Advertising Law

November 04, 2016

U.S. News Ranks Manatt Among Top in Nation
Manatt Attorneys Tapped for 38th BAA Marketing Law Conference
Ken Bone: Breakout Star, Violator of FTC Guides?
DAA to Launch Cross-Device Privacy Enforcement in February
FTC Retires Telemarketing Scam Targeting Elderly
T-Mobile's Limits on "Unlimited" Plans Yield $48M Fine
Most Read Stories

U.S. News Ranks Manatt Among Top in Nation

U.S. News & World Report and Best Lawyers have selected Manatt as the 2017 "Law Firm of the Year" in Advertising Law. Manatt is one of only four firms to have been honored with this prestigious recognition in this area of practice since the inception of "Best Law Firms" in 2010. In addition to the "Law Firm of the Year" designation, Manatt's advertising team, led by partner Linda Goldstein, received the highest national "Best Law Firms" ranking, as well as the highest metropolitan rankings in New York City and Washington, D.C., for Advertising Law. This marks the advertising group's second "Law Firm of the Year" win, having been selected for the first time in 2015.

To read more on Manatt's appointment to the top tier, click here.

Manatt Attorneys Tapped for 38th BAA Marketing Law Conference

Linda Goldstein, Marc Roth and Richard Lawson are featured speakers at the Brand Activation Association's upcoming 38th annual Marketing Law Conference.

Linda Goldstein, chair of Manatt's advertising, marketing and media practice, will share insights on the key issues and developments in her annual Year in Review. Marc Roth, co-chair of the firm's TCPA compliance and class action defense practice, will moderate a panel on issues surrounding mobile marketing, and Richard Lawson, partner in Manatt's consumer protection practice, will join directors from the Florida and California Offices of the Attorneys General and the Deputy Chief of Consumer Protection of the Texas Attorney General's office. Lawson's session is titled, "State A.G. Policy Enforcement Priorities in Consumer Protection—An Inside and Outside Look."

The conference will be held on November 9-11, 2016 at the Downtown Chicago Marriott.

Ken Bone: Breakout Star, Violator of FTC Guides?

One thing folks on both sides of the political aisle can agree upon is that Ken Bone left the second presidential debate as a breakout star. But he may have tripped up when attempting to capitalize on his fame by sending a promotional tweet for Uber.

Bone and his red sweater made just as many headlines as the candidates after he appeared as one of the undecided voters on the stage at the second debate and asked about energy policy.

In the days that followed, Bone rode the wave of his new fame with talk show appearances and a plug for car service Uber. As part of the company's launch of a black car service in St. Louis, Bone tweeted: "Everyone wants to know if I've decided … and I have. uberSELECT helps you ride in style like me." Those who followed a link and entered promo code "KENBONE" received $20 off their ride.

However, Bone failed to indicate that his tweet was sponsored, as required by the Federal Trade Commission's Endorsement Guides. While the Guides don't mandate the specific wording of disclosures, the agency recommends using words such as "advertising" or "promotion," and when facing character limits on social media platforms such as Twitter, "#ad."

When contacted about the problem, Uber indicated that the company provided Bone with Uber credit for his role in the launch. Bone did not respond when asked for a comment about the issue, but later deleted his promotional tweet and sent a new one apologizing: "#ad didn't know I had to do that. Sorry folks."

Why it matters: Uber certainly got publicity by making a connection with Bone, who said he had seven Twitter followers before the debate (two of whom were his grandmothers) and more than 200,000 afterwards. Whether Bone will remain a public figure remains to be seen, but at least he's aware of the requirements of the FTC Guides if he gets another endorsement opportunity.

DAA to Launch Cross-Device Privacy Enforcement in February

Are you ready? The Digital Advertising Alliance announced that it will begin enforcing the industry's cross-device privacy code beginning February 1, 2017.

The "Application of the DAA Principles of Transparency and Control to Data Used Across Devices" established privacy rules for companies that collect data from one type of device—a tablet, laptop, or smartphone, for example—and use it to serve ads to the same consumer on a different device. Companies must provide notice to consumers about the cross-device tracking, as well as offer consumers the opportunity to opt out.

The code was based on the DAA's preexisting privacy rules, which require companies to notify consumers about online behavioral advertising and offer the ability to opt out of receiving targeted ads.

"The DAA Principles have kept pace with technological advances and changes in advertising business models, and the DAA cross-device guidance helps companies consistently apply the DAA hallmarks of enhanced consumer transparency and control across our rapidly expanding multi-device, multi-browser world," DAA Executive Director Lou Mastria said in a statement. "This enforcement date sets a common marker for the industry to achieve compliance with the DAA cross-device guidance, so consumers have access to more uniform notice around cross-device practices and know their choices on each browser or device are honored."

Although the self-regulatory group first published the rules in November 2015, it elected to delay enforcement to provide plenty of time for companies to incorporate the code into their policies and practices.

