Contact Attorney Richard Keyt: 480-664-7478|rk@keytlaw.com

Panel on the FTC’s New Endorsement and Testimonial Guides

Rebecca Tushnet’s 43(B)log:  “Today’s the effective date of the Revised Guides.  Emphasizes that the Guides themselves don’t provide for fines, though practices inconsistent with the Guides can result in FTC investigation and possible resulting fines.  Big rule: deceptiveness of endorsement/testimonial depends on the facts.   An endorsement is anything that consumers are likely to believe reflects speaker’s personal views, whether or not identical with the manufacturer’s, whether or not the speaker reads from a script.  Fictional dramatizations and statements by company spokespersons are not endorsements because they’re apparent to the audience.  Endorsements must reflect endorser’s general views and must not contain any express/implied representation that would be misleading if made by the advertiser.  Advertisers can be liable for misrepresentations and for failure to disclose material connections, as can endorsers.”

New FTC Ad Rule Creates “Target Rich Environment”

NutriSupLaw:  “David Vladeck, Director of the Federal Trade Commission Bureau of Consumer Protection said that the FTC’s new Guides Concerning the Use of Endorsements and Testimonials in Advertising creates a “target rich enviornment” in which they intend to pursue violators using all the resources at their disposal.  And when the 1000+ enforcement personnel at the FTC run out, FTC plans to call on the state attorneys’ general. When the AG’s are too busy, Vladeck says that they will do as the FDA does and publish warning letters on the internet in order to ‘bully companies into compliance.'”

Despite the backpeddling FTC has done in the media recently, Vladeck made it clear that he will enforce Section 5 of the Federal Trade Commission Act and the endorsement guides. It was as if Vladeck was drawing imaginary targets on foreheads around the room…

Where Did You Get That Keychain?

City-Journal:  Overlawyered’s Walter Olson wrote an excellent article on the FTC’s new ad/testimonial rules.  “New guidelines on freebies target bloggers but go easy on traditional outlets.  If there was any doubt that sweeping regulation—big, shoot-for-the-moon regulation—was back in favor in Washington, it was laid to rest on October 5, when the Federal Trade Commission published 81 pages of new guidelines asserting authority over product endorsements and testimonials, particularly those published in blogs, Facebook, Twitter, and other social media. From the early coverage, you might have thought the guidelines were mostly of concern to the calculating Madison Avenue types who send baby-product and cosmetics swag to mommy-bloggers as part of nefarious “buzz marketing” campaigns. But the new guidelines are much broader than that. They lay out potential theories of liability for many bloggers and online commentators with more traditional literary, political, or journalistic profiles.”

See the FTC’s new guidelines.

See also Walter Olson’s October 16, 2009, post on this topic.

The Future of the Internet

Mises Economics Blog:  “There’s concern throughout the Internet after the Federal Trade Commission announced today

[October 5, 2009] that it has the power to regulate blogs, specifically blogs that endorse commercial products. The unelected FTC – composed entirely of Bush appointees – now mandates that “bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service.” This is merely a first step towards regulating the content of blogs themselves, as anyone who offers a personal testimonial about any product will be liable, under the Federal Trade Commission Act, should the FTC disagree with your personal experiences.

If you’re wondering just how big a mess the FTC can make, consider a decision published just last week by D. Michael Chappell, the FTC’s chief administrative law judge. Judge Chappell caught FTC prosecutors in a blatant attempt to lie their way out of a bad situation arising from yet another misguided attempt to micromanage the World Wide Web. It’s a case that demonstrates the FTC’s unique combination of stupidity and narcissism.

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