawsuits, which were consolidated in a CPAP MDL last fall in the U.S. District Court for the Western District of Pennsylvania.

Now, Philips faces off against a different kind of class action plaintiff—medical device suppliers. Earlier this month, Baird Respiratory Therapy, Inc., filed a putative class action lawsuit against Philips in the U.S. District Court for the Eastern District of Pennsylvania, seeking to represent a nationwide class of durable medical equipment suppliers who purchased Philips’ recalled breathing machines. Continue Reading Recall Litigation Report: Philips Faces Supplier Class Action Following CPAP/BiPAP Recall

Tuesday, March 8, 2022

Bureau of Consumer Protection: Deceptive/Misleading Conduct on Online Stock Trading Site

  • The FTC is requiring RagingBull.com, an online stock trading site, to pay $2.425 million and to implement tactics that end the alleged deceptive acts, require affirmative approval from consumers signing up for a subscription, and provide consumers with a simple method of cancelation. According to FTC allegations, the online stock trading site used bogus earnings claims to trick consumers into signing up for services and then trapped them in hard to cancel subscription plans. More specifically, RagingBull.com allegedly made claims that consumers who followed the advice and trade recommendations of its “gurus” could “double or triple” their trading accounts quickly and easily. The FTC complaint further alleges that the defendant included testimonials from purported customers claiming to have made significant amounts of money in short periods of time, e.g., “$6500.00 in 20 minutes.” The complaint noted that Raging Bull’s services, which costs hundreds or thousands of dollars, were set up as recurring subscriptions that are charged quarterly or annually, and that subscribers faced significant hurdles in preventing those recurring charges. The FTC took issue with the allegedly different cancellation requirements that each service had. The proposed order comes on the coat-tail of the FTC’s efforts to crackdown on false earnings claims, returning millions to consumers and requiring click-to-cancel online subscriptions.

Continue Reading FTC Updates (March 7-11, 2022)

Join Crowell & Moring attorneys Evan Chuck, Michelle Linderman, David Stepp, and Frances Hadfield on Wednesday, March 30 for an update on the current state of the Uyghur Forced Labor Protection Act (UFLPA), U.S. Customs and Border Protection (CBP) withhold release orders (WRO), findings, and how to successfully modify a WRO, submit WRO detention responses that work, and the timeline to have your goods released. This webinar will also address forced labor considerations such as the Anti-Foreign Sanction Law (AFSL), and anti-slavery laws in the United Kingdom and European Union.

Speakers:

  • Evan Chuck, Partner – Los Angeles, Shanghai
  • Michelle Linderman, Partner – London
  • David Stepp, Partner – Los Angeles, Shanghai
  • Frances Hadfield, Counsel – New York

Date/Time: Wednesday, March 30, 2022 from 12:00-1:00 pm ET

Click here to register!

In recent months, the metaverse, a term that is meant to encompass a mixture of virtual reality and augmented reality, has increasingly become a conversation topic for companies and consumers. Companies have begun to invest in this space and have started staking out virtual property on platforms like Decentraland and The Sandbox. Lawsuits and trademark applications have also popped up alongside these investments. This recent legal activity indicates that the metaverse will be a critical area for companies to begin to learn about and monitor to ensure they are adequately protecting their intellectual property and avoiding risk.

In January 2022, designer Hermès sued an individual named Mason Rothschild in the Southern District of New York for his creation and sale of “Metabirkins,” which are non-fungible tokens (“NFTs”) that resemble fur-covered versions of Hermès’ iconic Birkin bag. Among other things, the complaint alleges that Rothschild has engaged in trademark and trade dress dilution and infringement by selling his NFTs, one of which has already sold for $40,000, just as one would by selling a counterfeit physical bag. Interestingly, Hermès’ complaint notes that the defendant’s activity is preempting Hermès from entering the NFT market itself. Continue Reading See You in the Metaverse: What Brands Need to Know

Monday, February 28, 2022

Bureau of Consumer Protection: Credit Card Debt Fraud

  • The FTC has permanently banned a group of alleged scammers from the debt relief industry and has imposed a monetary judgment of $5.3 million. The ban and judgment stem from a settlement related to a lawsuit in which the Commission and the Florida Office of the Attorney General alleged that the defendants tricked seniors and financially distressed consumers into signing up for a debt relief scheme by “bombarding” them with telemarketing calls. Under the alleged scheme, the defendants falsely claimed that consumers could save thousands of dollars in credit card interest, when in reality the defendants did little more than collect upfront fees from consumers. The Commission voted unanimously to approve the stipulated final order based on the settlement.

