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Advertising Watchdog Refers CBD Health Claims to the FTC

The National Advertising Division of the Better Business Bureau (“NAD”), the investigative unit of the advertising industry’s system of self-regulation, recently referred to the Federal Trade Commission (“FTC”) advertising claims made by Grade A Nutraceuticals for its CannaPure CBD Oil dietary supplement, after the company failed to respond to NAD’s requests to provide substantiation for … Continue Reading

Cannabis Company is Sued for Showing Mural in Advertising Campaign

Artist Diana Perez filed a copyright infringement lawsuit in Colorado federal court against a cannabis company and two advertising agencies over allegations that her street mural was featured in advertisements for cannabis-infused essential oil products without her permission. According to the complaint, Perez created the mural at issue, entitled “Besties” as a part of the … Continue Reading

Class Action Alleges Starbucks Shortchanges Customers’ Caffeine

Last month, a putative class action was filed against Starbucks, Inc. in California federal court alleging that the coffee giant is tricking customers into purchasing larger espresso-based drinks when they contain the same amount of caffeine as the smaller size. The complaint alleges that Starbucks engages in a “classic bait-and-switch scheme that causes unsuspecting consumers … Continue Reading

FTC Settles With Financial Company Over Fake Rankings of Financial Products and Reviews

This month, the Federal Trade Commission (“FTC”) announced that it reached a settlement with the operators of a website that compares student loans and other financial products over allegations of misleading ratings and reviews. According to the FTC’s complaint, LendEDU falsely claimed that its website provided “objective,” “accurate,” and “unbiased” information about consumer financial products, … Continue Reading

Was it all a fantasy? New York Appeals Court says fantasy sports are illegal

Introduction On February 6, 2020, the New York Supreme Court’s Appellate Division, Third Department upheld a lower court ruling from 2018 which held that daily fantasy sports (DFS) contests amount to illegal gambling, and are thus unconstitutional in the state. In light of this decision, the New York DFS operations of popular companies like FanDuel … Continue Reading

Advertising Watchdog Says Gwyneth Paltrow’s Goop Is Making False Health Marketing Claims

Last month, prominent advertising watchdog, Truth in Advertising, Inc. (“TINA”), notified the California Food, Drug and Medical Device Task Force (the “Task Force”) in a formal complaint letter that Gwyneth Paltrow’s lifestyle brand Goop is violating a 2018 stipulated judgment that it entered into with the State of California. The 2018 stipulated judgment prohibits Goop … Continue Reading

Former “Bachelor” Contestant Stripped of $1 million Fantasy Football Win

Last month, a former Bachelor contestant was stripped of her $1 million prize won in a DraftKings online fantasy football contest after the company opened an investigation into the win amidst accusations of collusion. As we previously wrote about here, Jade Roper-Tolbert, a former contestant on the reality TV show “The Bachelor” beat more than 100,000 … Continue Reading

Proposed Class Action Targets CBD Maker Over ADA Website Accessibility

Last month, a putative class action lawsuit was filed in New York federal court against Charlotte’s Web, Inc., a Colorado-based maker of cannabidiol (“CBD”) oils, balms and gummies claiming that its website is not accessible to visually impaired shoppers, in violation of the Americans with Disabilities Act (“ADA”). According to the complaint, plaintiff Joseph Guglielmo, … Continue Reading

Kendall and Kylie Jenner “Klauber-ed” for Allegedly Infringing Lace Designs

Last month, a New York based fabric manufacturer, Klauber Brothers Inc., filed a copyright infringement lawsuit in California federal court against apparel companies owned by Kendall and Kylie Jenner for allegedly stealing the company’s lace designs and using them to make and sell apparel under the Kendall + Kylie collection name. According to the complaint, … Continue Reading

NCAA’s Consideration of Training Expenses for Olympic Athletes and Name, Image and Likeness Debate to Take Center Stage at Annual NCAA Convention

Last week, the National Collegiate Athletic Association (“NCAA”) proposed a new rule allowing elite Olympic and Paralympic athletes to have “additional training expenses” paid without jeopardizing their NCAA eligibility. Athletes designated “elite” by the U.S. Olympic and Paralympic Committee and national sport governing bodies would be allowed to receive “developmental training expenses, including travel for … Continue Reading

Former “Bachelor” Contestant’s $1 million Fantasy Football Win Under Investigation

Last week, sports gambling giant DraftKings announced that it is reviewing a former Bachelor contestant’s $1 million win in an online fantasy football contest after she and her husband were accused of cheating. Jade Roper-Tolbert, a former contestant on the reality TV show “The Bachelor” beat more than 100,000 entries to win first place in … Continue Reading

NAI Issues New Guidance on Consumer Opt-In Consent for Sharing of “Sensitive” Data

