Online reviews and related testimonials and endorsements provide a powerful way for businesses of all types to grow by showing firsthand how others have been satisfied with their products or services. As is standard, with such effective business growth strategies, there comes the risk of abuse, and regulators and lawmakers are increasingly putting guardrails in place to, in their view, protect consumers. Currently, there are laws on the international, federal, state, and regulator-specific levels that come into play when analyzing online reviews. The Federal Trade Commission (FTC), sector-specific regulators such as the Securities Exchange Commission (SEC), the Consumer Financial Protection Bureau (CFPB), and state attorney generals are all active in regulating online reviews. Previously, the focus was on proper transparency via disclosures for influencer marketing and related activities, but now, there is a complex landscape forming around the legal compliance obligations that must be followed in the context of online reviews and testimonials. We understand the importance of online reviews and help clients navigate the dynamic landscape.
FTC Compliance and Review Guidelines
Complying with the FTC regulations under the FTC Act, including the latest rules on fake reviews and testimonials, is essential as the regulator is increasingly active in enforcing online review practices it views as “unfair and/or deceptive.”
Endorsement and Influencer Marketing Compliance
In our influencer marketing, endorsements such as from celebrities, and affiliate marketing practices, including as it relates to specific sectors such as RIAs, there is significant overlap with online review laws, and we help clients on both the brand and influencers, endorsers, and affiliates comply, including with proper disclosure practices and review of influencer and related endorser or affiliate agreements to mitigate legal risks.
AI and Online Reviews
As artificial intelligence increasingly intersects with online reviews, we help businesses understand the legal implications. We advise on compliance with FTC actions like the recent case against Sitejabber, ensuring your AI-enabled review platforms collect and display truthful and accurate customer feedback.
Comprehensive Review Management
Our services extend beyond traditional compliance, addressing less obvious prohibitions such as review suppression and selective display of positive reviews. We help you implement fair and transparent review practices that build trust with consumers and regulators alike. We also assist in developing clear and conspicuous disclosure practices for reviews from company insiders or interested parties, ensuring compliance with material connection requirements and avoiding pitfalls that arise in the purchase of fake social media indicators.
Incentive Programs and Sweepstakes
We provide guidance on structuring legally compliant incentive programs for reviews, including sweepstakes legal considerations, ensuring your promotional activities adhere to all relevant laws, such as requirements for Alternate Methods of Entry (AMOE).
Platform Compliance and Risk Mitigation
In addition to Complying with the “letter of the law,” we help you navigate the policies of major app stores and online marketplaces, such as for Amazon sellers, to avoid penalties, suspensions, or legal action resulting from review practices. Our proactive approach helps protect your business presence on these crucial platforms.
Consumer Review Protection
Online review laws have an ancillary application to a business’s terms and conditions. Specifically, laws like the Consumer Review Fairness Act and state-specific laws, such as those in California (Civil Code 1670.8 and referred to as the “Yelp Law”), protect consumers’ rights to leave reviews. We help you draft terms that respect these rights and avoid potential class action lawsuits that weaponize these online review laws against unassuming businesses.
By working with RICHT, you gain access to comprehensive legal insights in the rapidly evolving field of online reviews and broader areas involving e-commerce and technology. We work diligently to protect your reputation, ensure regulatory compliance, and mitigate legal risks in the digital marketplace.
Contact us today to learn how we can safeguard your business in the world of online reviews and testimonials.
Legal News Re: Online Reviews
- CFPB Issues Policy on Contractual ‘Gag’ Clauses and Fake Review Fraud
- FTC, State Partners Secure Proposed Order Banning Roomster and Owners from Using Deceptive Reviews
- FTC Fines Fashion Company $4.2 Million for Blocking Negative Customer Reviews