The Federal Trade Commission (FTC) plans to conduct a study of food marketing to children and adolescents for a follow-up report to its 2008 study titled “Marketing Food to Children and Adolescents: A Review of Industry Expenditures, Activities, and Self-Regulation.” FTC seeks public comments by November 23, 2009, on proposed information requests to approximately 45 major food and beverage companies and quick-service restaurants about their marketing activities, expenditures and nutritional information concerning food and beverage products marketed to children and adolescents. FTC plans to evaluate possible changes in the nutritional content and variety of youth-marketed foods, and “proposes to seek scientific and market research exploring psychological and other factors that may contribute to food advertising appeal among youth.” See Federal Register, September 21, 2009.
Category Archives Federal Trade Commission
While the Federal Trade Commission (FTC) considers comments submitted by stakeholders to its proposed advertising endorsement guideline amendments, industry and blogging interests have reportedly expressed concerns about their ambiguity and suggested that voluntary ethical standards would best police the practice of “social media marketing.” The FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising, last updated in 1980, if applied to bloggers who are paid to endorse products or services, would require bloggers to substantiate their product performance claims without specifying the proof needed to satisfy the claim. The amended guidance would also require disclosure of compensation arrangements, ranging from product coupons and cash payments to free products or services and pay-per-click links to sites that sell the product. According to a news source, if the guideline amendments are adopted later in 2009, violators could face FTC stop orders, restitution to customers or civil penalties. See The Associated Press, June…
The Federal Trade Commission (FTC) has announced its approval of a final consent order in its challenge to the merger of Whole Foods Market, Inc. and Wild Oats Markets, Inc. Under the agreement, Whole Foods will sell 32 of its supermarkets and give up unrestricted rights to the “Wild Oats” brand. When the agreement was announced in March 2009, FTC Chair Jon Leibowitz claimed, “As a result of this settlement, American consumers will see more choices and lower prices for organic foods.” Whole Foods and Wild Oats completed their merger before an appeals court finally agreed with the FTC that the merger could have anti-competitive effects and allowed it to move forward with administrative proceedings against the company. Thus, it was unclear until the consent order was filed what remedies could be ordered if the FTC proved its case. See FTC Press Release, May 29, 2009.
The Federal Trade Commission (FTC) has announced that Kellogg Co. agreed to settle false-advertising charges involving Frosted Mini-Wheats® advertisements that claimed the product was “clinically shown to improve kids’ attentiveness by nearly 20 percent.” According to FTC, the clinical study on which the ads were based showed that “only about half the children who ate Frosted Mini-Wheats for breakfast showed any improvement in attentiveness, and only about one in nine improved by 20 percent or more.” Under the consent order, Kellogg agrees to pull its offending ads and not to express or imply that its cereal improves attentiveness “unless, at the time [the claim] is made, the representation is true and non-misleading.” The company also agreed not to make any representation “about the benefits, performance, or efficacy of such product for cognitive function, cognitive processes, or cognitive health, unless the representation . . . relies upon competent and reliable scientific…
The Federal Trade Commission (FTC) has apparently proposed amending its advertising guidelines to hold companies and paid word-of-mouth marketers, including bloggers and those on social networking sites, liable for making false statements to promote products. According to an FTC spokesperson, the proposal would bring the commission up to speed with evolving marketing practices. “The commission is attempting to update guidelines that are 30 years old so that they address current marketing techniques and in particular to address the issue of whether or not the safe harbor that’s currently allowed for ‘result not typical’-type disclaimers is still warranted,” he was quoted as saying. Meanwhile, a public comment submitted by the American Association of Advertising Agencies has reportedly urged FTC to reconsider “overly stringent amendments that will likely result in advertisers abandoning longstanding legitimate advertising techniques, such as consumer testimonials, and rejecting new media forms, such as blogs and viral marketing.” The…
