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Advertising, Marketing & Promotions Alert >> FTC to Review the Children’s Online Privacy Protection Act - Alert - 08/08/2019

The FTC’s latest COPPA review will not only impact online services that traditionally have been directed to children, but may extend to services that historically have not been considered child-directed, such as interactive television, interactive gaming and chatbots. The COPPA review will also examine whether COPPA should be modified to better address websites and online services that may not meet the current definition of “directed to children” but have a large number of child users, such as social media platforms that are popular with children.

Operators of online services should pay particular attention to the FTC’s COPPA review and the upcoming workshop. Please do not hesitate to contact us if you have any questions or would like Davis & Gilbert’s assistance in filing public comments with the FTC. We will continue to report on the FTC’s review and the workshop as developments warrant.

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NAD >> The NAD Exposes Hidden Fees - Alert - 07/10/2019

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Advertising, Marketing & Promotions Alert >> FDA Public Hearing on the Use of Cannabis and Cannabis-Derived Compounds in Food and Dietary Supplements - Alert - 06/03/2019

  • The FDA is in uncharted territory and has requested additional safety data to assess whether CBD and other cannabis-derived compounds can be safely added to food and dietary supplements.
  • The industry believes that CBD has the potential for significant health benefits, but is open to strong regulations over its use.
  • In order for comments to be considered, they must be submitted to the docket by July 2, 2019.

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Advertising, Marketing & Promotions Alert >> Two Websites Settle FTC Allegations That They Failed to Secure Consumer Data - Alert - 05/21/2019

The security of consumer data is an important priority for the FTC and has become even more important in recent years, particularly when such data is subject to attacks by malicious third parties. The FTC emphasized that both settlements contained “new requirements” going beyond requirements from previous data security orders.

Perhaps even more importantly, the FTC’s statement indicated that the agency has instructed staff to closely review its orders to determine whether they can be strengthened and improved, “particularly in the areas of privacy and data security” and particularly with respect to “data security assessments of companies by third parties.” This suggests that the FTC is likely to continue to bring such actions going forward — and may seek stronger penalties than it has in the past.

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Advertising, Marketing & Promotions Alert >> FTC and FDA Target Advertising of CBD Health Claims - Alert - 05/17/2019

The legalization of hemp is a major step in establishing a potentially significant new industry. However, producers and marketers need to exercise caution when making health-related claims in connection with hemp-based product. The FTC and FDA will continue to aggressively review related advertising to ensure that products are advertised truthfully.

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Advertising, Marketing & Promotions Alert >> FTC Settlement Over Charges of Misleading Consumer Reviews and Deceptive Negative Option Marketing Practices - Alert - 05/10/2019

The FTC continues to take action where it finds that marketers are engaging in misleading incentivized product review practices or enrolling customers in deceptive “free trial” negative option plans without providing the appropriate disclosures and obtaining the consumer’s affirmative consent to the terms of the plan.

Marketers should ensure that they are instructing their customers to adequately disclose any incentives they receive in return for posting product reviews online and that they should not be encouraging any incentivized reviews on websites that prohibit such reviews, including the BBB website. Marketers should also ensure that their “free trial” offers comply with the Restore Online Shoppers Confidence Act and other laws governing “free trial” negative option marketing plans.

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Advertising, Marketing & Promotions Alert >> FTC Plans Workshop on ‘Loot Boxes’ - Alert - 04/11/2019

A strong push has come forth from the likes of Senator Hassan, other legislators, the FTC and consumer lawsuits regarding consumer protection issues related to “loot boxes” in video games. This year may see efforts at regulating loot boxes move forward to the extent they have not done so to date, as the FTC prepares for its workshop on August 7, 2019.

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Advertising, Marketing & Promotions Alert >> Video Social Networking App Agrees to Pay $5.7 Million to Settle FTC’s COPPA Action - Alert - 03/25/2019

The sheer size of the Musical.ly settlement illustrates that the FTC continues to have a strong interest in enforcing COPPA. Online services cannot hide behind language in their terms and conditions claiming not to be child-directed when they include numerous activities that appeal to children and have actual knowledge they have collected personal information from children in violation of COPPA. Notably, this case came as a referral from the Children’s Advertising Review Unit (CARU), the children’s arm of self-regulation, thereby demonstrating the importance of self-regulation unless companies are willing to face significant regulatory penalties in the future.

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Advertising, Marketing & Promotions Alert >> FTC Brings First Action Against Company for Posting Fake Reviews - Alert - 03/12/2019

It should come as no surprise to companies that they should not be purchasing or posting fake reviews of their products as a way to improve sales to customers. The action against Cure Encapsulations and its owner shows that the FTC is interested in taking action to halt the publication of fictitious product reviews on retail websites such as Amazon.com. That’s another set of eyes watching and seeking to prevent companies from acting in this fashion.

