Richard Newman
On February 18, 2025, the Federal Trade Commission announced that Chairman Andrew N. Ferguson appointed David Shaw as Principal Deputy Director and Kelse Moen as Deputy Director of the agency’s Bureau of Competition, and Douglas C. Geho as Deputy Director of the Bureau of Consumer Protection.
Shaw is an experienced antitrust lawyer with expertise in high-stakes litigation and contentious merger review. During the first Trump Administration, Shaw served in the Department of Justice’s Antitrust Division in a variety of roles, from the front lines as a trial attorney to the front office as acting chief of staff. As a trial attorney, Shaw served on multiple trial teams, including the first litigated vertical merger challenge in forty years.
While serving in DOJ’s front office, he held a leadership role in the Big Tech investigations and successfully coordinated a bipartisan coalition of state attorneys general joining the DOJ complaint in the Google search monopolization case.
In addition to his government service, Shaw was a partner in the antitrust practice of a large international law firm.
Moen is an experienced antitrust attorney, with a career in both government service and private practice. Most recently, he served as senior counsel to the U.S. Senate Judiciary Committee for Senator Lindsey Graham, where he focused on antitrust, technology, and intellectual property issues, a position that he held until his appointment to the FTC.
Before joining the Judiciary Committee staff, Moen spent nearly a decade practicing antitrust law at major international law firms,
On the eve prior to its effective date, the FCC’s One-to-One Consent Rule which sought to redefine the meaning of “prior express written consent” under the Telephone Consumer Protection Act, was postponed for one year by order of the FCC’s Consumer and Government Affairs Bureau. Just minutes thereafter, the rule was struck down by the U.S. Court of Appeals for the Eleventh Circuit.
Background
The Telephone Consumer Protection Act (TCPA) , in part, requires callers to possess “prior express consent” when making non-emergency telephone calls to cell phones using an automatic telephone dialing system, or artificial or prerecorded voice; and telephone calls to residential telephone lines using an artificial or prerecorded voice (with limited exceptions).
In 2012, the Federal Communications Commission established that the foregoing calls (including SMS text messages) for marketing purposes must have “prior express written consent,” defined as “an agreement, in writing, bearing the signature of the person called that clearly authorizes the seller to deliver or cause to be delivered to the person called advertisements or telemarketing messages using an automatic telephone dialing system or an artificial or prerecorded voice, and the telephone number to which the signatory authorizes such advertisements or telemarketing messages to be delivered.”
The Federal Communication Commission Government Affairs Bureau Postpones Effective Date of the TCPA One-to-One Consent Rule
On January 24, 2025, the FCC announced that it has postponed the effective date of the one-to-one consent rule. “By this Order,
The Federal Trade Commission’s initial findings from its surveillance pricing market study revealed that details like a person’s precise location or browser history can be frequently used to target individual consumers with different prices for the same goods and services.
The staff perspective is based on an examination of documents obtained by FTC staff’s 6(b) orders sent to several companies in July aiming to better understand the “shadowy market that third-party intermediaries use to set individualized prices for products and services based on consumers’ characteristics and behaviors, like location, demographics, browsing patterns and shopping history.”
Staff found that consumer behaviors ranging from mouse movements on a webpage to the type of products that consumers leave unpurchased in an online shopping cart can be tracked and used by retailers to tailor consumer pricing.
“Initial staff findings show that retailers frequently use people’s personal information to set targeted, tailored prices for goods and services—from a person’s location and demographics, down to their mouse movements on a webpage,” said FTC Chair Lina M. Khan. “The FTC should continue to investigate surveillance pricing practices because Americans deserve to know how their private data is being used to set the prices they pay and whether firms are charging different people different prices for the same good or service.”
The FTC’s study of the 6(b) documents is still ongoing. The staff perspective is based on an initial analysis of documents provided by Mastercard,
On Friday, December 27, 2024, the Justice Department issued a final rule to address “urgent national security risks posed by access to U.S. sensitive personal and government-related data from countries of concern and covered persons.” The final rule was posted publicly and addresses “continued efforts of countries of concern to access, exploit, and weaponize Americans’ bulk sensitive personal and U.S. government-related data.”
This rule reflects the Department’s careful consideration of the comments received in response to the March 5, 2024 Advance Notice of Proposed Rulemaking (“ANPRM”) and the October 29, 2024 Notice of Proposed Rulemaking (“NPRM”) as well as feedback from hundreds of representatives from companies and organizations and extensive consultation with dozens of other U.S. Government agencies and offices, along with engagement foreign partners.
