As the bustling holiday season quickly approaches, and in light of COVID-19’s impact on global supply chains, retailers face many challenges in their business operations, but also in maintaining regulatory compliance relating to shipping—and shipping representations. This is especially true for retailers selling goods online, by phone, or by mail, who must be mindful of both federal and state regulations.
Major state regulators are already cracking down. Four California county district attorneys recently filed suit against Kanye West’s Yeezy Apparel brand, alleging violations of California Business & Professions Code, Section 17538, which requires in pertinent part that businesses selling goods online (or by mail or telephone) to California customers must ship the goods within 30 days of a completed order or provide a full refund, send written notice of the delay and offer a refund, or provide substitute goods and offer a refund. The law allows the state to seek civil penalties of $2,500 for each violation.
Continue Reading ‘Tis the Season—to Update Your Shipping Representations
States can now require internet retailers to collect sales taxes even if the retailer has no physical presence in the state.
Scrolling online through the California Business and Professions Code the other day, I was struck by a frightening sight. My pulse raced. My jaw dropped. I called out to an associate for help. I wanted to make sure that what I was seeing was real, i.e., that I wasn’t out of my mind. Many lawyers have read 
As states continue their quest to compel online vendors to collect sales and use tax on sales to customers located in the state and to subject such vendors to state income tax, a current trend has been targeting vendors selling via online marketplaces. Some states assert that the presence of inventory held for a vendor or the presence of the marketplace provider/facilitator in a state acting on behalf of a vendor is sufficient nexus or connection of the vendor with the state to subject the vendor to the state’s taxing jurisdiction.
The New York State Department of Health recently proposed a new set of regulations that would loosen marketing and advertising laws affecting New York’s medical cannabis program. The proposed regulations were published in the New York Register on August 23, 2017, and are open for a 30-day public comment period before the new regulations are to take effect.
It’s no secret that automatic renewal (or continuity or negative option programs) are on many regulators hit lists. Regulators argue that consumers are often unaware that they have signed up for services or products for which they will be billed on a monthly basis unless and until they cancel, particularly when it involves a free trial period. In some cases cancellation may not always be easy and the billing descriptor that appears on the consumer’s credit card statement may differ significantly from the branded product or service name. Finally, otherwise busy consumers may simply forget about the upcoming renewal, particularly if the subscription term is lengthy.
The plaintiffs’ bar is at it again, this time with a new target—the shipping and handling fees that retailers charge consumers in the course of delivering a product.