FTC Begins Cracking Down on Phony Affordable Care Act Marketing

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can-spamThe first Affordable Care Act-related action has been filed by the Federal Trade Commission (“FTC”) against an email marketer and its owner for allegedly violating the CAN-SPAM Act and FTC Act for sending unsolicited commercial email messages to consumers.

The Complaint was filed in Florida federal court and alleges that the purpose of the email marketing campaign was to trick consumers into clicking on links by scaring them into believing that they would be in violation of federal law if they did not enroll in a health insurance plan by a date certain.

According to the Complaint, if and when the consumer clicked on a link in one of the subject email messages, the consumer would be taken to a website that contained advertisements for assorted products and services, including insurance.  As an aside, please note that the insurance companies whose ads appeared in the websites allegedly never authorized the email marketing at issue.  Defendants were paid by the website operators every time a consumer clicked on one of the links in their email messages.

Alleged Violations of the FTC Act and CAN-SPAM Act

The Complaint alleges that Defendants represented that consumers would be in violation of federal law if they did not select health insurance by a date certain, which is false and a violation of the FTC Act.

The Complaint further alleges that the emails sent by Defendants do not include a clear and conspicuous notice of the recipient’s ability to unsubscribe from the receipt of future commercial email, which is a violation of the CAN-SPAM Act.  Separately, the Complaint alleges that the subject emails do not include the sender’s valid physical postal address, which also is a violation of the CAN-SPAM Act.

The FTC is seeking an injunction, restitution and disgorgement of alleged “ill-gotten monies.”

If you are interested in learning more about this topic or would like to review your marketing practices, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney.  Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.

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