FTC Defense Lawyer
Award-Winning Advertising Investigations and Litigation Leader
The Federal Trade Commission Act (FTC Act) (15 USC §45) is the primary consumer protection statute enforced by the agency. The FTC is empowered to prevent unfair or deceptive marketing practices, conduct investigations and seek relief for conduct injurious to consumers.
FTC defense lawyer Richard B. Newman has successfully resolved some of the most important Internet advertising enforcement actions and regulatory inquiries in the past decade and is a critical asset to any company or individual faced with navigating a federal or state deceptive trade practices case.
Richard’s significant, nationwide litigation and counseling experience extends to defending a sophisticated client base (some of whose clients are comprised of Fortune 100 retail companies) in high-stakes "bet-the-company" advertising proceedings and investigations at all levels of government, and in state and federal courts throughout the United States.
- Federal Trade Commission
- State Attorneys General
- Consumer Financial Protection Bureau
- U.S. Department of Justice
- National Advertising Division (NAD)
- Departments of Consumer Affairs
A number of Richard's clients have been recognized as being amongst the fastest growing private media and technology companies and ranked on Inc. Magazine's Annual 500/5000 List.
Richard defends and challenges marketing practices so his clients can strengthen their brands and market position. His litigation experience also includes defending companies and individuals in private litigation matters in state and federal court involving allegations of unfair trade practices and false advertising, and Lanham Act litigation involving Internet, telecommunications, dietary supplement and consumer product companies.
In an industry where more and more traditional lawyers and law firms claim digital media advertising-related FTC defense expertise simply to win over clients, Richard Newman’s comprehensive knowledge of the unique business operations of Internet marketers and related regulatory defense subject matter experience provide a solid foundation for his ability to ensure that clients' marketing practices satisfy expectations established by applicable government agencies and that their interests are aggressively defended in high-profile litigation matters involving cutting-edge issues of law.
See here for tips on the art of responding to an FTC Civil Investigative Demand and here for considerations for digital marketers when selecting industry savvy and aggressive regulatory enforcement and investigation defense counsel. Visit the "Ad Law Insights" - Legal and Regulatory Updates Blog for the latest FTC and state attorneys general compliance, investigation and enforcement developments of concern to advertisers and marketers. See examples of Richard's recent Representative Experience.
Federal Trade Commission
The FTC protects consumers and competition by preventing deceptive, unfair and anticompetitive business practices through law enforcement, advocacy and education.
The FTC is an independent agency that reports to the President and to Congress on its actions. These actions include pursuing law enforcement; developing policy and research tools through hearings, workshops, and conferences; and creating educational programs and materials for consumers and businesses.
FTC lawyers have consumer protection and competition jurisdiction in broad economic sectors. It administers a variety of laws, such as the Federal Trade Commission Act, the Fair Credit Reporting Act and the Clayton Act. The FTC also enforces rules issued pursuant to the Federal Trade Commission Act or other laws, including the Business Opportunity Rule and the Telemarketing Sales Rule.
Why the FTC was Created
The FTC seeks to maintain a competitive marketplace for both consumers and businesses. The Federal Trade Commission was created in 1914 to prevent unfair methods of competition in commerce. Congress has since passed additional laws giving the agency greater authority over anticompetitive practices.
Recognizing that unfair and deceptive practices can distort a competitive marketplace as much as unfair methods of competition, in 1938 Congress amended the FTC Act and granted the FTC authority to stop “unfair or deceptive acts or practices in or affecting commerce.” The FTC is also directed to enforce a wide variety of other consumer protection laws and regulations.
The FTC is headed by a five-member Commission, nominated by the President and confirmed by the Senate, each serving a staggered 7-year term. The President chooses one commissioner to act as Chair. No more than three commissioners may be from the same political party.
The FTC’s Mission and Strategic Plan
The FTC focuses on investigating and litigating cases that cause or are likely to cause substantial injury to consumers. This can include more than just monetary injury. It can also include, for example, unwarranted health and safety risks. The FTC’s mission is carried out by the Bureau of Consumer Protection, the Bureau of Competition and the Bureau of Economics.
The FTC’s strategic goals are to protect consumers from unfair and deceptive practices in the marketplace; maintain competition to promote a marketplace free from anticompetitive mergers, business practices, or public policy outcomes; and advance the FTC’s performance through excellence in managing resources, human capital, and information technology.
The Federal Trade Commission recently published its fiscal years 2018 to 2022 strategic plan. The road map that will guide the agency over the next five years. The plan will enable the FTC to gauge its success in protecting consumers, maintaining competition, and advancing its organizational performance.
The FTC updated its mission statement to reflect better the FTC’s active role in consumer protection and competition law enforcement, advocacy and education efforts on behalf of American consumers and businesses. The Commission has also expanded its goal to further information and technology management as critical support functions at the FTC.
