Category Archives: FTC

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Definitely not “Winning”: Scammers Pay Millions to FTC and Missouri Attorney General for Running Deceptive Prize Scheme

In February 2018, the FTC teamed up with the Missouri Attorney General’s office in filing a complaint against a prize promotions company and others that allegedly operated a large-scale deceptive prize scam targeting the elderly. A little more than a year later, the FTC and the Missouri AG’s office announced that they reached a settlement … Continue Reading

Best to Leave Cherry Picking to Cherry Farms: Regulators Revive Lawsuit Challenging Data Used to Support Memory Improvement Claims

Three things to remember when making claims: always ensure that you have the appropriate substantiation—I forget the other two. Last week, the Second Circuit issued an order vacating the Southern District of New York’s dismissal of an FTC complaint alleging that Quincy Bioscience falsely advertised a memory supplement, known as Prevagen. A little background: Quincy … Continue Reading

FTC Sets Its Sights on Fake Customer Reviews

Since updating its Endorsement Guides in 2015 to keep pace with the meteoric rise of social media and influencers in marketing, the FTC has placed a significant emphasis on the need to disclose material connections between advertisers and endorsers. Through its Guides, informal business guidance, blog posts, warning letters, and multiple enforcement actions, the FTC … Continue Reading

Stop the Presses: Third Circuit Limits FTC’s Access to Federal Court for Past Conduct

The Federal Trade Commission suffered a significant blow yesterday. In a decision that many saw coming—bloggers here included—the Third Circuit curtailed authority the FTC has been using for decades to confront allegedly unlawful past conduct. The decision has a direct impact on the ability of the FTC to obtain injunctions against defendants for alleged past … Continue Reading

FTC Opts Out of Canning the CAN-SPAM Rule

In June 2017, the FTC initiated a regulatory rule review of the Controlling the Assault of Non-Solicited Pornography and Marketing Rule (“CAN-SPAM Rule” or “Rule”), seeking information about the Rule’s costs and benefits as well as its economic and regulatory impact. The FTC received 92 responses to its request for public comment. Last week, the … Continue Reading

FTC and FDA Issue Warning Letters to Supplements Companies

Earlier this week, the FTC and the FDA announced a joint effort to combat unsubstantiated health claims in the supplement space. In three warning letters—to Gold Crown Natural Products, TEK Naturals, and Pure Nootropics, LLC (collectively, the “Companies”)—the agencies explain that certain efficacy claims may lack competent and reliable scientific evidence for support. Specifically, the … Continue Reading

Think Asterisks Don’t Matter?*

Every brand that has designed a product label has felt the call of the asterisk. Visual real estate on packaging and in advertisements is limited, and marketing departments often groan at the piles of clumsy language that legal departments insist make it onto the page. But the elegant solution—dropping an asterisk and including the disclaimers, … Continue Reading

Mastercard Targets Negative Options In 2019 – Demands Transparency

As 2019 goes into full swing, it’s important for providers of payment processing services (referred to here as “acquirers”) and their merchants or submerchants to prepare for the various regulatory and industry changes coming this year. One such significant change comes in the form of Mastercard’s updated rules for negative option billing programs. Set to … Continue Reading

Hanging Out to Dry: FTC’s Ongoing Pursuit of Credit Card Laundering has Reached an Apex

The Federal Trade Commission (“FTC”) continues to crack down on companies engaged in credit card laundering. Credit card laundering is the practice of processing credit card transactions for one company through the merchant processing account of another company. Credit card laundering can be used to bypass the monitoring practices and volume thresholds of credit card … Continue Reading

There is an Assault on the FTC’s Powers – Can it Withstand the Battering?

