Federal Trade Commission

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Federal Trade Commission
Seal of the United States Federal Trade Commission.svg
Seal of the Federal Trade Commission
Flag of the United States Federal Trade Commission.svg
Flag of the Federal Trade Commission
Agency overview
FormedSeptember 26, 1914;105 years ago (1914-09-26)
Preceding agency
  • Bureau of Corporations
Jurisdiction United States
Headquarters Federal Trade Commission Building
Washington, D.C.
Employees1,131 (December 2011) [1]
Annual budget$311 million (FY 2019) [2]
Agency executive
Website www.ftc.gov
Footnotes
[3] [4]

The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) U.S. antitrust law and the promotion of consumer protection. The FTC shares jurisdiction over federal civil antitrust enforcement in the United States with the Antitrust Division of the U.S. Department of Justice. It is headquartered in the Federal Trade Commission Building in Washington, DC.

Contents

The FTC was established in 1914 with the passage of the Federal Trade Commission Act. Signed into law by President Woodrow Wilson, who was a strong proponent of it, the Federal Trade Commission Act was a major response to 19th-century monopolistic trusts. Trusts and trust-busting were significant political concerns during the Progressive Era. Since its inception, the FTC has enforced the provisions of the Clayton Act, a key antitrust statute, as well as the provisions of the FTC Act, 15 U.S.C.   § 41 et seq. Over time, the FTC has been delegated with the enforcement of additional business regulation statutes and has promulgated a number of regulations (codified in Title 16 of the Code of Federal Regulations).

Legislative development

Apex Building, built in 1938 (FTC headquarters) in Washington, D.C. ApexBuildingHighsmith.jpg
Apex Building, built in 1938 (FTC headquarters) in Washington, D.C.
Federal Trade Commission entrance doorway in Washington, DC Federal Trade Commission Entrance Doorway.jpg
Federal Trade Commission entrance doorway in Washington, DC

Following the Supreme Court decisions against Standard Oil and American Tobacco in May 1911, the first version of a bill to establish a commission to regulate interstate trade was introduced on January 25, 1912, by Oklahoma congressman Dick Thompson Morgan. He would make the first speech on the House floor advocating its creation on February 21, 1912. Though the initial bill did not pass, the questions of trusts and antitrust dominated the 1912 election. [5] Most political party platforms in 1912 endorsed the establishment of a federal trade commission with its regulatory powers placed in the hands of an administrative board, as an alternative to functions previously and necessarily exercised so slowly through the courts. [6] [7]

With the 1912 presidential election decided in favor of the Democrats and Woodrow Wilson, Morgan reintroduced a slightly amended version of his bill during the April 1913 special session. The national debate culminated in Wilson's signing of the FTC Act on September 26, 1914, with additional tightening of regulations in the Clayton Antitrust Act three weeks later. The new Federal Trade Commission would absorb the staff and duties of Bureau of Corporations, previously established under the Department of Commerce and Labor in 1903. The FTC could additionally challenge "unfair methods of competition" and enforce the Clayton Act's more specific prohibitions against certain price discrimination, vertical arrangements, interlocking directorates, and stock acquisitions. [5]

Current membership

The following table lists commissioners as of May 2020.

MemberPolitical partySworn inTerm expiration*
Joseph Simons
(Chairman)
Republican May 1, 2018September 26, 2024
Rohit Chopra Democratic May 2, 2018September 26, 2019
Noah Joshua Phillips Republican May 2, 2018September 26, 2023
Rebecca Kelly Slaughter Democratic May 2, 2018September 26, 2022
Christine Wilson Republican September 26, 2018September 26, 2025

List of former chairmen

List of former commissioners

Recent former commissioners were: [8]

