On October 16, the Federal Trade Commission (“FTC”) announced a final “click-to-cancel” rule that amends the previous Negative Option Rule to “make it as easy for consumers to cancel their enrollment as it was to sign up.” The Rule also imposes extensive requirements regarding misrepresentations, disclosures, and consent, among others. Most of the provisions will go into effect 180 days after publication in the Federal Register. As of today, the final rule has not yet been published. This final rule is the culmination of a five-year proceeding including the FTC’s issuance of a notice of proposed rulemaking (“NPRM”) in March 2023 and an advanced notice of proposed rulemaking in October 2019. We previously analyzed the proposed rule presented in the NPRM.Continue Reading FTC Issues Final “Click-to-Cancel” Rule
FTC Issues Final Rule on Reviews and Testimonials
On August 14, the FTC announced a final rule that, according to the FTC, is intended to “combat fake reviews and testimonials.” The rule will go into effect on October 21, 2024. This final rule is the culmination of the FTC’s issuance of an advance notice of proposed rulemaking (ANPRM)
Continue Reading FTC Issues Final Rule on Reviews and TestimonialsFTC Reaches Settlement with NGL Labs Over Children’s Privacy & AI
On July 9, 2024, the FTC and California Attorney General settled a case against NGL Labs (“NGL”) and two of its co-founders. NGL Labs’ app, “NGL: ask me anything,” allows users to receive anonymous messages from their friends and social media followers. The complaint alleged violations of the FTC Act, the Restore Online Shoppers’ Confidence Act (ROSCA), the Children’s Online Privacy Protection Act (COPPA), and California laws prohibiting deceptive advertising and prohibiting unfair and deceptive business practices.Continue Reading FTC Reaches Settlement with NGL Labs Over Children’s Privacy & AI
FTC Proposes New Rulemaking Focused on Reviews and Testimonials
On June 30, the FTC announced that it had issued a new notice of proposed rulemaking that addresses fake reviews and testimonials. The rule prohibits practices the Commissioners have identified as problematic in public statements for the past several years. For instance, when announcing the review of the Endorsement Guides over a year ago, Chair Khan noted that “consumers’ increasing reliance on online reviews can also incentivize advertisers to harness fake reviews, suppress negative reviews, and amplify positive ones.” The proposed rule covers a variety of topics including fake reviews, review hijacking, purchasing reviews, employee reviews, review suppression, and the use of fake indicators of social media influence. Several of the new provisions track principles set forth in prior FTC cases, or target specific practices previously identified in the Endorsement Guides. Below we’ve summarized the requirements in the proposed rule. The NPRM will be open for public comment for 60 days once it is posted in the federal register. As of today, it has not yet been posted.Continue Reading FTC Proposes New Rulemaking Focused on Reviews and Testimonials
FTC Proposes to Rewrite Negative Option Rule with Expansive Notice of Proposed Rulemaking
On March 23, the Federal Trade Commission (“FTC”) announced a notice of proposed rulemaking that would significantly revise the legal framework governing automatically renewing subscriptions. The proposal would amend the FTC’s existing Negative Option Rule to provide specific disclosure, consent, and cancellation requirements applicable to all negative options in all media. The Rule would formalize many of the guidelines from the FTC’s October 2021 Enforcement Policy Statement Regarding Negative Option Marketing (“Policy Statement”) and incorporate new requirements not previously addressed at the federal level such as renewal reminders. Continue Reading FTC Proposes to Rewrite Negative Option Rule with Expansive Notice of Proposed Rulemaking