In This Issue:
SCOTUS : No Equitable Monetary Relief for FTC Under § 13(b)- First FTC Complaint Filed Under New COVID-19 Consumer Protection Act
- Swag Wag Tagged for Made-in-
USA Brag - NAD Filters Coronavirus Claims for Pure Air Peeps
- Expedia Settles With Hotels Over Glitchy Messaging
Well, the buck stops here (for now).
In
First FTC Complaint Filed Under New COVID-19 Consumer Protection Act
Supplement doctor gets spanked as
Acting Out
Much attention has been focused of late on the
First, what is it? The C19CPA (it's on page 2,094 of the appropriation in case you tried reading from the beginning) basically sics the Federal Trade Commission Act on false COVID-19 claims. It makes it "unlawful for any person, partnership, or corporation to engage in a deceptive act or practice in or affecting commerce in violation of section 5(a) of the Federal Trade Commission Act," regarding "the treatment, cure, prevention, mitigation, or diagnosis of COVID-19; or (2) a government benefit related to COVID-19."
Given all the attention paid to COVID-19, the
The Takeaway
The
The
Woo boy.
More to come, folks. However, expect the
Swag Wag Tagged for Made-in-
Young entrepreneur settles with the
AK Kurji is a wise old soul, and like many entrepreneurs, he likes to share entrepreneurish tips—wisdom to share with the young 'uns.
Here he is in an interview on the
"I pretty much started with nothing, and now I'm able to provide resources so [entrepreneurs] don't make the same mistakes and waste time like I did. Something that took me a year to learn, I could teach it to them in a day," he said.
And with his recent settlement with the
Take notes.
Swagamerica!
Kurji's company, Gennex Media, does business under several monikers, including Brandnex, BrandStrong,
But trouble reared up when Kurji allegedly advertised that these customized products were made in
According to the
Some Clarity
The
Under the terms of the proposed order,
The Takeaway
When interviewed about the judgment by the
The
"I was young. I didn't know better. I was maybe moving too fast and didn't have the right advice, and in my head, I thought what we were doing was fine," Kurji says. "I wasn't trying to deceive anyone. I didn't think we were doing anything wrong."
Last we looked, being young is not a defense to an
The
NAD Filters Coronavirus Claims for Pure Air Peeps
Explicit brags and suspect maps mar OxyPure commercial spot
Catcher in the Sky
Even though the
This was not good enough for NAD, which "was concerned that consumers who viewed the advertiser's website would reasonably take away the message that OxyPure Air Purifier is effective in killing 99.999% of COVID-19 without seeing the disclosure that testing of the product was on a coronavirus surrogate."
Here Be Viruses
A further claim targeted by NAD bears mention. According to the watchdog group,
There's no mention of COVID-19 here, right?
Unfortunately, the video "simultaneously [showed] a map of the world with the words 'AIRBORNE VIRUSES' and lines originating from
NAD held "that the visual of the world map conveys the implied claim that the product is effective against COVID-19" and recommended both ads be changed.
The Takeaway
The company also agreed to remove the map from the video, which is even better news. NAD believed this correction would stop people from assuming that the OxyPure was effective against COVID-19, of course.
But in our opinion, removing the image of threatening red lines emanating from
Another set of good calls from NAD.
Expedia Settles With Hotels Over Glitchy Messaging
Plaintiffs alleged the travel website falsely claimed it had no rooms to rent
Pręt ŕ Louer?
A five-year slog between travel website Expedia and several hotels came to an end with a settlement in April—a dispute that is interesting not for innovative legal argument, but for a technology argument deployed by the defendant.
Here's a brief outline:
According to the complaint, Expedia allegedly created fictitious search results for hotels that it did not have a booking relationship with. Even though Expedia could not sell rooms for these hotels, it allegedly returned false or misleading "unavailability messages," including something as direct as "We are sold out" and other, more ambiguous messages such as "Rooms are unavailable for your trip dates on Expedia. Try new dates to check availability." The plaintiffs claimed that these actions hurt their business.
Human Error
Expedia argued in a 2020 motion for summary judgment that a combination of technical glitches and mistakes made by the hotels represented by some of the plaintiffs caused the false or misleading "unavailability messages" to appear—specifically, the hotels' reliance on third parties to communicate the numbers of empty beds to Expedia. Even after a booking relationship between the parties had ceased to exist, the hotels continued to be listed on the site by the third parties.
Expedia also alleged that another hotel was accidentally registered with Expedia during negotiations between the travel site and the hotel's previous owner, even though the booking deal was never signed.
Expedia argued that these mistakes had been corrected and therefore there was no need to continue with the case. The court disagreed, finding that the messages—including the implied message in the ambiguous tags that Expedia could book rooms in unlisted hotels—created real questions of fact for a jury to chew on.
The Takeaway
The case bounced back and forth for years, finally settling for a little more than
"Recognizing that technology is evolving," the court order states, "best efforts may include steps ... contractually requiring third party providers to notify Expedia when a hotel terminates its relationship with that third party and using technological controls to prevent hotels from appearing in search results when third parties notify Expedia that a hotel has terminated its relationship with that third party."
The company also agreed "to ensure that search engine marketing, search engine optimization, and social media advertisements for the Websites do not identify by name class member properties that are not in and of themselves attractions."
All of which leads us to a rather self-evident yet nonetheless important takeaway: Any company that's engaged in data-enabled or data-enhanced advertising needs to maintain clear, continually audited links between its back-end systems and its front-end messaging.
We don't know how a jury might have reacted to this dispute in court, and the settlement seems to be a relatively inexpensive end to the case for Expedia.
But by the company's own admission, the whole thing might have been avoided if Expedia's back-end systems were bolstered in the first place by the commonsense controls it is now required to implement.
And certain attorneys wouldn't be
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