FTC Tightens the Noose Around Accomplices to False Advertising

For years now, the Federal Trade Commission has been expanding the wheel of liability for deceptive advertising practices outward, from the advertising merchant at the hub to the various entities on the spokes that make the wheel move.  As documented in this space, the campaign has ensnared numerous victims, from accomplices to deceptive telemarketing schemes who have explicit aiding and abetting liability under the FTC’s Telemarketing Sales Rule, to service providers in non-telemarketing cases for which, under the FTC Act, the legal basis for aiding and abetting liability is far less clear.  (See, e.g., “FTC’s ‘Duty of Inquiry’ for Non-Marketers Gets a Judicial Boost,” July 2013; “Does the FTC Have Legal Authority Over Affiliate Networks,” July 2014.)  Targets have ranged from affiliate marketers to affiliate marketing networks to payment processors, and even to a product owner who had no role in or authority over advertising for the product.  Online merchants, likewise, have settled charges of legal responsibility based on theories of agency or vicarious liability for the deceptive behavior of their affiliates. (See, e.g., “FTC Orders Super-Policing of Affiliates,” March 2012.) Continue with this post…

FDA Moves Against CBD Marketers Again. Is the FTC Next?

In “Negative Option Remains Prime Enforcement Target at Trump FTC”, I closed with this question after observing that overly bold continuity marketers were still in the Federal Trade Commission’s (FTC) crosshairs and playing a dangerous game: “Who will be next? Don’t be surprised if it’s an internet seller of controversial, cannabis-derived CBD, offers of which are exploding online and were the ‘talk of the show’ at Affiliate Summit” last August. Similarly, the most heavily attended session at last month’s ADSUM summit was a presentation on CBD marketing and the risks, as well as opportunities, it presents. Continue with this post…

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…

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