Last week, Laura Brett was named director of the National Advertising Division of the Advertising Self-Regulatory Council (“NAD”). Laura Brett joined the NAD in 2012, and is widely viewed as an excellent choice to maintain continuity with former director Andrea Levine. Laura speaks frequently at advertising conferences about the role of the NAD in the … Continue Reading
You can still get your quarter ham “STARTING AT $23.99” from Honey Baked Ham, Inc. according to the California Court of Appeal in its unpublished decision on November 8, 2016. The Court of Appeal affirmed a trial court’s judgment that Honey Baked Ham, Inc. did not engage in unfair competition or in false or deceptive … Continue Reading
The Federal Trade Commission has approved a final Decision and Order settling a dispute with pet food producer Mars Petcare US, Inc. (“Mars”) related to advertisements for Mars’ Eukanuba brand dog food. The settlement arose from an FTC investigation into a number of television, print, and internet advertisements released by Mars in 2015 stating that, … Continue Reading
Quietly, the Federal Trade Commission staff published a summary of the workshop it convened on September 15, 2016 (“Putting Disclosures to the Test”). The summary goes into detail and generally presents an accurate and objective recounting of the full-day workshop. Understanding how the Commission thinks about disclosures is critical because the FTC’s Enforcement Policy on … Continue Reading
On October 4, 2016, a federal court dismissed a putative class action against Valve Corporation (“Valve”) regarding its popular eSports game, Counter Strike Global Offensive (“CS:GO”). Specifically, the class claimed Valve violated a host of state laws and the federal Racketeer Influenced and Corrupt Organizations Act (“RICO”). In their complaint, the plaintiffs alleged that Valve’s … Continue Reading
Last week, Mars Petcare U.S., Inc. (“Mars”) settled its case with the Federal Trade Commission (“FTC”) over certain advertising claims. In 2015, the FTC initiated an investigation of Mars’ advertising claims for its Eukanuba dog food. Its advertising claimed that dogs that ate Eukanuba lived 30% longer than their typical lifespan and that Eukanuba brand … Continue Reading
The advertising industry’s self-regulatory arm, the National Advertising Division (“NAD”), recently reviewed certain advertising messages made by Vapore, LLC. In both television and internet advertising, Vapore claimed that its “MyPurMist” handheld steam inhaler had “more 5-star reviews than any other steam inhaler.” In connection with the 5-star review message, Vapore focused on certain attributes of … Continue Reading
In the European Union (EU), online barriers prohibit EU citizens from receiving goods and services that are commonplace to U.S. citizens. When I travel to Miami, for instance, I am able to use my Netflix streaming subscription to catch up on my favorite shows. The same cannot be said for a citizen from the UK … Continue Reading
The FCC is asking for comments on a letter it received from the National Association of Attorneys General that seeks out the Commission's opinion on the legality of telephone carriers implementing call-blocking technology to reduce the amount of unwanted telemarketing calls. If your company engages in marketing over the telephone or uses it to regularly conduct business with customers, you may want to consider getting involved. Comments are due December 24, 2014, and reply comments are due January 8, 2015. For more on this, please read the latest post on our Global Regulatory Enforcement Law Blog.… Continue Reading
In case you missed last week's Association of National Advertisers webinar covering the FTC's Operation Full Disclosure, please join John Feldman of Reed Smith and Michael Ostheimer of the FTC's Division of Advertising Practices on Monday, December 1, 2014, as they present on a program entitled, Operation Full Disclosure: What You Need to Know About TV and Print Disclaimers, hosted by the American Bar Association (Section of Antitrust Law).
Find out what Operation Full Disclosure means to you and your clients, and learn about the Commission's ongoing efforts to educate the industry on proper disclosure practices as well as potential enforcement activities.… Continue Reading
Don't miss out on your chance to learn how the FTC's Operation Full Disclosure can affect you. Join us November 18 at 1:00 p.m. ET for the complimentary webinar, "The FTC's Operation Full Disclosure: What You Need to Know." Led by John P. Feldman, partner at Reed Smith LLP, and Michael Ostheimer, staff attorney in the FTC's Division of Advertising Practices, the webinar will cover ways to ensure all ads are complying with the FTC's standards, the latest on the commission's ongoing efforts to educate the industry on proper disclosure practices, and what to expect in the coming months with regard to enforcement.
This webinar is part of a series of complimentary webinars from the ANA Government Relations group focused on legal and regulatory issues currently affecting the marketing community.
