Enforcement of Fashion Laws

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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, manufacturers and retailers who make claims about the amount of US content in their products must comply with the  “MADE IN USA” Enforcement Policy Statement issued by the Federal Trade Commission (“FTC”).[3]  The Enforcement Policy Statement applies to all products advertised or sold in the US, except those specifically subject to country-of-origin labeling requirements and “MADE IN USA” claims, express and implied, that appear on products and labelling, advertising and promotional materials and other forms of marketing including digital marketing and social media.[4]  In order to make an unqualified claim that a product is “MADE IN USA”, a manufacturer or marketer should have competent and reliable evidence (“a reasonable basis”) to support a claim that the product is “all or virtually all” made in the US.[5]
Continue Reading Seeking to Stop Deceptive ‘MADE IN USA’ Claims, the FTC Takes Action Against Brandnex

On November 5, 2019, the United States Federal Trade Commission (“FTC”) issued a guide entitled “Disclosures 101 for Social Media Influencers”[1] and a video “Do you endorse things on social media?” to alert influencers to the laws governing endorsement or recommendation of products or services and provide social media influencers with “tips on when and how to make good disclosures.”[2] The FTC’s written guide states that “[a]s an influencer, it’s your responsibility to make these disclosures, to be familiar with the Endorsement Guides, and to comply with laws against deceptive ads.”[3] The guide explains to influencers that disclosures must be made when an influencer has a “material connection,” that is “any financial, employment, personal, a family relationship with a brand” and that receiving “free or discounted products or other perks” requires a disclosure.[4] In addition, the FTC notes that “tags, likes, pins, and similar ways of showing you like a brand or product are endorsements.”[5] The FTC guide also instructs influencers that “[i]f posting from abroad, U.S. law applies if it’s reasonably foreseeable that the post will affect U.S. consumers. Foreign laws might also apply.”[6] The FTC notes that disclosures must be in simple and clear language that is placed “so it’s hard to miss” and should be placed with the endorsement itself. Disclosures that “appear only on an ABOUT ME or profile page, at the end of posts or videos, or anywhere that requires a person to click MORE” will not be sufficient.[7] The FTC gave the following guidance with regard to endorsement posts in photographs, video and live streaming:
Continue Reading FTC’S New “Disclosures 101” Publication And Video Is A Shout Out To Influencers

UPDATE:  On October 12, 2019, Governor Gavin Newsom signed AB 44 and Governor Newsom stated in social media: “I just signed #AB44 — one of the strongest animal rights laws in US History — making California the first state in the nation to ban new fur sales.” The ban goes into effect in 2023 and fur retailers have more than two years to sell any furs they still have in their inventory.  After the law goes into effect, manufacturers and retailers will face fines of $500 to $1,000 for every violation of the law.

Before the 1849 California Gold Rush, American, English and Russian fur hunters were drawn to Spanish (and then Mexican) California in a California Fur Rush, to exploit its enormous fur resources. Before 1825, these Europeans were drawn to the northern and central California coast to harvest southern sea otters and fur seals, and then to the San Francisco Bay Area and Sacramento–San Joaquin River Delta to harvest beaver, river otters, marten, fisher, mink, gray fox, weasels, and harbor seals. It has been said that California’s early fur trade, more than any other single factor, that opened up the West to world trade.
Continue Reading No Future for Fur in the Golden State?

Section 653o of the California Penal Code makes it a misdemeanor to import into the state for commercial purposes, to possess with intent to sell, or sell within the dead body or a product thereof, of a variety of animals. Commencing on January 1, 2020, Section 653o(b)(1) shall make it “unlawful to import into this state for commercial purposes, to possess with an intent to sell, or to sell within the state, the dead body, or any part or product thereof, of a crocodile or alligator.” This bans any shipment of alligator or crocodile into, possession of alligator or crocodile with an intent to sell, or to sell within California. A number of bills to either delay the effectiveness of the law or repeal it recently have been killed or tabled by the California Legislature.
Continue Reading See You Later Alligator? After A While Crocodile? Will Penal Law 653o(b)(1) Take Effect?

