The FTC says no! Specifically, the FTC said: “terms like “Thank you,” “#partner,” and “#sp” aren’t likely to explain to people the nature of the relationship between an influencer and the brand.” Before now, I might have approved the use of #partner in the right context. But last week, the FTC sent letters to over 90 influencers (athletes, celebrities, etc.) reminding them of their obligation to disclose if they are being paid to post or otherwise have a relationship with a company/brand mentioned in their post. Letters were also sent to marketers to remind them of their obligations in this arena. The letters warn of the wrong way to make these disclosures (e.g., don’t make the disclosure after a “more” button in a post, don’t make the disclosure within a string of unrelated hashtags, don’t make the disclosure vague – no #sp or “thank you”). Below are links to samples of the letters the FTC sent to influencers and marketers regarding improper/proper material connection disclosures. And check out our other posts that explain related compliance obligations when engaging influencers: HERE and HERE.
Last week, the New York Attorney General’s Office announced that it had entered into a settlement with privacy compliance company TRUSTe, signaling the AG’s continuing interest in children’s privacy and potentially portending an uptick in state-level enforcement under the Children’s Online Privacy Protection Act (“COPPA”).
TRUSTe operates an FTC-approved safe-harbor program for online services subject to COPPA. As an approved safe-harbor provider, TRUSTe is required to conduct annual audits of its clients’ online services to assess compliance with its program requirements. According the the New York Attorney General, TRUSTe’s assessments failed to adequately address the presence of third-party tracking technologies prohibited on child-directed sites under COPPA. Continue Reading
What Have Retailers Been “Up To” In New Jersey?
The last few years have been quite interesting for retailers, with a number of different pricing and advertising related legal issues coming to the forefront. Recently, another new front in this battle opened in New Jersey where a national clothing retailer became the subject of a class action related to its discount price advertising. This time the claim relates to a seemingly tried and true method of retail advertising– the use of “Up To X % Off” promotional messaging. This also marks the next chapter in our on-going discussion of “Up To” claims.
The suit, filed against JoS. A. Bank Clothiers, Inc., alleges that the retailer did not adequately display the minimum percentage of savings to customers when it used an “Up to 70 Percent Off” message and other similar messages in its advertising. The plaintiff, Michael Leese, alleges that this type of message violates New Jersey’s consumer protection laws, which require advertisements to state the minimum percentage of savings just as conspicuously as the maximum percentage of savings.
2017 is starting to look like the year of DIY content creation and distribution. Companies are becoming their own studios and broadcasters at a seemingly record pace. If your organization doesn’t already have its own channel or stream, there’s a good chance someone is at least considering making it happen. We work hand in hand with clients as they move into this space, and here are some important things to take note of and plan to address:
InfoLawGroup is pleased to announce that Eric J. Anderson has joined the firm as a Partner. Prior to joining InfoLawGroup, Mr. Anderson served for several years as head marketing and advertising counsel for Sears Holdings Corporation.
Eric has extensive experience advising on marketing, advertising, digital, mobile and e-commerce initiatives. Eric also regularly negotiates a wide variety of contracts affecting those initiatives, including agency and vendor agreements, sponsorship and celebrity spokesperson agreements, master services agreements, influencer agreements and the underlying tech agreements. From claim substantiation to privacy to navigating the compliance maze for multi-platform digital campaigns, Eric’s practice is expansive and fits right into what InfoLawGroup is called upon to address for its clients on a daily basis.
Eric is located in the firm’s Chicago office. He looks forward to continuing to speak and conduct training sessions on various topics affecting advertising and promotions, including loyalty programs, coupons, rebates, sports and entertainment sponsorships, branded entertainment and pricing and sale frequency issues.
InfoLawGroup announces the launch of CPO on Demand™, a service through which we serve as outside Chief Privacy Officers, Privacy Counsel, and DPOs as required under EU regulation. CPO on Demand™ brings the depth and breadth of our privacy and security focused attorneys to support your business’s legal, compliance, and privacy teams. Please click here for more information or contact Justine Young Gottshall or anyone on the InfoLawGroup team to discuss how we can help bring privacy and security compliance to your organization.
On Monday, February 6, 2017, the Federal Trade Commission (“FTC”) and New Jersey Attorney General (“NJAG”) announced a settlement agreement to resolve their joint enforcement action against Vizio. The regulators claimed that Vizio collected detailed information about the content consumers watched (including identifying the content and advertisements viewed through broadcast and cable networks, DVDs, and over-the-top streaming devices), enhanced the viewing information with device identifiers (e.g., IP addresses and MAC addresses) and demographic data (including gender, age, income, household size, and marital status), and disclosed this information to third parties for their own uses, including targeted advertising.