Continue Reading FTC Updates (February 28-March 4, 2022)

In the wake murder of George Floyd in 2020 and the demonstrations that followed, brands pledged to support anti-racism and solidarity with the Black community. Some companies professed that they would make large donations to social justice organizations, leading commentators to ponder whether brands were “woke washing.” At the end of Black History Month, the National Advertising Division (“NAD”) announced that it investigated two companies making express claims committing to sizable charitable contributions to ensure that those claims were substantiated. See Niantic, Inc. (Advertising by Niantic Labs), Report #7037, NAD/CARU Case Reports (February 2022) and DoorDash, Inc. (Advertising by DoorDash, Inc.), Report #7036, NAD/CARU Case Reports (February 2022). Continue Reading NAD Makes Clear that “Woke Washing” is False Advertising

A few months after putting the nation’s top advertisers on notice that consumer endorsements are high priority, the Federal Trade Commission (“FTC”) recently announced a settlement with online retail company Fashion Nova, LLC (“Fashion Nova”) for allegedly blocking negative reviews from being posted on its website, signaling to retailers that the FTC is cracking down on companies that inflate consumer reviews. In conjunction with the settlement, the FTC also released guidance regarding the collection and publication of online reviews directed to online retailers and review platforms and announced that it sent letters to 10 companies offering review management services. Continue Reading FTC Ramps Up Enforcement on Consumer Reviews

Tuesday, February 22, 2022

Bureau of Consumer Protection: Privacy, Security, and Identity Theft

  • The Commission has released a new data book aggregating information from 2021 consumer reports about fraud, identity theft, and similar topics in the field of consumer protection. The FTC received over 5.7 million reports in 2021, and the reports reflected a combined loss of over $5.8 billion dollars, a staggering 70% increase over 2020. Of these reports, approximately half pertained to fraud, and one in four fraud reports also reported monetary losses. The most common type of fraud reported was an imposter scam, where a scammer posing as a trusted friend or government agency asks for money. Within the realm of identity theft, which made up 25% of consumer reports, the most common type of theft related to misuse of personal information to apply for government documents or benefits, such as unemployment. The data book also breaks down the most common types of reports within each state and includes appendices listing major data contributors, descriptions of report categories, and a comparison of the various report categories over the past three years. The actual consumer reports are uploaded to the agency’s Consumer Sentinel Network, an online database used by law enforcement to identify suspicious trends and business practices.

Continue Reading FTC Updates (February 21-25, 2022)

The emergence of different COVID-19 variants and the corresponding surge in COVID-19 cases brings with it an increased demand for COVID-19 tests, particularly those that offer immediate results and can be done from the comfort of home. Unfortunately, like many other products on the market, at-home COVID tests are not immune to false claims or false results.

Earlier this month, the U.S. Food and Drug Administration (“FDA”) announced a Class I recall of at-home COVID-19 rapid antigen tests manufactured by E25Bio Inc. According to the FDA, E25Bio marketed and distributed its SARS-CoV-2 Antigen Test Kits (“E25Bio Tests”) to customers throughout the United States without authorization, clearance, or approval from the FDA and with insufficient data demonstrating that the E25Bio Tests performed accurately. Rapid antigen tests are designed to detect proteins called antigens from the SARS-CoV-2 virus in patient samples. And according to the FDA, the E25Bio Tests contained inaccurate claims and instructions, including a statement misrepresenting the test as FDA-authorized. Continue Reading Recall Litigation Report: E25Bio Inc. COVID-19 Rapid Antigen Tests

Friday, February 18, 2022

Bureau of Competition: Endorsements, Influencers, and Reviews

The FTC is refunding more than $580,000 to consumers across the country who bought indoor TV antennas and signal amplifiers marketed online with allegedly deceptive claims that the products would allow the consumers to cancel their cable service and still receive their preferred channels for free. The March 2021 complaint alleged that Wellco, Inc. and its owner and CEO, George M. Moscone violated the FTC Act by making deceptive performance claims for their antennas and signal amplifiers and using deceptive consumer endorsements and web pages that looked like objective news reports. The products were sold online under the brand names TV Scout, SkyWire, SkyLink, and Tilt TV. Continue Reading FTC Updates (February 14-18, 2022)