The FTC's primary objectives include the following:
- Identify and take actions to address deceptive or unfair practices that harm consumers
- Provide consumers and businesses with knowledge and tools that provide guidance and prevent harm
- Collaborate with domestic and international partners to enhance consumer protection
- Maintain competition to promote a marketplace free from anticompetitive mergers and business practices
- Manage resources, human capital and information technology
How the FTC Works
While the FTC does not often openly disclose why or when it began an investigation, there are several common triggers, including:
- Direct findings
- Consumer complaints
- News articles
- Advocacy group requests
- NAD recommendations
- Competitor requests
The FTC constantly monitors claims made across all media channels. In addition, consumers often submit complaints directly to the FTC, to state Attorneys General, to local Better Business Bureaus and via social media. The Commission also keeps a close watch on reports on news outlets for unlawful marketing practices.
The National Advertising Division of the Council of Better Business Bureaus (NAD) initiates reviews and conducts reviews in response to consumer or competitor complaints. If an advertiser refuses to participate or to comply with an NAD decision, the matter can be referred to the FTC.
Depending upon how egregious the allegations are, any one of the foregoing can result in the identification of an investigation target. Companies should consult with an FTC consumer protection investigations and enforcement law firm to monitor the foregoing and take proactive measures to minimize the likelihood of being investigated.
How the FTC Enforces the Law
The FTC often evaluates whether enforcement activities are tracking the areas of greatest concern and whether there are new practices or technologies that require additional law enforcement. The FTC’s Bureau of Consumer Protection, with the support of the Bureau of Economics, investigates cases and initiates civil enforcement actions, primarily by filing actions in federal court pursuant to FTC Act Section 13(b), when there is reason to believe that entities have violated these laws and rules. The FTC’s enforcement actions seek injunctions and other relief. The FTC also brings enforcement actions via administrative proceedings.
If the FTC makes the decision to litigate, it can initiate action in federal court or bring an administrative action. If the FTC proceeds to federal court to pursue an enforcement action against you or your company, it may take the following actions:
- Enjoin violations of the FTC Act, and secure other equitable relief such as restitution and disgorgement of “ill-gotten” gains
- Serve you with a complaint and temporary restraining order
- Immediately freeze corporate and personal assets
- Gain immediate access to business premises
- Appoint a temporary receiver to take over corporate assets and operations
Unlike the provisions of the FTC Act that permit the FTC to seek monetary relief for violations of a cease and desist order, dishonest or fraudulent acts or practices, or knowing violations of promulgated rules, the plain text of Section 13(b) permits the issuance of injunctive relief. Despite the FTC’s ability for decades to also pursue and obtain “ancillary equitable relief,” at least on its face, Section 13(b) does not permit the FTC to recover restitution, disgorgement, or other forms of equitable monetary relief.
Thus, in July 2020, the U.S. Supreme Court granted certiorari and consolidated two cases that call into question the FTC’s authority to seek equitable monetary relief directly in federal court in Section 13(b) cases, even before any administrative adjudication has occurred, and even in the absence of any rule violation. The Supreme Court’s resolution of these cases pertaining to the scope of the FTC’s authority under Section 13(b) during the 2020-2021 term threatens to eliminate one of the agency’s most important and effective enforcement tools. It is likely to have profound and significant policy implications for the FTC and strategic implications for the advertisers and marketers that it regulates.
The agency has traditionally possessed extremely broad powers that have severely impacted defendants’ ability to provide for basic necessities and compensate employees, suddenly and without warning. Such powers result from the FTC’s use of ex parte proceedings, held without prior notice in federal district courts to obtain temporary restraining orders (TROs) imposing asset freezes and temporary receiverships in cases of alleged consumer fraud.
The agency often names relief defendants in order to protect ill-gotten funds or assets as a result of the conduct of the other defendants. In a federal lawsuit, the FTC can seek injunctive relief, civil penalties of up to $43,280 per violation of the FTC Act and restitution.
If the Supreme Court rules in favor of the FTC, or there is a legislative “fix,” the FTC maybe left only the limited ability to seek financial redress through cease and desist order and rulemaking enforcement proceedings.
Contact experienced FTC attorneys to discuss sophisticated settlement and litigation strategies designed to rebuke FTC efforts to obtain monetary relief under Section 13(b) and stay pending litigation in anticipation of a potential Supreme Court ruling on potentially avoiding incurring monetary penalties.
FTC Administrative Actions
The administrative proceeding means of FTC enforcement provides the FTC with a narrow right to recover monetary relief in federal court.
An FTC administrative proceeding is, practically speaking, an expedited court proceeding that provides hurdles with respect to FTC’s ability to seek monetary relief. The FTC is only permitted to seek injunctive relief in an administrative proceeding. Following abbreviated motion practice and discovery, there is an evidentiary hearing and a substantive evaluation by an administrative law judge. The ALJ then renders a decision which can be appealed.
The FTC is authorized to bring such an “internal enforcement action” before an ALJ, who can issue a “cease and desist” order. If the “respondent” violates the cease and desist order, the FTC may initiate a lawsuit in federal court under Section 19 of the FTC Act to enforce the order and pursue civil equitable monetary relief. In addition, in consumer protection cases, the FTC can seek monetary relief in federal court under FTC Act Section 19 for the original conduct, but only if “a reasonable man would have known under the circumstances that the conduct was dishonest or fraudulent,” and only after it has issued a cease and desist order that has become final. These actions are subject to a three-year statute of limitations and, while FTC administrative consent orders do not usually contain monetary penalties, they carry the potential for fines of $42,530 per violation.