As previewed in the ANPRM and NPRM, the final rule establishes a national-security program within the Justice Department’s National Security Division that restricts and in some instances prohibits U.S. persons from engaging in certain categories of data transactions with six “countries of concern” (including covered persons and entities subject to coercion by those countries) because such transactions pose unacceptable national-security risks of giving those countries, entities, or persons access to U.S. bulk sensitive personal data or government-related data.
The rule will become effective 90 days after publication. Certain affirmative compliance obligations will be phased in with a later effective date of 270 days after publication.
The Department also intends to continue engaging with industry and other stakeholders to determine whether any general licenses are appropriate as this program goes into effect.
On January 1, 2025, an amendment to California’s existing false advertising law will become effective. The amended legislation takes aim at deceptive digital ad representations that lead consumers to believe that they are purchsing owership rights in a product when, in fact, only a revocable license is being conveyed.
With limited exception., AB 2426 prohbitis sellers of digital goods from using terms such as “buy,” “purchase” or similar terms when the net impression thereof objectively leads a reasonable person to believe that they are purchasing an unrestrictice ownership interest. The exception to the foregoing restriction is when a seller of digital products obtains affirmative acknowledgement from the buyer of a complete list of restrictions and conditions of the license, and that access to the digital product may be unilaterally revoked by the seller (e.g., if the seller no longer has the right to license). Additionally, prior to completing the sale, the seller must provide the buyer with a hyperlink, QR code or other means of accessing the license terms and conditions, a a clear and conspicuous disclosure that purchase of the digital product merely constitutes a license.
The new legistlation defines “digital goods” broadly. The law also sets forth exclusions, such as any distribution of television, video or radio service. The new law also does not apply to specifically enumerated subscription-based services and digital goods such as those advertised for no monetary consideration.
Violation of the amended statute can result in civil penalties of up to $2,500 per violation. It couls also potentially exposure a violator to class action litigation pursuant to California’s UCL law.
On December 19, 2024, the Federal Trade Commission announced that a group of 10 car dealerships and their parent company will be required to pay $20 million to settle allegations they systematically defrauded consumers looking to buy vehicles as a result of a lawsuit by the Federal Trade Commission and state of Illinois.
In addition to paying $20 million, which will be used to refund harmed consumers, the proposed settlement also would require the companies to make clear disclosures of a car’s offering price—the actual price any consumer can pay to get the car, excluding only required government charges—and get consent from buyers for any charges.
The $20 million proposed monetary judgment is the largest the FTC has secured against an auto dealer.
“Working closely with the Illinois Attorney General, we are holding these dealerships accountable for unlawfully extracting millions of dollars from consumers through a textbook bait-and-switch scheme, and bolstering their poor reputation with fake reviews,” said FTC lawyer Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “We will continue our work to ensure that consumers are not being overcharged for cars, and that honest dealers do not need to compete with firms that cheat.”
“This dealership network engaged in bait-and-switch tactics by luring consumers into their dealerships with lower prices only to either require consumers to purchase allegedly pre-installed add-on products or charge consumers for those products without their knowledge or permission,” said Illinois Attorney General Kwame Raoul.
On December 18, 2024, the Federal Trade Commission announced that it approved a final consent order against a seller of an AI “testimonial and review” service – settling allegations that the service it sold provided subscribers with the means of generating false and deceptive online reviews.
The FTC’s September 2024 complaint alleges that the service generated detailed reviews that contained specific, often material details that had no relation to the user’s input, so would purportedly be false for the users who copied them and published them online. Accordingly, the complaint charges that the company violated the FTC Act by providing subscribers with the means to generate false and deceptive written content for reviews. It also alleges the company engaged in an unfair business practice by offering a service that is likely to pollute the marketplace with a glut of fake reviews.
The final order settling the Commission’s complaint prohibits the comapny from engaging in such conduct and bars the company from advertising, promoting, marketing or selling any service dedicated to – or promoted as – generating consumer reviews or testimonials.
The Commission voted 3-2 to approve the final consent order and letters to eight public commenters. Commissioners Melissa Holyoak and Andrew Ferguson previously issued separate dissenting statements.
In his dissent, Commissioner Ferguson states, in pertinent part, “I dissent from the filing of the complaint and consent agreement because I do not have reason to believe that [the company] violated Section 5,
The Federal Trade Commission is watching the healthcare lead generation industry closely.
