FTC Suffers New Setback in RCT Crusade

The Federal Trade Commission’s (FTC) relentless push to establish a legal requirement of drug-level testing for dietary supplements, initiated by the pro-regulatory Obama FTC, appears to be continuing unabated under the supposedly more deregulatory policies of the Trump Administration and its acting FTC head, Maureen Ohlhausen. Depending on one’s perspective, the success of this effort has been “one step forward, two steps back” – or vice versa. Continue with this post…

Congress Codifies ‘Gag Order’ on Consumer Review ‘Gag Clauses’

In an October 2015 post – “FTC Obtains ‘Gag Order’ Against ‘Gag Clauses’” – I wrote about a Federal Trade Commission enforcement action that shut down Roca Labs (RL), a weight-loss supplement company, for deceptive advertising and for sneakily inserting a “gag clause” in its terms and conditions intended to shut up unsatisfied customers from sharing their experiences with other consumers in user comments and reviews. The clause read, in pertinent part: Continue with this post…

Negative Option Remains Prime Enforcement Target at Trump FTC

When Acting Federal Trade Commission (FTC) Chair Maureen Ohlhausen – who nine months into the Trump administration perhaps can claim the title of de facto permanent chair – took over the reins of the agency, she announced that after years of hyper-regulation by the Obama FTC, she would be returning the Commission to its core mission of traditional, bipartisan fraud enforcement, with actual consumer harm to serve as a prime guidepost in case selection. Included in the types of “fraud” (loosely defined since standard fraud elements, such as intent to deceive and actual reliance, don’t have to be proven by the FTC) she could be expected to target would be negative option offers, which are deceptive when they induce consumers through a “free trial” or low-cost initial fee to make a “continuity” purchase without being told there will be recurring charges unless they cancel. Continue with this post…

Does the FTC Have the Legal Right to Take Your Money After All?

What makes the Federal Trade Commission (FTC) so feared among direct response and online marketers? It’s not a tough injunction or even a ban on involvement with a particular product category or marketing technique, though they certainly aren’t “pleasant” and can cramp a company’s competitiveness and bottom line. No, the answer, in a word, is money – the power to force someone to disgorge all “unjust gains” from an allegedly unfair or deceptive business practice. The FTC has been cold-bloodedly ruthless and enormously effective in the application of this power, having extracted hundreds of millions of dollars from defendants in just the past few years.

Continue with this post…

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