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Advertising, Marketing & Promotions Alert >> FTC and FDA Sent Warning Letters to Companies Advertising Products that Claim Treatment of Disease - Alert - 03/07/2019

The FTC and FDA are aggressively reviewing companies’ websites and social media channels for false or unsubstantiated health claims and efficacy claims. Advertisements on company websites and in social media posts must avoid false or unsubstantiated health claims, and efficacy claims made for dietary supplements and other health-related products must be supported by competent and reliable evidence. Companies advertising these kinds of items should review their promotional materials with these letters in mind.

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Advertising, Marketing & Promotions Alert >> As More States Legalize Marijuana, Advertising and Marketing Regulations Come Into Focus - Alert - 02/14/2019

The advertising opportunities in this evolving industry are hard to ignore. However, with more opportunities comes more confusion, as state advertising regulations differ and the conflicts with the federal government become increasingly complicated. All participants in the industry, including media providers, marijuana brands, agencies and ad tech companies, need to analyze and evaluate their position and activities in the marketplace and those in California specifically need to comply with the new set of rules.

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Advertising, Marketing & Promotions Alert >> New York and Florida AGs Settle Charges with Seller of Fake Social Media Accounts and Engagements - Alert - 02/13/2019

Brands, marketers, and their agencies typically have the most to lose due to fraudulent social media traffic, in the form of wasted marketing dollars spent appealing to non-existent users. However, these settlements made clear that such practices also harm consumers and social media users.

In the past, the Federal Trade Commission has been the most active in policing fraudulent social media activity, but these settlements mark an increased willingness by state attorneys general to jump in the mix to protect consumers and may result in other states following New York and Florida’s lead in policing social media practices.

This enforcement action was announced within the first month of both Attorney General James’ and Attorney General Moody’s time in office, and offers a glimpse into both of their enforcement priorities.

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Advertising, Marketing & Promotions Alert >> Mastercard Announces New Free Trial Rules for Merchants - Alert - 02/06/2019

Companies that engage in negative option and subscription-based marketing must comply with various federal and state laws governing their practices. The proposed Mastercard rules will add another set of requirements to this compliance landscape. Marketers should prepare to comply with the Mastercard requirements once they are more clearly defined and go into effect (reportedly in April).

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Davis & Gilbert Elects a New Counsel - Press Release - 01/17/2019

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Advertising, Marketing & Promotions Alert >> The FTC's "Reasonable Basis" Standard Has Evolved for Disease Efficacy Claims - Alert - 01/09/2019

The FTC made it clear many times in 2018 that disease efficacy claims must be supported by competent and reliable scientific evidence, including human clinical testing, and that expert opinions will help guide the kind of human clinical testing and the number of RCTs that is acceptable to the FTC. Advertisers making disease efficacy claims in 2019 must make sure that they have the appropriate support in hand, before they go public with their campaigns.

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Advertising, Marketing & Promotions Alert >> Celebrity Endorsers of Initial Coin Offerings Settle with Securities and Exchange Commission - Alert - 12/20/2018

Celebrities not only need to comply with the FTC Endorsement Guides but also need to comply with the SEC’s disclosure rules when endorsing ICOs, or risk facing charges similar to those brought against Khaled and Mayweather.

These recent charges reflect the SEC’s concern around the increased popularity of cryptocurrency, the prevalence of fraud, and the importance of endorsement disclosures in this area.

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Advertising, Marketing & Promotions Alert >> New York Attorney General Reaches Record COPPA Settlement with AOL  - Alert - 12/10/2018

The AOL settlement – which requires AOL to pay the largest COPPA penalty ever to date – is the most recent instance in which the New York Attorney General’s Office has sought to enforce COPPA. While most ad tech industry members have long known that behavioral advertising cannot be targeted to children under 13, problems obviously still exist.

In announcing the settlement, New York Attorney General Barbara Underwood said her office “remains committed to protecting children online and will continue to hold accountable those who violate the law.” Her statement should serve as a forceful reminder of the need for operators, advertisers and ad networks to comply with COPPA or risk becoming the subject of an expensive enforcement action.

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Advertising, Marketing & Promotions Alert >> FTC Brings Action Against PR Agency and Publisher For Misleading Online Endorsements and Deceptively Formatted Advertising - Alert - 11/27/2018

The FTC is, once again, making it clear that all involved parties have a duty to comply with the FTC’s rules regarding paid endorsements and native advertising practices – and that it is equally willing to take action against agencies and publishers when they violate these rules. Failing to comply with these FTC requirements could expose an agency, the associated publisher, and even their owners, officers and directors in their individual capacities, to significant liability.



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