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Leonard L. Gordon

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Len Gordon, chair of Venable’s Advertising and Marketing Group, is a skilled litigator who leverages his significant experience working for the Federal Trade Commission (FTC) to help protect his clients’ interests and guide their business activity. Len regularly represents companies and individuals in investigations and litigation with the FTC, state attorneys general, the Department of Justice (DOJ), and the Consumer Financial Protection Bureau (CFPB). Len also represents clients in business-to-business and class action litigation involving both consumer protection and antitrust issues. He also counsels clients on antitrust, advertising, and marketing compliance issues.

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The latest edition of the FTC’s recent practice of holding open meetings brings a potential rule regarding earnings claims to the forefront. During the FTC’s open meeting, the Commission unanimously approved issuing an Advance Notice of Proposed Rulemaking with respect to earnings claims. As the Commissioners pointed out in their comments (additional information below), the motivation for this rulemaking is to repair the FTC’s ability to recover monetary relief for consumers after the Supreme Court’s decision in AMG Capital Management.

Prior to the vote, the Commissioners allowed Melissa Dickey from the Division of Marketing Practices to give a presentation on the FTC’s historical experience with earnings claims and the Division’s recommendation. Ms. Dickey recommended that the Commission move forward with the rulemaking process, and pointed to two primary reasons. First, the Division views false, misleading, and unsubstantiated earnings claims as especially problematic to consumers who, as Ms. Dickey postulated, ultimately rely on these assurances and, as a result, end up in significant debt. Second, the Bureau believes that these earnings claims are widespread, and impact almost every community, especially during the pandemic era, where purported bad actors target those who are seeking to earn extra income while working remotely.Continue Reading FTC Approves Rulemaking Process for Earnings Claims

As the rest of us prepare for the Super Bowl by buying avocados to make guacamole, installing new big-screen TVs, and donning Ram/Bengal-themed face paint, select corners of corporate America are preparing for the biggest advertising day of the year.

In 2021, companies spent approximately $485 million on ad slots during the big game, and the average cost of a 30-second commercial slot was about $5.6 million. With such high stakes, plus the intensive “Standards and Practices” review employed by the TV networks, one would assume that anything that makes the cut is above reproach. (The review board won’t even let advertisers use “Super Bowl” because it’s trademarked, which is why you often hear “the Big Game” in ads.)

However, the following examples of legal challenges to your favorite Super Bowl commercials demonstrate that the world of advertising law can be tricky to navigate, and companies that advertise simply cannot mitigate their litigation risk to zero.Continue Reading Defending Against the Blitz: Examining the Legal Issues Surrounding Super Bowl Ads

I’ve never really understood the saying “You can’t have your cake and eat it, too,” but I was reminded of it when I read U.S. District Judge Amy Totenberg’s opinion rejecting the FTC’s efforts to stay or voluntarily dismiss the federal court action brought against Fleetcor and its CEO.

Some background: The FTC sued Fleetcor in December 2019 in federal court in Georgia, alleging the fleet leasing company failed to adequately disclose the fees it charged and made deceptive claims about the money that businesses could save by using its services The case was litigated furiously, but then the Supreme Court gutted the FTC’s claim for relief in AMG. When a quick congressional fix did not occur, the FTC engaged in an “inventive” litigation strategy. The agency filed an administrative (Part III) action before its ALJ and asked the district court to stay or dismiss without prejudice the district court proceeding. The FTC indicated it intended to return to the district court after the conclusion of the administrative proceeding to recover redress under Section 19(a)(2). The defendants opposed the motion.

On February 7, 2022, Judge Totenberg denied the FTC’s motion. Summary judgment and Daubert motions had been fully briefed before the FTC filed its administrate complaint and sought a stay. The FTC urged the stay, arguing that the administrative proceeding could essentially pick up where district court litigation left off and be completed quickly.Continue Reading Judge Tells FTC That It Can’t Have Its Part III and Eat It, Too

It might be hard for some to imagine, but the Federal Trade Commission (FTC) is feeling groovy. This month, the agency released two guidance documents that track best practices to prevent consumers from being misled when marketers solicit and pay for online reviews and when review platforms feature online customer reviews.

The new documents are like two sides of an old-school vinyl album. Side A is for online retailers and marketers, while Side B is for review platforms (i.e., consumer review websites). The lyrics might be slightly different, but the tunes make for a pretty good mash-up.Continue Reading Federal Trade Commission Releases Online Customer Review Guidance

If you had asked us last week, we would have predicted that the Supreme Court’s momentous AMG Capital Management, LLC v. FTC decision last year, in which the Court struck down the Federal Trade Commission’s nearly 50-year practice of seeking equitable monetary relief under Section 13b of the FTC Act, would be the most significant decision about FTC jurisprudence we would see from the Supreme Court for a while.