Federal Trade Commission (FTC) Chair Jon Leibowitz has reportedly named David Vladeck as director of the commission’s Bureau of Consumer Protection. Vladeck, who leaves the Georgetown University Law Center faculty, is apparently a 30-year veteran of the Public Citizen Litigation Group and, as such, is expected to pursue a consumer-protection agenda. Representatives of other public advocacy organizations are applauding the selection and have expressed their hope that “he will pay special attention to advertising and marketing to children.” Vladeck co-authored a law review article with former Food and Drug Administration Commissioner David Kessler to criticize the preamble to the FDA’s 2006 prescription drug labeling rule, which set forth a pro-preemption policy. In the article, titled “A Critical Examination of the FDA’s Efforts to Preempt Failure-to-Warn Claims,” the authors conclude, “it would be a mistake to preempt state-law failure-to-warn cases, which impose a complementary discipline on the marketplace.” See Advertising Age and…
This article comprehensively summarizes the events and proceedings that led Whole Foods Market, Inc. to agree in March 2009 to settle Federal Trade Commission (FTC) charges that its merger with Wild Oats Markets, Inc. violated antitrust laws. According to freelance journalist Jenna Greene, the two-year fight ultimately cost Whole Foods $28 million and resulted in a D.C. Circuit Court of Appeal’s decision “that some fear will make it too easy for the FTC to effectively block future mergers.” She quotes an unnamed antitrust expert who opined, “so long as their lawyers don’t get up there and fall asleep at the podium,” the FTC will win is merger challenges. Apparently, a week after the Whole Foods settlement, a $1.4 billion merger between CCC Holdings and Mitchell International collapsed after it was enjoined by a federal district judge who cited the new Whole Foods standard.
The D.C. Circuit Court of Appeals has reportedly denied a Whole Foods Market, Inc. petition that sought to stop the Federal Trade Commission’s (FTC) antitrust proceedings against the company’s merger with Wild Oats Markets, Inc. The FTC’s administrative trial is scheduled to begin April 6, 2009, and Whole Foods contends that the commission has pre-judged the outcome. According to a Whole Foods spokesperson, “There is no question our due process and equal protection rights have been violated and we intend to pursue this case until we can get a hearing in a federal court about those violations.” According to a news source, Whole Foods is considering reframing and refiling its lawsuit. See Dow Jones Newswires, January 23, 2009.
Whole Foods Market, Inc. has reportedly withdrawn from U.S. district court its due process challenge to the Federal Trade Commission’s (FTC) antitrust proceedings against the company’s merger with Wild Oats Markets, Inc. The case was then refiled before the D.C. Circuit Court of Appeals. According to a Whole Foods executive, “Whole Foods Market is interested in getting to the merits of this case as quickly as possible rather than spending everyone’s valuable time and resources arguing about jurisdiction. Filing with the Court of Appeals, which the FTC concedes has jurisdiction over the case, saves time and we want to move this case forward in the most expeditious manner for all concerned.” Additional details about Whole Foods’ petition appear in issue 285 of this Update. The FTC’s administrative hearings are scheduled to begin April 6, 2009, and Whole Foods claims that the commission has already prejudged the case. See PR Newswire, January…
The Federal Trade Commission (FTC), continuing to challenge the merger of Whole Foods Market, Inc. with Wild Oats Markets, Inc, has reportedly indicated in court filings that it will seek a court order requiring Whole Foods to rename the Wild Oats stores that were changed into Whole Foods stores and rebrand them as Wild Oats. The FTC also apparently said that a trustee should be appointed to separately manage Wild Oats assets to preserve the status quo in the organic foods market until all legal proceedings have concluded. The $565 million merger has been completed, but the FTC convinced an appeals court in 2008 to allow the administrative antitrust proceedings to resume. Responding to the latest filing, Whole Foods reportedly stated, “Not only have they found us guilty before the final evidence is in, now they want to impose a burdensome remedy even before the first word of final evidence…
