With the Biden-Harris administration and Federal Trade Commission (FTC) Chair Lina Khan tenures now completed, we take a look back at the mountain of rulemaking carried out over the last few years. Khan’s ambitious agenda led to an avalanche of new and amended rules. All eyes will now be on Commissioner Andrew Ferguson, who is set to become the new chair, and how he will steer the agency going forward.

Under Khan’s leadership, the FTC issued major rules that attempted to regulate swaths of the U.S. economy. Some rules failed to become effective, as they faced judicial setbacks, such as the Non-Compete Rule, which was set aside by a federal court and the CARS Rule that the FTC stayed after litigation commenced. Similarly, the Negative Option Rule is in the midst of a court challenge that may halt its implementation. Meanwhile, the Unfair or Deceptive Fees Rule was substantially narrowed during the rulemaking process.

Continue Reading Welcome to the New Federal Trade Commission! But First, a Look Back at FTC Rulemaking

As part of a flurry of activity this week before the change in its leadership, the Federal Trade Commission (FTC) announced proposed rulemakings regarding deceptive earnings claims by multilevel marketers and money-making opportunity sellers. Whether a Republican-led agency will finalize these proposals is far from clear. The proposed rulemakings include the following:

  • A Notice of Proposed Rulemaking proposing amendments to the FTC’s Business Opportunity Rule (BOR)
  • A Notice of Proposed Rulemaking proposing a new rule addressing deceptive earnings claims in the multilevel marketing industry (ECR)
  • An Advance Notice of Proposed Rulemaking asking whether the FTC should propose additional rule requirements that would apply to the multilevel marketing industry
Continue Reading FTC Issues Proposed Rulemakings Related to Deceptive Earnings Claims

This week, the Federal Trade Commission (FTC) and the New York attorney general announced a settlement with Handy Technologies, Inc. to resolve allegations that the company engaged in an array of unfair and deceptive practices that violated Section 5 of the FTC Act and New York advertising laws. This settlement is yet another indication of the FTC’s continued emphasis on protecting workers’ rights, an emphasis that may continue under a new administration.

The complaint alleged that Handy, a gig-economy platform that connects workers with home cleaning and handyman services, misled workers by advertising inflated earnings claims and failing to clearly disclose fees and fines that withheld millions of dollars from workers’ pay.

Continue Reading FTC and New York Attorney General Settle with Handy for Deceptive Practices

This week, the Federal Trade Commission (FTC) and the Illinois attorney general announced a settlement with Grubhub Inc. to resolve allegations that the company engaged in an array of unfair and deceptive practices that violated Section 5 of the FTC Act, the Restore Online Shoppers’ Confidence Act (ROSCA), the FTC’s new Impersonation Rule, and Illinois state consumer protection laws. The FTC announced the case as Chair Lina Khan’s tenure at the helm of the FTC comes to an end, and the case highlights many of the approaches Khan has pushed for during her reign.

The complaint alleged that Grubhub, an online food ordering and delivery platform, engaged in practices that harmed diners, delivery workers, and restaurant owners. Grubhub reportedly deceived diners by advertising low or no delivery fees but then added hefty charges at checkout. Even members of the company’s subscription program, Grubhub+, who paid $9.99 per month for “unlimited free delivery,” were charged these additional fees without proper disclosure.

Continue Reading FTC and Illinois Attorney General Settle with Grubhub for Deceptive Practices

This week, the Federal Trade Commission (FTC) issued its long-awaited Final Rule on Unfair or Deceptive Fees. When the FTC released the proposed rule over a year ago, the rule covered any business that offered goods or services for sale. The Commission largely narrowed the rule’s application, which now focuses on live-event tickets and short-term lodging (defined as a hotel, motel, inn, short-term rental, vacation rental, or other place of lodging).

The Final Rule also covers third-party travel service providers, including online travel agencies and travel advisors. The FTC did not shed much light on its reasoning, but Republican Commissioner Melissa Holyoak’s concurring statement on the overly broad scope of the earlier version provides some indication of an effort to make the rule more palatable to the incoming Congress, which could repeal the rule through the Congressional Review Act.

Continue Reading FTC Issues Scaled-Back Final Fee Rule Targeting Live-Event Tickets and Short-Term Lodging

Join us as we spotlight select chapters of Venable’s popular Advertising Law Tool Kit, which helps marketing teams navigate the legal risk of campaigns and promotions. Click here to download the entire Tool Kit, and tune in to the Ad Law Tool Kit Show podcast, to hear the authors of this chapter dive deeper into the issue of Advertising Agreements in this week’s episode.

