In September, FTC Chairman Andrew Ferguson called for the FTC to regulate artificial intelligence claims through its existing consumer protection authorities: “Imposing comprehensive regulations at the incipiency of a potential technological revolution would be foolish. For now, we should limit ourselves to enforcing existing laws against illegal conduct when it involves AI no differently than when it does not.” Two recently announced enforcement actions involving artificial intelligence underscore the new FTC leadership’s commitment to evaluate AI claims under traditional deception frameworks. Continue Reading FTC Challenges Deceptive Artificial Intelligence Claims
Laura Kim
Laura Kim has a proven track record of successfully resolving clients’ most important consumer protection matters before the FTC, State AGs, and the NAD. She is well-known for her insider knowledge of the FTC as well as her practical approach to accomplishing her clients’ objectives.
As chair of Covington’s Advertising & Consumer Protection Investigations practice group, Laura represents corporate and individual clients in investigations before the FTC and State Attorneys General. She also provides pragmatic compliance advice on a wide range of consumer protection issues, including substantiating claims involving generative artificial intelligence, environmental benefits, and “Made in USA.” She counsels brands on emerging issues involving influencers, consumer reviews, AI-generated content, and subscription autorenewals. Laura regularly represents both challengers and advertisers before the NAD, achieving favorable outcomes in matters involving artificial intelligence, influencers, and claim substantiation.
During her twelve-year tenure at the FTC, Laura served as Assistant Director in two divisions of the Bureau of Consumer Protection, Attorney Advisor to Chairman William E. Kovacic, and Chief of Staff to Bureau Director Jessica Rich. She oversaw major rulemakings—including the Green Guides and the Telemarketing Sales Rule—and supervised dozens of investigations and enforcement actions. As Assistant Director in the Division of Enforcement, Laura also supervised compliance monitoring and enforcement proceedings for companies under federal court or Commission order.
FTC Delays Negative Option Rule Compliance Date to July 14
On May 9, 2025, the FTC announced that it is deferring the compliance deadline for the Negative Option Rule by 60 days to July 14. This announcement came five days before the original compliance date for the majority of the Rule’s provisions. All three Commissioners voted in favor of the deferral.Continue Reading FTC Delays Negative Option Rule Compliance Date to July 14
FTC Staff Paper Finds Most “Smart” Products Manufacturers Fail to Disclose How Long They Will Provide Software Updates
In late November, the Federal Trade Commission (“FTC”) released a staff perspective paper (“the Paper”) detailing the results of an FTC study that surveyed 184 “smart” devices, ranging from smartphones to hearing aids to door locks, to determine whether manufacturers disclose how long they provide software updates for their products and related apps. Without such updates, according to the Paper and the corresponding press release, these products “may lose their ‘smart’ functionality, become insecure, or completely cease to operate.”Continue Reading FTC Staff Paper Finds Most “Smart” Products Manufacturers Fail to Disclose How Long They Will Provide Software Updates
FTC Issues Final “Click-to-Cancel” Rule
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 Returns to Bipartisan Commission with Confirmation of Two New Republican Commissioners
On Thursday, March 7, 2024, the U.S. Senate confirmed two nominees for the open seats on the Federal Trade Commission: Andrew N. Ferguson, former solicitor general of the Commonwealth of Virginia; and Melissa Holyoak, former solicitor general with the Utah Attorney General’s Office. With this confirmation of two new Republican Commissioners, the FTC is one step closer to a full slate of five bipartisan Commissioners. The Senate also re-confirmed Commissioner Rebecca Kelly Slaughter for a second term. President Biden had nominated Ferguson and Holyoak on July 11, 2023, and renominated Slaughter on February 13, 2023. Continue Reading FTC Returns to Bipartisan Commission with Confirmation of Two New Republican Commissioners
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
FTC Relies on ROSCA and Notices of Penalty Offenses to Police Deceptive Conduct in Settlement with WealthPress
On January 13, the FTC announced a settlement with WealthPress, an online service provider that recommends trades in financial markets. The settlement resolved allegations that WealthPress violated both the Restore Online Shoppers’ Confidence Act (ROSCA) and Section 5 by making false and misleading claims about how much consumers could earn with the company’s trading recommendation services. The action is noteworthy for two reasons. First, building upon the FTC’s prior MoviePass settlement, the FTC’s ROSCA allegations focus not on the terms of the subscription service offered, but rather on the failure to clearly disclose material information about the company’s services. Second, this is the FTC’s first settlement imposing civil penalties for alleged earnings claims violations predicated upon a Notice of Penalty Offenses issued in October 2021. The settlement provides for $1.3 million in consumer redress, $500,000 in civil penalties, and injunctive relief.Continue Reading FTC Relies on ROSCA and Notices of Penalty Offenses to Police Deceptive Conduct in Settlement with WealthPress