Michele Shuster has been appointed Chair of the Executive Advisory Board for The Taylor Institute for Direct Marketing and Suarez Applied Marketing Research Laboratories at The University of Akron. Michele will serve a two year term as Chair.  She has faithfully served as a board member since 2007.

The Taylor Institute is the nation’s premiere learning and research venue for direct integrated marketing. Occupying over 25,000 square feet and serving over 700 students, the Taylor Institute provides a wide variety of educational, research and marketing service programs to the University’s students and industry businesses. The Taylor Institute is where theory meets practice and where the University of Akron’s College of Business Administration’s curriculum focuses on digital and online marketing, direct response advertising, direct marketing management, multi-channel marketing, integrated marketing communications, direct mail applications and call center services.  Fully accredited undergraduate and graduate degrees are offered from the University through the Taylor Institute focused on emerging marketing trends that will better prepare graduating students for the ever changing world of marketing.

The Suarez Applied Marketing Research Laboratories’ mission is to blend marketing intelligence with marketing research to provide real-world opportunities and advantages to businesses, and to UA students and faculty seeking to perform applied research.The Laboratories support both business marketing undergraduate and graduate course offerings, as well as student and faculty research activities by providing faculty and students with the research capabilities for conducting studies pertinent to the theory and practice of marketing and business, and creating an experiential learning environment where students and faculty can acquire and hone the skills and competencies needed for conducting theoretical and applied research.

Upon request of the several prominent consumer advocacy groups, the Federal Trade Commission issued an advisory opinion yesterday, reaffirming the consumers’ rights under the Holder in Due Course Rule.  The Rule provides consumers with claims and defenses when merchants sell consumer credit contracts to another lenders.

The rule entitles a consumer to assert the same claims and defenses against the buyer of the contract that the consumer had against the seller who provided the credit.  The only limitation in the Rule is that the consumer cannot recover from the buyer more than what the consumer paid under the contract.

Several courts had previously interpreted the Rule to bar consumers’ affirmative recovery under the Rule to those circumstances where rescission of the contract is warranted.  In its opinion letter, the Commission flatly rejected this interpretation stating, “The Commission affirms that the Rule is unambiguous, and its plain language should be applied.

No additional limitations on a consumer’s right to an affirmative recovery should be read into the Rule, especially since a consumer would not have notice of those limitations because they are not included in the credit contract.”

We will watch to see what weight courts give this advisory opinion as these types of cases get litigated.

This morning The Today Show ran an ugly expose on a telemarketer purportedly calling people on the federal Do Not Call list.  When the owner finally got a word in edgewise, he said he wasn’t violating the law because they were opt in leads. What does this mean? Lately it means a lead broker selling a list of consumer names who went to a website and opted to receive solicitations on their phone or wireless device even if they are on the DNC list.

Why is this dangerous? Because you have to rely on their word that they are opt in leads and even more importantly, that the opt in passes legal muster.

Why should you care? Because you don’t want to be the next Today Show victim and even more importantly, the FTC and state AG’s don’t sue the lead broker, they sue the telemarketer! And even if you tell the regulator you were told they were legal opt in leads, they don’t care!

You need to conduct your due diligence to ensure best you can that these leads are what they say they are. For every name you’re given, you should also be given (or be readily accessible) the IP address of the computer from where the opt in was obtained; the date and time (down to the second) of when it was made and the actual website and pages that the consumer saw when they opted in. Then you need to get a legal opinion on whether this suffices as express written permission – the required legal standard.

Yesterday (April 24th) the Consumer Financial Protection Bureau (CFPB) launched a public inquiry into how consumers and financial services companies are affected by arbitration and arbitration clauses. The purpose of the study is for the CFPB to assess whether imposing conidtions or prohibitions on arbitration would better protect consumers.

Arbitration is a formal way to resolve disputes outside the court system. Many contracts for consumer financial services products and services contain a “pre-dispute arbitration clause” stating that the parties generally agree to resolve all disputes about that product or service through arbitration, rather than through the court system. Through the Dodd-Frank Act, Congress requires the CFPB to study the use of pre-dispute arbitration clauses in consumer financial markets and gives the Bureau the power to issue regulations for the protection of consumers consistent with the study.