In our previous blog post, “Brands Beware!!! FTC Scrutinizing Influencer Posts for Compliance with Endorsement Guides,” we reported that the Federal Trade Commission (“FTC”) had issued more than 90 letters to brands and influencers, making it clear that it is paying close attention to influencer-based marketing.  More recently, the letters have been made publicly available, providing valuable insight into the types of disclosures that the FTC considers unacceptable or inadequate.
Continue Reading A Deeper Dive Into the FTC Crack-Down on Social Media Influencers: What You Should Know Before You Post

In response to a petition from a coalition of consumer groups last year complaining about the need for disclosures by social media influencers, the FTC recently announced on April 19, 2017 that it had issued more than ninety letters reminding influencers and brands that “if there is a ‘material connection’ between an endorser and the marketer of a product – in other words, a connection that might affect the weight or credibility that consumers give the endorsement – that connection should be clearly and conspicuously disclosed, unless the connection is already clear from the context of the communication containing the endorsement.” The FTC explained that material connections could “consist of a business or family relationship, monetary payment, or the provision of free products from the endorser.” A copy of the form of the letter, which explains that clear and conspicuous disclosures are required can be found here.
Continue Reading Brands Beware!!!! FTC Scrutinizing Influencer Posts for Compliance with Endorsement Guides

On February 1, 2017, the Federal Trade Commission (“FTC”) and iSpring Water Systems, LLC (“iSpring”) reached a settlement regarding its false, misleading, and unsupported claims that its water filtration systems and parts are “Built in USA,” “Built in USA Legendary brand of water filter,” and “Proudly Built in the USA.”
Continue Reading FTC Requires that iSpring’s “Built in USA” Claims Hold Water

In 2014, the United States Court of Appeals for the Third Circuit ruling in FTC v. Wyndham Worldwide Corporation agreed to hear an immediate appeal on two issues: “whether the FTC has authority to regulate cybersecurity under the unfairness prong of § 45(a); and, if so, whether Wyndham had fair notice its specific cybersecurity practices could fall short of that provision.” On August 24, 2015 the Third Circuit affirmed the decision of the District Court and denied Wyndham’s motion to dismiss the complaint.
Continue Reading FTC v. Wyndham: The Third Circuit Recognizes FTC Authority to Regulate Commercial Cyber Security Practices

As we previously reported last year, native advertisements represent an increasingly popular and effective means of promotion for marketers that also presents a major challenge for the Federal Trade Commission (“FTC”), an organization whose primary duty is to protect consumers from false and misleading advertising.  Native advertising, also known as corporate content or branded journalism, features marketing material that is designed to mimic the look and feel of the host website.  While the look of native advertisements differs depending on the host website, the underlying goal for marketers is the same — to make the advertisement look and feel like editorial content. 
Continue Reading Will The FTC Issue Native Advertising Guidelines in 2015?

Social media allows users to effortlessly communicate globally with nothing more than a few keystrokes.  Advertisers have harnessed the power of social media bloggers and incorporated it as a key component of their advertising campaigns.  This practice is known as “consumer-to-consumer” marketing or “consumer-generated media” marketing.  While consumer-to-consumer marketing is a prevalent practice, especially in the fashion industry, the use of bloggers to promote fashion products to consumers necessitates compliance issues under the Federal Trade Commission Act.
Continue Reading There’s No Such Thing As a Free Sample

Wacoal America and Norm Thompson, both manufacturers of women’s shapewear, recently entered into consent orders to pay sums of $230,000 and $1.3 million, respectively, and agree to  not make any false and misleading future claims that their products cause weight loss, fat loss or eliminate cellulite as the result of FTC enforcement action as the result of making unsubstantiated weight-loss claims.  This is yet another reminder that any claims made in advertisements or marketing materials as to weight-loss, fat-loss or cellulite elimination must be substantiated by a scientific study or the manufacturer may face an FTC action and potentially substantial fines.
Continue Reading FTC Takes Action Against Unsubstantiated Caffeine-Infused Shapewear Weight-Loss Claims