Ad Law News and Views - December 10, 2022


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AGs Focus on Transparent Fees

In late November, the Pennsylvania AG’s office announced a settlement with Grubhub. In its action, the AG alleged among other claims that Grubhub’s platform did not clearly disclose to consumers that they were sometimes charged higher prices for items ordered through the platform compared to ordering from the restaurant directly. Attorney General Shapiro settled for $125,000 in food bank donations and changes to its practices.

NAD Reviews Blue Apron’s Easy Cancelation Claims

Programs that automatically renew have been under a lot of scrutiny lately. Although the focus of scrutiny has often been on how people sign up, both regulators and plaintiffs’ attorneys have also been paying attention to how people cancel. (Click here and here, for example.) A recent decision from the NAD shows that they’re paying attention, too.

NAD Takes Strict View of Green Claims

In recent months, companies have scored some notable victories in lawsuits involving various types of green claims, including carbon emission claimsaspirational claims, and recyclability claims. As we noted in some of those posts, the decisions may have turned out differently if the cases had been heard by NAD. A new decision in a challenge that NAD initiated against various claims made by the American Beverage Association (or ABA”) shows how strictly NAD reviews these types of claims.

FTC and States Settle with Google and iHeartMedia Over Misleading Endorsements

In January, we reported that the Texas Attorney General had filed a lawsuit against Google alleging that the company engaged iHeartMedia DJs to provide endorsements for its Pixel 4 phone, even though they had never used it. This week, the FTC and several state attorneys general announced settlements with Google and iHeartMedia over the same conduct. The complaints provide more insights into what may have happened behind the scenes.

Hurried Woman Sues Over Cook Time Instructions

Time is money, and when you’re hungry for mac-and-cheese, a few seconds can be worth millions of dollars. Or at least that’s what a Florida woman suggests in her class action lawsuit against Kraft Heinz over a claim on single-serve cups of Velveeta Shells & Cheese stating that the product can be ready in 31/2 minutes.”

NAD Worries Consumers May Take Megan Thee Stallion Too Seriously

Imagine that Megan Thee Stallion told you that by investing as little as $1 in Bitcoin, with her knowledge and your hustle, you’ll have your own empire in no time.” Would you think that $1 is all you need to amass a fortune? No, I wouldn’t either. What if Megan was stacking shiny bars of gold while she told you that? I still wouldn’t be convinced, but if you’re on the fence, NAD is looking out for you in a recent decision involving an ad for Cash App.

Coca-Cola Scores Second Win over Green Claims in One Month

This month, the DC Superior Court dismissed a lawsuit brought by Earth Island Institute against Coca-Cola, alleging that the company falsely represents itself as a sustainable and environmentally friendly company, despite being one of the largest contributors of plastic pollution in the world.” The court held that many of the challenged statements are aspirational and do not include anything that can be measured to determine whether they are true or false.

Thirsty World Cup Fans Serve Up Reminder About Sponsorship Agreements

This week, the World Cup kicked off amidst cheers and chants from the fans who had made their way to Qatar to watch the games. Although most fans chanted in support of their teams, Ecuadorean fans in one section of Al Bayt Stadium had a different message: Queremos cerveza, queremos cerveza.” They want beer. Sadly for them, there is no beer to be had after the government in Qatar made a last-minute decision to ban sales at all World Cup stadiums.

The FTC’s Proposed Impersonation Scam Rule – Not as Straightforward as it Looks

Since Lina Khan took the reins of the FTC, the agency has launched five new rulemakings under its Section 18 (“Mag-Moss”) authority – specifically, rules to combat government and business impersonation scamsdeceptive earnings claimscommercial surveillance,” deceptive endorsements, and junk fees.” (I’m excluding here revisions to existing Mag-Moss rules, as well as rulemakings under other statutory authority.) While much has been written about how long Mag-Moss rulemakings generally take to complete (including by us, here), at least one of these rulemakings is proceeding apace – the first one, involving impersonation scams.

NAAG Consumer Protection Meeting: State Attorneys General 2022 Year in Review

Earlier this month at the 2022 NAAG Consumer Protection Fall Conference panelists including current and former AG personnel discussed recent consumer protection legislation and rulemakings that have been implemented or proposed, as well as recent court actions affecting consumer protection laws to provide AGs and staff a year in review.

Colorado’s AG Office Kicks Off CPA Rulemaking Meetings

On Thursday, November 10th, the Colorado Attorney General’s Office held the first of three stakeholder meetings on its Colorado Privacy Act draft rules. The initial meeting covered Universal Opt Out Mechanisms (UOOMs) and consumer rights. Pre-registered participants were given three minutes to present on each topic. AG staff then posed a variety of questions, encouraging input and engagement between participants.

Next Stop on the FTC’s Rulemaking Train: Proposed Revisions to the Business Opportunity Rule

In today’s open meeting, the FTC voted unanimously to issue an Advance Notice of Proposed Rulemaking (ANPR) considering expansions to and revisions of the FTC’s existing Business Opportunity Rule (“BOR”). This will be the first review of the BOR since it was promulgated back in December 2011.  In her statement announcing the ANPR, Chair Khan indicated that “[t]he rule had served the public well over the years,” but several varieties of scams . . .  fall outside the scope of the existing rule, [including] certain kinds of business coaching and work-from-home programs, investment programs, and e-commerce opportunities.” In a familiar refrain in the FTC’s push for rulemaking, Chair Khan argued that case-by-case enforcement has key limitations—especially after the Supreme Court’s AMG decision” finding that the FTC lacked authority to obtain equitable monetary redress under Section 13(b).

Coca-Cola Beats False Advertising Suit Over Aspirational Claims

Last year, we posted about Earth Island Institute’s lawsuit against Coca-Cola, alleging that the company falsely represents itself as a sustainable and environmentally friendly company, despite being one of the largest contributors of plastic pollution in the world.” While many lawsuits involving green claims focus on claims about past or present results (which can usually be proven or disproven), this lawsuit focused on aspirational and forward-looking statements (which are inherently harder to prove or disprove).

DC Lawsuit Against the Commanders Signals Expansion of Consumer Protection Laws

Last week, Attorney General Karl Racine announced a new lawsuit against the Washington Commanders, team owner Dan Snyder, the NFL, and NFL Commissioner Roger Goodell for colluding to deceive DC residents about an investigation into toxic workplace culture and allegations of sexual assault to maintain a strong fanbase and increase profits.”

Attorneys General Revisit the State of Multistates

Last week, multiple state Attorneys General (AGs) and staff from offices nationwide gathered in Washington, DC for the National Association of Attorneys General (NAAG) 2022 Consumer Protection Fall Conference. The conference addressed pressing and relevant consumer protection issues facing attorney general offices. The public portion of the conference included a panel of current and former AGs, who focused their remarks on multistate investigations.