However, in a surprising move, the Supreme Court recently granted certiorari in Axon Enterprises Inc. v. FTC to address whether Congress intended to strip federal district courts of jurisdiction to hear challenges to the constitutionality of the FTC’s structure, procedures, and very existence. Importantly, however, the Court declined to directly address the petitioner’s challenge to the constitutionality of the FTC. Still, the Court’s decision could significantly impact how future targets of FTC enforcement investigations and actions will challenge the FTC’s constitutional limits.Continue Reading Federal Trade Commission Goes to the Supreme Court Again, This Time in a Constitutional Challenge

Last week, the Federal Trade Commission (FTC) announced that it agreed to settle claims against Dun & Bradstreet (D&B), a business credit reporting agency engaged in deceptive and unfair practices with small and mid-sized business customers.

The FTC’s complaint primarily stemmed from businesses’ claims that error-ridden reports negatively affected business opportunities and that D&B’s offered credit-monitoring products did not easily improve credits scores and ratings as suggested. According to the order, D&B will have to adjust its operational practices in favor of its business customers.

Under FTC Chair Lina M. Kahn, the agency has been utilizing tools to affect broad swaths of the economy and certain industries. The FTC is using a traditional administrative cease and desist order to resolve small businesses’ credit reporting concerns – a continuation of the agency’s broad definition of “consumer” to challenge conduct directed at small businesses. The same concerns at issue in this case involving small business mirror those in many consumer cases, including credit reporting, deceptive telemarketing, and inadequately disclosed renewal terms.Continue Reading FTC to Dun & Bradstreet: Change Credit Reporting Operations to Benefit Business Customers

Senator Joe Manchin’s decision to torpedo the Build Back Better Act has wide-ranging consequences, including one that hits close to home, so to speak. Tucked in the bill was a provision to provide the FTC with authority to seek civil penalties for all violations of Section 5 of the FTC Act (something the FTC Act currently does not allow). This provision, which was vehemently opposed by a broad range of business groups, essentially has died on the vine. Although proposals to arm the FTC with such authority may be resurrected in future spending bills or standalone legislation, as of today, Congress’s focus appears to have narrowed on regulation of Big Tech, including the creation of a data privacy bureau within the FTC.

In the meantime, Senator Mike Lee, Republican of Utah, has introduced a new bill, the Consumer Protection and Due Process Act, which would provide the FTC with the authority to seek equitable remedies (including consumer restitution) under Section 13(b) of the FTC Act. This bill is a direct response to the April 2021 Supreme Court’s decision in AMG Capital Mgmt. finding the FTC did not have the authority to seek equitable remedies under current law (for more on that watershed case, click here and here). Notably, the bill has built-in guardrails to ensure the FTC does not “engage in substantial overreach.” Those guardrails include:Continue Reading 2021 Capitol Hill Wrap-up

A hallmark of Chair Lina Khan’s tenure thus far at the FTC has been her effort to stoke fear to try to deter conduct that she does not like.  The FTC’s recent Penalty Offense Notices and the Enforcement Statement on Negative Option Marketing provide examples.  Last week, during the Commission’s open meeting on November 18 the Commission engaged in more sabre rattling by issuing a “Commission Statement Regarding Criminal Referral and Partnership Process.”  This statement outlines the FTC’s renewed commitment to continue to expand its criminal referral program.  At the open meeting, however, the Commissioners stressed that this is not a new policy and that the statement merely reflects what FTC Staff have already done for approximately the past 20 years.  Since 2003, the FTC’s Criminal Liaison Unit (CLU) has worked with federal, state, and local criminal law enforcement to refer those matters that implicate criminal activity.  On occasion, the FTC has even referred cases to international criminal law enforcement partners.

Chair Khan noted that the FTC is redoubling its efforts to deter corporate crime that most harms consumers because civil fines are not doing enough, and that major corporations are likely to be repeat offenders due to their resources and scale.  Also, Commissioner Slaughter mentioned that a lower stock price or a visit from the FTC are not the only things that these offenders should fear.  In other words, the Commission hopes that with the help of criminal law enforcement, a company will see the light of day that crime does not pay.Continue Reading Chair Kahn says Don’t Do the Crime If You Can’t Do the Time

Last week two different bills were noticed by the House of Representatives that would provide additional remedial tools to the FTC to restore or replace some of what the agency lost when the Supreme Court struck down the agency’s ability to obtain equitable monetary relief under Section 13(b) of the FTC. Whether any of these…