False advertising occurs when a business makes a misleading, deceptive, or plainly false claim about a particular product or service. There are currently a host of state and federal laws aimed at addressing false advertising, the most prominent of which is the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. § 53(b). As articulated by Federal Trade Commission (“FTC”) Commissioner Christine S. Wilson, “[a]ccurate and complete information contributes to the efficient functioning of the market and facilitates informed consumer decision-making. In contrast, deceptive or false claims inhibit informed decision-making and cause economic injury to consumers.”[Read More]
December 12th, 2019
On December 10, 2019, the Federal Trade Commission (“FTC”) announced a settlement with the University of Phoenix and its parent company, Apollo Education Group (“AEG”), for $191 million dollars. This $191 million dollar settlement is the “largest settlement the FTC has ever obtained against a for-profit school.” This settlement is the culmination of a multi-year investigation undertaken by the FTC Bureau of Consumer Protection beginning in 2015.
How did The University of Phoenix Allegedly Violate Advertising Law?[Read More]
February 27, 2017
Two weeks ago, the Federal Trade Commission (“FTC”) announced multi-million dollar settlements with the operators of two online “high schools.” According to a complaint filed by the FTC last year, Capitol Network Distance Learning Programs and Stepping Stonez Development, LLC, along with their respective principals (collectively, the “Defendants”), falsely advertised that their schools were accredited institutions but, in actuality, were “paper mills” that sold worthless diplomas.
What are the Terms of the FTC’s Deceptive Advertising Settlement?
February 2, 2017
On Wednesday, the Federal Trade Commission (“FTC”) announced settlement of its false advertising claims against iSpring Water Systems, LLC (“iSpring”). According to the FTC’s complaint, iSpring, a company that sells water filtration systems and parts, falsely claimed and marketed that its products are “built in USA.” In fact, according to the FTC, iSpring “sources significant inputs to its products overseas,” and other “products are wholly imported.”
What are the Terms of the FTC’s False Advertising Settlement?
January 26, 2017
On Monday, the Federal Trade Commission (“FTC”) announced that it had settled claims against the marketer of two app-supported smartphone accessories allegedly advertised as having the ability to accurately measure a consumer’s blood alcohol content (“BAC”). The apps offered by Breathometer, Inc. (“Breathometer”), as well as its founder, were featured on the television show “Shark Tank.” As a result of his appearance on Shark Tank, Breathometer’s founder was able to obtain initial financing for his Breathometer app. Breathometer offered two versions of the app, an original and an upgraded “law-enforcement grade product.” According to the FTC, however, neither app had been “adequately tested for accuracy” by the company. After undertaking its investigation, the FTC commenced a false action against Breathometer and its founder in the United States District Court for the Northern District of California, which was then immediately settled.
Why did the FTC Find Breathometer’s Marketing Misleading?
September 27, 2016
Last Tuesday, a class action lawsuit was filed against The Honest Company, Inc. (“THC”) alleging that the “natural” products manufacturer has violated numerous California State false advertising laws. Specifically, the class action complaint alleges that THC advertises that its products are “100% natural” and “all natural” despite the presence of synthetic ingredients in its products. The lawsuit seeks actual and punitive damages, as well as costs and attorneys’ fees.
Why is The Honest Company being Sued for False Advertising?
August 9, 2016
Last Thursday, the Federal Trade Commission (“FTC”) announced that it had settled with Mars Petcare US, Inc. (“Mars Petcare”) concerning allegedly false advertising claims relating to its Eukanuba brand dog food. Specifically, the FTC alleged that Mars Petcare falsely touted the health benefits of Eukanuba dog food by citing to a “study” that was never actually conducted. Although no monetary penalty was assessed against Mars Petcare, the terms of the settlement agreement restrict how the company may advertise its products in the future.
What are the Settlement Terms for Falsely Advertising Eukanuba Dog Food?
May 25, 2016
On Tuesday, the Federal Trade Commission (“FTC”) announced its settlement with Viatek Consumer Products Group Inc. (“Viatek”) and its principal Lou Lentine (“Lentine”) concerning claims that their “Mosquito Shield” wristband prevents wearers from being bitten by mosquitos. The FTC commenced litigation against Viatek and Lentine in February, 2015. After a failed motion to dismiss by the defendants and some discovery, the parties agreed on the terms of a settlement and are now seeking court approval.
How did Viatek Falsely Advertise its Product?