CommissionerYears
John J. Carson 1949 – 1953
Stephen J. Spingarn 1950 – 1953
Caspar Weinberger December 31, 1969 – August 6, 1970
Philip Elman April 21, 1961 – October 18, 1970
Miles W. KirkpatrickSeptember 14, 1970 – February 20, 1973
Everette MacIntyreSeptember 26, 1961 – August 30, 1973
Mary Gardner JonesOctober 29, 1964 – November 2, 1973
David J. Dennison Jr.October 18, 1970 – December 31, 1973
Mayo J. ThompsonJuly 8, 1973 – September 26, 1975
Lewis A. EngmanFebruary 20, 1973 – December 31, 1975
Calvin J. CollierMarch 24, 1976 – December 31, 1977
Stephen A. NyeMay 5, 1974 – May 5, 1978
Elizabeth Hanford Dole December 4, 1973 – March 9, 1979
Paul Rand Dixon March 21, 1961 – September 25, 1981
David ClantonAugust 26, 1975 – October 14, 1983
Michael Pertschuk April 21, 1977 – October 15, 1984
George W. DouglasDecember 27, 1982 – September 18, 1985
James C. Miller III September 30, 1981 – October 5, 1985
Patricia P. BaileyOctober 29, 1979 – May 15, 1988
Margo E. MacholNovember 29, 1988 – October 24, 1989 [recess appointment]
Daniel OliverApril 21, 1986 – August 10, 1989
Terry Calvani November 18, 1983 – September 25, 1990
Andrew StrenioMarch 17, 1986 – July 15, 1991
Deborah K. OwenOctober 25, 1989 – August 26, 1994
Dennis A. YaoJuly 16, 1991 – August 31, 1994
Christine A. Varney October 17, 1994 – August 5, 1997
Janet D. Steiger August 11, 1989 – September 28, 1997
Roscoe B. Starek IIINovember 19, 1990 – December 18, 1997
Mary L. AzcuenagaNovember 27, 1984 – June 3, 1998
Robert Pitofsky June 29, 1978 – April 30, 1981 & April 11, 1995 – May 31, 2001
Sheila F. AnthonySeptember 30, 1997 – August 1, 2003
Timothy Muris June 4, 2001 – August 15, 2004
Mozelle W. ThompsonDecember 17, 1997 – August 31, 2004
Orson Swindle December 18, 1997 – June 30, 2005
Thomas B. LearyNovember 17, 1999 – December 31, 2005
Deborah Platt Majoras August 16, 2004 – March 29, 2008
Pamela Jones Harbour August 4, 2003 – April 6, 2010
William Kovacic January 4, 2006 – October 3, 2011
J. Thomas Rosch January 5, 2006 - Sept 2012
Jon Leibowitz March 2, 2009 – March 7, 2013
Joshua D. Wright January 11, 2013 – August 24, 2015
Julie Brill April 6, 2010 – March 31, 2016
Edith Ramirez April 5, 2010 – February 10, 2017
Terrell McSweeny April 28, 2014 – April 27, 2018

Bureaus

How to File a Complaint with the Federal Trade Commission, from the FTC

Bureau of Consumer Protection

The Bureau of Consumer Protection's mandate is to protect consumers against unfair or deceptive acts or practices in commerce. With the written consent of the Commission, Bureau attorneys enforce federal laws related to consumer affairs and rules promulgated by the FTC. Its functions include investigations, enforcement actions, and consumer and business education. Areas of principal concern for this bureau are: advertising and marketing, financial products and practices, telemarketing fraud, privacy and identity protection, etc. The bureau also is responsible for the United States National Do Not Call Registry.

Under the FTC Act, the Commission has the authority, in most cases, to bring its actions in federal court through its own attorneys. In some consumer protection matters, the FTC appears with, or supports, the U.S. Department of Justice.

Bureau of Competition

The Bureau of Competition is the division of the FTC charged with elimination and prevention of "anticompetitive" business practices. It accomplishes this through the enforcement of antitrust laws, review of proposed mergers, and investigation into other non-merger business practices that may impair competition. Such non-merger practices include horizontal restraints, involving agreements between direct competitors, and vertical restraints, involving agreements among businesses at different levels in the same industry (such as suppliers and commercial buyers).

The FTC shares enforcement of antitrust laws with the Department of Justice. However, while the FTC is responsible for civil enforcement of antitrust laws, the Antitrust Division of the Department of Justice has the power to bring both civil and criminal action in antitrust matters.

Bureau of Economics

The Bureau of Economics was established to support the Bureau of Competition and Consumer Protection by providing expert knowledge related to the economic impacts of the FTC's legislation and operation.

