Since July 1, when California’s “Honest Pricing Law” or “Hidden Fees Statute” became effective, the plaintiffs’ bar has filed more than a dozen complaints alleging violations of the statute. These complaints challenge alleged “junk fees” or “drip pricing” structures, including “service fees” charged by merchants through their websites, “processing fees” charged by third-party platforms, and various forms of credit card surcharges and debit card fees.

Background

California’s Honest Pricing Law requires “Total Price” disclosures and prohibits merchants from misrepresenting the nature and purpose of any charges or fees. Under the statute, “Total Price” means that the advertised prices of goods and services must include all mandatory charges and fees other than either government-imposed taxes or fees or postage or carriage charges “reasonably or actually incurred” to ship the physical good to the consumer.

Continue Reading A Variety of Fees and Surcharges Implicated in Early Cases Enforcing California’s Honest Pricing Law

The first episode of Venable’s Ad Law Tool Kit Show, Season 2,is now available. Listen to “Negative Option Marketing: Part 2” here, or search for it in your favorite podcast player.

Negative option marketing can include pre-notification negative option plans, continuity programs, automatic renewals, and free-to-pay conversions. This marketing strategy continues to invite scrutiny from the Federal Trade Commission (FTC), state attorneys general, and class action plaintiffs.

In this episode, I talk to my co-host on this podcast, Shahin Rothermel, and
Venable partner Ari Rothman about the keys to success in avoiding investigations and liability.

Continue Reading Listen to Venable’s Ad Law Tool Kit Show Podcast– “Negative Option Marketing: Part 2”

We are excited to announce Season 2 of Venable’s Ad Law Tool Kit Show, the podcast that helps you and your organization identify and avoid potentially problematic advertising practices.

As they did in Season 1, Shahin O. Rothermel and Leonard L. Gordon will interview their Venable colleagues and examine the increasingly complex regulatory landscape that governs the promotion of goods and services—from Made in USA claims to marketing to children.

Each week, the podcast brings the firm’s popular Advertising Law Tool Kitto life through the lens of current events. Listen to the trailer here. Episode 1, “Negative Option and Continuity Marketing: Part II,” will be available on Tuesday, October 1. In the first episode of the season, Len talks to Shahin and Venable partner Ari Rothman. Join us over the coming weeks to hear:

Continue Reading Listen to Season 2 of the Ad Law Tool Kit Show

This week, California amended its automatic renewal and continuous service offer law (ARL). Key provisions include the addition of “free-to-pay conversions,” consent obligations, misrepresentation prohibitions, request for cancellation procedures, price change notifications, and reminder and recordkeeping requirements. The new law takes effect July 1, 2025.

Express Affirmative Consent Required

The law will require “express affirmative consent” for all automatic renewal and continuous service offers. While the ARL provides no definition, class action plaintiffs’ attorneys, the California attorney general (AG), and California’s Automatic Renewal Taskforce (CART) are likely to interpret it similarly to the Federal Trade Commission’s (FTC) definition of “affirmative express consent,” i.e., “freely given, specific, informed, and unambiguous indication of an individual consumer’s wishes demonstrating agreement by the individual, such as by an affirmative action, following a clear and conspicuous disclosure to the individual.”

Continue Reading California Amends Autorenewal Law, with Stricter Consent Requirements and a “One Save” Rule: Fast VAST Update

The Federal Trade Commission (FTC) announced a “sweep” targeting AI-related conduct this week. The cases provide insight into how the agency may approach AI-related issues going forward and illustrate differences among the agency’s commissioners in how to approach issues raised by AI.

Three of the cases involved marketers making false earnings and business opportunity claims promising buyers income from AI-generated ecommerce locations. The FTC’s approach here was straightforward and consistent with how it has approached other money-making claims. Not surprisingly, both cases were voted out 5-0, and the FTC has obtained asset freezes against the companies and some principals.

The other cases were more novel and highlighted some of the challenges raised by AI.