In January, a California federal court dismissed a TCCWNA claim against Facebook upon finding that the California choice-of-law provision in Facebook’s Terms of Service was enforceable. Palomino v. Facebook, Inc., No. 16-cv-04230, 2017 WL 76901 (N.D. Cal. Jan. 9, 2017). The plaintiffs – Facebook users representing a purported class – claimed that Facebook’s Terms violated the TCCWNA by, among other things, disclaiming liability for negligence and misconduct, barring recovery of certain types of damages, and indicating that some limitations on liability may not apply in all jurisdictions without specifying whether they apply to New Jersey residents. (Because the Palomino court found Facebook’s choice-of-law provision enforceable, it did not have to reach the issue of whether provisions like this actually violate the TCCWNA – a question that remains open in other pending cases.)
California uses a two-factor test for evaluating the enforceability of a choice-of-law provision. “The Court must first determine (1) whether the chosen state has a substantial relationship to the parties or their transaction, or (2) whether there is any other reasonable basis for the parties’ choice of law.” If either factor is satisfied, the court will enforce the choice-of-law provision unless the party asserting that another state’s law should apply “can establish both that the chosen law is contrary to a fundamental policy of the alternate state and that the alternate state has a materially greater interest in the determination of the particular issue.”
Facebook being headquartered in California, it easily satisfied the first criterion. The burden then shifted to the plaintiffs to “show that application of California law would violate fundamental New Jersey policy.” The Court, relying on California’s own expansive consumer protection laws, held that the plaintiffs failed to make such a showing. The Court found that California law was not contrary to fundamental New Jersey policy because “the TCCWNA and California consumer protection law aim to accomplish the same end,” notwithstanding that application of the TCCWNA may have “afford[ed] different rights and remedies.”
While this is undoubtedly good news for website operators that are based outside of New Jersey and that include a non-NJ choice-of-law provision in their terms, we caution against too broad a reading at this stage. The Palomino court clearly relied on California’s status as the gold standard in consumer protection laws, specifically referencing its false advertising and deceptive practices laws, as well as its Consumer Legal Remedies Act. It is not clear whether a court asked to apply a choice-of-law provision from another state would necessarily reach the same conclusion as in Palomino.
The Federal Trade Commission (“FTC“) announced today that it has filed a lawsuit against D-Link alleging that it made deceptive claims about its products’ security and engaged in unfair practices that placed consumers’ privacy at risk. The Complaint For Permanent Injunction and Other Equitable Relief was filed in the United States District Court Northern District of California San Francisco Division, naming the Taiwanese D-Link Corporation and its California subsidiary D-Link Systems, Inc. as defendants. The FTC claims that D-Link failed “to take reasonable steps to secure the routers and Internet-protocol cameras they designed for, marketed, and sold to United States consumers.” In response to the charges, D-Link posted on its website a “FTC Complaint Q&As” in which it summarizes “D-Link Systems, Inc. is aware of the complaint filed by the Federal Trade Commission on January 5, 2017. D-Link Systems denies the unwarranted allegations outlined in the FTC complaint and will vigorously defend the action.” Continue Reading
The Copyright Office recently introduced changes to the process by which online service providers can designate an agent under the Digital Millennium Copyright Act (“DMCA”). To qualify for DMCA safe-harbor protections, service providers are required to maintain with the Copyright Office contact information for an agent designated to receive takedown notices. The changes, which go into effect on December 1, 2016, are part of the long-awaited transition to an electronic system for submitting these “Designation of Agent” filings.
Below is a quick look at some of the more significant changes. (A complete discussion of all changes is set out in the Copyright Office’s “Designation of Agent To Receive Notification of Claimed Infringement” Final Rule, available here.)
(a) Existing Designation of Agent Filings Must be Re-filed by 12/31/17. For online service providers (e.g., website and app operators) who currently have a Designation of Agent on file, the most notable change is the need to refile. Under the existing system, a Designation of Agent would remain valid in perpetuity, until replaced or affirmatively withdrawn. As part of the transition to an electronic system, all online service providers that previously filed a Designation of Agent with the Copyright Office will need to refile electronically between December 1, 2016, and December 31, 2017. (Existing paper filings will remain valid until either replaced electronically or January 1, 2018, whichever comes first.)
(b) Filings Must Be Renewed Every Three Years. The Copyright Office will now require that a service provider refile its Designation at least once every three years. Service providers will need to heed these renewal deadlines or risk losing their safe-harbor protection. (The Copyright Office has indicated that the new electronic system will be set up to send reminder emails as the renewal deadline approaches.)