On December 10, 2024, the Federal Trade Commission announced that it has sent warning letters to 21 companies that market or generate leads for healthcare plans. The letters were sent as open enrollment season for healthcare plans is ongoing. They provide guidance and provide about deceptive or unfair claims that likely violate laws enforced by the FTC.
The letters were sent to companies that provide marketing or advertising, including lead generation, related to Affordable Care Act Marketplace health insurance and healthcare-related products, such as limited benefit plans and medical discount programs.
The purpose of FTC warning letters is to warn companies that their conduct is likely unlawful and that they can face serious legal consequences, such as a federal investigation of lawsuit, if they do not immediately stop. Overwhelmingly, companies that receive FTC warning letters take steps quickly to correct and come into compliance with applicable legal regulations.
“It is critical for consumers’ health and financial well-being that marketers of health plans be honest about the plans they and their partners are offering,” said FTC lawyer Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “The FTC has been watching this important sector closely, especially during open enrollment season, and these warning letters put companies on notice that unlawfully marketing or advertising health plans to consumers can result in serious legal consequences.”
Based on information collected by FTC staff and the agency’s enforcement experience in this area,
On October 16, 2024, the Federal Trade Commission announced the final FTC “Click-to-Cancel” Rule pertaining to recurring subscriptions and memberships.
The Federal Trade Commission is not the only regulatory agency that actively enacts, updates and polices legislation governing autorenewals, subscriptions and continuous service offers. For example, state attorneys general are, in some instances, more aggressive than the FTC. Some notable states with automatic renewal legislation include New York, Vermont, Colorado, Illinois, Tennessee, Virginia, Minnesota, South Carolina, Utah and California.
California’s Current Automatic Renewal Law
California’s auto renewal legislation is perhaps the most aggressive of all. In short, California’s ARL applies to contracts with consumers, defined as “any individual who seeks, acquires, by purchase or lease, any goods, services, money, or credit for personal, family, or household purposes.” It includes notice and cancellation requirements for free trials and automatically renewing subscription plans. It also emphasizes the provision of a simple, easy-to-use cancellation mechanism. In California, those making an automatic renewal or continuous service offer are required to present material terms in a “clear and conspicuous manner.” Businesses are also required to seek and obtain a consumer’s affirmative consent to such terms in close proximity to making these material disclosures and prior to the point of billing the consumer.
Disclosures must include, for example and without limitation, that the subscription or purchase agreement will continue until the consumer cancels, a description of the cancellation policy, that recurring charges will be charged continuously until cancellation,
The Federal Trade Commission and the Justice Department’s Antitrust Division recently participated in the G7 Competition Authorities and Policymakers Summit to discuss ways to ensure competition in artificial intelligence (AI)-related technologies, products, and applications. At the conclusion of the summit, FTC Chair Lina M. Khan and other representatives of the G7 competition authorities and government policymakers issued a Communiqué highlighting potential competition concerns in AI-related markets and identifying guiding principles to ensure fair competition across AI markets.
The Communiqué underscores the important role that competition authorities and policymakers have in addressing competitive threats. As the Communiqué outlines, concentrated market power in AI-related markets and possible collusion or improper information sharing using AI technologies require careful vigilance and vigorous and timely competition enforcement. The G7 competition authorities and policymakers reaffirmed that they are working to ensure there is open and fair competition in digital markets and AI and seeking to ensure that the benefits of AI are fully realized and widely available across society.
The summit was convened by the G7 Industry, Technology and Digital Ministerial Declaration and hosted in Rome by the Italian Competition Authority (Autorità Garante della Concorrenza e del Mercato) in conjunction with Italy’s rotating G7 presidency.
The Federal Trade Commission works with counterpart agencies to promote sound antitrust, consumer protection, and data privacy enforcement and policy.
Richard B. Newman is an FTC defense lawyer at Hinch Newman LLP.
Informational purposes only. Not legal advice.
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Hinch Newman LLP’s advertising and marketing practice includes successfully resolving some of the highest-profile Federal Trade Commission (FTC) and state attorneys general digital advertising and telemarketing investigations and enforcement actions. The firm possesses superior knowledge and deep legal experience in the areas of advertising, marketing, lead generation, promotions, e-commerce, privacy and intellectual property law. Through these advertising and marketing law updates, Hinch Newman provides commentary, news and analysis on issues and trends concerning developments of interest to digital marketers, including FTC and state attorneys general advertising compliance, civil investigative demands (CIDs), and administrative/judicial process. This blog is sponsored by Hinch Newman LLP.