Continue Reading As FTC Begins Grappling with AI Issues, “Sweep” Signals Differing Approaches Among Commissioners

Not to be left behind by other regulators, the California Privacy Protection Agency (CPPA) recently issued an enforcement advisory on “dark patterns” in the context of the notice and consent required under the California Consumer Privacy Act (CCPA). As we’ve previously discussed, dark patterns are a subset of “deceptive marketing” and are also known as “deceptive design patterns.” The Federal Trade Commission (FTC) released a report in 2022 outlining the various methods companies employ, such as “making it difficult for consumers to cancel subscriptions or charges, burying key terms or junk fees, and tricking consumers into sharing their data.”

The scrutiny of dark patterns has only intensified since then, and states like California are jumping in. The CCPA defines dark patterns as “[u]ser interfaces or choice architectures that have the substantial effect of subverting or impairing a consumer’s autonomy, decision making, or choice” and says consumer agreement obtained through dark patterns does not constitute consent. The CPPA advises companies seeking to obtain consumer information to use language that is easy to understand and to avoid technical or legal jargon.

Continue Reading California Privacy Protection Agency Warns Businesses Against “Dark Patterns” and Urges “Symmetry in Choice”

Last month, the Federal Trade Commission (FTC) and U.S. Department of Justice (DOJ) jointly hosted a public meeting of the interagency “Strike Force on Unfair and Illegal Business Practices.” The meeting was a continuation of an effort, initially announced by President Biden in March, to “strengthen interagency efforts to root out and stop illegal corporate behavior that hikes prices on American families through anti-competitive, unfair, deceptive, or fraudulent business practices,” according to a press release.

The August 1 meeting brought together a number of different agencies to discuss their actions to lower prices for Americans, including the FTC and the DOJ, the Consumer Financial Protection Bureau (CFPB), the U.S. Department of Transportation, the U.S. Department of Agriculture (USDA), the U.S. Department of Health and Human Services (HHS), the U.S. Securities and Exchange Commission (SEC), and the U.S. Federal Communications Commission (FCC).

Continue Reading Federal Agencies Increase Focus on Pricing Enforcement

At this week’s National Advertising Division Annual Conference, FTC Commissioner Melissa Holyoak and FTC Bureau of Consumer Protection Director Samuel Levine presented starkly different perspectives of the agency.

On Monday, Levine provided a familiar list of the FTC’s accomplishments over the past year, including what consumers can expect from the BCP going forward:

Continue Reading At NAD Conference Federal Trade Commission’s Holyoak and Levine Share Contrasting Perspectives on the Agency’s Role

Companies that care about avoiding Federal Trade Commission (FTC) action should take heed. Last month, the FTC announced an $8.5 million settlement with Care.com, resolving claims challenging its advertising claims and automatic renewal program.

The challenge demonstrates the FTC’s willingness to use the Restore Online Shoppers’ Confidence Act (ROSCA) to target advertising claims.

Care.com offers a platform connecting job posters and job seekers. Users sign up as basic members or premium members. According to the FTC’s complaint, basic members could create job postings, but only premium members could hire. The FTC alleged that Care.com’s advertising inflated the number of jobs available on its site by including jobs “for which there is little to no chance a job seeker could be hired.”

Continue Reading Handle Autorenewal Programs with Care: Federal Trade Commission Targets Care.com for Alleged Dark Patterns and Earnings Claims

Consumer products regulated by the U.S. Consumer Product Safety Commission (CPSC) may soon be denied entry into the United States unless the importer of record electronically files a detailed product certification with the U.S. Customs and Border Protection (CBP). In late 2023, the CPSC published a proposed CPSC rule that will require that importers of regulated consumer products eFile Certificates of Compliance at import.

Since 2008, importers and domestic manufacturers have been required to maintain Certificates of Compliance and to provide distributors and retailers a reasonable means to access the certificate, but the certificates did not need to be filed at import. In June, the CPSC expanded its beta program testing the eFiling system and issued an “eFiling Quick Start Guide,” which provided additional information about the program and predicted that “full implementation of eFiling will occur in or around 2025.”

Continue Reading Get Ready to Comply with CPSC’s Upcoming eFiling Requirement