In addition to the privacy dispute over Facebook’s new facial recognition feature, several class action lawsuits (in California, New York, and most recently, Illinois) have been filed against Facebook during the last few months for using minors’ names, likenesses, preferences, and activity on the site.  The plaintiffs claim that Facebook has been releasing this information to advertisers for them to direct their ads to specific demographics, and using the collected information to place in “social ads” by the social media site itself.

Other recent social media litigation includes several class actions filed against both Twitter and MySpace in federal district court, alleging violations of the Telephone Consumer Protection Act (TCPA) because of confirmation texts sent by the social media sites after users chose to “opt out.”  Click the links above to view the complaints.

Social media and related legal issues will be covered in depth during several sessions at the 33rd Annual PMA Marketing Law Conference, November 15-16, 2011 in Chicago.  Discussing the internal issues in developing and carrying out corporate social policies will be Melissa Landau Steinman, Partner, Venable LLP; Sarah LaVoi, Corporate Counsel, Marketing-Intellectual Property, McDonald’s Corporation; and other speakers to be named.  In a second session, Ken Florin (Partner, Loeb & Loeb LLP), Christopher McCleary (Associate General Counsel, VISA), and other panelists will explore the external aspects of social media, including the current legal, regulatory, and intellectual property challenges.   Continue to check the PMA website for updates to the conference agenda and details on registration.

www.fda.gov

FDA Announces New Labeling Regulations for Sunscreen

On June 14, the FDA announced that after evaluating study data, it has developed new testing and labeling requirements for sunscreen products, “so that manufacturers can modernize their product information and consumers can be well-informed on which products offer the greatest benefit.”

The new guidelines illustrate an effort by the FDA and the Obama administration in the fight against high rates of skin cancer in the U.S., as well as an attempt to combat false advertising claims being made by sunscreen manufacturers.  For details on the new labeling regulations, take a look at the FDA’s press release.

Privacy Organizations File Complaint Against Facebook for New Facial Recognition Feature

www.facebook.com

On June 10, the Electronic Privacy Information Center (EPIC) and several other privacy organizations filed a complaint with the FTC about Facebook’s new facial recognition technology that allows for the automated “tagging” of Facebook users in photos.  EPIC alleges that the service is unfair and deceptive, particularly because the feature went into effect without asking the permission of users first, and should be something users can “opt-in” to instead.  Additionally, EPIC argues, third parties like advertisers and app developers may be able to access the personal information and “biometric identifiers” without users’ permission.  See EPIC’s news release here.

Facebook contends that since the facial recognition tagging technology rolled out in December, millions of people have used the feature with few complaints.  In addition, Facebook emphasizes that the feature can easily be disabled through a user’s privacy settings.

These issues, and related topics, including social media, behavioral advertising and health claims in advertising, will all be covered in depth at the 33rd Annual PMA Marketing Law Conference, November 15-16, 2011 in Chicago.  Click here for more details.

EVERYTHING YOU NEED TO KNOW ABOUT BEHAVIORAL ADVERTISING — DECEMBER 8 @ 2PM EST

This Webinar will address the hottest issues and latest developments that have altered the legal landscape and best practices for online behavioral advertising including:

• FTC Online Behavioral Advertising Principles
• Industry self-regulatory guidelines
• Developments in federal / state legislation
• Best practices for notice and choice for consumers
• Privacy issues and concerns
• Recent enforcement actions, and
• The challenges facing businesses using behavioral models today

Presenters

Richard Eisert, Esq. (left) and Gary Kibel, Esq. are partners in the Advertising, Marketing and Promotions Practice Group of Davis & Gilbert LLP.  Richard’s practice includes advising on specific legal/regulatory issues that affect e-commerce, including online data collection, privacy and limitations on behavioral advertising.  Gary regularly counsels clients regarding complex technology and intellectual property issues such as software and content licensing, wireless services and entertainment, interactive advertising, search marketing, enterprise technology implementations, behavioral advertising, privacy, data security, internal information management controls, copyrights, trademarks and laws affecting the Internet.

This PMA Webinar is FREE for PMA members.  For non-members, the cost is $75.

Click here for more information and to register!

As I recently reported, in an effort to give greater assistance to companies that engage in online behavioral advertising (“OBA”), many trade groups in the industry were working on creating a set of standards to help companies understand how to provide clear notice, and how to allow consumers a choice about whether their information is used for OBA purposes. Those industry self-regulatory principles have now been released, and provide different levels of notice and choice requirements depending on whether a company

1. allows data to be collected on its website for OBA purposes,
2. allows ads to be served based on information collected for OBA purposes,
3. collects data for behavioral advertising purposes on one site, and passes it to another (unaffiliated) website in order to serve targeted ads, or
4. is engaging in OBA and acting as a “Service Provider” (namely if it is a provider of Internet access, toolbars, browsers, or provides other desktop application or software).