Both of those paths require the FTC to complete the administrative enforcement process prior to initiating a lawsuit in federal court seeking monetary relief.
Additionally and in lieu of relying solely on actions against individual respondents to determine that practices are unfair or deceptive, the FTC may use trade regulation rules to address unfair or deceptive practices that occur commonly. The FTC is authorized to prescribe “rules which define with specificity acts or practices which are unfair or deceptive acts or practices in or affecting commerce” within the meaning of Section 5(a)(1) of the Act. Before commencing a rulemaking proceeding, the Commission must have reason to believe that the practices to be addressed by the rulemaking are “prevalent.”
Once the FTC has undergone the arduous formal trade regulation rulemaking process, anyone who violates the rule “with actual knowledge or knowledge fairly implied on the basis of objective circumstances that such act is unfair or deceptive and is prohibited by such rule” is liable for civil penalties for each violation. The FTC obtains such penalties by filing a suit in federal district court under Section 5 of the FTC Act.
In addition, any person who violates a rule (irrespective of the state of knowledge) is liable for injury caused to consumers by the rule violation. In addition to being able to seek redress under Section 13(b), as discussed above, the FTC may pursue such recovery in a suit for consumer redress under Section 19 of the FTC Act.
The above means of enforcement provide the FTC with a narrow right to recover monetary relief in federal court. In the case of administrative proceedings, the FTC may seek to enforce a cease and desist order in federal court, but only after the FTC has completed the administrative enforcement process and a cease and desist order has issued. In the rulemaking context, the conduct at issue must violate a specific FTC-prescribed rule.
Given these practical limitations, the FTC has historically relied heavily on the third means by which the FTC carries out its enforcement policy and priorities, Section 13(b) of the FTC Act. Section 13(b) has, until recently, provided the FTC with expansive authority to file suit in federal court in consumer protection matters in pursuit of both injunctive relief and “equitable monetary relief” such as restitution, disgorgement and rescission of contracts, where the defendant “is violating, or is about to violate,” the law and enforcement would be in the public interest.
As discussed above, the Supreme Court is set to decide whether Section 13(b) of the FTC Act authorizes the Federal Trade Commission to seek monetary relief. If it rules against the FTC, the agency will lose or have limited a valuable tool in its remedial arsenal.
How the FTC Uses Civil Investigation Demands (CIDs)
If your company receives a civil investigation demand, it means that the FTC is investigating unfair or deceptive acts or practices in anticipation of initiating an enforcement action. A civil investigative demand (CID) is similar to a subpoena and carries significant enforceable weight, including the ability of the FTC to petition a court to enter an order compelling compliance.
CIDs first go to the bureau chief and then to a commissioner’s office for approval. If you received one, it is not an accident. However, while a plain reading of the CID may not make it clear, do not automatically assume that you are the target. If you receive a civil investigation demand, it is possible that you may simply be a third-party with information that the agency is interested in obtaining.
Civil investigative demands can be used to seek documents, written responses to questions and oral testimony. CIDs often seek information pertaining to:
- Advertising and marketing campaigns
- Relationship or affiliation with third-parties
- Relevant documents and communications, including those with third-party marketers
- Claim substantiation
- Representations and disclosures made on websites
- Website and marketing agreements
- Refund policies or practices, including those about any continuity program or negative option
- Scripts and call recordings
- Marketing, sale and transfer of leads
- Lead qualification criteria
- Evaluation and monitoring of lead sources and buyers
- Products and services provided by lead buyers
- Policies, manuals and training materials
- Data security protocols and policies
- Data use restrictions
- Corporate organization charts, documents and information
- Business plans, balance sheets and income statements
- Consumer inquiries and complaints
- Bank account information
- Refunds, returns and chargebacks
- Federal, state and local law enforcement or government investigations, inquiries and actions
- Compliance with applicable federal laws, rules and regulations
CIDs require that recipients suspend any routine procedures for document destruction and take other measures to prevent the destruction of documents. Ensure that all documents and communications are preserved. Time is of the essence as there is typically a quick return date and often very little time to formally challenge a CID.
Civil investigative demands can be broad-sweeping and invasive. Proactively assessing what practices or relationships may have resulted in the investigation, implementing remedial measures and mounting a deliberate and persuasive response are critical.
The strength of the firm’s FTC CID investigation defense practice is its in-depth digital marketing industry knowledge and focus, professional leadership, ability to manage complex legal issues, attentiveness to time sensitive business matters, consistent delivery of positive results, innovative advice, diverse experience and familiarity with internal regulatory processes, all of which provide us with unique insights into understanding our clients’ businesses and allocating resources in a cost-efficient manner with the aim of investigation closure.