Enforcement—based on proactive monitoring of advertising as well as responding to consumer complaints—will be overseen by the Direct Marketing Association in cooperation with the Council of Better Business Bureau's Online Accountability Program, which has announced more than 70 compliance actions over the last five years.

To read the DAA's cross-device privacy rules, click here.

Why it matters: Companies that aren't already in compliance with the DAA's cross-device privacy rules now have less than three months to prepare themselves before enforcement begins.

FTC Retires Telemarketing Scam Targeting Elderly

A telemarketing operation that allegedly made more than $9 million targeting elderly consumers by urging them to buy or invest in e-commerce was hit with a temporary restraining order in an action brought by the Federal Trade Commission.

According to the FTC, the defendants (a trio of individuals and six related corporations) cold-called consumers and pushed them to invest in e-commerce websites or sites that link to popular e-commerce websites (such as Amazon) by promising the deals were "risk free" and had a "100 percent money back guarantee," with huge returns. Elderly consumers less familiar with e-commerce were frequent targets of the calls, as well as veterans and those on fixed incomes, the agency said.

Consumers paid amounts ranging from a few hundred dollars to more than $20,000. After they paid, defendants would respond to consumer calls for about 90 days—the date at which most credit cards limit consumers from disputing charges—and tell them that their "account" was earning substantial money that would be paid out at the end of the quarter, effectively stalling them, the FTC alleged. After that point, the defendants ceased contact with consumers and did not provide the promised investment returns.

The agency's complaint alleged violations of both the Federal Trade Commission Act and the Telemarketing Sales Rule, for calls to numbers listed on the National Do Not Call Registry.

An Arizona federal court judge granted the FTC's request for a temporary restraining order, which halted the operations of the defendants and froze their assets for potential consumer redress pending further litigation.

To read the complaint and temporary restraining order in FTC v. Advertising Strategies, LLC, click here.

Why it matters: The agency also charged the defendants with using mail-forwarding services to disguise their location and changing business names and addresses to dodge regulators. In one instance, the Arizona Attorney General's office subpoenaed one of the individual defendants to testify about the business. Not only did the individual fail to appear, but the FTC said the defendants also closed the office and moved to a different location.

T-Mobile's Limits on "Unlimited" Plans Yield $48M Fine

For falsely promising "unlimited" data plans to customers and then limiting their data access, T-Mobile will pay $48 million and make changes to its advertising practices, the Federal Communications Commission announced.

T-Mobile and MetroPCS advertised so-called "unlimited" data plans, where consumers paid more for not having a cap on their data consumption. After receiving hundreds of complaints from consumers about being deceived, the FCC launched an investigation. The agency found that the carriers operated under a "Top 3 Percent Policy" where they "de-prioritized" heavy data users during times of network contention or congestion.

For some consumers, this resulted in unusable data services for many hours each day and substantial limits on access to data, the FCC said. While T-Mobile subsequently amended its disclosures to explain that customers using more than 17 GB in a given month would be hit with slower data speeds, the Commission said it failed to adequately inform customers.

These actions violated the Commission's Transparency Rule, the FCC said, which requires that providers of broadband Internet access "publicly disclose accurate information regarding the network management practices, performance, and commercial terms" of its service, "sufficient for consumers to make informed choices regarding use of such services and for content, application, service, and device providers to develop, market, and maintain Internet offerings."

To settle the charges, T-Mobile will pay a $7.5 million fine to the FCC, provide $35.5 million in redress to affected consumers (in the form of 20 percent discounts off the regular price of any in-stock accessory and 4 GB of additional data if customers are enrolled in certain plans), and spend $5 million—plus any unredeemed funds from the consumer benefit fund—on technology for low-income school districts.

In addition, the company will update its disclosures to clearly explain the "Top 3 Percent Policy" with information such as who may be affected, what triggers its application, and what impact it may have on data speeds. When the data usage of individual customers approaches the slow-down threshold, T-Mobile is required to provide them with advance notice.

T-Mobile must also update and improve its disclosures regarding "unlimited" plans. The consent decree provides the company with four choices: (1) provide clear and conspicuous disclosures about all restrictions on the amount and speed of data provided for "unlimited" plans; (2) cease describing such plans as "unlimited"; (3) exclude "unlimited" data plan customers from the "Top 3 Percent Policy" or similar practices; or (4) limit any speed reductions for "unlimited" data plan customers to the minimum speed advertised for that plan.

Why it matters: "Consumers should not have to guess whether so-called 'unlimited' data plans contain key restrictions, like speed constraints, data caps, and other material limitations," FCC Enforcement Bureau Chief Travis LeBlanc said in a statement. "When broadband providers are accurate, honest and upfront in their ads and disclosures, consumers aren't surprised and they get what they've paid for. With today's settlement, T-Mobile has stepped up to the plate to ensure that its customers have the full information they need to decide whether 'unlimited' data plans are right for them."

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