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Last week, the Federal Trade Commission (FTC) filed a lawsuit in federal court against JustAnswer LLC and its CEO, arising from the company’s subscription program. According to the complaint, JustAnswer operates an online platform that engages “experts” where consumers can ask questions through online chats or phone calls about various subject areas.

The complaint alleges JustAnswer advertised a nominal fee for consumers to join the platform and receive an answer to their question (often $1 or $5). However, the FTC alleged that after the customer agreed to the nominal charge, JustAnswer simultaneously enrolled customers in an autorenewing subscription and charged them a much larger monthly fee ($28–$125) and continued to automatically charge consumers every month until the consumer canceled the subscription.Continue Reading FTC Lawsuit Targets JustAnswer for Alleged ROSCA and Subscription Disclosure Violations

Last week, an Eleventh Circuit panel unanimously upheld a federal district court’s summary judgment ruling in favor of the Federal Trade Commission (FTC) concerning advertising and disclosure practices related to a national fuel card program. The decision affirms the FTC’s authority to seek and obtain broad injunctive relief for unfair or deceptive acts and practices, particularly where fee disclosures and consent mechanisms are found to be inadequate.

In its opinion, the three-judge panel rejected a number of arguments challenging the scope of the district court’s relief and confirmed that forward-looking injunctive measures were appropriate given the record before it. The panel affirmed summary judgment on all five counts of the FTC’s complaint against the company and on four of five counts asserted against its chief executive officer.

The ruling may bring to a close more than seven years of litigation, spanning multiple changes in FTC leadership and enforcement priorities, as well as the Supreme Court’s decision in AMG Capital Management, LLC v. FTC, which narrowed the agency’s ability to obtain monetary relief under Section 13(b) of the FTC Act.Continue Reading FTC Wins Eleventh Circuit Ruling Over Hidden Fees and Deceptive Marketing

New York City’s consumer regulator has long been part of the local compliance backdrop. It now deserves sustained, strategic attention. The appointment of Samuel Levine, formerly the director of the Federal Trade Commission’s Bureau of Consumer Protection (during the Biden administration), as commissioner of the New York City Department of Consumer and Worker Protection (DCWP) signals a shift in how the City is likely to use its existing consumer protection authority.

Recent mayoral executive orders further signal that DCWP will devote additional attention to the review of fee disclosures (often characterized by regulators as “hidden junk fees”) and subscription models, including through monitoring, investigation, and, where deemed appropriate, enforcement under existing city law. DCWP’s role in shaping expectations for pricing, disclosures, and marketplace conduct will now become more consequential for companies that operate in New York City or reach its consumers.Continue Reading Why New York City’s Consumer Regulator Belongs on National Compliance Radar

In a rare course correction, the Federal Trade Commission (FTC) has reopened and vacated its 2024 consent order against Rytr LLC, a generative AI-powered company. The unusual move reflects a significant strategic reset of how federal regulators will approach AI technology, especially when alleged harms are hypothetical rather than concrete.

In 2024, the FTC filed an administrative complaint against Rytr, a company that sold an AI-powered writing assistant service that could generate testimonials and customer reviews. The FTC alleged that the AI-powered tool could generate reviews and testimonials that were not related to the user’s actual inputs or experience, and such reviews could therefore be deceptive.

The FTC challenged the conduct as unfair under Section 5, and as providing the means and instrumentalities for others to make deceptive statements. The final consent order was entered in December 2024, and it included a categorical ban on Rytr from providing any AI-powered service dedicated to consumer reviews or testimonials. Commissioner, now chairman, Andrew Ferguson, dissented from the votes issuing the complaint and approving the settlement.Continue Reading The FTC Walks Back Its Rytr Enforcement Action, Signaling a Shift in Federal AI Regulation

The Federal Trade Commission (FTC) issued warning letters to ten companies for alleged deceptive review practices, indicating its intent to step up enforcement of its relatively new Consumer Review Rule (16 C.F.R. Part 465) (“the Rule”).