Responses by an experienced FTC CID attorney should be strategic, persuasively advocate the appropriate position, set forth why the marketing or advertising claims in question are not misleading (e.g., substantiated), and why the company has not engaged in any wrongdoing. Depending upon the circumstances, it may be appropriate to request an meeting with an FTC attorney, the Director of the Bureau of Consumer Protection, FTC Commissioners or other FTC staff.
The FTC often contacts target companies to request information as part of an investigation. CIDs are formal information requests. Access letters are informal requests. Access letters typically come from an FTC staff attorney and set forth a general statement that the agency is conducting an investigation in order to assess whether the practices violates a statute or regulation. Details about the investigation are not always disclosed.
FTC Defense Lawyer With a National Reputation
Richard is an award-winning, industry leading FTC defense lawyer and regulatory defense attorney whose practice is uniquely focused upon assisting leading advertisers, affiliate networks, publishers, advertising agencies, lead generators, lead aggregators, list managers, email marketers, telemarketers and technology businesses effectively and efficiently resolve contentious FTC investigations and enforcement actions. The breadth of Richard’s superior grasp of the complex regulatory challenges and regimes facing the online advertising industry enables him to bring a broad perspective and knowledge to Federal Trade Commission matters, including the development of tactics needed to defend against agency actions and to secure advantageous outcomes.
He has successfully defended companies and individuals facing regulatory enforcement actions to minimize liability for conduct that violates the FTC Act and other laws and regulations enforced by the agency, modified broad-sweeping asset freezes, obtained necessary living expenses and attorneys’ fees, negotiated favorable settlement terms, modified compliance and monitoring requirements, and secured partially suspended judgments for a fraction of the total amount of alleged consumer injury and totally suspended $0 settlements.
When the FTC oversteps its authority, Richard is a formidable advocate in litigation, able to swiftly develop affirmative and aggressive strategies that are aligned with his clients’ business objectives. His credibility with the Commission as an effective negotiator and consensus builder is a distinct benefit to his clients when obtaining an equitable early resolution is preferred. Richard's excellent working relationships with the state and federal agencies regulating the Internet marketing industry help facilitate discussions that can be crucial to resolving enforcement actions amicably.
Richard is also well positioned to guide advertisers and marketers through the minefield of FTC investigations. He possesses the talent and experience to develop win-win solutions that reduce the burden for those faced with a CID. As a result of this experience, he brings unique perspective when counseling clients and finding creative solutions to complicated problems, including narrowing the scope of civil investigative demands, negotiating favorable production schedules and, in some instances, securing the amicable and outright closure of investigations with the goal of avoiding the initiation of enforcement proceedings altogether.
- Analyzing the facts, evidence and law
- Analyzing response tactics and defenses
- Preparing thoughtful, persuasive and analytical substantive responses aimed at disposing of the investigation and mitigating potential exposure
- Evaluating implications of responses
- Obtaining an extension of the return date
- Negotiating the scope of the CID, a “rolling” production schedule and other substantive and procedural matters
- Determining the substantive claims at issue and implementing corrective measures
- Assessing the scope of responsive documents and information in the company’s control
- Engaging in technical discussions with agency staff
- Preparing witnesses for investigational hearings
- Negotiating amicable investigation closure or settlement
National news outlets such as BBC World News call on Richard for featured commentary on digital media, online advertising and Internet related legal and regulatory issues. He is recognized within the industry as a leading Internet marketing and regulatory defense lawyer and is frequently in the news as a columnist for publications such as National Law Review, Leading Internet Case Law, Data Protection Leader, Digital Business Lawyer, MarketingProfs, Law360 and Privacy Law Bulletin on a variety of regulatory issues related to the risks and liabilities in the Internet marketing industry.
Richard recently presented a live webinar for a legal education provider recognized by the National Law Journal. Topics that he explored include an examination of recent developments in advertising and marketing regulation, social media marketing, factors that often trigger FTC investigations, and how to develop and implement compliance best practices. Segments of the webinar can be viewed here.
The breadth of Richard’s skills and experience sets him apart from other FTC defense lawyers and enables him to successfully assist clients to navigate CID responses in a practical and thoughtful manner, and to limit the potential disruption and cost of compliance.
Having Asset Freezes Modified and Securing Zero Dollar Settlements
Richard's solid relationships with regulatory agencies enables him to regularly negotiate asset freeze modifications with FTC staff to cover necessary living expenses and attorneys' fees, and secure the exemption of assets from compromise terms, including, but not limited to, homes, automobiles, insurance policies, retirement accounts and personal belongings whenever possible. When amicable negotiation is not an option, Richard has successfully petitioned the court for modification of asset freeze orders.
The firm has also delivered numerous zero dollar settlements with favorably modified reporting requirements, and totally suspended judgments on behalf of numerous clients, based upon the truthfulness of asset disclosure forms.
Comprehensive Advice and Advocacy
The Federal Trade Commission has developed a reputation for its aggressive investigation and litigation tactics. That is where FTC defense lawyer Richard B. Newman can help. He has extensive experience assisting marketers with the complexities of regulatory matters, litigation defense, investigative inquiries and compliance counseling.
