This past week, several consumer actions made headlines that affect the retail industry.
Chairwoman Ramirez Announces Resignation
FTC Chairwoman Edith Ramirez announced that she will resign effective February 10, 2017. Chairwoman Ramirez joined the FTC on April 5, 2010, and has headed the agency since March 4, 2013. During her tenure as Chairwoman, the FTC brought close to 400 consumer protection action and approximately 100 challenges to mergers and business conduct.
Western Union Resolves Actions Related to Anti-Money Laundering Program
The Western Union Company has entered into agreements with the FTC, Department of Justice and several U.S. Attorneys’ Offices related to its conduct regarding its anti-money laundering program. In its agreement with the DOJ, Western Union admitted to willfully failing to maintain an anti-money laundering program and aiding and abetting wire fraud. In resolving the FTC charges, which alleged that Western Union has long been aware that fraudsters utilize its money transfer system, Western Union has agreed to forfeit $586 million and to implement a comprehensive anti-fraud program.
J&J Settles Suit on Bedtime Baby Products
An Illinois federal judge granted final approval to a settlement resolving four lawsuits claiming that Johnson & Johnson deceived parents into believing that J&J’s bedtime baby products would help babies sleep longer. The settlement provides for a $5 million payout for any consumers who purchased the products between 2010 and 2016 without requiring any evidence of injury.
Olive Oil Advertising Claims Settled
A California federal court gave initial approval to a preliminary settlement between consumers and Salov North America Corp. The consumers claim they were misled by “Imported from Italy” labels on Filippo Berio olive oil. Under the settlement, certified class members will receive 50 cents for each bottle of olive oil purchased. The certified class includes consumers who bought Filippo Berio olive oil of any grade (except for an organic variety) between May 2010 and June 2015.
Visionworks Settles Buy-One-Get-One Claims
Consumers in Ohio and Illinois have requested preliminary approval of a $4.2 million settlement with Visionworks of America. The consumers alleged that Visionworks engaged in a fraudulent ‘buy-one-get-one-free’ advertising scheme by inflating the cost of the first pair of eyeglasses to such an extent that it covered part of the cost of the second pair. The consumers also requested that the court certify a settlement class of (1) Ohio consumers who completed a ‘buy-one-get one-free’ transaction from June 25, 2012, through September 15, 2016, and (2) Illinois consumers who completed a ‘buy-one-get one-free’ transaction from June 8, 2013, through September 15, 2016.
American Media to Change Advertising Practices in Response to NAD Inquiry
American Media, Inc., will no longer run ads in a format that the National Advertising Division (“NAD”) determined blurs the line between advertising copy and editorial content. American Media came to the NAD’s attention for a featured cover story about weight loss, “Snack Away the Weight,” that linked to an internal Slim-Fast ad that was formatted to look like editorial content. The ads included claims that Slim-Fast products are “clinically backed” and “proven to lose weight and keep it off,” and that it is the “superfast slim-down secret!”
Sally Hansen Maker to Appeal NAD Recommendation Related to Gel Polish Claims
The NAD has recommend that Coty, Inc., discontinue certain claims related to its Sally Hansen Miracle Gel, including a claim that the product produces a result equivalent to a salon gel manicure. The claims, which were included in TV, Internet, social media and in-store displays, were challenged by Revlon Consumer Products. Coty is appealing NAD’s recommendation related to certain of the reviewed claims.