Behind the Scenes | Volume 2, Issue 10
Fake But Loving It: Concern Growing Over False Reviews on Yelp
October 4, 2013
Companies are advised to thoroughly investigate the companies they hire to manage their online reputations and reviews to ensure that only truthful and accurate reviews and comments from actual consumers are posted online. A company that does not thoroughly investigate the companies they use could find themselves in violation of the Federal Trade Commission’s (FTC) Guides Concerning the Use of Endorsements and Testimonials in Advertising (the 'Guides'). The Guides set forth the principles that the FTC uses when evaluating testimonials and endorsements.
Sears Fined For Cutting Rewards When Providing Refunds
The New York Attorney General recently fined Sears Roebuck & Co. for reducing customers’ “Come Back Cash” rewards when they returned merchandise even when the remaining purchase total was above the qualifying minimum to receive the reward. The initial complaint to the Attorney General came about after a Sears customer purchased seven items totaling $164.65. The customer returned three items totaling just under $30, leaving the remaining total of purchases over the $100 threshold to receive the reward. Despite this fact, the customer did not receive a full refund as a little over $3 was deducted from the refund to offset the amount of reward applied to that portion of the purchase. The Attorney General fined Sears based on this policy, noting that even if this system were disclosed, the practice still would have constituted a deceptive practice under New York law. All companies that provide rewards to customers should be aware of this decision as it serves as a cautionary tale regarding deduction of reward values from purchase refunds. The New York Attorney General’s press release announcing the settlement is available here.
Data Security & Privacy
Facebook Settings and the Stored Communications Act
Two separate cases that came out in two different ways show how the Stored Communications Act (SCA) interplays with Facebook’s privacy settings. In one instance, an arbitrator recently determined that a manager of the U.S. Border Patrol violated the SCA by creating a fake Facebook profile to friend an employee and take action against that employee based on information discovered on the Facebook page. Additional details are available here. In a separate instance, a New Jersey federal judge determined that the management of a hospital was not at fault where it took action against an employee based on a Facebook status message where one of the employee’s Facebook “friends” took a screen shot of the message and delivered it to management without being asked. More details on this case are available here. In both instances, the employees had privacy settings that limited their wall postings so that only “friends” could see what was posted. The turning point in the second situation was that the manager made no proactive attempts to obtain the information, but only used unsolicited information that was provided. This is a reminder that information posted to social media is accessible and can, in some instances, be used as the basis for adverse decisions.
LinkedIn Fights Data Breach Class Action
The FTC will hold a consumer privacy workshop onNovember 19, 2013, in Washington, DC to address the consumer privacy and security issues raised by the growing connectivity of consumer devices such as smart phones, cars, appliances, and medical devices, also commonly referred to as “The Internet of Things”. More information regarding the “Internet of Things” workshop and comments is available here.
Fashion & Entertainment
Converse Accuses 'Fair Trade' and 'Eco-friendly' Competitor of Infringement
October 2, 2013
Converse Inc. recently sued a competitor, Autonomie Project, Inc., for willfully infringing Converse’s famous Chuck Taylor All Star shoes. In the suit filed in federal court in Massachusetts, Converse accuses Autonomie of designing and selling its Ethletic line of shoes as flagrant imitations of Converse’s iconic line.
Fashion Counsel: Babies "R" Us HALO SleepSack a Costly Reminder of Brand-Damaging Recalls
September 17, 2013
In August, baby products maker HALO became the most recent high-profile company to recall items of clothing, after it pulled back 27,000 of its SleepSack wearable blankets due to a choking hazard. The Huffington Post reported that the HALO SleepSacks, which are exclusively sold at Babies “R” Us, were recalled based on six reports sent to the US Consumer Product Safety Commission (CPSC) that the petals on the garment were detaching with one infant found gagging on the flower.
In addition to potential choking hazards, retailers should be concerned with regulated heavy metals like lead and cadmium in fasteners and zippers in apparel, and accessories like belt buckles and shoe fasteners, in order to avoid expensive and brand-damaging recalls. In this episode of Fashion Counsel, Anthony Lupo talks with partner Georgia Ravitz, the Consumer Product Safety practice leader, about navigating concerns involving CPSC heavy metal regulations without breaking the bank on product testing.
Food Fight: Trademark Suit Heats Up Over Food Fanatics Television Series
September 11, 2013
On September 3, US Foods, Inc. (US Foods) filed a federal lawsuit against Scripps Networks Interactive Inc. (Scripps), owner of the Food Network and the Cooking Channel, over Scripps’ use of the title Food Fanatics with a new television series. The complaint alleges trademark infringement and false designation of origin under federal law, and deceptive trade practices under state law.
Impact of New gTLD Launch Expands to US Patent & Trademark Office
September 10, 2013
With the impending launch of up to 1,400 new generic top level domains (gTLDs) in the coming months, trademark owners are scrambling to decide how to protect their brands from online infringement, and, on the other hand, how to leverage their intellectual property assets in this new online space. Many major companies like Nike and McDonald’s Corporation have applied to operate new gTLDs based on their brand names (i.e., .NIKE and .MCDONALDS). Unlike registering a domain name, creating a new gTLD means the owner is operating an online registry (like .com or .info). So long as the registry is “open,” third parties can register domain names in the new gTLD. Thus, private companies will be offering domain name registration and registry services to third parties. With this new landscape in mind, the U.S. Patent & Trademark Office (USPTO) has decided to rethink its policy about registering gTLDs as trademarks. If the policy change goes through, new gTLD applicants will have to decide whether they also want to file a new trademark application covering their domain name registry and registration services.