There’s a certain irony in the FTC’s record-setting $20 million settlement with Vivint Smart Home, a national seller of smart home technology platforms, including security devices and monitoring services. One purpose of the company’s products is to help residents ensure that people at their front door are who they say they are. But according to the FTC, Vivint engaged in some identity deception of its own.
FTC staff sent 30 warning letters to companies, raising concerns about their COVID-related advertising claims. In two notable ways, some of these letters differ from letters we’ve sent to other marketers pitching products advertised to prevent, treat, or cure COVID-19.
For businesses in the middle of a global pandemic, there’s no such thing as “business as usual.” The percentage of Americans working remotely has grown substantially, now reportedly up to 33% of the U.S. workforce. Accompanying that seismic shift have been increased security threats to data, with one analysis reporting that over 36 billion online records were exposed in the first half of 2020 alone. Consumers whose lives have been upended by identity theft are paying close attention to how corporations are responding.
Yellowstone – the majestic national park – is known for Old Faithful, roaming bison, and vistas to take your breath away. According to a 2020 FTC complaint, Yellowstone – the merchant cash advance provider – was unfaithful to its promises, buffaloed small business owners, and made illegal withdrawals that took their cash away. A settlement will return more than $9.8 million to customers and includes injunctive provisions to change how Yellowstone does business.
Advances in artificial intelligence (AI) technology promise to revolutionize our approach to medicine, finance, business operations, media, and more. But research has highlighted how apparently “neutral” technology can produce troubling outcomes – including discrimination by race or other legally protected classes. For example, COVID-19 prediction models can help health systems combat the virus through efficient allocation of ICU beds, ventilators, and other resources.
Congress passed a law in December 2020 – the COVID-19 Consumer Protection Act – that imposes monetary penalties on violators. The Department of Justice and the FTC just brought their first action under the statute, alleging that a Missouri chiropractor and his company violated both the new law and the FTC Act by deceptively marketing vitamin D and zinc products to treat or prevent COVID-19.
The FTC’s long-standing Holder Rule requires businesses to include a special notice in credit contracts that gives consumers certain protections. Today, a Staff Note reiterates the Commission’s determination that the Rule applies regardless of the size of the transaction – and corrects some staff guidelines published in 1976.
Have you marked your calendar for April 29, 2021, to attend Bringing Dark Patterns to Light: An FTC Workshop? The virtual event will examine digital “dark patterns,” potentially deceptive or unfair user interfaces on websites and mobile apps. In addition to your participation, the FTC is asking for research and public comments on topics related to the workshop.
People who claim that hindsight is 20/20 probably weren’t talking about the post hoc evaluation of clinical testing. That’s an alleged flaw the FTC challenged in purported substantiation submitted by the marketers of Hepaxa and Hepaxa PD, fish oil products advertised as clinically proven to treat liver disease in adults and children. In addition to injunctive provisions, the proposed settlement includes a financial remedy of $416,914.