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FTC Brings First Action Against Retail Tracking Company

By Sheila Millar & Tracy Marshall on May 5, 2015
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On April 23, 2015, the Federal Trade Commission (FTC) announced that retail tracking company Nomi Technologies has agreed to settle FTC charges that it misled consumers. The FTC alleged that the company, which develops technology to allow retailers to track consumers’ movements through their stores, misled consumers by failing to uphold promises to provide a mechanism for consumers to opt-out of tracking at stores using Nomi’s tracking technology, and, in doing so, implied that consumers would be informed when retailers were using the company’s tracking services. The FTC alleged that, although the company did provide an opt-out on its website, there was no option to opt out at retailers’ locations using the service, and consumers were not informed of the tracking taking place in the stores at all. Under the settlement, Nomi will be prohibited from misrepresenting consumers’ options for controlling whether information is collected, used, disclosed or shared about them or their computers or other devices, as well as the extent to which consumers will be notified about information practices.

The Commission vote to issue the complaint and accept the proposed consent order was 3–2, with Republican Commissioners Maureen K. Ohlhausen and Joshua D. Wright dissenting. The dissenting commissioners argued that Nomi’s promise to provide in-store opt out was immaterial, because consumers could opt out online. Commissioner Olhausen stated that, as “a third party contractor collecting no personally identifiable information, Nomi had no obligation to offer consumers an opt out,” but nevertheless offered consumers this opportunity. She further wrote that she dissented due to “fear that the majority’s decision in this case encourages companies to do only the bare minimum on privacy, ultimately leaving consumers worse off.” Chairwoman Edith Ramirez, joined by Commissioners Julie Brill and Terrell McSweeney, asserted that Nomi offered an express opt-out promise, which was both false and material to consumers. The decision illustrates the importance of carefully choosing every word in a public privacy policy.

Photo of Sheila Millar Sheila Millar

Sheila A. Millar is a partner at Keller and Heckman LLP, where she represents businesses and trade associations on a variety of public policy and regulatory issues, including privacy, data security, cybersecurity and advertising matters, as well as product safety issues. She has…

Sheila A. Millar is a partner at Keller and Heckman LLP, where she represents businesses and trade associations on a variety of public policy and regulatory issues, including privacy, data security, cybersecurity and advertising matters, as well as product safety issues. She has been involved in a variety of audit and compliance projects, including, among other issues, privacy and data security audits, and is experienced in providing crisis management legal support to a variety of national and international companies and associations.

Ms. Millar is a frequent speaker on regulatory and public policy matters, and has authored many articles. Ms. Millar is one of the vice chairs of the International Chamber of Commerce (ICC) Marketing and Advertising Commission, and chair of its Working Group on Sustainability, where she spearheaded the development of the ICC Framework Guides on Environmental Marketing Claims.

Ms. Millar is AV® PreeminentTM Rated by Martindale-Hubbell and for the eigth consecutive year was selected by her peers for inclusion in The Best Lawyers in America® 2018 for her work in practicing Advertising Law. She has also received the distinguished honor of Advertising Law “Lawyer of the Year” 2014 in Washington, DC by Best Lawyers®, and was awarded Advertising and Marketing Lawyer of the Year USA by Finance Monthly for their Finance Monthly Global Awards 2017.

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Photo of Tracy Marshall Tracy Marshall

Tracy Marshall counsels international and domestic for-profit and non-profit clients on a range of privacy, data security, advertising, promotions, and intellectual property matters. She also advises on general corporate and transactional matters.

Tracy assists clients with compliance and advocates on their behalf. She …

Tracy Marshall counsels international and domestic for-profit and non-profit clients on a range of privacy, data security, advertising, promotions, and intellectual property matters. She also advises on general corporate and transactional matters.

Tracy assists clients with compliance and advocates on their behalf. She is a Certified Information Privacy Professional (CIPP/US) through the International Association of Privacy Professionals (IAPP) and helps clients implement privacy, data security, and security breach response programs, develop internal and public-facing privacy policies to comply with applicable laws, respond to cyber and data security incidents, and manage relationships with service providers and third parties. Tracy advises on structuring and conducting email and text messaging campaigns, sweepstakes, contests, and other promotions, and she helps clients protect and enforce their intellectual property rights.

In addition, Tracy counsels clients on corporate matters and assists with structuring and negotiating a variety of transactions, including licensing, marketing, and outsourcing arrangements.

Tracy is frequently invited to speak at privacy, data security, telecommunications, and advertising conferences and is a contributor to Keller and Heckman’s Consumer Protection Connection blog and Beyond Telecom Law Blog.


To learn more about Tracy’s practice areas, click here.
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  • Posted in:
    Privacy and Cybersecurity
  • Blog:
    Consumer Protection Connection
  • Organization:
    Keller Heckman
  • Article: View Original Source

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