The FTC has long claimed expansive authority under the FTC Act to obtain injunctions and monetary judgments. Its claim to that expansive authority is somewhat creative, however, and has always rested on a shaky foundation. Litigants have begun taking aim at that claimed authority. In recent blog posts, we have written about challenges to the … Continue Reading

The FTC is Searching for the Value in Loot

The Commissioners of the FTC agreed, during an oversight hearing on November 27, 2018, to investigate the use of “loot boxes” in video games. Senator Hassan (D-NH), following up on questions she asked the newly appointed Commissioners during their confirmation hearings, specifically requested the FTC investigate loot boxes citing addiction concerns, (especially as it relates … Continue Reading

Cell Cultured Food—FDA and USDA Reach Agreement on Splitting Up Oversight

Previously on the blog, we noted that federal government agencies don’t always play well together. So, when these agencies synchronize their efforts, the industry would do well to take notice. One such coordination effort is well underway. The FDA and the USDA just announced that they will jointly oversee cell‑cultured food production derived from livestock … Continue Reading

The FTC, Contact Lenses, and the Future of Retail?

On November 14, the FTC Commissioners, in an opinion authored by Chairman Simons, issued an opinion in an antitrust case involving the online advertising industry that has important implications for online advertisers. Last November, we discussed the initial decision by FTC ALJ Chappell that 1-800 Contacts had violated Section 5 of the FTC Act by … Continue Reading

New Faces, Same FTC

Recently, we wrote about new faces at the FTC, which, for the first time in its history, has five new Commissioners in a calendar year. This unprecedented change has cast some uncertainty on how the FTC will approach consumer protection enforcement. Recent actions by the Commission, however, indicate that despite new leadership, the Commission’s focus … Continue Reading

FTC Stems Doc’s Stem Cell Claims

The Federal Trade Commission (“FTC”) recently settled a case against a physician and his two clinics over allegedly deceptive and unsubstantiated claims relating to their “amniotic stem cell therapy.” The physician, Dr. Bryn Jarald Henderson, frequently appeared in his companies’ advertisements and claimed that this therapy, which purported to use stem cells derived from amniotic … Continue Reading

The FTC’s New Data Tool: The first edition may be setting the stage to go after gift and prepaid card retailers, program managers, and other vendors?

This week, the FTC launched a new interactive tool to view its aggregated consumer complaint data. Previously released annually, data collected through the Consumer Sentinel Network will now be reported quarterly. The FTC’s data tool is interactive and allows users to narrow the data by state, type of fraud, contact method, age of victim, amount … Continue Reading

Court Sets Important Limits on Ability of FTC to Challenge Past Conduct

Believe it or not, the FTC’s power is not limitless. We wrote previously on an antitrust decision (FTC v. Shire ViroPharma) limiting the FTC’s ability to proceed in federal court to challenge past violations of the FTC Act. This week a judge extended that reasoning to the FTC’s consumer protection enforcement authority. In FTC v. … Continue Reading

Insights into the FTC and the Utah Department of Commerce: Consumer Fraud and Business Symposium

On September 20, 2018, the FTC and Utah Department of Commerce held a symposium in Salt Lake City, Utah, discussing, among other things, how the two work together to combat consumer fraud in various areas. The panels provided a unique insight into how law enforcement agencies coordinate and their respective priorities. Below are two key … Continue Reading

Demystifying the NAD Referral Process

What does it mean when the National Advertising Division refers a case to the Federal Trade Commission? At this year’s NAD Annual Conference, Mary K. Engle, the associate director of the FTC’s Division of Advertising Practices, and NAD director Laura Brett sorted fact from fiction about NAD referrals and shared their perspectives from both sides … Continue Reading

“Money, It’s a Gas” – Bureau Director Smith Makes NAD Debut

To kick off this year’s National Advertising Division Annual Conference, Andrew Smith—the FTC’s new Director of the Consumer Protection Bureau—discussed his views on the Commission’s priorities with respect to remedies, privacy and data security, and national advertising cases. Given the backgrounds of the new Commissioners, Director Smith acknowledged that some of them may be re-thinking—or … Continue Reading
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