JULY 2018
Highlights
The FTC will hold a series of public hearings on whether broad-based changes in the economy, evolving business practices, new technologies, or international developments might require adjustments to competition and consumer protection enforcement law, enforcement priorities, and policy. The hearings will cover topics such as competition and consumer protection issues in communication, information, and media technology networks, the intersection between privacy, big data, and competition, and consumer welfare implications associated with the use of algorithmic decision tools, artificial intelligence, and predictive analytics. The multi-day, multi-part hearings, which will take place this fall and winter, will be similar in form and structure to the FTC’s 1995 “Global Competition and Innovation Hearings.” The Commission will invite public comment in stages throughout the term of the hearings; initial comments on the topics identified are due August 20. More details on the topics and comment process are here.
Consumer Protection and Privacy
The FTC, jointly with federal and state law enforcement partners and the Better Business Bureau, announced the results of Operation Main Street: Stopping Small Business Scams. Operation Main Street is a law enforcement initiative targeting operations seeking to defraud small businesses, and an education outreach effort to help small businesses protect themselves from fraud. The agencies announced 24 actions, including one new FTC case, three other FTC actions from the past six months, two criminal actions announced by U.S. Attorneys’ Offices, and 18 actions by state AGs over the past year.
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At the FTC’s request, a federal district court has stopped Internet marketers from deceptively advertising free trial offers and not only charging consumers full price for the trial product, but also enrolling them in expensive, ongoing continuity plans without their knowledge or consent. The court temporarily halted the operation, froze its assets, and appointed a temporary receiver. As the FTC has indicated with the yellow arrow in the screen capture of this ad, Defendants hide the true charges and the continuity plan by using tiny faint type that consumers must scroll down to see.
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A California company has agreed to settle FTC charges that it falsely claimed it was in the process of being certified as complying with the EU-U.S. Privacy Shield framework, which establishes a process to allow companies to transfer consumer data from European Union countries to the United States in compliance with EU law. Click for a Privacy Shield business blog.
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The FTC hosted the semi-annual meeting of the Asia Pacific Privacy Authorities Forum in San Francisco on June 25-26. Members exchanged best practices on privacy protection in their own countries, including on topics relating to artificial intelligence, online reputation, managing data breach notifications, and ongoing privacy investigations. They also explored opportunities for cooperation on education, technological research, and enforcement activities across the Asia Pacific region. At the conclusion of the 49th APPA forum, members issued a communique, which contains more information about the meetings.
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Report International Scams to econsumer.gov Using Your Mobile Device
Did you know econsumer.gov is mobile friendly? See the mobile screen snap grab. About 30 percent of the visits to econsumer.gov, and about 30 percent of the complaints filed there used a mobile device. The econsumer.gov site is specially designed for access by tablets, smart phones, and other mobile devices. Contact Hui Ling Goh, hgoh@ftc.gov, for more information on how to participate in econsumer.gov.
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Adding to the billions of dollars the FTC returned to consumers in 2017, FTC Chairman Joe Simons announced that the agency would return more than $500 million to consumers harmed by a massive payday lending scheme. The Justice Department recovered the funds in criminal and civil actions against the scheme’s operators. The FTC had previously obtained a $1.3 billion civil court judgment in connection with this scheme.
Competition
A U.S. District Court ruled that AbbVie used sham litigation to illegally maintain its monopoly over the testosterone replacement drug Androgel. The court ordered $448 million in monetary relief to consumers who were overcharged for Androgel as a result of AbbVie’s conduct. The court order represents the largest ever monetary award in a litigated FTC antitrust case. The decision is subject to appeal to the Federal Court of Appeals.
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CRH plc, an Irish-based construction company, agreed to divest facilities in Montana, Nebraska, and Kansas as part of a settlement resolving charges that CRH’s $3.5 billion acquisition of its Kansas-based competitor, Ash Grove Cement Company, is anticompetitive and violates federal antitrust law.
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In Other News
In a comment to the Consumer Product Safety Commission about potential safety issues associated with Internet-connected consumer products, staff of the FTC’s Bureau of Consumer Protection warned that poorly secured Internet of Things devices could pose consumer safety hazards to systems, for example, automobile braking systems. Click for FTC business guidance on how to predict and mitigate Internet of Things privacy and security risks.
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The FTC, with the concurrence of DOJ’s Antitrust Division, approved amendments that simplify and clarify some of the language used in the HSR Rules and instructions for filling out the premerger notification form, and that allow for the use of email in certain circumstances such as in granting early termination. A notice in the Federal Register provides more information.
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