A change in administration inevitably raises questions regarding the priorities and direction of federal agencies. To help set the record straight, Lesley Fair, a Senior Attorney with the Federal Trade Commission’s (FTC or Commission), Bureau of Consumer Protection, reminded us during last week’s NAD Annual Conference that the FTC has kept quite busy over the last year or so, with numerous enforcement cases arising out of the FTC’s Bureau of Consumer Protection. Ms. Fair also shared her views regarding the FTC’s key enforcement priorities that affect advertisers and marketers. Perhaps unsurprisingly, these priority areas generally relate to (i) advertising substantiation; (ii) use of social media, endorsements, and consumer reviews; (iii) matters involving privacy and data security; and (iv) allegations of financial deception. While such topics warrant serious consideration and attention for advertisers, one would be remiss in failing to mention that, in typical Ms. Fair fashion, she discussed these issues in a manner that not only kept the audience engaged, but largely entertained.
With respect to advertising substantiation, Ms. Fair took the opportunity to remind the audience that despite our obsession with smartphones—and our assumption that they can do almost anything except fold our laundry—the FTC will carefully scrutinize advertisers’ claims about their products, including health apps for smartphones, to ensure they are adequately substantiated. As an example, Ms. Fair mentioned the Commission’s January 2017 Settlement with Breathometer, Inc. and Charles Michael Yim in which the FTC alleged that marketers of two app-supported smartphone accessories, marketed to accurately measure consumers’ blood alcohol content (BAC), failed to adequately test the accuracy of the app and failed to notify customers that the app regularly understated BAC levels. In another smartphone settlement from December 2016, FTC v. Aura Labs, Inc. and Ryan Archdeacon, the FTC alleged that the marketer’s blood pressure app lacked reliable testing, and that the app’s readings were significantly less accurate than those taken with a traditional blood pressure cuff. In both of these cases, Ms. Fair suggested that FTC seemed particularly concerned due to potential safety issues arising from the lack of proper testing, especially where an intoxicated driver might get behind a wheel, or where a consumer may think his/her blood pressure does not present a health risk. These cases serve as a reminder that the FTC will evaluate substantiation with an especially critical eye where advertisers make health and safety-related claims.