Wednesday, October 7, 2009

Guest Post: FTC FAQ For Book Bloggers

  Today I'm featuring a guest post by Boston internet and media attorney Jeffrey Hermes, of the firm Hermes, Netburn, O'Connor and Spearing, P.C., who will answer some frequently-asked questions about the FTC regulations governing reviews and endorsements. Please see the comments for more discussion on this issue and feel free to ask questions!
FAQ for Review Bloggers:
The Federal Trade Commission’s “Guides Concerning the Use of Endorsements and Testimonials in Advertising”

1. What is this FAQ? What is it not?
This FAQ represents a general analysis of, and commentary on, the Federal Trade Commission’s “Guides Concerning the Use of Endorsements and Testimonials in Advertising.” This document is limited to an analysis of United States law, and does not purport to address the laws of any other country or how U.S. law might apply to residents of other countries.

2. What is the Federal Trade Commission?
The Federal Trade Commission (better known as the “FTC”) is an agency of the United States government. The FTC is responsible for protecting consumers in the U.S. from unfair competition and unfair or deceptive acts or practices in commerce.

3. What powers does the FTC have?
The FTC was created by, and receives its powers from, federal statute; specifically, an Act of the U.S. Congress popularly known (simply enough) as the “Federal Trade Commission Act” or “FTC Act.” The text of the FTC Act may be found at 15 U.S.C. §§ 41-58 (that’s Title 15 of the United States Code, at Sections 41 through 58, for those unfamiliar with legal citation formats).
The most important section of the FTC Act is 15 U.S.C. § 45 (also known somewhat confusingly as “Section 5” of the FTC Act, because it is the fifth of the bundle of sections making up the Act). Section 5 states that “Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful.” Basically, all of the powers entrusted to the FTC are intended to assist the agency in rooting out and preventing the types of practices declared wrongful under Section 5.
These powers include, among others:
· Conducting investigations into whether a certain business’s or individual’s business practices are unfair or deceptive;
· Issuing cease and desist letters directing businesses or individuals to stop any practices found by the FTC to violate Section 5;
· Filing a federal lawsuit against a business or individual that has violated Section 5 or failed to comply with a cease and desist letter, including seeking monetary penalties against the business or individual;
· Issuing regulations and guidance informing the public how the FTC interprets Section 5 in specific circumstances and advising businesses and individuals how to voluntarily comply with Section 5.
If the FTC declares a particular business practice to be unlawful under Section 5, that determination will be given significant deference in any lawsuit that the FTC files in a federal court. Similarly, if the FTC issues regulations or guidance about what it considers to be an unfair or deceptive trade practice under Section 5, a federal court may later declare that the FTC has misinterpreted Section 5, but ordinarily a federal court will defer to the FTC’s interpretation.

4. What are the “Guides Concerning the Use of Endorsements and Testimonials in Advertising”?
The “Guides Concerning the Use of Endorsements and Testimonials in Advertising” (which from now on I’ll simply call the “Guides”) are guidance issued by the FTC under the rulemaking authority granted to the FTC under the FTC Act. They are part of the Code of Federal Regulations, which collects regulations issued by U.S. federal agencies, and may be found at 16 CFR Part 255.
Specifically, the Guides are intended to inform the public about how the FTC interprets and intends to apply Section 5 of the FTC Act to endorsements and testimonials used in advertising. The Guides deal with manufacturers, advertisers, and endorsers of goods or services.
The Guides provide advice and examples of how Section 5 would apply to a variety of sample situations. However, while the Guides are phrased as advice, it is important to remember that they are backed up with the FTC’s enforcement authority under the FTC Act. If an individual or business engages in conduct that the Guides suggest is unlawful, the FTC may file a federal lawsuit against the individual or business for a violation of Section 5.
The Guides become effective as FTC policy as of December 1, 2009.

