NEWSLETTER: Advertising, Marketing & Promotions, Spring 2009

Client Alert

Dear Clients, Colleagues and Friends,
Spring is finally here! There is lots of interesting legal news, like President Obama’s appointment of Jon Leibowitz as FTC Chairman and his senior staff appointments. Also, there have been a number of important decisions coming out of the courts – causing great confusion among marketers and the legal community. And, of course,we couldn’t provide a relevant newsletter without mentioning the big “E” – the economy. It’s been tough on all of us, but we’re excited to see new and innovative marketing programs continuing to emerge. As always, Olshan strives to stay on top of all of this to provide our clients and friends with the most relevant and efficient (another “E”) legal advice.

Legal Developments of Interest

President Names Jon Leibowitz FTC Chairman
President Barack Obama has appointed FTC Commissioner Jon Leibowitz as the Chairman of the Commission. The appointment, which does not require Senate confirmation because he is a sitting Commissioner, is expected to bring about a significant increase in the FTC's enforcement activities, particularly in the area of online advertising and privacy protection. For a brief biography on the career of FTC Chairman Jon Leibowitz, click here. For information on his recent senior staff appointments, click here.

AT&T Settles With NYAG Over Deceptive Rebate Program
The New York Attorney General's Office has entered into a settlement agreement with AT&T Mobility that will require the company to pay up to $2.63 million dollars to consumers who were entitled to rebates but instead were given "rebate cards" that expired in just 120 days and were allegedly difficult to use. For more information, click here.

Supreme Court Wyeth Decision Puts Pre-emption At Risk
On March 4, 2009 the U.S. Supreme Court decided the controversial case of Wyeth v. Levine in favor of patient-plaintiff Diana Levine. The Court rejected Wyeth's argument that the FDA's approval of its labeling pre-empted a claim for personal injury arising from a failure to warn. The decision is a major set-back for the pharmaceutical industry and the reliance on compliance with FDA standards in defending private actions. Indeed, as a result of the ruling, the Supreme Court has subsequently vacated an important appellate court decision which had barred a consumer fraud claim based on FDA approval and oversight of advertising and labeling. Click here for more details.

FTC Staff Issues Report that Offers Guidance on Online "Negative Option" Marketing
FTC continues enforcement of negative option Internet marketing. FTC issued a report that identifies five principles for marketing online negative option offers based upon recent FTC cases. Click here to read more.

Makers of Tide and AJAX Asked to Come Clean
Six state and national environmental health groups, including the Sierra Club and the American Lung Association, filed a lawsuit in New York state court to force major U.S. manufacturers-Church & Dwight, Colgate-Palmolive and Proctor & Gamble as well as England-based Reckitt Benckiser Group-to disclose ingredients in their household cleaning products. Continue Reading

FTC Unilaterally Rescinds Enforcement Policy Regarding the Advertising of Books and Publications.
Without the benefit of public comment, the FTC has announced that it is rescinding the agency's enforcement policy regarding the advertising of books and publications, known as the Mirror Image Doctrine. Previously, advertisers could be assured that if the advertising only reflected the opinion of the author of the book as to the contents of the publication, (i.e., was the mirror image of the publication), they could be comforted that the FTC would not ordinarily bring an enforcement action because there was not adequate substantiate for the truth of the claims set forth in the book. This safe harbor is now up in the air. Continue Reading

New Jersey Sues Verizon Over Deceptive FiOS Sales and Marketing Practices
The New Jersey Attorney General filed suit against Verizon alleging that its marketing, sales, billing and customer service practices for its FiOS television, telephone and Internet services are deceptive and misleading. Continue Reading.

New York Attorney General Settles with Chase to End Monthly Fees
Chase agrees to refund $4,400,000 in a settlement reached with the New York Attorney General and modify billing practices. For more details, click here. Settles Class Action and agrees to payments up to $10,000,000
Proposed settlement in class action against Webloyalty regarding company's Internet marketing enrollment process. For more information on this important settlement, click here.

Yo Quiero Taco Bell Now Yo Quiero Mi Dinero!
The Ninth Circuit recently ruled that Taco Bell was liable for the $42 million in breach-of-contract damages award to two Michigan admen who created the Chihuahua idea that served as the foundation for the fast-food chain's hit $500 million ad campaign in the 1990s. Continue Reading

News and Events

Legal Do's and Don'ts with Mobile Marketing Campaigns
Andrew B. Lustigman will co-present on legal compliance matters at the "Mobile Marketing for Agencies and Media Buyers" event on April 28, 2009. The seminar will discuss key mobile marketing issues that affect agencies, media buyers and their brand clients.

Avoiding Greenwashing Accusations
Andrew Lustigman will be presenting on “Avoiding Greenwashing Accusations” before the International Intellectual Property Society in New York. The presentation will focus understanding the evolving standards applicable to the widening use of green claims both in the United States and abroad.

ABA Roundtable on Environmental Marketing Law
On Thursday June 4, 2009, Adam Solomon will co-chair a roundtable discussion on environmental marketing law as part of the ABA-IPL Section - Special Committee on Promotions and Marketing Law. The roundtable will be facilitating a discussion amongst members and invited guests on the topic, including the challenges faced by marketers in the current and anticipated future regulatory environment. If you are interested in attending the roundtable please contact Adam.

Direct Marketing Enforcement - Emails, Mailings, and Telemarketing
Andrew Lustigman to present on "Direct Marketing Enforcement - Emails, Mailings, and Telemarketing" at ACI's 3rd Annual Advertisers' and Marketers' Regulatory Summit to be held on June 25-26, 2009 in Washington, D.C.

Recent Developments in Advertising and Claim Substantiation
Andrew Lustigman will present on "Recent Developments in Advertising and Claim Substantiation" at the Insight 6th Annual Cosmeceuticals Conference on June 30, 2009 at the Marriott New York East Side in New York.

BNA Article on Home Raffles
Adam Solomon was featured in a BNA story covering the home raffles. The story, "Sellers Seeking to Raffle Home Online Face Fifty-State Patchwork of Rules, Restrictions", discusses the legal complexities of conducting an online raffle.

Update on the NY "Amazon Tax" Collection on NY Affiliate-Driven Sales Podcast
Recently-enacted New York law requires those online marketers with affiliate programs whose NY-based affiliates generated $10,000 or more in sales to collect and pay sales tax on all New York-bound shipments. With the recent dismissal of's lawsuit against New York's state involving the so-called "Amazon Tax", the impact of this new law has become much more defined. For the podcast of the webinar, click here.

Please feel free to pass this newsletter on to your friends and colleagues and invite them to join our mailing list. As always, we appreciate your comments and recommendations.
* * * *

Sheldon S. Lustigman
Andrew B. Lustigman
Scott A. Shaffer
Adam Z. Solomon
Jonathan I. Ezor

This newsletter is a publication of Olshan, a law firm with offices in New York and New Jersey. This newsletter and the referenced articles are intended to provide a general overview of legal issues. It is not intended to cover all laws or to serve as legal advice or as a replacement for specific advice of counsel. The views, opinions, statements, analysis and information contained in this outline do not necessarily reflect the views of Olshan or any of its past, present and future clients. © MMIX by Olshan.

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Originally published by The Lustigman Firm, P.C. and has been re-branded and edited to conform and to correct certain references.

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