The Request for Information on Arbitration, as submitted to the Federal Register for publication, is available here.

On April 4, 2012 the Arizona governor signed into law a bill that amends its laws pertaining to telephone solicitations, including the adoption of specific requirements pertaining to sellers of business opportunities.  Significant new provisions include the following:

• Persons offering to sell “identity protection assistance” during inbound calls and/or offering business opportunities through any means must register as telephone “sellers” unless an exemption applies.
• As part of the registration process, sellers of business opportunities must submit specific information pertaining to their experience selling business opportunities and the specific goods, services and/or training that will be provided.
• Sellers of business opportunities are expressly excluded from the registration exemption for business to business sales.
• Purchasers of business opportunities may cancel at any time within 10 business days after the date the consumer signs the contract or the date the seller notifies the consumer in writing that the contract or agreement is accepted, whichever is later.
• Sellers of business opportunities must provide prospective purchasers with a written disclosure document at least 5 days prior to the execution of a contract or acceptance of payment.  The document must contain specific disclosure language and detailed information regarding what will be provided, the applicable costs, the seller’s registration and bonding information, the material terms and conditions of the sale and the purchaser’s cancellation rights.
• Consumers may rescind any purchases made from unregistered sellers (including sellers offering items other than business opportunities) and recover the purchase price as well as financial damages and attorney fees.

It has been roughly 6 weeks since the FCC approved a Report and Order that will amend its Telephone Consumer Protection Act regulations.  There are still many unanswered questions surrounding how these new regulations will impact our industry.  The ATA continues to work with the FCC regarding these very issues.

The ATA will be able to provide the most up-to-date information available at our 2012 National Convention and Expo, April 29th through May 2nd in Hollywood, FL.   These updates will not only include the compliance aspect of the ruling, but also how this ruling is impacting businesses from a tactical and a strategic perspective.

MPS will be represented at the convention by Michele Shuster, Shaun Petersen, Nick Whisler, and Betty Montgomery. Michele will be speaking at the convention on the regulatory state of the teleservices industry and ATA Regulatory Guide updates.  Her presentation will include a panel of current Assistant Attorney Generals will discuss the regulatory state of the teleservices industry by providing advice on enforcement practices and explaining the latest updates to the ATA regulatory guide.

We hope you will be able to join us for these very timely and important updates, and for a few days of warm weather and sunshine!  You can register for the Convention here.

Last week, Governor John Kasich signed HB 275, which contains a significant amendment to Ohio’s Consumer Sales Practices Act (CSPA).  This new addition to the law allows a supplier of consumer goods or services to offer a right to cure when the consumer has initiated a lawsuit alleging a violation of the CSPA.  Once the supplier receives service of the lawsuit, the supplier has 30 days to deliver a cure offer to the consumer.  The consumer then has 30 days to either accept or reject the cure offer.  The supplier’s cure offer must include the compensation offered to the consumer, reasonable attorneys’ fees for the filing of the lawsuit not to exceed $2,500, and court costs incurred in filing the lawsuit.

If the consumer rejects the cure offer and a judge, jury, or arbitrator awards actual economic damages that are less than that offered by the supplier in the cure offer, then the consumer is not entitled to treble damages, compensation for court costs incurred after the cure offer is received by the consumer, or attorneys’ fees incurred by the consumer after the consumer receives the cure offer.

Click here to read the bill’s language.

Cash Grant Institute Called Consumers on the Do Not Call Registry, Promised Cash Grants That Didn’t Exist

In response to charges by the Federal Trade Commission, a federal judge has ordered the defendants, Paul Navestad, also known as Paul Richard, and Chintana Maspakorn, also known as Christina Maspakorn, both doing business as, among others, The Cash Grant Institute, Global Ad Agency, Global Advertising Agency, Domain Leasing Company, and/or Cash Grant Search, who are behind a deceptive robocall scheme, to pay a total of $30 million in civil penalties and give up more than $1.1 million in ill-gotten gains for violations of the FTC Act and the Telemarketing Sales Rule.