The self-regulatory group, Network Advertising Initiative (“NAI”), has issued new guidance, in which it mandates that its members obtain opt-in consent from consumers before collecting or using “sensitive” data for ad delivery and reporting, as well as for ad targeting. Specifically, the guidance states that a member must obtain a user’s opt-in consent for the … Continue Reading

Proposed Class Action Targets CBD Chocolate Maker Over False THC and CBD Content

A class action filed this month in California alleges that Bhang Corporation, a Florida-based medicinal chocolate maker, violated several state and federal laws by claiming that its chocolate products contained much greater amounts of tetrahydrocannabinol (“THC”) and cannabidiol (“CBD”) than they actually did, in order to charge consumers premium prices. The complaint alleges that plaintiff Charles … Continue Reading

NAD Announces Updated Filing Fees for 2020

This week, the National Advertising Division of the Better Business Bureau (“NAD”), the investigative unit of the advertising industry’s system of self-regulation, announced changes to its filing fees that will take effect on January 1, 2020. The following price structure will apply to bring a challenge: Under $250M – $10,000 (New Category) National Partner – $25,000 Under … Continue Reading

FTC Releases Guidance for Influencers

On Tuesday, the FTC released a set of guidelines for online influencers dictating when and how influencers must disclose sponsorships to their followers. The guidelines, available here, break down disclosure requirements and provide tips for influencers on how to avoid deceptive advertising. In general, the guidelines largely reflect what the industry has gleaned from FTC … Continue Reading

USDA Issues Highly Anticipated Interim Domestic Hemp Production Rule

On October 29, 2019, the United States Department of Agriculture (“USDA”) released its highly anticipated interim final rule establishing rules and regulations for domestic hemp production. These interim regulations were required by the 2018 Agricultural Improvement Act (2018 Farm Bill), which tasked the USDA with promulgating a regulatory framework for hemp production in the United … Continue Reading

Aloe Vera Supplement Marketer Feels the Burn After FTC Settlement Over Company’s Misleading Health Claims

Last month, the Federal Trade Commission (“FTC”) announced its settlement with a Florida-based marketer and seller of aloe vera-based supplements over allegations that it deceived consumers in claiming that its products were effective treatments for a range of conditions affecting seniors, such as chronic pain, ulcerative colitis, diabetes, and acid reflux. According to the FTC’s … Continue Reading

Website and Its Operator Settle FTC Charges They Sold Fake Indicators of Social Media Influence

Devumi, LLC (“Devumi”) and its owner and CEO, German Calas, Jr. (“Calas”) have agreed to settle the Federal Trade Commission’s (“FTC”) complaint alleging that Devumi and Calas engaged in deceptive online marketing tactics in violation of the FTC Act. In this first-ever type of complaint, the FTC alleges that Devumi and Calas sold fake indicators … Continue Reading

FTC Obtains Temporary Restraining Order To Halt Company’s “Misleading” and “Bogus” Real Estate Seminars

Earlier this month, a federal court entered a temporary restraining order against a Utah-based business, which the Federal Trade Commission (“FTC”) and the Utah Division of Consumer Protection (“DCP”) alleged used deceptive promises of big profits to lure consumers into real estate seminars costing thousands of dollars. According to the complaint filed by the FTC … Continue Reading

The FDA and FTC Join Forces in Issuing Warning Letter to CBD Product Company

On October 22, 2019, the U.S. Food and Drug Administration (“FDA”) and the Federal Trade Commission (“FTC”) issued a public statement regarding a joint warning letter sent to Rooted Apothecary, LLC, a Florida-based company, for unlawfully marketing several of its products containing cannabidiol (“CBD”). The warning letter indicated that Rooted Apothecary, LLC was illegally marketing … Continue Reading

FTC Settles with Beauty Brand Over False “Organic” and “Vegan” Claims

Last month, the Federal Trade Commission (“FTC”) announced a $1.76 million settlement with Truly Organic, Inc. and its CEO over allegations that the company’s personal care products advertised as “100% organic” were anything but. According to the FTC’s complaint, since at least 2015, the company advertised a range of personal care products including body washes, … Continue Reading

FTC Issues Warning Letters to Three CBD Companies

This week, the Federal Trade Commission (“FTC”) sent warning letters to three companies that sell cannabidiol (“CBD”) products regarding the health claims found in the companies’ advertisements. The companies sold a variety of products containing CBD, including oils, tinctures, capsules, creams, and “gummies.” Each company claimed that its CBD products can prevent, treat, or cure … Continue Reading

FTC Announces Two More Actions Enforcing The Consumer Review Fairness Act

Last month, the Federal Trade Commission (“FTC”) announced two new actions under the Consumer Review Fairness Act (“CRFA”) against companies that allegedly used non-disparagement provisions in consumer “form contracts” in connection with their respective services to rent properties. These two actions follow the FTC’s inaugural CRFA actions against three companies last month, which we previously … Continue Reading
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