FTC

On Friday, April 22, 2022, the National Telecommunications and Information Administration (NTIA), which is part of the Department of Commerce, issued a request for comment (RFC) on the state of competition in the mobile app marketplace.  According to the RFC, the record developed will be used to inform the Biden Administration’s competition agenda, including a report on competition in the mobile app ecosystem.  Comments are due on May 23, 2022.
Continue Reading NTIA Seeks Comment on Competition in the Mobile App Marketplace

On April 8, 2020, the Federal Trade Commission (“FTC”) released a blog post about the use of artificial intelligence (“AI”) and algorithms in automated decisionmaking. The blog highlighted the potentially great benefits and risks presented by increasingly sophisticated technologies, particularly in the “Health AI” space. However, it also emphasized that automated decisionmaking is not a new phenomenon—and the FTC already has a long history of assessing and addressing its challenges. Based on prior FTC enforcement actions, studies, reports, and other sources of guidance, the post outlined five general principles for using AI and algorithms while adequately managing consumer protection risks:
Continue Reading AI Update: FTC Provides Guidance on Use of AI and Algorithms

The “Internet of Things” (IoT)—the network of consumer devices connected to the Internet through digital connections and sensors—has dramatically grown over the past five years. A McKinsey analysis estimated that the potential annual economic impact of IoT in 2025 could be between $4 trillion and $11 trillion, with value accruing in manufacturing, urban spaces, human wellness, retail, autonomous vehicles, homes, and other sectors. An analysis by Gartner, Inc. estimated that in 2018, nearly 11.2 billion connected things will be in use globally, and that this figure will surpass 20 billion by 2020.

IoT already has global reach. Nearly one-third of the overall installed IoT base is located outside China, North America, and Western Europe. And although IoT use will continue to grow in commerce and industry, more than 63% of IoT-connected units are already available on the consumer market. Some “smart” consumer products—such as fitness monitors, wearable devices, smart thermostats, and smart TVs—are well-established. In the coming years, connected devices will continue to expand in other categories, including kitchen appliances, toys, and medical devices, among many others.
Continue Reading Covington Internet of Things Update: U.S., U.K., and E.U. Regulators Turn Focus to IoT

As we previously reported, in October 2014 the Federal Trade Commission (FTC) filed a complaint against AT&T in federal court alleging that AT&T’s “throttling” practices for mobile broadband subscribers who were “grandfathered” into the company’s unlimited mobile data plan were unfair and deceptive in violation of Section 5 of the FTC Act.  On Monday,

The Federal Trade Commission will host a workshop on December 4, 2013 in Washington, DC to examine so-called “native advertising.”  This term refers to the practice of blending advertisements with news, entertainment, and other content in digital media and is sometimes also referred to as “sponsored content.”  As an FTC blog post explains, “[w]hatever the name, it’s for sure ads in digital media are starting to look a lot more like the surrounding content.  What are the consumer protection implications now that those lines appear to be blurring?”

According to the Commission, the workshop builds on previous Commission initiatives, such as the Dot Com Disclosures guidance and the Endorsements and Testimonials guidance, to “help ensure that consumers can identify advertisements as advertising wherever they appear.”  The FTC noted a number of questions and topics that may be covered at the workshop, including:

  • What is the origin and purpose of the wall between regular content and advertising, and what challenges do publishers face in maintaining that wall in digital media, including in the mobile environment?
  • In what ways are paid messages integrated into, or presented as, regular content and in what contexts does this integration occur?  How does it differ when paid messages are displayed within mobile apps and on smart phones and other mobile devices?
    Continue Reading FTC Announces Workshop To Examine Native Ads

Yesterday, the U.S. Senate Subcommittee on Consumer Protection, Product Safety and Insurance held a hearing entitled, “Stopping Fraudulent Robocall Scams: Can More Be Done?”   The hearing takes place two weeks after the FTC celebrated the ten-year anniversary of the its implementation of the Do Not Call Registry and on the heels of the FTC’s recent announcement that Mortgage Investors Corporation has agreed to pay $7.5 million (the largest Do Not Call fine the FTC has ever collected) to resolve FTC allegations that it violated provisions of the FTC’s Telemarketing Sales Rule (TSR).  The Federal Communications Commission, which has authority under the Telephone Consumer Protection Act of 1991 (TCPA) to regulate prerecorded and auto-dialed calls, shares jurisdiction with the FTC over so-called robocallers.

