June 30, 2015
On June 16, the United States District Court for the Central District of California issued an ex parte temporary restraining order prohibiting certain marketing companies from continuing to offer “risk free trials.” The injunction follows the filing of a complaint by the Federal Trade Commission (“FTC”) against negative option marketers who promoted certain cosmetic skincare products over the Internet. According to the FTC, these marketers offered “risk free trials” to lure consumers into paying charges, as much as $97.88, under terms that were allegedly hidden in the fine print of the defendants’ websites. The defendant marketers have yet to appear in the action.
Why are clear and conspicuous disclosures important?