Key Takeaways:

  • Experian Consumer Services, operating as, agreed to pay a $650,000 civil penalty for alleged violations of the CAN-SPAM Act by sending marketing emails without an opt-out option.
  • This settlement serves as a reminder that all marketing emails must contain an opt-out and that the Federal Trade Commission (FTC) will use its enforcement tools to protect consumers from violations of the CAN-SPAM Act.

Under the CAN-SPAM Act, brands must provide a way for consumers to opt out of commercial email messages. However, according to a complaint filed by the U.S. Department of Justice (DOJ) on behalf of the FTC, Experian sent marketing emails without explicit opt-out instructions. Further, some emails included a message at the bottom of these emails stating that they are being sent because they contain important account information, when, in reality, the emails promoted Experian’s products or services.

In addition to the $650,000 fee, the proposed order prohibits Experian from sending commercial emails that do not include an opt-out option. The FTC’s press release emphasized that signing up for services should not result in unwanted marketing communications that do not contain a right to unsubscribe. The FTC’s pursuit of CAN-SPAM violations underscores that brands should check their emails to ensure compliance with the CAN-SPAM Act.

The Federal Trade Commission recently finalized updates to its Guides Concerning the Use of Endorsements and Testimonials in Advertising, which address the FTC’s latest thinking about how the truth-in-advertising standards under the FTC Act apply to endorsement and review-related issues.

The updated Guides expand or clarify guidance related to (1) who can be considered an endorser, what qualifies as an endorsement, and who can be liable if the endorsement is deceptive; (2) consumer review practices; (3) what counts as “clear and conspicuous” for endorsement disclosures; and (4) when and how to disclose paid and other material connections between brands and endorsers.

Click here to read the full Update.

Key Update:

  • Publishers Clearing House (PCH), a direct marketing company known for its sweepstakes, has agreed to pay $18.5 million as part of a settlement with the Federal Trade Commission (FTC).
  • The settlement follows allegations of deceptive practices, such as the use of “dark patterns” to encourage sweepstakes entries and purchases.
  • As part of the settlement, PCH agreed to redesign its user interface in order to avoid confusion and ensure transparency.
Continue Reading FTC’s Secures $18.5 Million Settlement With Publishers Clearing House for Alleged Dark Pattern Sweepstakes Tactics

Key Update:

  • Online marketplaces must comply with key requirements in the Act by June 27, 2023, to avoid penalties for noncompliance.
Continue Reading INFORM Act Addresses Online Marketplace Transparency With Harsh Penalties for Noncompliance

After sharing its initial proposals on videoconferencing platform accessibility (described in our previous blog post), on June 8, 2023, the Federal Communications Commission (FCC) voted to require videoconferencing platforms to comply with accessibility requirements under the Communications Act and agency rules governing interoperable videoconferencing services (IVCS). The corresponding Report and Order (R&O) was released on June 12, 2023, as well as a Notice of Proposed Rulemaking (NPRM) that seeks, among other things, to amend the FCC’s rules to better define the steps necessary to make an IVCS accessible to those with disabilities. The FCC also issued a separate Order granting telecommunications relay services (TRS) providers a limited waiver of the video relay services (VRS) privacy screen rule, which limits when VRS users can turn off their video when not actively participating in a video conference.

Continue Reading FCC Requires That Videoconferencing Platforms Comply with Accessibility Requirements

Key Update:

  • Washington consumers filed a proposed class-action lawsuit against Old Navy, accusing the retailer of sending customers emails with incorrect information regarding the duration of promotions and sales.
  • The emails allegedly advertised that products were on sale for a limited time or that discounts were available for a last-chance offer, when in fact, the sales continued beyond those time frames.

According to the complaint, Old Navy sent emails indicating that customers had a final opportunity to receive a discount. However, the plaintiffs claim that they received emails the next day promoting the same discount. The plaintiffs complain that the emails contained images of ticking clocks and phrases urging recipients to act quickly, even when there was no genuine urgency.

The plaintiffs claim that Old Navy’s actions violate both the Consumer Protection Act of Washington and the state’s Commercial Electronic Mail Act. They are suing for $500 in statutory damages for each email that violates the latter.

The FTC has expressly stated that creating a false sense of urgency is a form of dark patterns.

On May 16, 2023, Federal Communications Commission (FCC) Chairwoman Jessica Rosenworcel announced that she shared proposals with her fellow commissioners that would, for the first time, require videoconferencing platforms to comply with accessibility requirements under the Communications Act and agency rules governing interoperable videoconferencing services.

Among other things, Chairwoman Rosenworcel’s proposals would (1) treat “interoperable videoconferencing services” as providers of advanced communications services, subjecting them to certain accessibility requirements (including recordkeeping and certification obligations) under the Twenty-First Century Communications and Video Accessibility Act (CVAA) and the FCC’s rules; (2) amend the FCC’s rules to add accessibility performance objectives for videoconferencing platforms, including text-to-speech capabilities; speech-to-text (captioning) capabilities; and American Sign Language (ASL) support; and (3) conditionally waive, for one year, a rule that limits video relay service (VRS) users’ ability to turn off their video when not actively participating in a videoconference.

In sharing these proposals, Chairwoman Rosenworcel explained that while videoconferencing has played an important role in consumers’ lives since the pandemic, it remains difficult for many people with disabilities to effectively use videoconferencing platforms. It is unclear whether (and if so, when) the FCC will take official action on the proposals, and whether the proposals may be further modified prior to publication (to the extent the FCC takes that route). Nevertheless, given the chairwoman’s keen interest in this issue and parallel efforts in Congress to extend accessibility requirements to videoconferencing platforms, providers of videoconferencing services should be prepared to take steps in the near term to integrate accessibility support into their platforms.

The FTC published the proposed Negative Option Rule (Rule) to the Federal Register on April 24, 2023, with the goal of preventing unfair and deceptive practices related to recurring subscriptions for products and services. The FTC has invited the public to comment on proposed changes to the Rule. Written comments must be submitted by June 23, 2023.

See our blog for more information about the proposed Rule.

Key updates:

  • Under its Penalty Offense Authority, the Federal Trade Commission (FTC) warned almost 700 marketers with a Notice of Penalty Offenses (Notice) that certain advertising claims must be proven or substantiated with reliable evidence, especially those related to health products, or they may face civil penalties.
  • Advertisers should have a reasonable basis for health claims, including complying with recognized scientific standards when making claims about the effectiveness of their products in curing, mitigating, or treating significant conditions such as cancer or heart disease.
  • The Notice comes on the heels of the FTC updates to Health Products Compliance Guidance (the Health Guides) and indicates the FTC continues to scrutinize health claims.
Continue Reading Another Round of Notice of Penalty Offenses—The FTC Targets Health Claims

Key Update:

  • The National Advertising Division (NAD) updated its Fast-Track SWIFT process (Single Well-defined Issue Fast Track) to accommodate “implied” claims as long as they are clear cut and involve a single issue.
  • In 2020, the NAD launched its Fast-Track SWIFT resolution process, promising to resolve single-issue cases within 20 business days (as opposed to approximately three months in a standard NAD case). For an overview of the process, see our blog.

Previously, the SWIFT track was only used for express claims, and NAD frequently rejected SWIFT treatment for challenges to implied claims. The process, however, is now expanded to include “misleading express and implied claims.” NAD hopes that by making the change it will reduce the number of disputes over SWIFT jurisdiction that revolve around whether the contested claim is express or implied.

Continue Reading National Advertising Division Expands Fast-Track SWIFT Process for 2023