A new decision out of the Middle District of Florida may signal further erosion of the FTC’s authority to seek monetary relief as it sets forth a heightened standard of proof the FTC must satisfy to support its disgorgement calculation. In FTC v. Vylah Tech LLC, the court found Vylah Tech, a small tech company, liable for disseminating false and misleading information regarding its computers. However, the court completely shut down the FTC’s demand for…

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Locksmiths Locked Out of Lawsuit Against Search Engines

By Leonard L. Gordon & Matthew S. Renick on June 17, 2019

These days, Big Tech is Big News. While federal lawmakers have recently turned their attention to tech giants and their market power—and launched a broad antitrust probe to boot—a recent decision out of the D.C. Circuit may offer these companies some respite (for now). In a case that pitted fourteen locksmith companies against three tech giants, the appeals court ruled that the safe harbor protections under Section 230 of the Communications Decency Act (“CDA”) applied…

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FTC Continues to Clamp Down on Gag Clauses

By Annie H. Lee on June 5, 2019

About a month ago, we blogged about how the FTC brought its first-ever cases under the Consumer Review Fairness Act (CRFA) since the statute went into effect in 2017. Well, it looks like the FTC was just getting started, as it announced this week that it has issued administrative complaints and proposed orders against two more companies for allegedly violating the CRFA. To briefly recap, the CRFA prohibits businesses from including “gag clauses” in their…

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FTC Reminds Crowdfunders: Deliver on Your Promises or Refund

By Kathleen K. Sheridan & Melissa Landau Steinman on June 4, 2019

Crowdfunding plays an important role in democratizing access to capital for small entrepreneurs, but as we’ve written before, entrepreneurs of every ilk need to remember that their representations to consumers need to be truthful, accurate and not misleading. Last month, the FTC filed a complaint against Douglas Monahan and his company iBackPack of Texas, LLC, alleging that Monahan and his company had violated Section 5 of the FTC Act by scamming consumers on crowdfunding…

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You Can’t Block the Ability of the CFPB to Challenge Conduct Through a Release in a Class Action

By Leonard L. Gordon on June 3, 2019

On April 22, the Maryland Court of Special Appeal told us that a class action settlement can’t buy you peace from the CFPB. That court ruled that a class settlement that purports to interfere with a state agency’s or the CFPB’s enforcement authority was unenforceable. The underlying dispute stems from two cases. The first is a class action brought by lead poisoning victims with cognitive impairments. And the second is a suit bought by government…

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fore·shad·ow (verb). Be a warning or indication of (a future event): FCC Commissioner O’Rielly Speech Suggests What’s in Store for the TCPA

By Daniel S. Blynn on May 16, 2019

On May 16, 2019, FCC Commissioner Michael O’Rielly gave a speech at the ACA International Washington Insights Conference in Washington, DC, which gave a preview of how the Commission may shape the TCPA landscape in the near future. Commissioner O’Rielly’s full speech is available here. He gave his thoughts on a number of subjects and some of the highlights are below. As to the TCPA’s definition of “automatic telephone dialing system” (ATDS or more…

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Gagging Gag Clauses under the Consumer Review Fairness Act

By Annie H. Lee on May 9, 2019

For the first time since the Consumer Review Fairness Act (CRFA) went into effect in March of 2017, the FTC has brought three separate actions enforcing the CRFA to halt the use of “gag clauses” – i.e., contract provisions that prohibit consumers from writing or posting negative reviews. The CRFA bans these types of non-disparagement clauses in consumer form contracts when the clauses are imposed on individuals without giving them a meaningful opportunity to negotiate.…

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FTC Warns Ukraine Company: You Can’t Let Kids Use Your Dating Apps

By Elliot Kelly & Leonard L. Gordon on May 8, 2019

With more and more children becoming technologically savvy, parents are having to rely more heavily on laws such as the Children’s Online Privacy Protection Act (“COPPA”) to shield their children’s information. The FTC recently issued a warning letter to a Ukraine-based company, Wildec LLC (“Wildec”), for allowing children under the age of thirteen to access its dating apps—alleging a potential violation of COPPA and the FTC Act. A little background on COPPA: the FTC’s COPPA…

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California Advertised-Discount Law Safe—For Now

By Leonard L. Gordon & Tyler Hale on May 6, 2019

The advertised-discount provision of California’s False Advertising Law, California Business and Professions Code § 17501, lives to fight another day. A coalition of national department stores, having found themselves brought together by the regulatory lasso of the Los Angeles City Attorney, recently took a big swing at the validity of that statute by objecting to its constitutionality on vagueness and free-speech grounds. The stores’ argument connected with the district court, but was ultimately thrown out…

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Online Lender Settles with FTC on UDAP, TSR, and EFTA Claims

By Peter S. Frechette, Leonard L. Gordon & Evan R. Minsberg on May 2, 2019

The Federal Trade Commission’s settlement with an online consumer lending platform, Avant LLC, highlights the importance of legal and regulatory compliance in the fintech space, including—perhaps most importantly—what happens after a loan is made. According to the Commission’s complaint, Avant offered personal consumer loans through its website. The complaint notes that although the loans were formally issued through a bank partner, Avant handled all stages of the process, and all consumer interactions, including advertising,…

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Regulatory & Litigation Developments for Advertisers and Marketers

Blog Authors

Federal Court to FTC: Show the Receipts When Seeking Disgorgement

Locksmiths Locked Out of Lawsuit Against Search Engines

FTC Continues to Clamp Down on Gag Clauses

FTC Reminds Crowdfunders: Deliver on Your Promises or Refund

You Can’t Block the Ability of the CFPB to Challenge Conduct Through a Release in a Class Action

fore·shad·ow (verb). Be a warning or indication of (a future event): FCC Commissioner O’Rielly Speech Suggests What’s in Store for the TCPA

Gagging Gag Clauses under the Consumer Review Fairness Act

FTC Warns Ukraine Company: You Can’t Let Kids Use Your Dating Apps

California Advertised-Discount Law Safe—For Now

Online Lender Settles with FTC on UDAP, TSR, and EFTA Claims

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