Richard possesses extraordinary perspective gained from many years litigating and defending a broad spectrum of industry-specific, technology-centric government-plaintiff enforcement matters, investigations and civil contempt actions for the violation of court ordered injunctions.
- Advertising and Marketing Basics
- Misleading, false and deceptive advertising claims
- Notices of Penalty Offense Authority
- Children's Online Privacy Protection Act (COPPA)
- Endorsement, Influencer and Review Guidance
- Advertising substantiation policy and proceedings
- Affiliate and paid influencer campaigns
- Negative option marketing models (ROSCA)
- Online training and business coaching programs
- Consumer Review Fairness Act (CRFA) Guidelines
- Privacy and data security
- Native advertising and sponsored content
- Email marketing (CAN-SPAM) and telemarketing (TSR) compliance
- Mail, Internet or Telephone Order Merchandise Rule Guidance
- Competitor comparative brand advertising
- Guides Against Deceptive Pricing
- Guides Concerning Use of the Word "Free" and Similar Representations
- Environmental and “Made in USA” claims
- Anti-competitive advertising restraints
- State UDAP laws
His extensive experience within the affiliate marketing space and knowledge of cutting-edge advertising, lead generation, privacy, data brokerage, telemarketing, mobile marketing, email marketing and social media issues are a significant benefit to his clients. He has also provided industry-specific views to governmental agencies.
As a regulatory compliance, investigation and defense attorney, Richard is committed to achieving the most beneficial outcomes for his clients. Today’s regulatory environment is pro-consumer and pro-enforcement. An advocate with concentrated, industry-specific experience is vital when dealing with the Federal Trade Commission.
Broad Client Base and Diverse Practice Areas
Richard consistently delivers comprehensive legal counsel that emphasizes risk analysis and sound business practices for corporations involved in advertising and marketing. He provides legal advice and regulatory advocacy regarding issues involving advertising and marketing, privacy, data security and electronic commerce to a broad base of clients that include providers and marketers of products and services across numerous industries, from dietary supplements to receivables management.
An authority on a range of issues involving consumer protection law, Richard concentrates his practice on defending highly-charged advertising and marketing proceedings so his clients can promote their brands. He has successfully defended clients in private commercial litigation matters in federal and state courts, as well as in arbitration and mediation forums, and complex bet-the-company government proceedings and investigations conducted by the Federal Trade Commission and state Attorneys General, including:
- Manufacturers of dietary supplements
- Affiliate and pay-per-call networks
- Publishers and lead generators
- Payment processors
- Advertising agencies and exchanges
- Lead aggregators
- List managers
- Email marketers, telemarketers and call centers
- Debt relief service providers and debt collection companies
- Online education and business coaching providers
- Health clubs
- Consumer credit companies
- Technology service providers
A substantial portion of Richard’s work also involves conducting preventative FTC advertising compliance reviews of marketing campaigns and promotional programs, and advising digital media clients on consumer protection issues. He works closely with clients to proactively design and implement customized internal compliance processes that meet business objectives and government expectations.
Notably, Richard has litigated the issue of whether the FTC possesses the ability to seek disgorgement, at all. He is also a member of the Compliance Counsel of the Performance Marketing Association, a trade association representing the performance marketing industry.
Richard serves as outside general counsel to numerous clients throughout the United States. He is a partner in the law firm of Hinch Newman LLP. His law firm website is hinchnewman.com, where you can obtain a free consultation on most legal matters.
Award-Winning FTC Attorney
In 2019, 2020 and 2021 Richard was recognized as a National Law Review Go-To Thought Leader for his coverage of the FTC, including enforcement, CID investigations, Made in the USA requirements, products containing cannabidiol (CBD) advertising, the Restore Online Shoppers’ Confidence Act (ROSCA), Children's Online Protection Act (COPPA), Telephone Consumer Protection Act (TCPA) and various state cybersecurity laws. The awards recognize the unique talents of less than 1% of the publication’s 15,000 thought leaders and spotlights exceptional legal authors selected from a pool of over 100,000 news articles.
Richard is a member of the International Association of Privacy Professionals. His technology acumen enables him to confer with general counsel and chief information officers about issues pertaining to the privacy and security of information. As a result, Richard also assists clients facing the gamut of privacy and data breach incident-related litigation, compliance and regulatory counseling matters, and internal investigation challenges to traverse a complex web of state and federal requirements.
From children’s privacy to the international transfer of data, data protection is driven by data security. Richard advises leading technology businesses regarding the development and implementation of sound security plans, honoring privacy claims, and properly maintaining and disposing of sensitive personal information about consumers.
With hands-on experience dealing with regulators such as the FTC’s Division of Privacy and Identity Protection, who themselves often struggle to determine a framework for tech platforms and when intervention may be warranted, Richard is well-versed in the agency’s privacy and data security enforcement policies, including those pertaining to mobile device and computer monitoring applications and services. Privacy and cybersecurity laws are continually evolving and even the most well-meaning company can inadvertently get tripped-up when it comes to capturing, using and transferring personal information. Ensuring regulatory and legal compliance, including data breach preparedness and response, are critical to mitigate liability exposure and unwanted media attention.
