The Federal Trade Commission has traditionally responded forcefully to public health and economic crises, and it is doing so again in response to the coronavirus pandemic.  The current crisis does present some additional complications, however, because of its impact on the operations of the agency itself.  Three particular aspects of the FTC’s consumer protection-related response stand out: (1) continuation of the agency’s scrutiny of false and deceptive product claims that seek to capitalize on the fears of consumers, (2) signs that the agency will work with businesses to accommodate the special pressures of the crisis, and (3) continuation but postponement of other, non-enforcement activities.

The FTC’s first consumer protection priority in response to the coronavirus pandemic has been to focus on especially egregious marketing scams that target particularly vulnerable populations.  The FTC has already issued a number of warning letters to sellers of supposed COVID-19 cures ranging from tea to edible silver and to voice over internet protocol (“VoIP”) service providers facilitating illegal coronavirus-related calls.  Fraud reports continue to rise rapidly: the FTC has received 7,800 coronavirus-related complaints this year, and almost half of these were filed in the last week.

In addition to enforcement, the FTC is also prioritizing working with businesses that provide goods and services necessary to respond to COVID-19.  While FTC Chairman Joe Simons has emphasized that the FTC “will not tolerate businesses seeking to take advantage of consumers’ concerns and fears” regarding coronavirus, he also emphasized that the Commission will be “flexible” in enforcing compliance requirements that may hinder the production of important goods and services.  Simons further noted that the FTC is “ready to assist” businesses with guidance on compliance and consumer protection issues during this uncertain time.

As enforcement and guidance take priority in these extraordinary circumstances, the FTC has de-emphasized some of its other activities.  The FTC has cancelled its participation in most conferences and public events.  And while non-enforcement proceedings such as rulemakings are still ongoing, a number of deadlines have been extended to allow more flexibility for the FTC and participants.  Notably, the Commission has extended the comment deadlines by sixty days for both the Funeral Rule and the Endorsement Guide proceedings, with comments now due in June rather than April.

Covington will continue to monitor the FTC’s response to this unprecedented situation and will provide further updates as it evolves.

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Photo of John Graubert John Graubert

John Graubert has more than 30 years of experience in a wide range of complex antitrust and consumer law matters. Mr. Graubert came to the firm after serving for ten years as Principal Deputy General Counsel of the Federal Trade Commission. Mr. Graubert…

John Graubert has more than 30 years of experience in a wide range of complex antitrust and consumer law matters. Mr. Graubert came to the firm after serving for ten years as Principal Deputy General Counsel of the Federal Trade Commission. Mr. Graubert is chair of the firm’s Advertising and Consumer Protection practice group, an Adjunct Professor at the Georgetown University Law Center, and a vice-chair of the Federal Civil Enforcement Committee of the ABA Antitrust Section.

Photo of Laura Kim Laura Kim

Laura Kim draws upon her experience in senior positions at the Federal Trade Commission to advise clients across industries on complex advertising, privacy, and data security matters. She provides practical compliance advice and represents clients in FTC and State AG investigations. Ms. Kim…

Laura Kim draws upon her experience in senior positions at the Federal Trade Commission to advise clients across industries on complex advertising, privacy, and data security matters. She provides practical compliance advice and represents clients in FTC and State AG investigations. Ms. Kim advises on a wide range of consumer protection issues, including green claims, influencers, native advertising, claim substantiation, Made in USA claims, children’s privacy, subscription auto-renewal marketing, and other digital advertising matters. In addition, Ms. Kim actively practices before the NAD, including recent successful resolution of matters for both challengers and advertisers. She co-chairs Covington’s Advertising and Consumer Protection Practice Group and participates in the firm’s Internet of Things Initiative.

Ms. Kim re-joined Covington after a twelve-year tenure at the FTC, where she served as Assistant Director in two divisions of the Bureau of Consumer Protection, as well as Chief of Staff in the Bureau of Consumer Protection and Attorney Advisor to former Chairman William E. Kovacic. She worked on key FTC Rules and Guides such as the Green Guides, Jewelry Guides, and the Telemarketing Sales Rule. She supervised these and other rule making proceedings and oversaw dozens of the Commission’s investigations and enforcement actions involving compliance with these rules. Ms. Kim also supervised compliance monitoring for companies under federal court or Commission order.

Ms. Kim also served as Deputy Chief Enforcement Officer at the U.S. Department of Education, where she helped establish a new Enforcement Office within Federal Student Aid. In this role, she managed investigations of higher education institutions and oversaw issuance of fines and adverse actions for institutions in violation of federal student aid regulations. Ms. Kim also supervised the borrower defense to repayment division and the Clery campus safety and security division.