5. What do the Guides say?
The primary focus of the Guides is ensuring that endorsements of products by consumers, celebrities, or experts are not unfair or deceptive. To that end, the Guides indicate (among other things) that any endorsement must represent the endorser’s own honest findings, opinions and experience with the product. In the case of an endorser that is represented to be an expert, the endorser must in fact have the relevant expertise and that expertise must be applicable to the endorsed product or service. If a product or service is represented as being endorsed by an organization, the endorsement must in fact represent the judgment of the organization as a body.
Furthermore, the Guides indicate that most endorsements will be considered a representation that the product or service endorsed is “effective for the purpose depicted in the advertisement” and typical of what consumers will experience when using the product. For example, if an advertisement includes a customer’s testimonial about their experience with a particular brand of refrigerator, that testimonial may be considered to be not merely a subjective statement, but a representation that the refrigerator works as promised and that other consumers will have similar experiences with that brand. Use of such an endorsement by an advertiser may be considered false advertising in violation of Section 5 if the endorsement is not backed up by adequate evidence possessed by the advertiser.
However, a review of an artistic work (for example, a book or a movie) will probably not be considered a statement that the work is “effective for the purpose depicted,” because readers of the review will know that the review represents one person’s subjective judgment rather than a promise of typical results.
Finally, the Guides are concerned with bias among endorsers. For example, if someone who endorses a product is compensated for that endorsement by the manufacturer or advertiser of the product, the FTC is concerned that the endorser will be biased toward a favorable review. Similar concerns might arise where the endorser is related to or otherwise connected with the manufacturer. Accordingly, the Guides state that where readers of a review might not expect there to be a compensation arrangement, failing to disclose such an arrangement or other “material connection” may violate Section 5 because readers may be misled into thinking that a review is unbiased.

6. Why do the Guides matter to bloggers?
Bloggers who review products and services may be considered “endorsers” under the Guides. Accordingly, the FTC may find that a blogger violates Section 5 if the blogger (1) posts a positive review that does not represent their honest experience with the product or service; (2) makes misrepresentations about key features of the product or service; or (3) fails to disclose a “material connection” or compensation arrangement related to the review.

As discussed above, blogs that review artistic works are unlikely to be found to be making representations as to how others will experience a book, movie, et cetera, as opposed to providing subjective opinions. However, such a blog may still be found to violate Section 5 if the blogger posts a positive review that is not their own honest opinion (for example, if a book blogger has not read enough of a reviewed book to provide an honest opinion but suggests that they have), or if the blogger fails to disclose a “material connection” or compensation arrangement related to the review.

Critically, the Guides suggest that a blogger’s receipt of a sample of a product, or a copy of a work for review, might be considered compensation for a review and a “material connection” to the advertiser or manufacturer (at least if the blogger is permitted to keep the product/copy after the review is completed). Similarly, if a blogger receives free services (including free tickets to a movie) in exchange for a review, that might constitute a “material connection.” Accordingly, the Guides indicate that bloggers should conspicuously disclose when they receive free services, or review copies or sample products that they are allowed to keep, in expectation of a review.

7. Do these Guides apply to professional reviewers who write for media outlets?
Yes. However, the FTC has separately suggested that it will not generally consider professional reviewers to be compensated by a manufacturer or publisher, since they are separately compensated by the publication for which they write. Thus, the FTC will presume that professional reviewers are unbiased (or, at least, less biased) than non-professional bloggers.

8. Do the Guides prohibit bloggers from accepting ARCs/galleys/review copies of books or other media, or participating in blog tours?
No. However, if the publisher has given the blogger a copy of a book, etc., that they can keep in expectation that the blogger will provide a review, that fact should be disclosed. For the purposes of the Guides, the fact that a review copy is an unedited advanced review copy (“ARC”) is not relevant.