Activities

The FTC investigates issues raised by reports from consumers and businesses, pre-merger notification filings, congressional inquiries, or reports in the media. These issues include, for instance, false advertising and other forms of fraud. FTC investigations may pertain to a single company or an entire industry. If the results of the investigation reveal unlawful conduct, the FTC may seek voluntary compliance by the offending business through a consent order, file an administrative complaint, or initiate federal litigation.

Traditionally an administrative complaint is heard in front of an independent administrative law judge (ALJ) with FTC staff acting as prosecutors. The case is reviewed de novo by the full FTC commission which then may be appealed to the U.S. Court of Appeals and finally to the Supreme Court.

Under the FTC Act, the federal courts retain their traditional authority to issue equitable relief, including the appointment of receivers, monitors, the imposition of asset freezes to guard against the spoliation of funds, immediate access to business premises to preserve evidence, and other relief including financial disclosures and expedited discovery. In numerous cases, the FTC employs this authority to combat serious consumer deception or fraud. Additionally, the FTC has rulemaking power to address concerns regarding industry-wide practices. Rules promulgated under this authority are known as Trade Rules.

In the mid-1990s, the FTC launched the fraud sweeps concept where the agency and its federal, state, and local partners filed simultaneous legal actions against multiple telemarketing fraud targets. The first sweeps operation was Project Telesweep [9] in July 1995 which cracked down on 100 business opportunity scams.

In 1984, [10] the FTC began to regulate the funeral home industry in order to protect consumers from deceptive practices. The FTC Funeral Rule requires funeral homes to provide all customers (and potential customers) with a General Price List (GPL), specifically outlining goods and services in the funeral industry, as defined by the FTC, and a listing of their prices. [11] By law, the GPL must be presented to all individuals that ask, no one is to be denied a written, retainable copy of the GPL. In 1996, the FTC instituted the Funeral Rule Offenders Program (FROP), under which "funeral homes make a voluntary payment to the U.S. Treasury or appropriate state fund for an amount less than what would likely be sought if the Commission authorized filing a lawsuit for civil penalties. In addition, the funeral homes participate in the NFDA compliance program, which includes a review of the price lists, on-site training of the staff, and follow-up testing and certification on compliance with the Funeral Rule." [10]

One of the Federal Trade Commission's other major focuses is identity theft. The FTC serves as a federal repository for individual consumer complaints regarding identity theft. Even though the FTC does not resolve individual complaints, it does use the aggregated information to determine where federal action might be taken. The complaint form is available online or by phone (1-877-ID-THEFT).

The FTC has been involved in the oversight of the online advertising industry and its practice of behavioral targeting for some time. In 2011 the FTC proposed a "Do Not Track" mechanism to allow Internet users to opt-out of behavioral targeting.

In 2013, the FTC issued a comprehensive revision of its Green guides, which set forth standards for environmental marketing. [12]

Unfair or deceptive practices affecting consumers

Endorsement Guides from the FTC

Section 5 of the Federal Trade Commission Act, 15 U.S.C.   § 45 grants the FTC power to investigate and prevent deceptive trade practices. The statute declares that "unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful." [13] Unfairness and deception towards consumers represent two distinct areas of FTC enforcement and authority. The FTC also has authority over unfair methods of competition between businesses. [14]

Deception practices

In a letter to the Chairman of the House Committee on Energy and Commerce, the FTC defined the elements of deception cases. First, "there must be a representation, omission or practice that is likely to mislead the consumer." [15] In the case of omissions, the Commission considers the implied representations understood by the consumer. A misleading omission occurs when information is not disclosed to correct reasonable consumer expectations. [15] Second, the Commission examines the practice from the perspective of a reasonable consumer being targeted by the practice. Finally the representation or omission must be a material one—that is one that would have changed consumer behavior. [15]

Dot Com Disclosures guide

In its Dot Com Disclosures guide, [16] the FTC said that "[d]isclosures that are required to prevent deception or to provide consumers material information about a transaction must be presented clearly and conspicuously." [16] The FTC suggested a number of different factors that would help determine whether the information was "clear and conspicuous" including but not limited to:

  • the placement of the disclosure in an advertisement and its proximity to the claim it is qualifying,
  • the prominence of the disclosure,
  • whether items in other parts of the advertisement distract attention from the disclosure,
  • whether the advertisement 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. [16]

