Key Takeaways:
FTC Finalizes Updated Guidance for Influencer and Consumer Review Programs
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
FTC’s Secures $18.5 Million Settlement With Publishers Clearing House for Alleged Dark Pattern Sweepstakes Tactics
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.
INFORM Act Addresses Online Marketplace Transparency With Harsh Penalties for Noncompliance
Key Update:
- The Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers Act (INFORM Act or the Act) aims to increase transparency in online transactions and discourage the sale of stolen, counterfeit, or unsafe items through online marketplaces.
- Online marketplaces must comply with key requirements in the Act by June 27, 2023, to avoid penalties for noncompliance.
Old Navy Faces Lawsuit for Allegedly Creating False Sense of Urgency in Sales Emails
Key Update:
FTC Proposes New Rules for Subscription Services—Public Comments Now Open!
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
Another Round of Notice of Penalty Offenses—The FTC Targets Health Claims
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
National Advertising Division Expands Fast-Track SWIFT Process for 2023
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
FTC To Hold Workshop on “Recyclable” Claims as Part of Continuing Green Guides Review
As part of its assessment of the Guidelines for the Use of Environmental Marketing Claims (Green Guides), the Federal Trade Commission (FTC) will hold a workshop on May 23, 2023, to consider “recyclable” advertising claims and issues related to environmental claims. The workshop is titled “Talking Trash at the FTC: Recyclable Claims and the Green Guides.”
FTC Settlement With NutraClick Reimburses Customers Nearly $1 Million for Recurring Subscription Practices
Key Update:
- The Federal Trade Commission (FTC) has used a $1 million settlement with NutraClick to reimburse customers who allegedly believed they were receiving free products but were actually enrolled in an unwanted monthly subscription program.