Richard’s straightforward approach and experience are particularly valued by those that operate in highly-regulated areas and those with an online presence. His clients appreciate the timely and realistic advice that Richard provides, as well as his understanding that the effective protection and management of information is at the heart of well-functioning online marketing and technology businesses. This knowledge, coupled with familiarity of recent law enforcement actions and closed investigations, allows him to better understand his clients' products and services, find methods to minimize legal risk and effectively advocate on their behalf to regulators.
Richard is a member of the State Bars of California, New York, Nevada and the District of Columbia, the District Courts for the Northern, Central and Southern District of California, the Southern District of New York and the District of Nevada. He is also admitted to practice in the United States Court of Appeals for the Federal Circuit.
He is a member of the Internet Law Leadership Summit, an international organization of leading lawyers with expertise in Internet law. He is also a member of the Performance-Driven Marketing Institute, the International Association of Privacy Professionals and the Performance Marketing Association’s Compliance Council, on whose behalf he has authored authoritative online marketing compliance.
Do not liaise with the Federal Trade Commission directly. Contact an FTC defense attorney that concentrates exclusively on Internet marketing-related regulatory matters – all day, every day – to discuss your rights and obligations.
The following are examples of select regulatory investigations and enforcement matters the firm has handled to successful resolution:
- Represented developers of so-called mobile device and computer “stalking” apps in conjunction with a precedent-setting privacy and data security case brought by the Federal Trade Commission relating to such technologies. This first-ever investigation involved a number of cutting-edge, unsettled legal issues and was initiated by the FTC after a hacker was able to access the cloud storage account of the app developers. The FTC examined whether the Children’s Online Privacy Protection Act and/or Section 5 of the FTC Act had been violated. Drawing upon sophisticated knowledge of applicable advertising regulations, data privacy laws and FTC enforcement policy, the firm was able to successfully develop and implement a multi-faceted CID investigation defense strategy while productively liaising with a data security vulnerability penetration expert. As a result of these efforts, coupled with persuasive defense advocacy, this complex, highly-publicized investigation resulted in a non-monetary administrative settlement that avoided the initiation of enforcement proceedings.
- Represented an online lead generator in conjunction with a Civil Investigative Demand (CID) issued by the Federal Trade Commission examining deceptive acts and practices in connection with listings, descriptions, reviews, ratings, comparisons or endorsements of, or referrals to, providers of health-related services in violation of Section 5 of the FTC Act. The firm successfully secured the prompt closure of the investigation with no monetary penalty.
- Represented an affiliate network in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining deceptive acts or practices in connection with creation, sale and dissemination of online adult dating-related advertisements in violation of Section 5 of the FTC Act. The firm significantly narrowed the scope of the investigation without the FTC ultimately seeking any remedy.
- Represented individuals and corporate defendants in a Federal Trade Commission lawsuit filed on the agency’s behalf by the Department of Justice alleging that the company and its telemarketer made illegal robocalls to consumers, including tens of millions of calls to numbers listed on the agency’s Do Not Call Registry. The firm successfully negotiated favorable settlement terms that included the exclusion of numerous physical assets and monetary relief that amounted to a fraction of damages sought by the FTC in civil penalties without protracted litigation, a finding of liability or any admission of culpability, premised upon the truthfulness of defendants’ financial information.
- Represented a lead aggregator in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining deceptive and unfair acts or practices in the advertising, marketing, sale or servicing of products. The FTC was also investigating whether brokers, servicers and other marketers of products and services had engaged in acts or practices in violation of other federal legislation designed to protect consumers. The firm successfully secured the prompt closure of the investigation.
- Represented an online lead generator in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining deceptive and unfair acts or practices in the advertising, marketing, sale or servicing of products. The FTC was also investigating whether consumer brokers, servicers and the other marketers of products and services had engaged in acts or practices in violation of the MARS Rule, 12 U.S.C. § 5538, and other federal legislation designed to protect consumers. The firm successfully secured the prompt closure of the investigation.
- Represented a leading software development academy in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining deceptive and unfair acts or practices in the advertising, marketing or sale of secondary or post-secondary education products or services, or educational accreditation products or services in violation of Section 5 of the FTC Act. The firm successful secured the prompt closure of the investigation.
- Represented leading industrial tool manufacturer in conjunction with an investigation initiated by the Federal Trade Commission examining the marking, advertising, labeling and other promotional activities relating to the use of unqualified domestic origin claims for products. The purpose of the investigation was to determine whether the company was engaged in unfair or deceptive acts or practices in violation of Section 5 of the FTC Act and the FTC’s enforcement policy with respect to the use of “Made in USA” claims in advertising and labeling. The firm worked with the client to implement a remedial action plan to update and qualify its representations and ensure that the company did not overstate the extent to which its products are made in the United States. As a result, the firm successfully secured the prompt closure of the investigation.