However, the "key is the overall net impression." [16]

Cyberspace.com case

In F.T.C. v. Cyberspace.com [17] the FTC found that sending consumers mail that appeared to be a check for $3.50 to the consumer attached to an invoice was deceptive when cashing the check constituted an agreement to pay a monthly fee for internet access. The back of the check, in fine print, disclosed the existence of this agreement to the consumer. The FTC concluded that the practice was misleading to reasonable consumers, especially since there was evidence that less than one percent of the 225,000 individuals and businesses billed for the internet service actually logged on. [17]

Gateway Learning case

In In re Gateway Learning Corp. the FTC alleged that Gateway committed unfair and deceptive trade practices by making retroactive changes to its privacy policy without informing customers and by violating its own privacy policy by selling customer information when it had said it would not. [18] Gateway settled the complaint by entering into a consent decree with the FTC that required it to surrender some profits and placed restrictions upon Gateway for the following 20 years. [19]

Sears Holdings case

In In the Matter of Sears Holdings Management Corp. , the FTC alleged that a research software program provided by Sears was deceptive because it collected information about nearly all online behavior, a fact that was only disclosed in legalese, buried within the end user license agreement. [20]

Loot Boxes in Computer and Video Games as Gambling

In November 2018 by request of US Senator Maggie Hassan, the FTC decided to investigate whether paid-for loot boxes, virtual items with random benefits in certain video games, were a form of gambling. [21] [22] [23] [24]

Money Now Funding / Cash4Businesses case

In September 2013, a federal court closed an elusive business opportunity scheme on the request of the FTC, namely "Money Now Funding" / "Cash4Businesses". [25] The FTC alleged that the defendants misrepresented potential earnings, violated the National Do Not Call Register, and violated the FTC's Business Opportunity Rule in preventing a fair consumer evaluation of the business. [26] This was one of the first definitive actions taken by any regulator against a company engaging in transaction laundering, where almost US$6 million were processed illicitly. [27] [28]

In December 2018, two defendants, Nikolas Mihilli and Dynasty Merchants, LLC, settled with the FTC. [29] They were banned from processing credit card transactions but a monetary judgment of $5.8 million was suspended due to the defendants’ inability to pay.

OMICS Publishing Group case

In 2016, the FTC launched action against the OMICS Publishing Group — "OMICS Group Inc., a Nevada corporation, also doing business as OMICS Publishing Group, iMEDPub LLC, a Delaware corporation, Conference Series LLC, a Delaware corporation, and Srinubabu Gedela" [30] — for producing predatory journals [31] and organising predatory conferences. This action, partly in response to on-going pressure from the academic community, [32] is the first action taken by the FTC against an academic journal publisher. [33] The complaint alleges that the defendants have been "deceiving academics and researchers about the nature of its publications and hiding publication fees ranging from hundreds to thousands of dollars" [34] and notes that "OMICS regularly advertises conferences featuring academic experts who were never scheduled to appear in order to attract registrants" [32] and that attendees "spend hundreds or thousands of dollars on registration fees and travel costs to attend these scientific conferences." [34] Manuscripts are also sometimes held hostage, with OMICS refusing to allow submissions to be withdrawn and thereby preventing resubmission to another journal for consideration. [33] Jeffrey Beall has described OMICS as the worst-of-the-worst amongst the predatory publishers. [32] [35] In November 2017, a federal court in the District of Nevada granted a preliminary injunction that

"prohibits the defendants from making misrepresentations regarding their academic journals and conferences, including that specific persons are editors of their journals or have agreed to participate in their conferences. It also prohibits the defendants from falsely representing that their journals engage in peer review, that their journals are included in any academic journal indexing service, or any measurement of the extent to which their journals are cited. It also requires that the defendants clearly and conspicuously disclose all costs associated with submitting or publishing articles in their journals." [36]

Unfair practices

Courts have identified three main factors that must be considered in consumer unfairness cases: (1) whether the practice injures consumers; (2) whether the practice violates established public policy; and (3) whether it is unethical or unscrupulous. [14]

