ftc settlement

LendEDU to Settle Alleged FTC Marketing Law Violations

February 7, 2020 by David Klein

In response to an administrative complaint filed by the Federal Trade Commission (“FTC”), Shop Tutors d/b/a LendEDU (“LendEDU”) has agreed to enter into a settlement agreement to address allegations that it violated federal marketing law. Specifically, the FTC alleged that LendEDU violated Section 5 of the FTC Act by misleading prospective customers into believing that its website featured objective rankings of financial products and services, when, in fact, the rankings actually consisted of paid advertising. On February 3, 2020, FTC Commissioner Rebecca Kelly Slaughter issued a statement in which she expressed concern over an “increasingly common online trend” in which “purportedly neutral rankings and recommendations . . . actually reflect paid product placement.”

What marketing law issues does the LendEDU settlement address?

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University of Phoenix Settles FTC Deceptive Advertising Law Allegations

December 12, 2019 by David Klein

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?

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FTC Investigation Leads to its First Fake Reviews Settlement

February 28, 2019 by David Klein

February 28, 2019

A Federal Trade Commission (“FTC”) investigation of Cure Encapsulations, Inc. and its owner, Naftula Jacobowitz (the “Defendants”), has ended in a settlement that awaits court approval. In its complaint, the FTC alleges that Defendants made false and unsubstantiated claims concerning the efficacy of garcinia cambogia (the “Product”) as a weight-loss supplement and paid a third-party website operator (www.amazonverifiedreviews.com) to post fake Product reviews on Amazon.com. Pursuant to the terms of the FTC investigation settlement agreement, Defendants are prohibited from publishing weight-loss, appetite-suppression, fat-blocking, and disease-treatment claims concerning any dietary supplement, food or drug, unless those claims are substantiated by third-party clinical studies. In addition, the Defendants must notify consumers who purchased the Product of the FTC’s allegations/investigation and pay a judgment in the amount of $12.8 million (which will be suspended upon payment of $50,000 and certain unpaid income tax obligations).

How can businesses avoid the FTC’s radar? [Read More]

Office Supply Marketers Settle Deceptive Trade Practices Investigation

September 27, 2017 by David Klein

September 27, 2017

deceptive-trade-practices — Deceptive Trade Practices Investigation

The Federal Trade Commission (“FTC”) recently announced a $7 million settlement with an office supply marketer and its individual owner. The FTC had filed a lawsuit in the United States District Court for the Central District of California in connection with charges of unfair and deceptive trade practices related to the marketing and sale of office and cleaning supplies to small business and non-profit organizations, such as child care centers and schools.

What are the Terms of the FTC’s Office Supply Marketing Settlement Agreement?

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FTC Lawsuit Alleging Deceptive Marketing of “Free” Products and Continuity Plans Settles

September 18, 2017 by David Klein

September 18, 2017

The Federal Trade Commission (“FTC”) has announced that ten online marketers of cooking and golf-related products have agreed to settle claims alleging violations of the FTC Act and the Restore Online Shoppers’ Confidence Act, based on the marketers’ alleged improper use of two types of negative option offers: (i) continuity plans, where consumer credit cards are billed on a recurring basis until consumers cancel their subject plans; and (ii) purportedly “free” trial offers, where consumers receive goods or services for a trial period for free (or for a nominal fee), and are charged after the trial period ends unless the consumers return the products or cancel the plan. The complaint alleged that the defendants failed to include clear and accurate disclosures concerning the terms and conditions associated with their negative option plans.

Why Did the FTC Take Issue with the Subject Continuity Plans and “Free” Trial Offers?

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