The Guides do not provide clear guidance as to when a copy is provided in exchange for a review. Remember that the FTC's primary focus is on preventing unfair and deceptive advertising, and so the agency will concentrate on distribution of free copies by publishers or advertisers where a review is clearly expected (even if the book was not solicited by the blogger, and even if the publisher states that the blogger is not required to review the book). However, publishers also distribute books for free in situations where no review is solicited or even expected; for example, at library conferences publishers may give away galleys, not for the purpose of obtaining reviews, but in order to encourage librarians to buy the final books for their collections. Arguably, therefore, the fact that a book is obtained at such a conference would not need to be disclosed. The FTC will review such situations on a case-by-case basis.

Alternatively, the blogger may return or dispose of the review copy, provided that the blogger receives no compensation for disposing of the copy (for example, by selling it at a used bookstore).

9. Do the Guides prohibit bloggers from including advertising or “click here to purchase” links on their blogs?
No. However, if a blogger includes advertising or a purchase link for a product (such as a book) reviewed on the blog, and the blogger receives compensation for purchases of the product through the blog, the blogger should disclose that fact. 

10. The Guides say that a “material connection” or other compensation arrangement only needs to be disclosed if readers/viewers wouldn’t expect such an arrangement to exist. Doesn’t everyone know that blog reviewers get review copies and get compensated for purchases through links?
According to the FTC, no. If you were sued, you might be able to present a court with evidence to the contrary, but the FTC’s judgment on that issue would receive deference.
11. What about my First Amendment rights?
Section 5, and the Guides which interpret it, prohibit false and deceptive endorsements and advertising. False advertising has been held to be outside the protection of the First Amendment, which generally only protects true speech or speech that cannot be proven true or false (for example, artistic expression or statements of opinion).
Thus, while a blogger cannot be penalized for presenting their honest opinion, they might be penalized for an explicit false statement of fact (e.g., that a product does something that it cannot), or an implied false statement of fact (e.g., that the reviewer has seen a reviewed movie when in fact they have not seen it, or that there was no compensation for the review).

12. Will the FTC come after bloggers personally if they don’t comply?
Possibly. The FTC has stated that enforcement of Section 5 against individual bloggers is unlikely to be an efficient way to pursue the goals of the Guides. Rather, the FTC is more likely to focus on the manufacturers and advertisers who reach out to bloggers, to make sure that those companies fully inform bloggers about their responsibility to disclose compensation arrangements and material connections.
However, the FTC has not restricted itself from pursuing individual bloggers (including issuing cease and desist letters or filing a lawsuit) if it decides that this would be an effective way to prevent misleading endorsements.

13. Can a blogger be sued by anyone other than the FTC for violation of the Guides?
Possibly. Although the FTC Act does not permit lawsuits by anyone but the FTC, most states have their own laws (known as “Little FTC Acts”) granting private parties and/or the state Attorney General the ability to file lawsuits seeking damages for unfair or deceptive trade practices. Such “Little FTC Acts” are typically interpreted by state courts in accordance with the FTC’s interpretation of Section 5 of the FTC Act. Therefore, a state court might hold that the Guides, which interpret the FTC Act, also provide a basis for private parties to sue under a “Little FTC Act.”

14. If the FTC considers ARCs/galleys/review copies to be compensation, does that mean they represent taxable income if I keep them? We’re not supposed to resell ARCs, so how can they have cash value?
Maybe; this question is not addressed by the Guides. Generally, the Internal Revenue Service (“IRS”), and not the FTC, would be the agency responsible for determining what constitutes taxable income. If this is an issue of concern to you, you should consult a tax attorney. NOTE: This FAQ does not provide tax advice and is not intended or written to be used, and cannot be used, for the purpose of: (i) avoiding penalties under the Internal Revenue Code; or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.


Dawn @ sheIsTooFondOfBooks said...

Thanks, Marie, for hosting Jeffrey's analysis and commentary. I appreciate his insight.

bermudaonion said...

This is a great post, but I have to admit, even after reading this, the whole thing confuses me. It's hard for me to fathom that this is the most pressing issue our government has to tackle.

Unknown said...

Thanks so much for providing us with all these answers. They do clear up a lot of issues I wasn't certain about and even answer some questions I wouldn't think to ask until now.

