Thursday, December 16, 2021

Bureau of Consumer Protection: Deceptive and Misleading Conduct

  • The FTC announced rulemaking geared towards combatting government and business impersonation fraud. During the COVID-19 pandemic, there has been a significant uptick in scammers utilizing various forms of communication to impersonate government agencies or businesses in order to steal money or a consumer’s

Wednesday, December 1, 2021

Consumer Protection: Advertising and Telemarketing

  • The FTC finalized a settlement with New York-Based Lifewatch, Inc, an ambulatory cardiac monitoring service, which will result in paying back more than $1.8 million to consumers, including many older Americans. The FTC’s complaint, filed jointly with the Florida Attorney General’s Office, alleged that the defendants bombarded consumers with at least a billion unsolicited robocalls to pitch supposedly “free” medical alert systems. These pre-recorded messages claimed that Lifewatch’s medical alert system was endorsed or recommended by reputable organizations like the American Heart Association. The company’s telemarketers often told consumers that a medical alert system had been purchased for them, and they could receive it “at no cost whatsoever.” Consumers eventually learned that they were responsible for monthly monitoring fees and that it was difficult to cancel without paying a penalty. The defendants are also banned from telemarketing and misrepresenting the terms associated with the sale of any product or service.


Continue Reading FTC Updates (November 29 – December 1, 2021)

In recent weeks, the Federal Trade Commission (“FTC” or “Commission”) sent nearly two thousand letters with a “Notice of Penalty Offenses” to a who’s who of companies across America, putting them on notice that they might face steep potential civil penalties if they engage in deceptive conduct. The letters targeted top consumer products companies, leading retailers and retail platforms, major ad agencies, and other advertisers nationwide that engage in online marketing, multi-level marketing, offer “gig” economy jobs, or are in the for-profit education sector.
Continue Reading FTC “Notice of Penalty Offense” Letters – What Are They and What’s Next?

Monday, November 8, 2021

Antitrust: Hart-Scott-Rodino Act

  • The Federal Trade Commission and the Justice Department’s Antitrust Division released the agencies’ 43rd Annual Hart-Scott-Rodino Report. The report provides HSR Premerger Notification data for fiscal year 2020, and its release coincides with an unprecedented surge in pre-merger filings during the current fiscal year.


Continue Reading FTC Updates (November 8-12, 2021)

Tuesday, November 2, 2021

Deceptive or Misleading Conduct & Consumer Protection

  • The FTC recently issued full refunds totaling over $2 million to consumers who lost money through certain deceptive direct mail schemes. The agency recovered the refunds via a federal district court order resulting from the FTC’s lawsuit against Agora Financial, LLC, NewMarket Health, and other defendants. The lawsuit was based upon two publications defendants marketed to older consumers. One publication contained a protocol promising to permanently cure type 2 diabetes in 28 days, while the other promised to show how to claim money from a secret giveaway by Congress. The FTC obtained the order including consumer refunds before the Supreme Court stripped the agency of its ability to obtain equitable monetary relief in federal court in the April 22, 2021 AMG Capital decision. Congress has not yet acted on the FTC’s request to reinstate this power.


Continue Reading FTC Updates (November 1-5, 2021)

Monday, October 25, 2021

Bureau of Competition and FTC Operations

  • The FTC issued a policy statement restoring its pre-1995 practice of requiring parties under a merger consent decree to obtain the Commission’s permission before pursuing additional acquisitions in that market. This “Prior Approval” policy is designed to protect consumers and deter “clearly anticompetitive” deals, per Holly Vedova, the Director of the Bureau of Competition. The FTC will consider a number of factors when deciding whether to permit a deal, including (1) the nature of the transaction, (2) the level of market concentration and the degree to which the transaction increases market concentration, (3) the degree of pre-merger market power, (4) the parties’ history of acquisitiveness, and (5) evidence of anticompetitive market dynamics. The Commission approved the statement by a vote of 3-2; the Commissioners voting against the policy subsequently issued a dissenting statement.


Continue Reading FTC Updates (October 25-29, 2021)

In the wake of the COVID-19 pandemic, product manufacturers and distributors—many of whom have pivoted to create PPE-related products for the first time—are now faced with a veritable morass of guidelines and requirements to navigate from a variety of governmental agencies. Recent enforcement actions by federal agencies have only highlighted the importance of understanding exactly how a product must be produced, advertised, labeled, and sold.  This begs the important question: who is the regulator and what is the rule?

Our product risk management team has been speaking to several trade associations in September 2020 about how to navigate the alphabet soup of federal agencies supervising COVID-19 product distribution.  The biggest takeaway:  How a product is advertised for sale plays a critical role in how it is regulated and by which agency .  The regulatory profile can mean the difference between required manufacturing registration or specific requirements as to product labeling.

This article outlines a few of the major players involved in regulating products designed to mitigate or prevent COVID-19—specifically, the Food and Drug Administration (“FDA”), Federal Trade Commission (“FTC”), and Environmental Protection Agency (“EPA”)—and discusses high-level considerations for entities who find themselves caught up in the regulatory alphabet soup.

Continue Reading Who is the regulator? What is the rule?: Navigating the Alphabet Soup of COVID-19 Product Requirements       

Federal Trade Commission
Federal Trade Commission

Presidential advisor Steve Bannon famously told the Conservative Political Action Conference (CPAC) that the Trump Administration seeks to “deconstruct” the regulatory state. The President has issued several Executive Orders (EOs) on regulations designed to implement this policy, including the “two for one” EO, an EO on enforcing the regulatory agenda, and an EO on reorganizing the executive branch.  The three orders collectively promote a policy of deregulation and wholesale elimination of administrative functions deemed overly burdensome to business, redundant, or outdated.

This week, the White House followed through on that agenda by publishing a proposed budget that would impose sweeping budget reductions on almost every federal agency, with the exception of the Departments of Defense and Homeland Security.

The key consumer protection agencies—the Federal Trade Commission, Federal Communications Commission, and Consumer Financial Protection Bureau—are not directly subject to any of these EOs or addressed in the President’s Budget Request. But that does not mean these agencies are in the clear in terms of budget-cutting or deregulatory efforts.  Rather, it seems more likely that the administration is preoccupied with bigger fish at the moment; in the meantime, they are treading carefully.  Which raises the question:  what else is in store for these agencies once they regain the Trump Administration’s focus?


Continue Reading The President’s Regulatory Agenda and the FTC

Photo Credit: Jason Trim (Flickr)

Vizio Reaches $2.2 Million Settlement With FTC, New Jersey, For Failing to Obtain Viewer Consent to Track and Sell Viewing Habits to Third Parties

Traditionally, advertisers purchase ad inventory during television programs based on basic demographic information regarding viewer attributes. Thus, while ads may reach viewers of a particular gender and age range, those ads may not necessarily reach the consumers that are most interested in their products or services.  Thus, advertisers are increasingly interested in more finely targeting their advertising and sending a specific television commercial to a specific household based on the viewing activities in that household.  In order to pinpoint their targets, marketers rely on data extending beyond demographic information that includes information on consumer viewing and internet habits.  While targeting commercials to specific households can be highly beneficial to marketers (allowing them to send their ads to the consumers most interested in seeing them) and consumers (showing them the ads they most want to see), marketers must remember that the basic requirements of advertising law still apply.  Thus, in collecting data, marketers must ensure that they clearly disclose their data collection practices up front, obtain consent from consumers before collecting and sharing highly specific information regarding their viewing practices, and make it easy for consumers to opt out.


Continue Reading Failure to Obtain Viewer Consent Leads to $2.2 Million Settlement for Vizio