- Represented owner of company in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining alleged false and unsubstantiated representations about the health-related benefits of dietary supplements in violation of Sections 5 and 12 of the FTC Act. The firm worked closely with the client and a scientific expert to critically assess the physiological properties of product ingredients, as well as the nature and degree of data in the client’s possession prior to dissemination of claims, in order to construct persuasive legal arguments regarding a reasonable basis for advertising claims. As a result of these efforts, in addition to the persuasive utilization of cutting-edge legal precedent limiting the FTC’s judicial enforcement authority, the firm successfully resolved the matter without the initiation of litigation enforcement proceedings.
- Represented individual and corporate defendants in a Federal Trade Commission lawsuit alleging approximately $9M in consumer harm as a result of a purported products and services scam through Internet websites, telemarketing, and unsolicited emails and text messages. The FTC was prosecuting what it alleged to be deceptive acts or practices in violation of Section 5 of the FTC Act, the Telemarketing Sales Rule (16 C.F.R. Part 310), the Consumer Review Fairness Act (15 U.S.C. § 45b) and other federal legislation designed to protect consumers. The firm successfully negotiated favorable settlement terms of nominal monetary value without protracted litigation, a finding of liability or any admission of culpability, premised upon the truthfulness of defendants’ financial information.
- Represented data broker defendants in a Federal Trade Commission lawsuit alleging in excess of $4M in consumer harm as a result of the purported collection of sensitive consumer data submitted by consumers to lead generation websites and the distribution thereof to unanticipated third-parties that, in turn: (i) utilized the information to withdraw millions of dollars from consumers’ accounts without their authorization; and (ii) conducted unauthorized marketing activities by email, text message and telephone calls. The firm successfully negotiated favorable settlement terms without any admission of culpability, premised upon the truthfulness of defendants’ financial information.
- Represented an affiliate marketer defendant in a Federal Trade Commission lawsuit prosecuting what the FTC described as deceptive acts or practices in violation of Section 5 of the FTC Act and the Restore Online Shoppers’ Confidence Act, in connection with the marketing and sale of monitoring services. In doing so, the FTC alleged that defendant lured consumers with fake rental property ads and deceptive promises of “free” reports. The firm successfully negotiated extremely favorable settlement terms, including reduced compliance reporting and recordkeeping obligations, without protracted litigation or a finding of liability. Defendant paid only a small proportion of the damages alleged by the FTC and that an affiliate marketer co-defendant was ordered to pay, premised upon the truthfulness of submitted financial information.
- Represented online lead generators in a Federal Trade Commission lawsuit wherein the Commission sought millions of dollars in damages as a result of what the FTC described as fake blogs, fake news websites, fake testimonials, the failure to disclose material connections and bogus free trial offers in conjunction with selling Acai berry weight loss products. The firm successfully negotiated extremely favorable settlement terms without any finding of liability. Defendants paid only a small proportion of the damages that their network co-defendants were ordered to pay and an even smaller fraction of the damages sought by the FTC, premised upon the truthfulness of their financial information.
- Represented defendants in a Federal Trade Commission lawsuit prosecuting what the FTC described as deceptive acts or practices in violation of Section 5 of the FTC Act in connection with the marketing and sale of document preparation services. The FTC alleged that defendants falsely claimed to be affiliated with the Department of Education and charged consumers illegal fees. The firm successfully negotiated extremely favorable settlement terms, including retention of funds, and reduced compliance reporting and recordkeeping obligations, without protracted litigation or a finding of liability. Defendants paid only a small proportion of the damages alleged by the FTC, premised upon the truthfulness of submitted financial information.
- Represented individual and corporate defendants in a Federal Trade Commission lawsuit alleging approximately $3M in consumer harm as a result of a purported products and services scam. The FTC was prosecuting what it alleged to be deceptive and abusive collection practices in violation of Section 5 of the FTC Act and other federal legislation designed to protect consumers. The firm successfully negotiated favorable settlement terms of nominal monetary value without protracted litigation, a finding of liability or any admission of culpability, premised upon the truthfulness of defendants’ financial information.
- Represented affiliate marketers in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining false and misleading representations about certification programs, as well as the failure to clearly and conspicuously disclose material connections within purported independent websites. The firm successfully negotiated favorable settlement terms of nominal monetary value without any finding of liability, premised upon the truthfulness of respondents’ financial information. The firm also successfully negotiated the exclusion of additional specific instances of alleged unlawful advertising conduct.
- Represented affiliate marketers in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining false and misleading representations in conjunction with an alleged Internet business coaching scheme that purported resulted in more than $125M in consumer harm. The firm assisted the individual client regarding invocation of the 5th Amendment privilege and successfully negotiated favorable settlement terms of nominal monetary value without any finding of liability, premised upon the truthfulness of the individual client’s financial information.
- Represented affiliate marketers in conjunction with investigations by the Florida Attorney General into the promotion of weight loss and automobile insurance products/services. The firm successfully negotiated extremely favorable settlements where respondents paid only a nominal proportion of the damages alleged by the FL OAG. Both matters were resolved promptly and quietly, without any resulting litigation or admission of culpability.
