The Advertising Law Blog provides commentary and news on developing legal issues in advertising, promotional marketing, Internet, and privacy law. This blog is sponsored by the Advertising, Marketing & Promotions group at Olshan. The practice is geared to servicing the needs of the advertising, promotional marketing, and digital industries with a commitment to providing personal, efficient and effective legal service.
A federal lawsuit challenging the state of Texas’ recent expansion of telemarketing regulations to include text messages has ended with a stipulation of settlement that applies a more limited scope of the registration requirement for SMS marketing programs. This blog has previously covered this issue as businesses were vexed by the dilemma of whether or not registration as a telemarketer in Texas was required under a confusingly worded new state law known as SB 140.
New York’s Algorithmic Pricing Disclosure Act is now in effect (as of November 10, 2025). (Read our coverage of the law in our June 25, 2025 Advertising Law Blog post.) Originally enacted in May as part of the state’s 2025-2026 omnibus budget bill, the law's effective date was delayed due to a failed legal challenge in the United States District Court for the Southern District of New York by the National Retail Federation, who alleged that the Act’s mandatory disclosure requirement violated the First Amendment and sought a preliminary injunction.
On October 13, 2025, California Governor Gavin Newsom signed into law the nation’s first statute aimed at regulating “companion chatbots,” which are AI systems that simulate human-like relationships with their users. The new law, which has been added to California’s Business & Professions Code, sets out disclosure, safety, and reporting requirements. Users who suffer harm from a violation of this law now have a private right of action that allows them to seek at least $1,000 per violation plus attorney’s fees. The law will take effect on January 1, 2026.
Andrew Lustigman, Chair of Olshan's Advertising, Marketing & Promotions Group and Co-Chair of the firm’s Brand Management & Protection Group, and Branding Department associate Morgan Spina published an article in New York Law Journal entitled “Continued Focus on Subscription-Based Practices Leads to $2.5 Billion Amazon Settlement With FTC.”
On September 1, 2025, Texas Senate Bill 140 (“SB 140”) expanded the state’s telemarketing law to cover text messaging under Chapter 302 of the Texas Business & Commerce Code. Previously, these rules primarily applied to telephone calls, but SB 140 was designed to include unwanted or “spam” text messages. Critical to businesses that use text messaging for marketing purposes, SB 140’s broad language appears to expose such businesses to burdensome registration and bonding requirements, even if the businesses limit their marketing texts to consumers who have opted in voluntarily. This uncertainty prompted a same-day legal challenge in federal court, filed by Flux Footwear, Postscript, and the Ecommerce Innovation Alliance (EIA).
Amazon’s recent massive $2.5 billion settlement with the Federal Trade Commission (“FTC”) regarding its Prime subscription model is a game-changer with respect to the exposure for difficult cancellation paths. It is also a strong reminder that the FTC, under Commissioner Ferguson and the Trump/Vance administration, intends to enforce the consumer protection laws in effect.
On September 1, 2025, Texas’s amended telemarketing law became effective. It significantly broadened the state's rules by explicitly adding text messages (SMS), multimedia messages (MMS) and other electronic communications into the definition of “telephone solicitation.” The law, amended through Senate Bill SB 140, does not change the consent requirement for telemarketing but in addition to expanding the registration requirements, it establishes harsher penalties for violations compared to the federal Telephone Consumer Protection Act (TCPA). Because the law contains a private right of action, we are expecting a sharp increase in consumer lawsuits in Texas.
Chair of Olshan’s Intellectual Property Law Group and Co-Chair of the firm’s Brand Management & Protection Group Mary Grieco and Branding Department associate Morgan Spina published an article in Bloomberg Law entitled “OpenAI Trademark Victory Sets Roadmap for Avoiding IP Missteps.” In the article, Mary and Morgan discuss the key takeaways in the recent California ruling in which U.S. District Judge Yvonne Rogers sided with OpenAI in its trademark suit against Silicon Valley entrepreneur Guy Ravine and his company “Open Artificial Intelligence,” ruling that Ravine had violated OpenAI’s trademark rights, even though he registered the “open.ai” domain months before OpenAI’s founding.
Olshan announced that nine of the firm’s lawyers have been recognized for inclusion in the 2026 edition of The Best Lawyers in America, including Andrew Lustigman and Mary Grieco, and four lawyers have been recognized to the “Ones to Watch” list.