Robocalls may have always had some artificial flavor to them; however, the proliferation of the use of artificial intelligence (AI) continues to blur the line between human and machine interaction. On July 17, the Federal Communications Commission (FCC) issued a draft Notice of Proposed Rulemaking (NPRM) to address the ability of the Telephone Consumer Protection Act (TCPA) to restrict and regulate robocalls made using AI. The NPRM will be finalized and adopted at the agency’s August 7 meeting and may be modified prior to that based on feedback from interested parties.

The draft NPRM comes after the FCC invited and received comments on the subject in November of 2023. Specifically, the agency sought comments on “how AI technologies can be defined in the context of robocalls and robotexts” and what steps should be taken to ensure that the FCC can advance its statutory obligation under the TCPA. Subsequently, as we’ve reported, the FCC took action aimed at unlawful AI robocalls in a recent AI robocall enforcement in response to increased election year calling activities.

Continue Reading Hello, This Is AI Calling. FCC Proposes New Rules for AI Robocalls

In early July the Staff of the Federal Trade Commission (FTC) issued new guidance on how to approach Made in USA claims. The agency says the new guidance will help businesses comply with its “all or virtually all” standard, including how to make disclosures qualifying a Made in USA claim. The new guidance is “Staff’s” view, which means it is not formally approved by the commissioners.  

Under an Enforcement Policy Statement issued in 1997, the FTC stated that to make a Made in USA claim, “all or virtually all” of a product had to be made in the USA. In 2021, the FTC finalized the Made in USA Labeling Rule, which codified the “all or virtually all” standard for labels on products. Under the labeling rule, regardless of industry or type of product, marketers are now subject to civil penalties if they improperly use an unqualified Made in USA claim on the product label.

Continue Reading FTC Issues Guides for Made in USA Claims

These days, it seems like there are three guarantees in life—death, taxes, and monumental Supreme Court administrative law opinions in the summer. As you’ve probably heard by now, the trend continues this year, including perhaps the largest fireworks display possible (in the administrative law context, that is). If for some reason you’ve been ignoring the news, just recently in Loper Bright Enterprises v. Raimondo, the Supreme Court overruled the Chevron decision and held that courts need not defer to an agency’s interpretation of a statute; rather, courts must exercise independent judgment when determining whether an agency acted within its statutory authority.

There’s a lot to unpack in the 109 pages of majority, concurring, and dissenting opinions. So, we’ll just focus on what this could mean for the recent uptick in agency action coming out of the Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB).

Continue Reading The Loper Bright Impact: Agency Action Likely to Face More Scrutiny in Light of the Supreme Court’s Disposal of Chevron Deference

With the election cycle heating up as we approach the dog days of summer, so too is the Federal Communications Commission’s scrutiny of the use of AI technology in fraudulent robocalls. As we previously discussed, the FCC has already doled out fines for the use of deepfakes in political robocalls.

Now, FCC Chairwoman Jessica Rosenworcel has ratcheted up the scrutiny of nine telecom companies, asking them to explain the measures they are taking to prevent deepfake robocalls. Specifically, the FCC asks the carriers to describe the steps taken to authenticate calls in line with the STIR/SHAKEN requirements. The agency’s inquiry also includes what resources carriers have dedicated to identifying generative AI voices, and what steps they have taken to verify customers’ identities.

Continue Reading AI Robocalls: Election Season Triggers Additional FCC Scrutiny

On May 20, Minnesota Gov. Tim Waltz signed the state’s so-called junk fee bill into law. The law, similar to a proposed Federal Trade Commission rule and laws in other states, requires businesses to include all mandatory fees or surcharges in the advertised price. Mandatory fees include:

  • A fee or surcharge that must be paid to complete the transaction
  • A fee or surcharge that is not “reasonably avoidable” by the consumer
  • A fee or surcharge that one would expect to pay when purchasing the goods or services advertised

Mandatory fees do not include taxes imposed by a government entity, such as a state tax on the purchase of goods. These requirements mirror the FTC’s Proposed Rule we have previously discussed that targets similar fees. The law will take effect on January 1, 2025.

Continue Reading Minnesota Joins the Fee Fray with a Twist on Variable Pricing

In a pair of Notices of Apparent Liability for Forfeiture this week, the Federal Communications Commission (FCC) has proposed a collective $8 million in fines against telecommunications company Lingo Telecom and political consultant Steven Kramer.

