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ARTICLE · 30 JANUARY 2023

When Does The FTC Step In Over A Free Trial That Automatically Converts To A Ongoing Subscription?

Frankfurt Kurnit Klein & Selz PC
Frankfurt Kurnit Klein & Selz PC
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Frankfurt Kurnit Klein & Selz PC

Frankfurt Kurnit Klein & Selz PC

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The settlement required the company to change its billing practices and to pay $350,000 in equitable monetary relief.

United StatesMedia, Telecoms, IT, Entertainment

When it gets 70,000+ complaints.

Back in 2016, the FTC settled with beauty product and nutritional supplement marketer, NutriClick. NutriClick was alleged to have automatically enrolled consumers in ongoing membership programs without their consent when they signed up for free product samples on the company website, violating the FTC Act and ROSCA. The settlement required the company to change its billing practices and to pay $350,000 in equitable monetary relief.

Four years later, the company was back in front of the FTC, accused of violating ROSCA, the FTC's Telemarketing Sales Rule, and the previous court order, by failing to clearly and conspicuously disclose all material terms of their negative option sales offers. Once again, the company was alleged to have used a free sample program to lure consumers into costly membership programs without fully disclosing the terms or obtaining consumers' affirmative consent. Specifically, the company failed to clearly

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www.fkks.com

This post first appeared in Frankfurt Kurnit's Focus on the Data blog (www.focusonthedata.com). It provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.

Originally published by the New York Legal Ethics Reporter

www.fkks.com

This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.

www.fkks.com

This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.

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