SJ said...

Thanks for posting this. It clears up alot, but I still have questions regarding e-books.

Mr. BB said...

Lady Jane --

Good point about e-books. Is your question whether they would be considered compensation for a review by the FTC? If so, the specific issue is not addressed by the Guides, but I suspect the answer would be yes if the blogger is allowed to retain the e-book. There doesn't appear to be an obvious distinction between print and electronic copies as far as the policy behind the FTC's action is concerned.

If there are additional questions, I'd consider putting together a supplemental FAQ, so please feel free to post them. I must, however, refrain from commenting on any specific person's situation.

-- Jeff Hermes (a/k/a Mr. Boston Bibliophile)

Kim (Sophisticated Dorkiness) said...

Thanks a lot of this post, I sort of clarifies everything that's going on. It's too bad the FTC spokesperson, Cleland, I think, has put his foot in his mouth so badly on this whole issue. His statements clearly indicated the FCC has no idea about the relationship between book bloggers and publishers, etc., and make me worried that even the the Guides are as this lawyer suggests the FTC could still make this much more complicated than it needs to me.

caite said...

So bottom line, I should just acknowledge if the book that is the subject of a review was given to me by an author/publisher/publicist or if there was (in my dreams) any other sort of compensation...right?

Jessica said...

Thanks so much for an incredibly helpful and informative post.

Mr. BB said...

Caite --

Right, unless for some reason you're not allowed/able to keep the copy.


Melissa said...

Thanks for posting this (and thanks to Mr. Hermes for taking the time to explain it). I'm thinking that what we need to do, as book bloggers, (aside from complying?) is argue that reviews of books/movies are inherently different than reviews of other "products" and that applying this whole disclosure thing to book reviewing is nonsense. But that's just my opinion.

Wendy said...

Thanks for this post...but I have to say after reading it my blood pressure went up several points! Why on earth does the FTC care about some lowly little book blogger? And how could they possibly PROVE that the blogger was being anything less than honest in their reviews? I had to laugh at the statement that if a blogger gives a review without reading the entire book but says they read it, they would be in violation. Is the FTC going to send out agents to spy on readers to make sure they read the entire book before blogging about it?!??! LOL! This represents the worst of government interference in our lives.

I feel I "disclose" that I receive review books - it is in my review policy and I provide an email for requests to receive review books. I also post Mailbox Mondays where I list the books I got and where I got them. I have no intention of tagging every review with where I got a book. If someone wants to know, they can ask me via email, or read through my Mailbox Monday posts, or check out my LT page where all my books are tagged with where they came from...

*kicks away soapbox*!!!

Anonymous said...

One of the big questions that remain, at least in my mind, is what "conspicuously disclose" entails.

Does a blanket statement count? Does tagging work? (Does adding further definition in a policy statement change things?) Does each review need to contain a statement, in the body of the post? What if you use small type when disclosing in the body of the post? Or does disclosure need to be in giant, red, bold text to be considered conspicuous?

nomadreader said...

Great post! I imagine in the end, book bloggers are not the FTC's main concern. I'm happy to comply with the regulations as I understand them, and, in fact, most bloggers I know have been complying with these regulations by posting where books come from. The worst case scenario isn't even that bad: review copies disappear because publishers are afraid of legal ramifications, and we can all go back to reading our TBR piles and waiting a few more weeks to read new books until it's our time at the library!

Mr. BB said...

Wendy and Wordlily --

Not to suggest that this makes the Guides any more palatable, but I don't read them to require a specific disclosure of the person from whom you obtained a review copy -- only a statement that you were provided with a free copy of the book.

And you are right that the FTC probably won't be spying on you to see if you've read an entire book. But if it turns out that a publisher has been blasting people with perks to churn out good reviews regardless of the content, the FTC as part of an investigation might well ask bloggers if they've actually read the books at issue.