For more information or to register visit http://www.ana.net/webinars/show/id/LRE-NOV14.… Continue Reading
Advertisers, read our firm's latest client alert on the FTC's Operation Full Disclosure to learn about what your company can do to meet the FTC's "clear and conspicuous" requirements. Take advantage of this opportunity to closely review and remedy any inadequacies in your advertising disclosures before more aggressive steps are taken by the FTC and the plaintiffs' class action bar.… Continue Reading
Last week, the Federal Trade Commission ("FTC") approved final changes to its Guides for Advertising Allowances and Other Merchandising Payments (the "Guides"), also known as the Fred Meyer Guides. The Guides were originally issued in 1969, and subsequently revised in 1990, to help businesses comply with sections 2(d) and (e) of the Robinson Patman Act (the "Act"). The Act generally prohibits certain forms of price discrimination between suppliers and the merchants who resell their products. Sections 2(d) and (e), which are the focus of the Guides, are designed to prohibit disguised price discrimination in the form of promotional payments or services. In other words, a supplier is prohibited from paying allowances or furnishing services to merchants to promote the resale of the supplier's products, unless the allowances or services are offered to all competing merchants on proportionally equal terms. The Act aims to help small businesses compete against chain stores by prohibiting anticompetitive price discrimination by suppliers, and certain other kinds of business discrimination. In December 2012, the FTC sought public comment on the Guides, and input on the overall costs and benefits and continuing need for the Guides.
In response to the comments solicited, the FTC approved moderate changes to the Guides in order to update them with respect to current technological developments, changes in marketing methods (such as widespread online marketing), and FTC enforcement priorities. The changes also reflect jurisprudential developments since the last revision of the Guides.… Continue Reading
In letters sent to more than 60 companies, including 20 of the top 100 TV and print advertisers in the country, the FTC warned companies to review specific ads to ensure their disclosures are "clear and conspicuous," and that they comply with federal advertising regulations.
In a press release on Tuesday, the FTC explained the initiative - Operation Full Disclosure - as the agency's latest effort to guide companies to follow proper disclosure standards and avoid misleading consumers. Specifically, the agency targeted disclosures made in fine print or that were easy to miss by the average consumer. The FTC explained that disclosures should be in proximity to the claims to which they relate and in easy-to-read font color, size, and style, so consumers have access to all relevant information. For TV ads, disclosures "should be on the screen long enough to be noticed, read, and understood, and other elements in the ads should not obscure or distract from the disclosures."
The FTC is keeping the names of those companies targeted secret in an effort to allow them a chance to adhere to disclosure laws. However, without getting too specific, the agency hinted toward recurring problems. For example, the FTC explained in some ads, "the advertiser claimed that a product was unique or superior in a product category, but did not adequately disclose how narrowly the advertiser defined the category, while other comparative ads did not adequately disclose the basis of their comparisons."… Continue Reading
The Federal Trade Commission held a workshop on September 15, entitled "Big Data: A Tool for Inclusion or Exclusion?" where FTC Commissioner Julie Brill emphasized the push to place more scrutiny on data brokers, reaffirming ideas and objectives expressed in the FTC's May 2014 report on transparency and accountability.… Continue Reading
There has been a proliferation of wearable devices hitting the market, such as Google Glass, Fitbit and others, all with the ability to collect data and track behavior. These "wearables" have begun to receive some scrutiny by senators and regulators, including New York's senior senator Chuck Schumer, who recently urged the FTC to push fitness device and app companies to provide users with a clear opportunity to "opt-out", since personal information may be potentially sold to third parties without the users' knowledge or consent. For additional information on this story, please read the latest post on our firm's Global Regulatory Enforcement Law Blog.… Continue Reading
Last month, Snapchat reached a settlement with the Maryland Attorney General over alleged deceptive trade practices regarding Snapchat's marketing claims that user "snaps" disappear forever. In addition, the Attorney General alleged that Snapchat had violated the Children's Online Privacy Protection Act (COPPA). This settlement follows a similar settlement between Snapchat and the Federal Trade Commission, which we reported on previously.
After announcing the settlement, Attorney General Douglas F. Gansler said that "despite Snapchat's marketing claims to the contrary, no company can fully prevent content you send to someone else from being copied, shared or posted online[.]" Attorney General Gansler went on to state that companies operating online or through mobile devices have a responsibility to safeguard user privacy and to be transparent about the information they collect. According to Attorney General Gansler, Snapchat misrepresented to consumers that pictures and video messages sent using the Snapchat mobile application are only viewable temporarily, when in fact they can be captured by the recipient for future viewing or circulation. As a result of these representations, some Snapchat mobile application users may have sent pictures or video messages they would not have sent were these risks adequately disclosed. The Attorney General further alleged that Snapchat secretly collected information from users' contact lists without their consent, and that Snapchat failed to comply with COPPA by knowingly collecting the personal information of children under the age of 13 without verifiable parental consent.… Continue Reading
Sniffing something fishy in the sea of consumer reviews, the National Advertising Division (NAD) snapped its jaws at advertising claims made in television commercials, infomercials, and on the Web by Euro-Pro Operating for its Shark brand vacuum cleaners. The advertising was brought to the NAD's attention by competing vacuum cleaner manufacturer, Dyson, Inc. The claim at issue was:
"America's Most Recommended Vacuum Brand.*
*Based on percentage of consumer recommendations for upright vacuums on major national retailer websites through August 2013, U.S. Only."
