Posts Tagged ‘Federal Trade Commission’

Are You FTC Compliant?

On December 1st 2009 the FTC (Federal Trade Commission) closed down the wild west of Internet Marketing but help is at hand for newbies and experienced marketers a like, Denise Gosnell and Jynell Berkshire, attorneys and co-founders of Innoventum, Inc have come up with some sound advice that will not cost you the earth. Denise one of the US of A’s top cutting-edge attorneys when it comes to the legalities of Internet marketing, FTC regulations, product patents and looking after your business. As a business owner you need to be concentrating on the profitability and growth of your business.  The protection of your intellectual and physical assets are part of the  growth and profitability of your business.

Now Denise and Jynell have come up with 10 strategies that you need to cover, They are:

• STRATEGY 1: Use The Proper Written Agreements with Contractors and Employees
• STRATEGY 2: Trademark Law Pitfalls And Tips
• STRATEGY 3: Form a Company With Limited Liability Protection
• STRATEGY 4: Use Non?Disclosure Agreements To Protect Your Intellectual Property
• STRATEGY 5: Include a Privacy Policy and Terms of Use On Your Web Site(s)
• STRATEGY 6: FTC Proximity Rule and Clear and Conspicuous Rule
• STRATEGY 7: Robo?Call Rule (September 1, 2009)
• STRATEGY 8: Average Results/Testimonials Rule (December 1, 2009)
• STRATEGY 9: CAN?SPAM Act
• STRATEGY 10: Follow Proper Accounting Principles To Keep Your Business In Good Standing

Note that they are not all about FTC compliance but also but best practices that can be over looked by even the most successful business.

The Real Value of the Information that Denise and Jynell provide is the 10 agreements with explanations on when to use them. Clients can pay thousands for this. While the product may be short and sweet, don’t underestimate the value.  They don’t like to drag things out just to make them seem more impressive.  Time is money.

Here are the agreements that are included with the course:

• Professional Services Agreement (to use with Contractors)
• Intellectual Property Ownership Agreement (with Contractors)
  
• Employment Agreement (to use with Employees)
• Intellectual Property Ownership Agreement (with Employees)
  
• Interview Release Agreement
• Non-Compete Agreement
• Non-Disclosure Agreement
• Mutual Non-Disclosure Agreement
• Intellectual Property Transfer Agreement
  
• Sample Web Site Privacy Policy With No Data Sharing/Selling Rights
• Sample Web Site Privacy Policy With Data Sharing/Selling Rights
• Sample Web Site Terms of Use

Watch the Video Here

PS If you buy the product I get paid.

Avoid The FTC’s Fine

CliffsNotes For Bloggers To Avoid The FTC’s $11,000 Fine For Endorsements

by Chip Cooper
Posted on October 26, 2009

If you’ve already read – and clearly understand – the 81-page Guides for the use of Endorsements and Testimonials in Advertising issued by the FTC on October 5, 2009, then read no further.However, if you’re a blogger or other producer of consumer-generated online content, and you’re not quite sure about how to decipher the legaleze or how to comply with the Guides, then this article may be for you… particularly if you’re more than a little concerned about avoiding the $11,000 fine for non-compliance.

What’s This All About, Anyway?

I’ve read bloggers’ comments to the effect of “why is the Federal Trade Commission sticking its dad-gum nose into the blogosphere — how far will this go?” That’s one way to look at it – as an unnecessary intrusion by the government.

Another way to look at is that the Guides represent an “official” recognition that blogging has passed its adolescent stage. Blogging has grown up, and the FTC is the so-called new sheriff in town.

Now, any producer of consumer-generated online content – bloggers, podcasters and video producers – is being treated to the same truth in advertising rules that other businesses in the brick and mortar world have been living with for a long time.

When Do Bloggers Become Endorsers?

This is the key threshold question. If a blogger is not an endorser, then the Guides do not apply. However, if the blogger is an endorser, then the Guides apply and with them, potential liability.