MPS’ client, the Vehicle Protection Association, has led the assault via self regulation in this area virtually eliminating all illegal robodialing in the vehicle service contract industry.

Click here to read the entire FTC’s press release.

Summary of the FTC’s Final Privacy Report

“Privacy by Design”

On March 26, 2012 the Federal Trade Commission (FTC) released its long anticipated final privacy report entitled “Protecting Consumer Privacy in an Era of Rapid Change: Recommendations for Businesses and Policymakers” (Report).  The Report, which expands on the principles outlined in the FTC’s December 2010 preliminary report, urges Congress to implement privacy and data security regulations while also counseling industry to accelerate the pace of self-regulatory measures.  The three primary practices outlined in the report are:

1. Privacy by Design - Companies should build privacy protections into their everyday business practices. That includes limiting data collection and retention, securing the information they hold on to, safely disposing of what they no longer need, and implementing reasonable measures to ensure information is accurate.
2. Simplified Choice – Companies should give consumers a choice at a time and in a context that matters to people. The preliminary report noted that choice shouldn’t be necessary for certain “commonly accepted practices.” The Report refines that approach and concludes that choice needn’t be provided for data practices that people would expect, given the context of the transaction, the company’s relationship with the consumer, or as required or specifically authorized by law. The Report also reaffirms the Commission’s strong support for Do Not Track.
3. Improved transparency – Companies should increase the transparency of their data practices. What does the FTC have in mind? For example, businesses could develop clearer, more standardized privacy disclosures and could give people reasonable access to their information. The final Report also proposes important consumer protections with regard to data brokers. The Report supports targeted legislation that would provide greater transparency about what they’re doing and calls on data brokers to explore creating a centralized website where data brokers could identify themselves and describe how they collect and use people’s information.

Over the course of the next year, FTC staff will work to encourage consumer privacy protections by focusing on five main action items:

1. Do-Not-Track – The FTC intends to work with industry groups to “complete implementation of an easy-to-use, persistent, and effective Do Not Track system,”
2. Mobile – The FTC urged companies offering mobile services to work toward improved privacy protections, including disclosures. It will host a workshop on May 30, 2012 to address how mobile privacy disclosures can be short, effective, and accessible to consumers on small screens.
3. Data Brokers –The FTC made two recommendations to increase transparency. First, it reiterates the Commission’s prior support for legislation that would provide consumers with access to information held by data brokers. Second, it calls on data brokers who compile consumer data for marketing purposes to explore creation of a centralized website where consumers could get information about their practices and their options for controlling data use.
4. Large Platform Providers – The report cited heightened privacy concerns about the extent to which platforms, such as Internet Service Providers, operating systems, browsers and social media companies, seek to comprehensively track consumers’ online activities. The FTC will host a public workshop in the second half of 2012 to explore issues related to comprehensive tracking.
5. Promoting Enforceable Self-Regulatory Codes – The FTC will work with the Department of Commerce and stakeholders to develop industry-specific codes of conduct.

To minimize the effect on smaller business, the final framework doesn’t apply to them if they collect only non-sensitive data from fewer than 5,000 consumers a year, provided they don’t share the data with third parties.

The Report can be found at http://ftc.gov/opa/2012/03/privacyframework.shtm.

]]> http://mpslawyers.com/summary-of-the-ftcs-final-privacy-report/feed/ 0 http://mpslawyers.com/mps-visits-marine-one/ http://mpslawyers.com/mps-visits-marine-one/#comments Fri, 23 Mar 2012 16:27:33 +0000 MPS News http://mpslawyers.com/?p=942

This week, the MPS team had the unique opportunity to tour Marine One since it was in Columbus, Ohio for the President’s visit.

Michele Shuster’s brother-in-law is a pilot who flies Marine One, the President’s helicoptor.