Businesses often hire advertising agencies to assist with their marketing and promotion efforts. This outsourcing model has gained popularity with the emergence of online, social media, and mobile advertising.

While this approach to online advertising has many benefits, businesses must ensure that their contracts with advertising agencies contain key provisions that will mitigate certain legal risks, bearing in mind that the business itself is the party that is likely to be sued if a third party objects to the contents of the advertising. The best practices listed below can help businesses limit risk when outsourcing marketing campaigns.

Continue Reading Advertising Agreements: An Excerpt from the Advertising Law Tool Kit

Just before Thanksgiving, the Federal Trade Commission (FTC) announced a Final Rule significantly expanding the coverage of the Telemarketing Sales Rule (TSR). The amendment extends the TSR’s prohibition against deceptive practices to cover inbound telemarketing calls for technical support services.

Under the amendment, technical support services are defined as “any plan, program, software, or service that is marketed to repair, maintain, or improve the performance or security of any device on which code can be downloaded, installed, run, or otherwise used, such as a computer, smartphone, tablet, or smart home product, including any software or application run on such device.”

Continue Reading Telemarketing Sales Rule Amendment Sparks Debate Between FTC Republicans Ahead of Administration Transition

Episode 11 of Venable’s Ad Law Tool Kit Show, Season 2,is now available. Listen to “Advertising Agreements” here, or search for it in your favorite podcast player.

The emergence of online, social media, and mobile advertising has made the outsourcing of marketing efforts important to many businesses. While this approach offers many benefits, businesses must ensure that their advertising agreements contain key provisions that will mitigate certain legal risks.

Venable partners Bret Siciliano and A.J. Zottola talk about how these agreements can go wrong, and some best practices that can help businesses avoid risk when outsourcing marketing campaigns.

Continue Reading Listen to Venable’s Ad Law Tool Kit Show Podcast – “Advertising Agreements”

Last month, the Federal Trade Commission (FTC) announced an enforcement action against Evolv Technologies, alleging that the company made deceptive claims about the capabilities of its AI-powered security screening system, including in school settings. Among other allegations, the complaint alleged that Evolv advertised that its systems could reliably detect all weapons, but the systems consistently failed to detect guns and knives and routinely gave false alarms.

The FTC also announced a proposed settlement. Interestingly, the two sitting Republican commissioners, one of whom will likely be the acting chair after January 20, disagreed on the scope of the proper remedy under Section 13(b) of the FTC Act. While commissioners Andrew Ferguson and Melissa Holyoak both supported the FTC’s settlement with Evolv, they disagreed on the FTC’s authority to provide relief in the form of contract cancellation for school customers.

Continue Reading The Dueling Views of FTC Commissioners Ferguson and Holyoak on the Scope of Agency Authority

Episode 10 of Venable’s Ad Law Tool Kit Show, Season 2,is now available. Listen to “Understanding False Advertising Claims, Part 2: The National Advertising Division” here, or search for it in your favorite podcast player.

The National Advertising Division (NAD) is part of the BBB National Programs. Its mandate is to “hold national advertising across all media types to high standards of truth and accuracy by reviewing truth-in-advertising challenges from business, trade associations, consumers, or on its own initiative.” In 2023, the NAD closed 26% more false advertising cases than the year before.

In the second of two episodes about false advertising claims, Venable partner Claudia Lewis discusses how marketers can reduce the risk of a competitor challenge, and what to do if you believe your competitors’ advertising is violating the law.

Venable’s Ad Law Tool Kit Show will help you identify potentially problematic advertising and marketing practices, or avoid them altogether. The Season 2 episodes examine such topics as Made in USA claims, litigation trends in privacy laws, and marketing to children.

If you have specific questions after listening to this episode, don’t hesitate to contact me or Claudia to arrange a conversation. You can also download the complete Tool Kit or bookmark the link to our e-book for quick access to these industry best practices.

And if you haven’t already, be sure to subscribe to this award-winning blog, and tune in to our comprehensive webinar series, where our team addresses current events and examines themes and issues important to advertising and marketing.

Tune in next week to our final episode of the season when I will be talking to Venable partners Bret Siciliano and A.J. Zottola about “Advertising Agreements.”