The Advertising Law Blog provides commentary and news on developing legal issues in advertising, promotional marketing, Internet, and privacy law. This blog is sponsored by the Advertising, Marketing & Promotions group at Olshan. The practice is geared to servicing the needs of the advertising, promotional marketing, and digital industries with a commitment to providing personal, efficient and effective legal service.
Andrew Lustigman, Chair of Olshan's Advertising, Marketing & Promotions Group and Co-Chair of the firm’s Brand Management & Protection Group, and Claudia Dubón, a partner in the firm’s Corporate/Securities Group, published an article in New York Law Journal entitled “New Cosmetic Regulations Dramatically Changing the Compliance Landscape.” In the article, Andy and Claudia discuss the cosmetics labeling compliance requirements in the Modernization of Cosmetics Regulation Act of 2022 (MoCRA). Several provisions took effect on July 1, including requiring facilities that process or manufacture cosmetic products to register with the FDA. The product label must also include the contact information of the responsible person(s) for facilitating the reporting of adverse events. “MoCRA is arguably the most significant expansion of the FDA’s regulation of cosmetic products in decades,” Andy and Claudia explain. “These requirements will apply to manufacturers and marketers (among other various parties in the cosmetic space), who will need to carefully consider their and their suppliers’ compliance obligations under these new regulatory requirements.” They add that more MoCRA regulations may be forthcoming, including good manufacturing practices (GMPs) for disclosing fragrance allergens in cosmetic product labeling and establishing and requiring standardized testing methods for detecting asbestos in talc-containing cosmetics. “Given the substantial and expanding compliance obligations, parties in the cosmetic space will need to be mindful of the enhanced regulation requirements to maintain compliance moving forward,” Andy and Claudia write.
Andrew Lustigman, Chair of Olshan's Advertising, Marketing & Promotions Group and Co-Chair of the firm’s Brand Management & Protection Group, and associate Morgan Spina published an article in Bloomberg Law entitled “FTC’s Focus on Subscriptions Protects Consumers: Legal Insight.” In the article, Andy and Morgan provide a comprehensive overview of the complexities surrounding automatic renewal subscriptions, a payment model increasingly used by e-commerce businesses. The article offers critical advice for companies looking to navigate the evolving regulatory landscape, particularly in light of recent state and federal developments. Andy and Morgan highlight key areas of focus, including the importance of clear enrollment terms, streamlined cancellation processes and the implications of the FTC’s recent actions against major players like Amazon and Adobe. "Companies should ensure customers aren’t forced to reject a barrage of offers before the cancellation request is processed or are somehow taken out of the cancellation path if they are considering a save offer," they advise. Andy and Morgan emphasize that businesses must stay ahead of regulatory changes to avoid costly litigation and maintain consumer trust.
Andrew Lustigman, Chair of Olshan's Advertising, Marketing & Promotions Group and Co-Chair of the firm’s Brand Management & Protection Group, and associate Morgan Spina published an article in Attorney at Law Magazine entitled “FTC and States Continue to Prioritize Automatic Renewal Regulation and Enforcement.” In the article, Andy and Morgan discuss the recent regulations impacting subscription paths and payment models. “Because consumers are charged until they affirmatively cancel,” they note, “the regulatory scrutiny of these programs has continued to increase, both on the federal and state levels.” In light of the Biden administration's recently announced proposals regarding cancellations, this topic continues to be at the top of consumers' minds. Staying compliant requires vigilance and adaptation to evolving legal landscapes. Andy and Morgan write, “As active litigation unfolds ahead of the 2025 trial, attorneys should be mindful of the FTC’s position on automatic renewal programs and the newfound emphasis on transparent user experiences for consumers.”
On August 14, 2024, the Federal Trade Commission (“FTC”) announced and published a final rule banning fake reviews and testimonials. Although unfair or deceptive acts and practices are already generally unlawful, the new rule will enable the FTC to more easily go to court and seek civil penalties against knowing violators. The rule, published at 16 CFR Part 465, takes effect this October 13th.
The United States Patent and Trademark Office (“USPTO”) is constantly adapting to the changing world, which now includes the virtual world, and more and more trademark applicants are seeking to obtain trademark protection for virtual goods and services. As a reminder, the USPTO has adopted an international system of classifying goods and services in trademark applications, with 45 different categories. There is some confusion about how virtual goods and services are classified.
On the heels of California’s “Hidden Fees Statute,” Minnesota has enacted its own price transparency law. Under the new Minnesota law, any business must disclose all mandatory fees or surcharges any time that that business advertises, displays or offers a price for goods or services.
Automatic renewal programs and frictionless cancellation processes continue to garner significant regulatory scrutiny. Now, the Federal Trade Commission (“FTC”) is taking action against the software company, Adobe, and two of the company’s executives, Maninder Sawhney and David Wadhwani, regarding the company’s automatic renewal subscription practices, particularly as such practices relate to the company’s subscription enrollment and cancellation pathways. After investigating the company’s subscription practices, the FTC referred the matter to the United States Department of Justice, who in turn filed a complaint in federal court in the Northern District of California.
The Consumer Financial Protection Bureau (“CFPB”) is making it a priority to monitor credit card rewards programs and crack down on unfair or deceptive acts that prevent consumers from obtaining the advertised benefits of these programs.