As for what a conspicuous disclosure involves, the Guides leave that open to case-by-case judgment. This is not a situation like tobacco packaging, with defined label sizes and language. Rather, "conspicuous" means that the disclosure must be obvious enough under the circumstances so that a reasonable reader/viewer would see the disclosure and understand it to dispel any contrary belief that they might have otherwise formed.

Could it be clearer? Absolutely. Unfortunately, whenever more specific rules are provided on issues like this, there will always be someone out there trying to find loopholes because the rules have been drawn too narrowly. The FTC and other lawmakers have learned that setting forth general rules which are applied case-by-case is the best way to avoid that problem. This does, however, result in situations of uncertainty like those you are raising. It's one of the central tensions in drafting legislation, and it's rarely resolved to everyone's satisfaction.


Mr. BB said...

Melissa --

Amen. A blogger who reviews artistic works develops a meaningful reputation by expressing a subjective judgment that is consistent with their readers' taste. That is very different from an endorsement of appliances or other consumer goods where subjective taste is mostly irrelevant.

In other words, book/movie bloggers need to earn their reputations, and will quickly lose followers if they suck up and sell out. At that point, the deceptive effect of their reviews is basically non-existent. The system is, to my mind, self-correcting.

There is of course the possibility of a sudden and dramatic betrayal by a trusted blogger who all of a sudden turns corporate lackey -- but I don't that a galley is enough to make that happen, do you?

I agree with your suggestion: the best thing to do is let the FTC know how you feel.


Wendy said...

Jeff, thank you for addressing my response. I do have to say however, your comment: But if it turns out that a publisher has been blasting people with perks to churn out good reviews regardless of the content, the FTC as part of an investigation might well ask bloggers if they've actually read the books at issue. made me laugh out loud. I know I am not getting blasted with perks...I don't think ANY book blogger is getting blasted with perks. The truth is that by the time I actually read a book, and spend the time to review it...any "perk" I've gotten from getting a "free" book is long gone. The time it takes negates any material value the book might have.

One question: I have a book review policy whereby I state VERY CLEARLY that I give HONEST reviews and if I don't like the book I say so. Wouldn't that policy make it clear to the FTC that I am an ethical blogger?? I must admit the vagueness of the guidelines is disconcerting. You say it is so people don't find the loopholes, but it provides little protection to bloggers to not really know the rules of the can one follow the "law" if the law has never been stated?

Mr. BB said...

Wendy --

My example of a publisher perkfest was, to a certain extent, tongue-in-cheek. Do the concerns the FTC has with respect to online consumer product marketing really extend to the publishing industry? Probably not at present, or (for that matter) in the reasonably foreseeable future. But the FTC is clearly preserving its ability to take action if such a thing were ever to occur.

As for a blogger saying that they provide honest reviews, in a perfect world that would be enough. However, the FTC has had plenty of experience with people claiming to be honest who turned out not to be, and so the agency views such statements with skepticism. (DISCLAIMER: PLEASE NOTE THAT I AM NOT SPEAKING ABOUT YOU PERSONALLY -- INDEED, TO BE CLEAR, I AM NOT GIVING ADVICE RELATING TO ANY SPECIFIC BLOG OR BLOGGER.) Also, the fact that a blogger publishes both good and bad reviews of books received for free would certainly suggest a lack of bias -- but I can imagine the FTC arguing that, for readers to see that lack of bias, they would need to know which books were received for free.

As for the vagueness of the regulation, the law tends to assume that people have an inherent understanding of what "conspicuous" means, and (more to the point) what "inconspicuous" means. If a blogger tries to hide the disclosure, that's obviously going the wrong direction. Further guidance will need to await the FTC applying the Guides in specific situations.

It could indeed be frustrating for honest bloggers who want to comply with the rules, and aren't sure how. The bottom line, though, is that if a blogger tries in good faith to comply, they are unlikely to get in trouble.


Michelle said...