The warning letters have implications for all direct-to-consumer sellers. For industries that rely heavily on consumer reviews, including dietary supplement, health and wellness, and beauty/personal care companies, the FTC’s action is particularly significant. These industries often market using consumer reviews, influencer endorsements, testimonials, and before-and-after content—practices that now carry increased regulatory risk. While the warning letters do not constitute formal findings of liability, they underscore the FTC’s readiness to pursue civil penalties of up to $53,088 per violation against the recipients (an amount that will likely increase in 2026 with inflation-adjusted civil penalties).Continue Reading FTC Signals Heightened Enforcement of New Consumer Review Rule

Last month, two association groups, the Consumer Federation of America (CFA) and the American Economic Liberties Project (AELP), submitted a Petition for Renewed Click to Cancel Rulemaking attempting to restart the Federal Trade Commission’s (FTC) rulemaking process. The petition asks the FTC to revive the rulemaking process by reopening the Rule Concerning Subscriptions and Other Negative Option Plans, often referred to as the “Click-to-Cancel” rule.

In July, a federal appeals court vacated the Click-to-Cancel rule, holding that it exceeded the scope of the FTC’s authority, was not promulgated in accordance with necessary rulemaking procedures, and was overly broad.Continue Reading Industry Groups Urge FTC to Revive Click-to-Cancel Rulemaking on Subscription and Negative Option Plans

Earlier this month, attorneys general from seven states launched a coordinated inquiry into the rapidly expanding “buy now, pay later” (BNPL) market. Led by Connecticut and North Carolina, and joined by California, Colorado, Illinois, Minnesota, and Wisconsin, the multistate coalition of attorneys general sent letters to six major BNPL providers, outlining concerns that the companies’ products may be violating state consumer protection laws.

Regulators Cite Risks: Repayment Challenges and Transparency Concerns

In the letters, state AGs request information on pricing and repayment structures, as well as copies of consumer contracts, user agreements, and disclosures. The inquiries focus on determining whether consumers have received what the states view as appropriate protections—specifically, whether they have encountered a lack of transparency, undisclosed fees, and risky repayment structures.Continue Reading State AGs Increase Scrutiny of Buy Now, Pay Later Providers Amid Consumer Protection Concerns

This week, the Federal Trade Commission (FTC) Bureau of Consumer Protection issued 13 warning letters to rental housing management software providers focused on the display of the total advertised price of their properties. According to the FTC, the software providers do not allow rental property managers and owners to advertise a total monthly rental price that includes all mandatory fees. This in turn prevents consumers from obtaining complete pricing information on those property owner websites and platforms.

The FTC noted that such practices may be in violation of Section 5 of the FTC Act, which prohibits unfair or deceptive acts and practices, as well as the Gramm-Leach-Bliley Act, which makes it unlawful to use false, fraudulent, or fictitious statements or representations to obtain, attempt to obtain, cause the disclosure of, or attempt to cause the disclosure of customer information of a financial institution. Violations are subject to civil penalties of up to $53,088 per violation.Continue Reading FTC Begins Rulemaking on Unfair Rental Housing Fees After Issuing Warning Letters

Last week, the Ninth Circuit Court of Appeals upheld a decision issuing a permanent injunction and over $7 million in sanctions against people engaged in an illegal multilevel marketing scheme. The court’s opinion in Federal Trade Commission (FTC) v. Noland sheds light on the scope of the agency’s power to obtain monetary relief after the Supreme Court restricted the FTC’s authority under Section 13(b) of the FTC Act in a 2021 case, AMG Capital Management v. FTC.

In Noland, the defendants attempted to use the AMG Capital decision to challenge the court’s ability to award compensatory sanctions for contempt and redress under Section 19 for a rule violation. The Ninth Circuit affirmed the district court’s rejection of those arguments.Continue Reading Ninth Circuit Affirms the FTC’s Authority to Seek Damages After AMG Capital