In recent years, affiliate marketing has emerged as a profitable medium to generate interest in a merchant’s products or services, with affiliate marketers often earning huge payouts for generating leads or sales for merchants. The FTC has taken notice, filing a number of actions against affiliate marketers for violations of Section 5 of the FTC, including several high-profile suits against marketers of weight-loss products. In March, the FTC obtained summary judgment against LeadClick Media, Inc., an affiliate marketing network operator hired by LeanSpa, LLC to advertise its weight-loss products through affiliate websites using a number of fake news websites. The Ruling highlights the broad net the FTC now casts in its cases.
The FTC originally sued LeanSpa for making deceptive claims about its weight loss products through fake news stories. The FTC later amended its complaint to include LeadClick and CoreLogic, the corporate parent of LeadClick. LeanSpa and its principals settled in December 2013, while LeadClick and CoreLogic continued toward trial. Most recently, both the FTC and the remaining defendants moved for summary judgment, which the court granted in the FTC’s favor. Continue Reading