Witnesses from both agencies participated in the hearing and highlighted their respective enforcement efforts.    Lois Greisman, Associate Director, Division of Marketing Practices, Bureau of Consumer Protection, FTC, noted that there have been 105 FTC enforcement actions since the Commission began enforcement of the Do Not Call provisions.  Eric Bash, Associate Bureau Chief, Enforcement Bureau, FCC, noted that the FCC has issued more than 500 citations for robocall violations pursuant to its authority under the TCPA.  Mr. Bash’s written testimony describes the FCC’s enforcement authority:

In this day and age of heavy mobile phone use, it may be worth repeating that the FCC’s rules flatly prohibit all autodialed or prerecorded calls to mobile phones made for a non-emergency purpose without the called party’s permission. It does not matter whether the call is to persuade the called party to buy some thing or to support some cause. And, despite common mischaracterizations of the law, it does not matter whether the called party is charged for the call, or whether the content of a message is blasted by text or voice. (The FCC has been clear that “autodialed” text messages fit within the restriction.)

The applicability of the FCC’s rules to text messages has been the source of a significant volume of litigation.

Mr. Bash urged Congress to give the FCC the authority to pursue robocall violators without having to issues citations, expand the statute of limitations from one year to two, extend robocall prohibitions outside of U.S. jurisdiction, and give the FCC authority over third-party spoofing providers. 
Continue Reading FTC, FCC Testify Before Senate On Robocall Fraud

On March 12, 2013, the Federal Trade Commission (FTC) released new guidance for online advertisers, providing specific tips and examples of how to make disclosures clear and conspicuous, and, therefore, not deceptive in the context of emerging technologies, space-constrained screens, and social media platforms.

The guidelines—titled “.com Disclosures:  How to Make Effective Disclosures in Digital Advertising”—update prior guidance known as “Dot Com Disclosures,” which was released in 2000.  The updated guidelines emphasize that consumer protection laws apply to commercial activities across all mediums, including on computers, mobile devices, and tablets.
Continue Reading FTC Releases New Guidance For Online Advertising Disclosures

Path, a social networking mobile app, has agreed to enter into a settlement with the Federal Trade Commission (“FTC”) regarding charges that the company deceived consumers by collecting contact information from users’ mobile address books without notice and consent.  The agreement also resolves charges that the company violated the Children’s Online Privacy Protection Act (“COPPA”) by collecting personal information from children under  13 years old without parental notice and consent.  Path did not admit any liability by entering into the consent decree, which is for settlement purposes only.

The FTC alleged that the Path application included an “Add Friends” feature that allowed users to make new connections within the app.  Users were given three options when using the “Add Friends” functionality:  “Find friends from your contacts,” “Find Friends from Facebook,” or “Invite friends to join Path by email or SMS.”  Regardless of which option was chosen, Path automatically collected and stored contact information from the address book on the user’s mobile phone.  The FTC argued that this practice was contrary to representations made in the company’s privacy policy that only certain technical information, such as IP address, browser type, and site activity information, was automatically collected from the user.  Under the settlement, Path agreed to implement a comprehensive privacy program and obtain biennial, independent privacy assessments for the next twenty years.
Continue Reading FTC Settles Deception, COPPA Charges Against Social Networking App Path

The Federal Trade Commission (“FTC”) announced settlement yesterday with an online marketer accused of using fake news sites to entice customers to buy acai berry weight-loss products and colon cleansers.  The settlement was the latest in a string of FTC actions aimed at Internet affiliate marketers using fake web sites to make weight-loss claims.Continue Reading The Federal Trade Commission Keeps a Watchful Eye on Internet Affiliate Marketers