If you want to actually read the Guides to find the answer, go to new Example 8 (pp. 50-51). Example 8 provides 3 scenarios where a consumer reviews a product or service on a blog:

* no endorsement – a consumer purchases a product with his/her own money, and posts a review or opinion on a blog (result: Guides do not apply do not apply because there is no relationship at all with the advertiser; no worries);

* no endorsement – same scenario, except that a coupon for a free trial of the product is generated by the store’s computer, based on his/her purchases (result: Guides do not apply because there is no relationship with the advertiser indicating “sponsorship”; no worries); and

* endorsement – the consumer is part of a network marketing program where he/she periodically reviews products and receives a free product for which he/she writes reviews (result: Guides apply because there is a relationship with the advertiser based on the stream of free products indicating “sponsorship”; there are legitimate worries about how to comply with the Guides).

Suggestions For Bloggers Who Act as Endorsers

If you’re a blogger who acts as an endorser, then you should take care to understand and comply with the Guides to avoid a $11,000 fine by the FTC.

In simple terms, the basic rules are these:

* disclose “material connections” you receive for promoting someone else’s product or service, and

* disclose typical results that should reasonably be expected from a product or service (“results not typical” disclaimers won’t work anymore).

The real trick is understanding how to comply with these basic rules. The following is a list of examples and suggestions to assist you:

* if you purchase a product and pay for it with your own money, then blog about it, you’re not regulated by the Guides – no worries;

* if you are paid for product review, you should disclose who paid you that you were paid for the review (you’re clearly regulated by the Guides);

* if you regularly get free products and blog about them (e.g. a book reviewer), you should disclose who sent you the product and that it was free (you’re clearly regulated by the Guides);

* however, if you don’t routinely blog about products, or you don’t routinely receive free products, but you receive a free product that’s not very valuable and you blog about it, you’re probably not regulated by the Guides;

* even if you write a negative review of a product or service you’re not off the hook — if you’re required by the Guides to make disclosures, the disclosure rules still apply, even to negative reviews;

* if you’re an endorser, you should be a bona fide user of the product or service at the time the endorsement is given – fake endorsements are deceptive, and won’t comply with the Guides;

* disclosures should not be after-the-fact; they should be made at the time of the endorsement and live with it;

* disclosures should be clear and conspicuous – it’s not required that the disclosure be in ALL CAPS, but all caps disclosures would go a long way toward satisfying the clear and conspicuous requirement; * example disclosure: FTC GUIDES NOTICE: I RECEIVED THIS PRODUCT FROM XYZ, INC. FREE OF CHARGE, or FTC GUIDES NOTICE: THIS PRODUCT WAS PROVIDED FREE OF CHARGE BY XYZ COMPANY; and

* if you regularly get free products and blog about them (e.g. a book reviewer), you might consider adding a clause to your website’s Terms of Use regarding this business practice.

Conclusion

Prior to the issuance of the Guides by the FTC – which go into effect on December 1, 2009 – the blogosphere was sort of like the wild, wild west. Few if any rules, anything goes… and that sadly included fake endorsements and material relationships that weren’t disclosed.

The Guides were intended  to address some of these abuses. Despite the good    intentions motivating the Guides, there are legitimate concerns that the Guides may have gone too far. Critics argue that they are overbroad, and that they may create as many problems as they solve. Legal scholars debate whether they are contrary to established legal precedent.

Despite the misgivings of some and debate among legal scholars, the new FTC Guides are here to stay. They represent not only a win for consumers, but also a wake-up call to bloggers. The blogosphere has now come of age, and this requires a much greater sense of responsibility in a highly regulated environment.
Leading Internet, IP and software lawyer Chip Cooper has automated the process of drafting website documents for small websites with his MyLegalFirewall website documents drafting service. Discover how quick, easy, and cost-effective it is to determine which legal documents you need, draft them online, and claim your FREE Special Report, Determine Which Legal Documents Your Website Really Needs, at ==> http://digicontracts.com/kits/firewall.aspx
Copyright © 2009 Chip Cooper