Sony Computer Entertainment America (“Sony”) has agreed to settle Federal Trade Commission charges that it deceived consumers with false advertising claims about the “game changing” technological features of its PlayStation Vita handheld gaming console during its U.S. launch campaign in late 2011 and early 2012.
As part of its settlement with the FTC, Sony is barred from making similarly misleading advertising claims in the future, and will provide consumers who bought a PS Vita gaming console before June 1, 2012, either a $25 cash or credit refund, or a $50 merchandise voucher for select video games, and/or services. Sony will provide notice via email to consumers who are eligible for redress after the settlement is finalized by the Commission.
The settlement with MPHJ is the first time the FTC has taken action using its consumer protection authority against a patent assertion entity (PAE). PAEs are companies that obtain patent rights and try to generate revenue by licensing to or litigating against those who are or may be using patented technology.
“Patents can promote innovation, but a patent is not a license to engage in deception,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “Small businesses and other consumers have the right to expect truthful communications from those who market patent rights.”
Google Inc. has agreed to change some of its business practices to resolve Federal Trade Commission concerns that those practices could stifle competition in the markets for popular devices such as smart phones, tablets and gaming consoles, as well as the market for online search advertising.
Under a settlement reached with the FTC, Google will meet its prior commitments to allow competitors access – on fair, reasonable, and non-discriminatory terms – to patents on critical standardized technologies needed to make popular devices such as smart phones, laptop and tablet computers, and gaming consoles. In a separate letter of commitment to the Commission, Google has agreed to give online advertisers more flexibility to simultaneously manage ad campaigns on Google’s AdWords platform and on rival ad platforms; and to refrain from misappropriating online content from so-called “vertical” websites that focus on specific categories such as shopping or travel for use in its own vertical offerings.
“The changes Google has agreed to make will ensure that consumers continue to reap the benefits of competition in the online marketplace and in the market for innovative wireless devices they enjoy,” said FTC Chairman Jon Leibowitz. “This was an incredibly thorough and careful investigation by the Commission, and the outcome is a strong and enforceable set of agreements.”
An online advertising company agreed to settle Federal Trade Commission charges that it used “history sniffing” to secretly and illegally gather data from millions of consumers about their interest in sensitive medical and financial issues ranging from fertility and incontinence to debt relief and personal bankruptcy.
“Consumers searching the Internet shouldn’t have to worry about whether someone is going to go sniffing through the sensitive, personal details of their browsing history without their knowledge,” said FTC Chairman Jon Leibowitz. “This type of unscrupulous behavior undermines consumers’ confidence, and we won’t tolerate it.”
The Federal Trade Commission will require Robert Bosch GmbH to sell a business that makes equipment used to recharge vehicle air conditioning systems as part of an agreement resolving charges that Bosch’s acquisition of SPX Service Solutions U.S. LLC would have been anticompetitive. Under the agreement, Bosch also will grant manufacturers licenses to key patents that they need in order to compete in the market for this equipment. The proposed settlement order also requires Bosch to end agreements that restrict third parties from advertising, servicing, distributing, or selling competitive products in the United States.
Under the proposed settlement with the FTC, Bosch has agreed to sell its automotive air conditioner repair equipment business, including RTI Technologies, Inc., to automotive equipment manufacturer, Mahle Clevite, Inc.
Bosch also has agreed to resolve allegations that, before its acquisition by Bosch, SPX harmed competition in the market for this equipment by reneging on a commitment to license key, standard-essential patents (SEPs) on fair, reasonable and non-discriminatory (FRAND) terms. The FTC alleged that SPX reneged on its obligation to license on FRAND terms by seeking injunctions against willing licensees of those patents. Bosch has agreed to abandon these claims for injunctive relief.
“Patent holders that seek injunctive relief against willing licensees of their FRAND-encumbered SEPs should understand that in appropriate cases the Commission can and will challenge this conduct as an unfair method of competition under Section 5 of the FTC Act,” the Commission majority said in a separate statement.
The FTC will seek to use the $2 million judgment announced today to provide refunds to consumers who were allegedly deceived by the defendants’ marketing. The settlement also bars the defendants from a wide range of deceptive marketing practices, including making misleading or unsupported claims; misrepresenting any material fact in the sale of any product; failing to adequately disclose a material connection to the seller of any product, service, or program; and misrepresenting the existence or result of a test or study.