- Represented a pay-per-call network in conjunction with a subpoena issued by the Illinois Attorney General. Specifically, the investigation focused upon potential violations of the Illinois Consumer Fraud and Deceptive Business Practices Act by various third-party publishers pertaining to the advertising, soliciting and generation of leads. The firm successfully secured the prompt closure of the investigation.
- Represented online marketers in a Federal Trade Commission lawsuit prosecuting what the FTC described as deceptive acts or practices in violation of Section 5 of the FTC Act, in connection with the marketing and sale of academic degree and certification programs. In doing so, the FTC alleged that defendants misled consumers about their association with recognized high school equivalency programs through the use of deceptive metatags and website names designed to look like legitimate online high schools. The firm successfully negotiated extremely favorable settlement terms without protracted litigation or a finding of liability. Defendants paid only a small proportion of the damages alleged by the FTC, premised upon the truthfulness of their financial information.
- Represented a corporate officer defendant in a Federal Trade Commission lawsuit prosecuting what the FTC described as deceptive acts or practices in violation of Section 5 of the FTC Act and the Restore Online Shoppers’ Confidence Act, in connection with the marketing and sale of personal care product trial offers. The firm successfully petitioned the court to modify a broad-sweeping asset freeze and allow distributions for personal living expenses and to fully-satisfy outstanding obligations. The firm also successfully negotiated extremely favorable settlement terms without protracted litigation or a finding of liability. Defendant paid only a small proportion of the damages alleged by the FTC, premised upon the truthfulness of financial disclosures.
- Represented a digital marketing network in conjunction with a Civil Investigative Demand issued by the Federal Trade Commission examining deceptive acts or practices in connection with the creation, sale, and dissemination of online dating advertisements in violation of the FTC Act, 15 U.S.C. § 45. The firm dramatically narrowed the scope of the investigation which was promptly closed with no monetary remedy or enforcement.
- Represented a telemarketer in a Utah Division of Consumer Protection investigation regarding alleged violations of the Utah Consumer Sales Practices Act and the Telephone Fraud Prevention Act. The Utah DCP was focused upon whether consumers were contacted to make telephone solicitations while the telemarketers were not registered as a telephone soliciting business, whether the telemarketers informed consumers of the right to cancel and whether the telemarketers failed to furnish services after receipt of payment. The matter was resolved amicably and the investigation promptly closed after payment of an extremely nominal sum by respondent.
- Represented an email marketing company in an investigation by the New York Attorney General relating to alleged violations of the CAN-SPAM Act. The New York OAG was focused upon the company’s email marketing practices, related compliance considerations and third-party lead generation relationships.
- Represented an individual in conjunction with a subpoena issued by the Federal Trade Commission pertaining to a pending lawsuit alleging deceptive chain referral schemes involving cryptocurrencies. The FTC sought verbal testimony and documentation from the client. The firm successfully defended the subpoena without the client having to provide either. The matter was closed with no further inquiry or action.
- Represented an affiliate marketing network in conjunction with a subpoena issued by the United States Attorney’s Office regarding fraudulent “tech support” advertising campaigns. Specifically, the investigation focused upon alleged misrepresentations of affiliation with Microsoft, spoofed caller IDs, and the detection of viruses or other malware. The matter was concluded successfully with no further inquiry or action.
- Represented merchant in conjunction with a subpoena issued by the Wyoming Attorney General examining misrepresenting the standard, grade, style, model, use, availability, value, price and discount of its merchandise; misrepresenting its approval, affiliation or sponsorship; and advertising under the guise of obtaining sales personnel when in fact the purpose of the advertisement is to sell merchandise to sales personnel applicants. The firm successfully negotiated extremely favorable settlement terms whereby respondent paid only a fraction of the statutory damages alleged and sought by the WY OAG. The firm also successfully negotiated terms that successfully minimized any negative publicity. The matter was resolved promptly and quietly, without any resulting litigation or admission of culpability.
- Successfully defended full-service pharmacy located in New York City against highly-publicized consumer, New York State Office of the Attorney General and NYC Department of Consumer Affairs (n/k/a NYC Department of Consumer and Worker Protection) charges alleging the advertising or offering for sale certain necessary consumer protection goods during the outbreak of the novel coronavirus (COVID-19) at unconscionably excessive prices. The New York AG alleged violation of section 396-r of the New York General Business Law and the Rules of the City of New York (6 RCNY §5-38). The NYC DCA alleged violation of 6 RCNY §§ 5-38 and 5-42, also mandating compliance with NYC Administrative Code § 20-700, et seq. proscribing unfair, deceptive or unconscionable trade practices. The firm successfully resolved the NY OAG matter with no monetary settlement while avoiding the initiation of enforcement proceedings. The firm also successfully resolved the NYC DCA investigation by negotiating extremely favorable settlement terms where respondent paid only a small fraction of the damages alleged by the DCA. All matters were resolved quietly and amicably without any resulting litigation, finding of liability or any admission of culpability.
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