FTC activities in the healthcare industry

In addition to prospective analysis of the effects of mergers and acquisitions, the FTC has recently resorted to retrospective analysis and monitoring of consolidated hospitals. [37] Thus, it also uses retroactive data to demonstrate that some hospital mergers and acquisitions are hurting consumers, particularly in terms of higher prices. [37] Here are some recent examples of the FTC's success in blocking or unwinding of hospital consolidations or affiliations:

  1. Phoebe Putney Memorial Hospital and Palmyra Medical Center in Georgia. In 2011, the FTC successfully challenged in court the $195 million acquisition of Palmyra Medical Center by Phoebe Putney Memorial Hospital. [37] [38] The FTC alleged that the transaction would create a monopoly as it would "reduce competition significantly and allow the combined Phoebe/Palmyra to raise prices for general acute-care hospital services charged to commercial health plans, substantially harming patients and local employers and employees". [38] The Supreme Court on February 19, 2013 ruled in favor of the FTC. [38]
  2. ProMedica health system and St. Luke's hospital in Ohio. Similarly, court attempts by ProMedica health system in Ohio to overturn an order by the FTC to the company to unwind its 2010 acquisition of St. Luke's hospital were unsuccessful. [37] [39] The FTC claimed that the acquisition would hurt consumers through higher premiums because insurance companies would be required to pay more. [39] In December 2011, an administrative judge upheld the FTC's decision noting that the behavior of ProMedica health system and St. Luke's was indeed anticompetitive and ordered ProMedica to divest St. Luke's to a buyer that would be approved by the FTC within 180 days of the date of the order. [37] [39]
  3. OSF healthcare system and Rockford Health System in Illinois. In November 2011, the FTC filed a lawsuit alleging that the proposed acquisition of Rockford by OSF would drive up prices for general acute-care inpatient services as OSF would face only one competitor (SwedishAmerican health system) in the Rockford area and would have a market share of 64%. [40] Later in 2012, OSF announced that it had abandoned its plans to acquire Rockford Health System. [40]

See also

Related Research Articles

The Federal Trade Commission Act of 1914 established the Federal Trade Commission. The Act, signed into law by Woodrow Wilson in 1914, outlaws unfair methods of competition and unfair acts or practices that affect commerce.

The Robinson–Patman Act of 1936 is a United States federal law that prohibits anticompetitive practices by producers, specifically price discrimination. It was designed to protect small retail shops against competition from chain stores by fixing a minimum price for retail products.

United States antitrust law collection of federal and state government laws, which regulates the conduct and organization of business corporations, generally to promote fair competition for the benefit of consumers

In the United States, antitrust law is a collection of federal and state government laws that regulates the conduct and organization of business corporations, generally to promote competition for the benefit of consumers. The main statutes are the Sherman Act of 1890, the Clayton Act of 1914 and the Federal Trade Commission Act of 1914. These Acts serve three major functions. First, Section 1 of the Sherman Act prohibits price-fixing and the operation of cartels, and prohibits other collusive practices that unreasonably restrain trade. Second, Section 7 of the Clayton Act restricts the mergers and acquisitions of organizations that would likely substantially lessen competition. Third, Section 2 of the Sherman Act prohibits the abuse of monopoly power.

Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act (FDCPA), Pub. L. 95-109; 91 Stat. 874, codified as 15 U.S.C. § 1692 –1692p, approved on September 20, 1977 is a consumer protection amendment, establishing legal protection from abusive debt collection practices, to the Consumer Credit Protection Act, as Title VIII of that Act. The statute's stated purposes are: to eliminate abusive practices in the collection of consumer debts, to promote fair debt collection, and to provide consumers with an avenue for disputing and obtaining validation of debt information in order to ensure the information's accuracy. The Act creates guidelines under which debt collectors may conduct business, defines rights of consumers involved with debt collectors, and prescribes penalties and remedies for violations of the Act. It is sometimes used in conjunction with the Fair Credit Reporting Act.

False advertising Misleading content in advertisements

False advertising is the use of false, misleading, or unproven information to advertise products to consumers. Consumers' ability to distinguish false advertisements is affected by their emotions. People with positive emotions are more sensitive to false advertisements. The advertising frequently does not disclose its source. One form of false advertising is to claim that a product has a health benefit or contains vitamins or minerals that it in fact does not. Many governments use regulations to control false advertising. A false advertisement can further be classified as deceptive if the advertiser deliberately misleads the consumer, as opposed to making an honest mistake. But it is difficult to judge whether advertising violates regulations. It's hard to tell if some tiny misleading expressions are false ads.

