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Hot Legal Litigation Topics for Advertisers and Marketers in 2020
The COVID-19 pandemic pushed brands headlong into e-commerce. Certain advertising and marketing practices led to litigation in 2020. Brands and their legal counsel should target these hot topics for legal vetting and risk mitigation as we move forward into 2021.
FTC Mail Order Rule
With the slowdown of mail systems, consumers grew frustrated with unfulfilled promises from companies. The FTC took notice and starting enforcing its Mail, Internet, or Telephone Order Merchandise Rule (Mail Order Rule) (https://bit.ly/38JQDj7). This detailed FTC rule outlines requirements for the timing of shipping and related customer communications. At its most bare bones, the rule dictates a 30-day presumed delivery window for goods ordered via mail, Internet, or telephone. Sellers may deviate from the 30-day window if they have a reasonable basis for another time frame and make meaningful disclosures before the sale. Once the sale happens, the seller may change the delivery window by a notice to the consumers that includes refund procedures.
In April 2020, the agency announced a $9.3 million settlement ("record-setting" according to the agency) with Fashion Nova regarding its unmet promises of fast and quick shipping. Then, in November 2020, the FTC obtained a temporary restraining order in Ohio federal court against 25 websites that allegedly "trick [consumers] into paying for genuine Clorox and Lysol products that the defendants never deliver." (See, FTC v One or more unknown parties, et. al. N.D. Ohio, 5:20-cv-02494.) The defendants, they allege, are part of an elaborate scheme that utilizes fake websites, falsifies shipment information, infringes trademarks, employs deceptive URLs, and deceives consumers. The complaint outlines violations of the FTC Act and the Mail Order Rule.
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