Marketing Practices and FTC Litigation

Conceiving and launching an effective marketing campaign is a complicated venture. From a legal perspective, companies must strike a careful balance between edgy marketing tactics and consumer protection laws. Because they must walk this razor’s edge, companies should always seek counsel to ensure that their marketing campaign complies with federal and state laws.

Firms that don’t take this crucial step often find that lawsuits quickly follow their campaign launch, entangling them in legal proceedings they could have avoided.

For over 15 years, our attorneys have represented direct marketers, telemarketing firms, Internet companies, and other advertising and media groups to protect and defend their legal interests in a wide range of contexts, including:

  • Regulatory enforcement actions and investigations by FTC, CFPB, state attorneys general, and other agencies.
  • Compliance and clearance of online advertising content, telemarketing scripts, and infomercial media.
  • Terms and conditions, billing practices, and subscription programs review.
  • Trademark registration, protection and enforcement.
  • Internet commerce and CAN-SPAM Act compliance.
  • Rights of privacy and publicity, including agreements with celebrity endorsers.
  • Vendor, supplier and customer contracts and disputes.

We review our clients’ advertising, sales, and billing practices to identify potential concerns before they become problems. For example, we will scrutinize health and safety claims about your nutritional supplement that could trigger a higher standard of substantiation and carefully evaluate your negative-option/continuity billing program for compliance with the Restore Online Shoppers’ Confidence Act (aka, “The Rockefeller Act) and California Business and Professions Code 17509.

Of course, if you’ve already received a demand for information, are the subject of a regulatory investigation, or have already been sued by the FTC, CFPB, or another law enforcement agency, we can aggressively defend your rights and work on your behalf to achieve the best possible outcome—through an early settlement if possible, but also through trial if necessary.

Federal Trade Commission Litigation

We aggressively defend advertisers and marketers against enforcement actions by the FTC, state attorneys general and other regulatory agencies for deceptive acts and consumer fraud associated with advertising, marketing and billing practices, whether in federal or state court.

We’ve obtained some outstanding results for our clients in the kinds of high-stakes lawsuits in which the government often seeks preliminary relief in the form of a Temporary Restraining Order, Preliminary Injunction, and asset freeze, and final relief in the form of a Permanent Injunction and consumer redress. That’s important because a negative outcome in these kinds of actions could ultimately subject a company to liability for its total gross sales to consumers less refunds. Under these dire circumstances, we’ve proven our ability to obtain favorable settlements on behalf of our clients, and successfully defend them against government attack.

Our experience includes:

  • Defending one of the largest Internet merchants on the Web against a FTC action for allegedly fraudulent billing practices. When the representation began, the FTC had already obtained a Temporary Restraining Order seizing the assets of both the company and its principals. We successfully obtained a court order allowing the owners to regain control of their business and assets. Within months, we secured a highly favorable settlement that affirmed the clients’ innocence and avoided any redress or other payment.
  • Defending a major telemarketing firm in a FTC action for deceptive marketing and advertising practices in violation of the FTC Act. When the representation began, the FTC had already obtained a Temporary Restraining Order seizing the assets of the company and its owners. We negotiated a favorable settlement enabling the owners to regain control of their business and assets and resume operation.
  • Representing one of the largest loan modification companies sued by the FTC. We obtained a result that involved no monies being paid to the FTC.
  • Representing a large subscription Internet merchant selling government grants and nutraceuticals. We obtained a result where nearly all the funds paid to the government were applied to the principals’ taxes and their merchant processor’s attorney fees.
  • Representing direct response marketers in commercial disputes with manufacturers, suppliers, distributors, wholesalers, and fulfillment houses involving a variety of issues including breach of contract and trademark infringement.
  • Counseling numerous Internet merchants and telemarketers with respect to regulatory compliance issues involving federal and state advertising and consumer protection laws.

Responding to Regulatory Investigations by the FTC, State Attorneys General and Other Agencies

When your company is the subject of a regulatory investigation and CID by the Federal Trade Commission, state attorneys general, or other agencies, you need experts on your side.

Call us. We work closely with advertisers and marketers to promptly identify and evaluate the investigation’s critical issues and craft an appropriate plan of action, even if the government has informally requested information, subpoenaed records, or sought an immediate access order.

Advertising and Infomercial Clearance

We work closely with our clients from the concept stage through release to ensure their advertising materials and promotions comply with federal, state and local laws as well as other applicable standards. We review scripts, storyboards, and copy, and we help clients understand the level of substantiation required for express and implied product and service claims. We also help them conform their advertising to relevant media guidelines, policies, and standards.

We also address two-page websites to determine the adequacy of their disclosures of terms and conditions.

Counseling Direct Marketers, Telemarketers and Electronic Retailers

Direct marketing and telemarketing companies as well as electronic retailers and infomercial producers rely on us for counsel in all aspects of their businesses. If your company works in one of these spaces, we can advise you on:

  • Advertising and infomercial clearance.
  • Trademark registration and compliance.
  • Sweepstakes and contests.
  • Online retailing and Internet commerce.
  • CAN-SPAM Act compliance.
  • Negotiating and drafting commercial agreements with vendors, suppliers, customers, and celebrity endorsers.
  • Rights of privacy and publicity.

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