The Office of Fair Trading (OFT) was a non-ministerial government department of the United Kingdom, established by the Fair Trading Act 1973, which enforced both consumer protection and competition law, acting as the United Kingdom's economic regulator. The OFT's goal was to make markets work well for consumers, ensuring vigorous competition between fair dealing businesses and prohibiting unfair practices such as rogue trading, scams, and cartels. Its role was modified and its powers changed with the Enterprise Act 2002.

Movieland

Movieland, also known as Movieland.com, Moviepass.tv and Popcorn.net, was a subscription-based movie download service that has been the subject of thousands of complaints to the Federal Trade Commission, the Washington State Attorney General's Office, the Better Business Bureau, and other agencies by consumers who said they were held hostage by its repeated pop-up windows and demands for payment, triggered after a free 3-day trial period. Many said they had never even heard of Movieland until they saw their first pop-up. Movieland advertised that the service had "no spyware", and that no personal information would need to be filled out to begin the free trial.

Consumer protection is the practice of safeguarding buyers of goods and services, and the public, against unfair practices in the marketplace. Consumer protection measures are often established by law. Such laws are intended to prevent businesses from engaging in fraud or specified unfair practices in order to gain an advantage over competitors or to mislead consumers. They may also provide additional protection for the general public which may be impacted by a product even when they are not the direct purchaser or consumer of that product. For example, government regulations may require businesses to disclose detailed information about their products—particularly in areas where public health or safety is an issue, such as with food or automobiles.

Federal Trade Commission v. Sperry & Hutchinson Trading Stamp Co., 405 U.S. 233 (1972), is a decision of the United States Supreme Court holding that the Federal Trade Commission (FTC) may act against a company's “unfair” business practices even though the practice is none of the following: an antitrust violation, an incipient antitrust violation, a violation of the “spirit” of the antitrust laws, or a deceptive practice. This legal theory is termed the "unfairness doctrine."

The unfairness doctrine is a doctrine in United States trade regulation law under which the Federal Trade Commission (FTC) can declare a business practice "unfair" because it is oppressive or harmful to consumers even though the practice is not an antitrust violation, an incipient antitrust violation, a violation of the "spirit" of the antitrust laws, or a deceptive practice.

In the middle of 2009 the Federal Trade Commission filed a complaint against Sears Holdings Management Corporation (SHMC) for unfair or deceptive acts or practices affecting commerce. SHMC operates the sears.com and kmart.com retail websites for Sears Holdings Corporation. As part of a marketing effort, some users of sears.com and kmart.com were invited to download an application developed for SHMC that ran in the background on users' computers collecting information on nearly all internet activity. The tracking aspects of the program were only disclosed in legalese in the middle of the End User License Agreement. The FTC found this was insufficient disclosure given consumers expectations and the detailed information being collected. On September 9, 2009 the FTC approved a consent decree with SHMC requiring full disclosure of its activities and destruction of previously obtained information.

This report is the result of a student task force exploration of the Federal Trade Commission (FTC), completed over the course of a summer job led by Ralph Nader. The seven law student volunteers began their evaluation of the FTC in June 1968, and published a revised and expanded version of the report as a book in January 1969.

In re Gateway Learning Corp, 138 F.T.C. 443 File No. 042-3047, was an investigatory action by the Federal Trade Commission (FTC) of the Gateway Learning Corporation, distributor of Hooked on Phonics. In its complaint, the FTC alleged that Gateway had committed both unfair and deceptive trade practices by violating the terms of its own privacy policy and making retroactive changes to its privacy policy without notifying its customers. Gateway reached a settlement with the FTC, entering into a consent decree in July 2004, before formal charges were filed.

