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Dot Com Disclosures Redux

6 Jun, 2011 By: Cathy Polisoto, Jeffrey Richter


These days, everyone sells products from their websites, but how many websites would pass muster with the Federal Trade Commission (FTC)? We recommend, for your reading pleasure, the FTC’s staff working paper entitled Dot Com Disclosures: Information About Online Advertising, which sets forth the proper way to make disclosures on a website.

The primary focus of the publication is to counsel advertisers on how to provide clear and conspicuous disclosures of information that consumers need in order to make informed decisions about goods and services being offered on the Internet. In its online version, the underlined hyperlinks link to mock ads, illustrating the preferred way to make clear and conspicuous disclosures. The FTC Act’s prohibition against “unfair or deceptive acts or practices” applies to Internet advertising, marketing and sales. In addition, FTC rules and guides that use specific terms – “written,” “writing,” “printed,” or “direct mail” – apply to website text.

The FTC analyzes the overall impression an advertisement would make on a reasonable consumer. In determining whether online disclosures are likely to be clear and conspicuous, an advertiser “should consider the placement of a disclosure in an ad and its proximity to the relevant claim. Additional considerations include: the prominence of the disclosure; whether items in other parts of the ad distract attention from the disclosure; whether the ad is so lengthy that the disclosure needs to be repeated; whether disclosures in audio messages are presented in an adequate volume and cadence and visual disclosures appear for a sufficient duration; and, whether the language of the disclosure is understandable to the intended audience.” (Dot Com Disclosures, Overview, p. 1).

In recognition of the rapidly changing online world, the FTC recently issued an invitation for public comments as it considers updating and reissuing these Dot Com Disclosures. (A copy of the invitation can be viewed at www.ftc.gov/os/2011/05/110526dotcomecomments.pdf.)

In its request for comments, the FTC references the dramatic changes in the online world since the Dot Com Disclosures were originally published in 2000, particularly the rise and popularity of mobile marketing, the “App” economy and online social networking. In the request for comments, the FTC poses a series of questions to help advertisers consider what type of revisions need to be made, including: What issues have been raised by online technologies or Internet activities or features that have emerged since the business guide was issued (e.g., mobile marketing, including screen size) that should be addressed in a revised guidance document? What specific types of online disclosures, if any, raise unique issues that should be considered separately from general disclosure requirements?

Public comments are due by July 11. Revisions to the Dot Com Disclosures will certainly impact the format and content of future online advertisements presented on desktops, mobile devices and tablets. You can review the Dot Com Disclosures and the questions posed in the FTC’s request for comments. If any of those questions impact an your business, you should consider how any new guidance might affect your advertising practices and provide comments to the FTC directly or through your counsel.

Jeffrey Richter is a partner and Cathy Polisoto is an associate at Los Angeles-based Finestone & Richter. They can be reached at (310) 575-0800.


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