Marie and Mr. BB you are the best for sharing with us some legal knowledge on the subject. I've found this post (and the comments to it) quite useful. All I know is that I'll be stating where my books come from in each review and suspect that will be enough to be compliant.

Zibilee said...

This is a really informative and interesting post. I am glad to have some of these issues cleared up for me. I think the best thing for me to do will be to consistently disclose my sources from now on. Although I do agree with Bermudaonion's opinion that this is a ridiculous thing for the government to be focused on with everything else that's going on right now.

J.T. Oldfield said...

An interesting post...thanks for the explanation. But what if I just tell the FTC to STFU? I mean, can they really enforce this?

Anonymous said...

J.T. --

A blogger is most likely to come to the attention of the FTC as follows:

1) The FTC decides for whatever reason to investigate a manufacturer or advertiser who is supplying free products to bloggers.

2) As part of that investigation, the FTC demands a list of all bloggers who have received the products.

3) The FTC tasks some intern to go check the sites of the bloggers in question to see if they're including the necessary disclosures on the manufacturer/advertiser's products.

4) The FTC fires off cease and desist letters to those bloggers who are non-compliant, telling them that they have to comply with the Guides.

When a blogger gets to step four, they're pretty clearly in the agency's cross-hairs; refusal to comply would be at the blogger's own risk.

This is not to say that the FTC could not, for some reason, decide to go after a blogger out of the blue; however, that would not be consistent with how the agency generally operates.


The Book Resort said...

Thank you, Marie, for the fascinating post. Thank you, Jeffrey for the great post!

(Diane) Bibliophile By the Sea said...

Great post Marie. It was nice to read a legal opinion.

SJ said...

Jeff- That was one of my questions. Yet I have to wonder how do they know I still have the book without actually looking on my hard drive. But that point could be argued with print books as well, how would they know you returned said book, without checking.
My question actually stems from another post where the point was made that most book bloggers are not paid and it was said that a book blogger could get monetary compensation from selling their books. E-books are non-transferable. You can't resell them or even give them away. When you no longer want them the only option is delete.
So how can they consider this a form of compensation? Other than you get the book.

Mr. BB said...

Lady Jane --

As far as I understand the FTC's rationale, they consider the mere fact that you get the book to be compensation, regardless of whether it can be transferred.

In a related context, the FTC has indicated that providing free movie tickets in exchange for an endorsement of the movie would be an incentive that needs to be disclosed. In that case, of course, the person receiving the tickets does not get to "keep" the movie, much less give it away -- the benefit is merely the opportunity to see the movie, not the ability to resell it later.

Following this logic, the FTC could have taken the position that it would not matter if a blogger gives away a galley or deletes an e-book, since (like watching a movie) it is enough of a benefit that they'd been given the opportunity to read it. Richard Cleland's comments suggest that the FTC will not go that far with respect to book bloggers, but there's arguably a logical inconsistency between saying that a book blogger can avoid disclosure by disposing of a book after reading it and saying that a movie blogger has to disclose even though they walk away with nothing tangible after the movie. The difference is likely down to an instinctive perception that possession is more relevant with respect to books than with respect to movies, but it's not clear why that would affect the legal question of whether a benefit has been received.

As far as how the FTC will discover whether you've kept a book or not, it's an excellent question. As I mentioned in response to J.T.'s post above, the most likely way for the FTC to find a book blogger is through the publishers who distribute copies. At that point, the FTC would presumably ask the blogger what happened to the book. Whether they'd care enough to check if the blogger's response is true is anyone's guess.


SJ said...

Jeff- Thank you for the reply. I find it kinda funny, if you follow this logic. What's the point of returning a book?
Personally I'm waiting to see more on this. But I have added a disclaimer to my blog.

Mr. BB said...

Update: Richard Cleland has spoken again, this time saying that, whatever the Guides may suggest, the FTC has never and will never sue an endorser simply for failing to disclose a material connection. See

Sounds to me like the FTC has heard the voices raised in concern, and is seeking to reassure everyone. This sort of reinforces my belief that, absent truly outrageous behavior, the most that bloggers can expect to see is a cease and desist notice indicating the disclosures they should be making.