The Franchise Rule defines acts or practices that are unfair or deceptive in the franchise industry in the United States. The Franchise Rule is published by the Federal Trade Commission. The Franchise Rule seeks to facilitate informed decisions and to prevent deception in the sale of franchises by requiring franchisors to provide prospective franchisees with essential information prior to the sale. It does not, however, regulate the substance of the terms that control the relationship between franchisors and franchisees. Also, while The Franchise Rule removed the regulation of the sale of franchises from the purview of the states under the authority of the FTC to regulate interstate commerce, The FTC Franchise Rule does not require franchisors to disclose the unit performance statistics of the franchised system to new buyers of franchises as would be necessary and material under state and federal Securities and Exchange law. The FTC Franchise Rule was originally adopted in 1978. This followed a lengthy FTC rulemaking proceeding that began in 1971. A substantial revision of the FTC Franchise Rule was adopted by the FTC in 2007.

OMICS Publishing Group discredited academic publishing company

OMICS Publishing Group is a predatory publisher of open access academic journals. It started publishing its first journal in 2008. By 2015, it claimed over 700 journals, although about half of them were defunct. Its subsidiaries include iMedPub LTD and Conference Series LLC LTD. Other organisations linked to OMICS are EuroSciCon Ltd, Allied Academies, Trade Science Inc, and Meetings International.

In addition to federal laws, each state has its own unfair competition law to prohibit false and misleading advertising. In California, one such statute is the Unfair Competition Law [hereinafter “UCL”], Business and Professions Code §§ 17200 et seq. The UCL “borrows heavily from section 5 of the Federal Trade Commission Act” but has developed its own body of case law.

FTC v. Balls of Kryptonite is an enforcement action brought in 2009 by the U.S. Federal Trade Commission (FTC) in United States District Court for the Central District of California. The defendant was Jaivin Karnani, a Southern California man, his company Balls of Kryptonite LLC, and several other corporate names they did business as. In 2011 the FTC secured a court order barring Karnani and Balls of Kryptonite from engaging in many of the deceptive business practices that had brought him to the agency's attention.

FTC v. Motion Picture Advertising Service Co., 344 U.S. 392 (1953), was a 1953 decision of the United States Supreme Court in which the Court held that, where exclusive output contracts used by one company "and the three other major companies have foreclosed to competitors 75 percent of all available outlets for this business throughout the United States" the practice is "a device which has sewed up a market so tightly for the benefit of a few [that it] falls within the prohibitions of the Sherman Act, and is therefore an 'unfair method of competition' " under § 5 of the FTC Act. In so ruling, the Court extended the analysis under § 3 of the Clayton Act of requirements contracts that it made in the Standard Stations case to output contracts brought under the Sherman or FTC Acts.

<i>Federal Trade Commission v. Vemma Nutrition Company</i>

Federal Trade Commission v. Vemma Nutrition Company, No. 2:15-cv-01578, was a case heard in United States District Court for the District of Arizona. On August 17, 2015 the Federal Trade Commission for the United States filed a complaint for the preliminary injunction and for other equitable relief of Vemma Nutrition Company.. The FTC, under Section 13(b) of the Federal Trade Commission Act filed for the permanent injunction of Vemma and alleged Vemma in violation of Section 5(a) of the FTC Act, 15 U.S.C § 45 (a) in connection with the advertising, marketing, promotion, and sale of opportunities to sell health and wellness drinks. The FTC alleged Vemma Nutrition Company of running an illegal pyramid scheme dependent on targeting young adults and recruitment tactics that emphasize the importance of becoming an "affiliate" and purchasing "affiliate packs" and monthly auto-delivery supply packs. Vemma further emphasizes the importance of affiliates to recruit others and "teach them to duplicate this process," offering "bonuses" as incentive for doing so. Vemma CEO Benson K. Boreyko claimed in his recruitment presentations that there is a potential for affiliates to "earn up to $50,000 a month working part time." The FTC found that affiliates are unlikely to earn substantial income and suffer, therefore being misled to participate in a deceptive act in violation of Section 5(a) of the FTC Act, 15 U.S.C § 45 (a).

Predatory conferences or predatory meetings are meetings set up to appear as legitimate scientific conferences but which are exploitative as they do not provide proper editorial control over presentations, and advertising can include claims of involvement of prominent academics who are, in fact, uninvolved. They are an expansion of the predatory publishing business model, which involves the creation of academic publications built around an exploitative business model that generally involves charging publication fees to authors without providing the editorial and publishing services associated with legitimate journals.

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Further reading