What was special about this case was that Euro-Pro sought to substantiate its "most recommended" claim on aggregated consumer reviews.
The first issue was, what did the claim really mean? Dyson said it meant that the Shark is the most recommended vacuum among vacuum cleaner owners, nationwide, and that the claim communicated a comparative message, namely that the Shark was recommended over other brands. Euro-Pro, on the other hand, thought the claim was as clear as Caribbean water: the Shark is "America's Most Recommended Vacuum Brand" "based on percentages of consumer reviews for upright vacuums on major national retailer websites through August 2013." There was nothing comparative about the statement, according to the advertiser. Interestingly, the NAD tended to side with the advertiser's interpretation, namely that the claim "America's Most Recommended Vacuum Brand*" reasonably conveyed a message that Shark is the most recommended vacuum brand among American vacuum cleaner consumers. However, it interpreted the asterisked second part of the claim to be an explanation of how Euro-Pro sourced the data on which it based its claim. So, the Shark wins, right? Not so fast.… Continue Reading
The FTC released its report "Data Brokers: A Call for Transparency and Accountability", which calls for more transparency and accountability from the companies that collect, resell or share consumers' personal information, generally known as data brokers. While the report mentions some of the benefits of these companies, it strongly emphasizes their associated risks, noting that data brokers often store delicate consumer information, potentially exposing consumers to fraud, theft, and other types of consumer harm. One of the FTC's key findings was that consumers have little access or control over their information once it is provided to data brokers, sparking a call for legislative action for increased transparency and accountability. For more information on this issue, please read the latest post on our Global Regulatory Enforcement blog.… Continue Reading
On May 15, 2014, Maneesha Mithal, Associate Director of the Division of Privacy and Identity Protection at the Federal Trade Commission ("FTC" or "Commission") testified, on behalf of the FTC, before the U.S. Senate Committee on Homeland Security and Governmental Affairs addressing the Commission's work regarding three consumer protection issues affecting online advertising: (1) privacy, (2) malware and (3) data security. Below is a summary of the Commission's testimony regarding these three key areas and the Commission's advice for additional steps to protect consumers.… Continue Reading
Last Thursday, the Federal Trade Commission (FTC) announced that messaging app Snapchat agreed to settle charges that it deceived consumers with promises about the disappearing nature of messages sent through the app. The FTC case also alleged that the company deceived consumers over the amount of personal data the app collected, and the security measures taken to protect that data from misuse and unauthorized disclosure. The case alleged that Snapchat's failure to secure its Find Friends feature resulted in a security breach that enabled attackers to compile a database of 4.6 million Snapchat usernames and phone numbers.… Continue Reading
In a recent letter to shoe retailer Cole Haan regarding its Wandering Sole Pinterest contest, the Federal Trade Commission (FTC) signaled a major change for promotional contests conducted through social media platforms. In the letter, the FTC determined that the Pinterest contest sponsored by the company was a form of product endorsement, subject to Section 5 of the FTC Act, which requires the disclosure of a material connection between a marketer and an endorser when their relationship is not otherwise apparent from the context of the communication that contains the endorsement.… Continue Reading
The FDA recently issued a warning to a Swiss drug company for failing to include on its Facebook page a product's risk information and limitations. Although this type of enforcement activity involving drugmaker conduct on social media has been rather uncommon, it is a stern reminder for companies that the FDA is monitoring activity, and that its marketing and advertising rules apply to product promotion over social media networks as well. For additional information on this story, read the latest post on our firm's Life Sciences Legal Update blog.… Continue Reading
In order to provide consumers with increased information to make well-informed food choices, the FDA announced today a noteworthy overhaul in the presentation of the Nutrition Facts panel on packaged foods. Among the revisions are updates to the display, including font size changes and bolded text, new serving size and nutrient content calculations, and added sugar information. The changes will have implications for the advertising industry, presenting advertisers with the opportunity to capitalize on various nutrition claims. The FDA has invited feedback on the proposed changes and will be accepting comments for 90 days. For more information, please read the recent post on our Life Sciences Legal Update blog.… Continue Reading