Wendy said...

Thanks, Jeff...thank goodness there is SOME rationality to all of this *smiles*

Lenore Appelhans said...

Thanks to Jeff for the post and for taking the time to clear up our questions!

Katie said...

Thanks for this post Jeff; I have to admit before I read it (and even a little after) I was a little confused about the issue. It seems to me most bloggers already disclose their source of books.

Thanks for taking the time to address the issue.

Karen Harrington said...

Thanks so much for all of this information. As an author/book blogger who enjoys giving away my own books, I was confused about the issues surrounding this new action. You've clarified quite a few things for me. :)

Serena said...

I'm wondering if I now have to disclose that this book came from such-and-such public library or I bought this book at such-and-such retailer as well?

And are these rules as of Dec. 1, 2009, retroactive to previous posts on my blog.

Serena said...

It seems to me that as long as there is disclosure of the free books on each review post, that the FTC should not take issue.

Anonymous said...

Serena --

It sounds like you've got it right; bloggers are only required to disclose books, etc., they get for free from a publisher or advertising agent in expectation of a review. If a blogger gets books anywhere else (bookstores, libraries, holiday gifts, giveaways by non-publisher-affiliated sources) they don't need to disclose the source.

As for retroactivity to pre-12/1/09 reviews, the Guides are not clear, given that older reviews typically remain available long after their release date. However, I would be very surprised if the FTC interprets the Guides to require bloggers to go back and revise earlier reviews. Normally, regulations affecting publishing are only targeted at content created after the date the regulations become effective.


Anna said...

Thanks for a great, informative post. I think most of my questions have been answered. I have no problem disclosing review copies, and I do that already. I guess I'll just insert the word "free" before review copy to cover the bases.

Diary of an Eccentric

MLO said...

People should keep in mind that we pay our attorneys to give us a worst case scenario - at least most businesses do - when it comes to general stuff. If you actually retain an attorney, the advice is going to be a bit different - how to stay out of court. There really is nothing new here by the FTC. Reviewers of print media have always been assumed to receive galleys which is why they don't publish it on the front of their review section.

Speaking from a historical point of view, the truth is, the furor over these rules is silly and will not, over time, stand up unless it is a full on press to stop online reviewers from competing with old media.

Having worked in some of the most heavily regulated industries around, it doesn't matter what is said, it matter in how it is enforced. I don't see a great deal of revenue being acquired by fining individual bloggers, so, honestly, unless you are consistently lying about your reviews, I doubt you have anything to worry about.

Anonymous said...


You are of course correct that the analysis provided in an article such as this would be different from the advice provided by an attorney retained to consult on a particular situation. For example, I have avoided providing specific guidance on the form of a disclosure that bloggers can use, because in my judgment that would step over the line (as an ethical matter) into the type of communication better handled within the protected confines of an attorney-client relationship.

The primary point of the FAQ, and the comments I have made here, is to clear up misconceptions about what the FTC Guides do and do not say. There was significant confusion about what the Guides will require come December. I hope I have managed to do that.

Is any of this new? Well, it is true that the Guides merely interpret Section 5 of the FTC Act, so the power was always there for the FTC to take action regardless of whether the Guides existed to warn people. It is also true that the FTC will likely do what it has always done, and focus on people who are engaging in egregiously deceptive behavior in the marketplace.

However, I think it important for people to know and understand the extent to which a government agency has asserted its authority over the Internet, which is broadly perceived as unregulated. Only by understanding the FTC's action properly can there be a real public dialogue about whether this is the right way for the FTC to combat the evils that it was created to prevent. Maybe that dialogue results in a conclusion that the FTC's action is a minor extension of existing activity, which does not significantly impact freedom of speech and press; but maybe not.


Jo-Jo said...

Thanks for providing this helpful information. It's good to know that we will have all of our ducks in a row.