A company that provides management services to more than 300 payday loan and check cashing stores, and an affiliated company that owns and operates several stores, will pay $101,500 to settle Federal Trade Commission charges that they violated federal law by allowing sensitive consumer information to be tossed into trash dumpsters.
The Commission vote to approve the proposed consent decree was 5-0. The Department of Justice filed the proposed consent decree on behalf of the Commission, which was signed by the Judge Joan Gottschall of the U.S. District Court for the Northern District of Illinois on November 1, 2012.
It has always seemed to me that that the practices of payday loan and check cashing stories are nearly predatory to begin with. That those who need money so badly that they are willing to pay what I consider exorbitant rates have to also worry about their identities is truly a sad statement. $101,500 just doesn’t seem an adequate penalty given the careless and reckless disregard involved here.
Two of the nation’s leading paint companies, The Sherwin-Williams Company and PPG Architectural Finishes, Inc.,have agreed to settle Federal Trade Commission charges that they misled consumers to believe that some of their paints are free of potentially harmful chemicals known as volatile organic compounds (VOCs). SeeIn re Sherwin-Williams and In re PPG.
The two companies agreed to settlements with the FTC requiring them to stop making the allegedly deceptive claim that their Dutch Boy Refresh and Pure Performance interior paints, respectively, contain “zero” volatile organic compounds. According to the agency, while this may be true for the uncolored “base” paints, it is not true for tinted paint, which typically has much higher levels of the compounds, and which consumers usually buy.
VOCs are carbon-containing compounds that easily evaporate at room temperatures. Some VOCs can be harmful to human health and the environment. Historically interior paints, which are the subject of the FTC’s cases against Sherwin-Williams and PPG, have contained significant levels of VOCs.
Seven rent-to-own companies and a software design firm have agreed to settle Federal Trade Commission charges that they spied on consumers using computers that consumers rented from them, capturing screenshots of confidential and personal information, logging their computer keystrokes, and in some cases taking webcam pictures of people in their homes, all without notice to, or consent from, the consumers.
The software design firm collected the data that enabled rent-to-own stores to track the location of rented computers without consumers’ knowledge according to the FTC complaint. The settlements bar the companies from any further illegal spying, from activating location-tracking software without the consent of computer renters and notice to computer users, and from deceptively collecting and disclosing information about consumers.
Last month the Federal Trade Commission announced that Skechers USA, Inc. agreed to pay $40 million to settle charges that the company deceived consumers by making unfounded claims in a variety of advertisements. The claims made by Skechers that were determined to be unsupported related to advertisements that claimed that Shape-ups would help people lose weight, and strengthen and tone their buttocks, legs and abdominal muscles. See Stipulated Final Judgment and Order.
Under the Federal Trade Commission Act advertising must be truthful and non-deceptive, advertisers must have evidence to back up their claims; and advertisements cannot be unfair. The FTC will consider an ad deceptive if it contains a statement – or omits information – that is (1) likely to mislead consumers who are otherwise acting reasonably under the circumstances; and (2) material to a consumer’s decision to buy or use the product. The FTC will consider an ad to be unfair if it is: (1) likely to cause substantial consumer injury that a consumer could not reasonably avoid; and (2) not outweighed by the benefit to consumers.
Provisions are Designed to Foster Competition in the Computer Chip Business
The Federal Trade Commission approved a settlement with Intel Corp. that resolves charges the company illegally stifled competition in the market for computer chips. Intel has agreed to provisions that will open the door to renewed competition and prevent Intel from suppressing competition in the future.
This week the Federal Trade Commission (FTC) announced it had preliminarily reached a settlement with Dyna-E International and its owner George Wheeler, which would bar the retailer of rayon towels from making false and misleading claims that dupe consumers into believing its paper towels are biodegradable. under a proposed settlement with the Federal Trade Commission. This preliminary settlement is now open for public comment, as is routine and customary when the FTC seeks to settle a complaint against individuals or companies charged with violations of law. Those wishing to comment have through September 25, 2009, after which the Commission will decide whether to make it final. While nothing can be certain, it is safe to say that in the vast majority of cases a preliminary settlement is made final. It is also worth knowing that a consent agreement is for settlement purposes only and does not constitute an admission of a law violation, but a final order does carry the force of law with respect to future actions and each violation of a final order may result in a civil penalty of $16,000.