Covering Your Ads® Blog

Legal Issues Affecting Advertising, Marketing and Promotions

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“NFT” was 2021’s word of the year.  This isn’t too surprising—they’re everywhere!  The market cap for NFT transactions jumped from roughly $400 million at the beginning of 2021 to over $7 billion by year’s end.  What’s next and how can brands and other content creators leverage NFTs to bring value?
Continue Reading Thinking of Jumping on the NFT Bandwagon – Are you Prepared?

Last week, Reps. Anna Eshoo (D-CA), Jan Schakowsky (D-IL) and Cory Booker (D-NJ) introduced the Banning Surveillance Advertising Act of 2022, a new bill that seeks to significantly restrict targeted advertising practices. The proposed legislation prohibits “advertising facilitators” (defined as entities who receive consideration for disseminating ads and collect or process personal information in connection with such dissemination) from targeting ads to individuals based on their personal information. In addition, the bill prohibits advertisers from targeting, or using an advertising facilitator to target, ads based on personal information that the advertiser obtained from a third party (i.e., anyone other
Continue Reading Proposed Federal Legislation Seeks to Ban Targeted Advertising

In October 2021, Governor Gavin Newsom signed into law a sweeping package of six bills aimed at reducing plastic waste, improving recycling efforts, and clarifying labeling standards for recyclables and compostables.  These new laws will likely mean significant changes for many companies.  They come at a time when multiple states are passing similar environmentally focused bills, signaling a renewed effort to promote recycling and regulate green advertising.
Continue Reading California Passes Sweeping Package of “Green” Bills

The FTC has sent a strong message to industry that it plans to hold companies responsible for using endorsements and customer testimonials that deceive consumers.  The recent warning signals the FTC’s focus on fake reviews and endorsements and the agency’s intent to hold brands and advertising service providers accountable where necessary.  The agency is paying particularly close attention to how brands communicate with customers through third party influencers on social media.
Continue Reading FTC Signals Plan to Enforce Civil Penalties for Deceptive Endorsements

The Federal Trade Commission (“FTC”) recently settled an enforcement action against an advertiser for $753,000 for deceptive “Assembled in USA” product claims, the first such settlement following the FTC’s recent adoption of a new rule addressing unqualified “Made in USA” labeling claims.  (See Made in USA Labeling Rule.)
Continue Reading FTC Cracks Down On Violations of Newly-Codified “Made in USA” Claims Rule

The Children’s Advertising Review Unit (CARU) recently revised its children’s advertising guidelines to address the increased prevalence of online media directed to children. Of note, the guidelines now apply to content directed to children under 13 -in line with COPPA- rather than the previous applicability to children under 12.
Continue Reading CARU Revises its Guidelines to Address Increase in Online Media

On January 25, 2021, President Joe Biden issued an Executive Order entitled “Ensuring the Future is Made in America by All of America’s Workers,” which directs a broad review and strengthening of governmental procurement and financial assistance policies and regulations which require or provide a preference for goods, products or materials produced in the United States.[1]  While US content must be disclosed on automobiles, textile, wool and fur products sold in the US[2] and there is no law which requires a company to disclose the amount of US content or that a product is manufactured in the US,
Continue Reading Seeking to Stop Deceptive ‘MADE IN USA’ Claims, the FTC Takes Action Against Brandnex

Overriding the governor’s veto of H.B. 732 (2020), the Maryland Senate on February 12, 2021 passed the nation’s first state tax on the digital advertising revenues pulled in by large companies. This development follows attempts by various other states like New York to directly regulate digital advertising and ecommerce services in new ways. We took a look at the Maryland bill to find out what advertisers need to know about its details and potential pitfalls.
Continue Reading Maryland Breaks Ground with Digital Advertising Tax

To date, there are over 1 billion augmented reality (“AR”) users and 171 million virtual reality (“VR”) users worldwide[1], a number that continues to increase as more industries turn to AR and VR to create immersive user experiences. Companies are offering stand-alone experiences that integrate augmented reality and virtual reality at events, such as Samsung and Live Nation’s broadcast of a VR Coldplay concert, as well as through in-store location based applications to encourage a seamless “try before you buy” approach, like Gucci’s AR apparel and accessories try-on app. AR and VR are shaping the future of advertising
Continue Reading Is it Time to Make AR and VR a Part of Your Reality?

As anyone who has been through a corporate sale process can tell you, there is no such thing as a “standard” M&A transaction.  Every deal is different and presents a unique set of challenges.  This is especially true of transactions involving lead generation companies, which can be very different than businesses in other industries.  Amongst other differences, companies in this space utilize a wide variety of customized commercial arrangements and are subject to numerous industry-specific regulatory requirements that buyers need to be aware of before making an investment in this space.  In this article, we highlight the top 10 issues
Continue Reading Top 10 Diligence Issues in Lead Generation Mergers and Acquisitions

Tapjoy, Inc. (“Tapjoy”), a mobile advertising company, settled FTC allegations that it failed to provide promised in-game rewards to consumers. Tapjoy operates an advertising platform that works within mobile games and offers in-game virtual currency to users who complete the activities of third-party advertisers (i.e. purchase products, sign up for a free trial, take a survey). Despite hundreds of consumer complaints, Tapjoy failed to deliver on its promises to consumers who earned in-game rewards.
Continue Reading Mobile Advertising Company Gets Flack from FTC for Failure to Deliver Upon Advertised Promises

This article was originally published on Food Navigator on January 13, 2021.

If your company sells any vanilla-flavored food or beverage product, then you are probably aware of the innumerable class action cases that have been filed over the last 18 months attacking these products – 67 cases by our count.  Here, we trace the history of this litigation and the outcomes achieved to date.
Continue Reading The Scoop on All that Vanilla Flavor False Advertising Litigation

This article was originally posted in Food Manufacturing on January 6, 2021.

Despite the COVID-19 pandemic, the number of putative class actions targeting the food and beverage industry increased in 2020 and show no signs of slowing down in 2021. The number of class actions filed against beverage companies in New York increased while the number of cases filed in California decreased. While the Northern District of California, which had become known as the “food court” remained a popular jurisdiction for these suits, filings in New York outpaced those in California. The factual basis of the claims also continues to evolve. Early cases challenged
Continue Reading Food & Beverage False Advertising and Labeling Class Actions: What You Need to Know for 2021