Robocalls, Generative AI, and Deepfakes

The FCC alleges Kramer violated the Truth in Caller ID Act. According to the FCC, two days before the New Hampshire 2024 presidential primary election, Kramer orchestrated a campaign of illegally spoofed and malicious robocalls that carried a deepfake audio recording of President Biden’s cloned voice telling prospective voters not to vote in the upcoming primary.

To transmit the calls, he worked with voice service provider Lingo Telecom, which incorrectly labeled the calls with the highest level of caller ID attestation, making it less likely that other telecommunications providers would detect the calls as potentially spoofed. For this reason, the FCC is also pursuing forfeiture against Lingo, alleging a violation of the STIR/SHAKEN rules for failing to use reasonable “Know Your Customer” protocols to verify caller ID information in connection with Kramer’s alleged illegal robocalls.

Continue Reading FCC Proposes $8 Million in Fines Against Telecom Company and Political Consultant for Using Deepfake Generative Artificial Intelligence

One of the questions that remains uncertain among looming federal and state “junk fee” and “drip pricing” bans in 2024 concerns the impact these rules will have on credit card surcharges. Surcharges are added to sale transactions by some retailers when the buyer uses a credit card to make a purchase. Is this a mandatory fee that must be incorporated in the total price under the new laws? Or does the consumer’s choice to use a credit card to pay make the convenience of paying by credit card an optional service or feature that need not be included in the advertised price?

We may need to wait for further clarification from regulators or a lawsuit to know how junk fee bans impact surcharging, but understanding the possible arguments and pitfalls may help you decide how you will address this question in the short-term. Contact us if you need guidance or advice on these junk fee bans or surcharge rules.

Continue Reading Drip Pricing, Surcharging, and the Push for “Total Price” Disclosures

Late last week, the California attorney general released Frequently Asked Questions regarding California’s “Honest Pricing Law” or “Hidden Fees Statute,” which will take effect July 1, 2024. The law is anticipated to have a sizeable impact, given its breadth, and will vastly change how businesses disclose the price of their goods and services to the public. When “advertising, displaying, or offering” a price, the law requires businesses to include all required fees and charges other than certain government taxes and shipping costs.

The Advertised Price Is a Single Price, No Exceptions

The FAQs make clear that the intent of the law is to force businesses to display a single price that includes all required fees and charges that a consumer would pay at the end of the transaction. This is similar to the Federal Trade Commission’s Proposed Rule that businesses display the “Total Price” for goods and services.

Continue Reading California Releases FAQs on Complying with Impending Drip Pricing Law

In late March, Tennessee Governor Bill Lee signed into law the Ensuring Likeness Voice and Image Security Act of 2024—known as the “ELVIS Act”—making Tennessee the first state to address head-on potential misuses of artificial intelligence (AI) related to an individual’s voice. The law prohibits individuals from using AI to generate and distribute replicas of another’s voice or image without their prior consent.

Many prominent members of the music and entertainment community have identified Tennessee’s law as an important step forward for the protection of artists’ (and others’) voice and likeness. Specifically, right of publicity laws across the nation typically provide that individuals have a property right in the use of their name, photograph, and likeness. However, these laws generally do not address the use of one’s voice or generative AI exploiting another’s image, likeness, or voice to generate unauthorized impersonations or replicas. In the age of AI cloning and deep fakes, these unauthorized works have caused great concern among those in the entertainment and media industries. The ELVIS Act is “first-of-its-kind” legislation to directly address these concerns by expanding Tennessee’s existing protections against the unauthorized commercial use of one’s rights of publicity.

Continue Reading Tennessee Out Front: Enacting Protections Against AI Misuse in the Music Industry

The Federal Communications Commission (FCC) and the Federal Trade Commission (FTC) agreed this week to cooperate and coordinate consumer protection efforts in enforcing the FCC’s reinstated “net neutrality” rules. The agencies stated in a Memorandum of Understanding that they will share legal, technical, and investigative expertise and experience in enforcing the rules.

The reinstated rules, adopted on April 25, formally reclassify internet service providers’ broadband services as “Telecommunications Services” under Title II of the Communications Act, rather than as a less-regulated Title I “Information service.” With this change in status, the FCC also reinstates specific proscriptive rules against blocking, throttling, or engaging in paid preference for certain network traffic, and re-adopts a “general conduct” standard barring unreasonable interference with consumers or providers that provide content and services.

Continue Reading FCC and FTC to Cooperate in Enforcing Reinstated Net Neutrality Rules