Companies in the first group – those that allow data to be collected from users on their site, which data will be used for OBA purposes – must have on the pages where information is collected for OBA purposes a link that takes users to a disclosure about the OBA practices occurring at the site. This link would be separate from the link to the company’s privacy policy.

Companies in the second and third groups – those that allow ads to be served that are based on OBA data, or that pass data from one site to an unaffiliated site for OBA purposes – must provide prominent notice about the OBA activities on the site where the ad is served. This notice can be in a link that is included in or near the advertisement, and can be either a link to a page created by the website where the ad appears, or a link to a page created by the company that has passed data from one site to another. Additionally, for companies in the third group – those that are passing the data – they must have a prominent disclosure on their own websites that they engage in OBA activities. The notice provided by companies in both groups two and three must include information about how consumers can opt out of having their information used for OBA purposes, as well as the types of data collected, the use of such data, and whether data is transferred to any third parties for OBA purposes. The notice needs to be on a link on the both companies in group two and three’s web sites (a link separate from the privacy policy link), as well as in or near the advertisement that is delivered as a result of the OBA activities. The link near the ad that is being served is not necessary, however, if there was a link to the company’s notice on the web page where data was first collected. The principles anticipate that this might happen in instances where the website on which the ad is served has a relationship with the original website where information was collected.

Unlike companies in the first three groups, Service Providers are held to a higher standard, and must get consumers consent before they can engage in behavioral advertising. Service Providers also must have a notice – linked from their web sites – that describes their OBA activities, including information about how a consumer can opt out of having his or her information used for OBA purposes, as well as the types of data collected, the use of such data, and whether data is transferred to any third parties for OBA purposes.

Under the industry self-regulatory principles, different “accountability programs” will be developed, through which additional direction about how to provide notice and choice will presumably be given. Those programs are intended to go into effect in the beginning of next year.

These materials have been prepared by Winston & Strawn for informational purposes only. These materials do not constitute legal advice and cannot be relied upon by any taxpayer for the purpose of avoiding penalties imposed under the Internal Revenue Code.

As those of us on the legal side of the advertising industry are well aware, behavioral advertising has been a large concern for consumers and regulators for the past few years. Not only did the Federal Trade Commission issue a set of guidelines in February about how companies should disclose to consumers that the companies engage in behavioral advertising and give consumers choice over such practices, it also recently settled with a major U.S. retailer over that retailer’s behavioral advertising practices. The question facing the industry now seems to be whether we will see more cases – whether from the FTC or others – or whether self-regulatory guidelines will be developed that limit governmental oversight and enforcement.

But really, what is this thing called behavioral advertising, and why is it so important?

It has been heralded by many to be the wave of the advertising future. With mediums like the Internet and tracking technology, it is possible to “watch” consumers’ behavior over an extended period of time and target advertising that may be of interest to the consumer. As new mediums – like smart phones – develop, behavioral advertising may become even more sophisticated. An advertiser might have the opportunity not only to know what websites a consumer visits, but what physical locations he or she goes to as well. The FTC, in its guidelines, appears to anticipate this departure of behavioral advertising from the online environment, indicating that if data collection for behavioral advertising “occurs outside of the traditional website context, companies should develop alternative methods of disclosure and consumer choice that meet the standards” of clarity, prominence, and ease of use. How can a company provide notice in a way that consumers understand, though, and that isn’t lost among all the other information an advertiser is trying to communicate about its products or services? And, how can that communication occur in a medium like a smart phone, which has limited space (and for many consumers, limited connectivity speeds)?

In an effort to give greater assistance to companies that engage in behavioral advertising, many trade groups in the industry have been working on creating a set of standards that will hopefully address concerns such as how to provide clear notice. According to a recent Wall Street Journal article, the standards may include use of icons to provide notice. In the meantime, some industry guidelines do already exist, which guidelines include requirements for members that engage in behavioral advertising activities. This issue is being looked at closely both in the United States and abroad, and is important to companies and consumers alike. As self-regulatory guides continue to develop and possible new cases continue to be issued, we will all be watching with much interest.

These materials have been prepared by Winston & Strawn for informational purposes only. These materials do not constitute legal advice and cannot be relied upon by any taxpayer for the purpose of avoiding penalties imposed under the Internal Revenue Code.