In its simplest form, the entire concept is this:

Advertising must tell the truth and not mislead consumers.
In addition, claims must be substantiated.

Readers should note that this does not reflect a change in the laws or regulation, but in the Guides to compliance as issued by the FTC.  The last time the FTC revised the Guides was 1980.  This latest revision goes into effect today, December 1, 2009.

The following News Release was issued by the Federal Trade Commission.  It is published here in its entirety.  The original can be found at http://ftc.gov/opa/2009/10/endortest.shtm

For Release: 10/05/2009

FTC Publishes Final Guides Governing Endorsements, Testimonials

Changes Affect Testimonial Advertisements, Bloggers, Celebrity Endorsements

The Federal Trade Commission today announced that it has approved final revisions to the guidance it gives to advertisers on how to keep their endorsement and testimonial ads in line with the FTC Act.

The notice incorporates several changes to the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising, which address endorsements by consumers, experts, organizations, and celebrities, as well as the disclosure of important connections between advertisers and endorsers. The Guides were last updated in 1980.

Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect. In contrast to the 1980 version of the Guides – which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as “results not typical” – the revised Guides no longer contain this safe harbor.

The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization. And a paid endorsement – like any other advertisement – is deceptive if it makes false or misleading claims.

Celebrity endorsers also are addressed in the revised Guides. While the 1980 Guides did not explicitly state that endorsers as well as advertisers could be liable under the FTC Act for statements they make in an endorsement, the revised Guides reflect Commission case law and clearly state that both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement – or for failure to disclose material connections between the advertiser and endorsers. The revised Guides also make it clear that celebrities have a duty to disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media.

The Guides are administrative interpretations of the law intended to help advertisers comply with the Federal Trade Commission Act; they are not binding law themselves. In any law enforcement action challenging the allegedly deceptive use of testimonials or endorsements, the Commission would have the burden of proving that the challenged conduct violates the FTC Act.

The Commission vote approving issuance of the Federal Register notice detailing the changes was 4-0. The notice will be published in the Federal Register shortly, and is available now on the FTC’s Web site as a link to this press release. Copies also are available from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,700 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

MEDIA CONTACT:

Betsy Lordan
Office of Public Affairs
202-326-3707

STAFF CONTACT:

Richard Cleland
Bureau of Consumer Protection
202-326-3088

(FTC File No. P034520)
(endorsement testimonial guide.wpd)

Continuing proof that 1and1 is incompetent, dishonest, and cares nothing about their customers.

Just a quick recap.  A transfer of 270+ domains was requested on December 8.  1and1 was unable to complete the tranfer until January 15.  During this period, the domains were inaccessible in my account.  1and1 is attempting to charge me for 17 domains that expired between December 15 and January 3; domains I had no ability to cancel and did not want.  They have locked my account, denying me access to over 150 domains that are fully paid and not in question.

I have issued complaints with the Better Business Bureau and Federal Trade Commission.

1and1 has thus far ignored every request to fix this issue and they keep blaming me for their internal system failures.

That’s where this site comes in.  Since 1and1 continues to ignore my complaints, I decided to tell my story here in hopes that I can warn someone else before they subject themselves to 1and1′s atrocious customer service.

Here is what I sent to David Rubel, Billing Manager, and everyone else at 1and1:

From: 1and1 Complaints [1and1complaints@rippedoffconsumers.org]
Sent: Sunday, March 01, 2009 3:34 AM
To: ‘David.Rubel@1and1.com’
Cc: ‘billing@1and1.com’;
‘marketing@1and1.com’; ‘redemption@1and1.com’; ‘complaints@1and1.com’;
‘sales@1and1.com’; ‘support@1and1.com’
Subject: FW: CXXXXXXXXX Re: FW: ATTN: David Rubel FW: KXXXXXXXXX Reminder

Hi, David.

I’m sending this to every address I can find at 1and1 because I’m not sure you are getting my messages, and I really want to make sure you get this one.  At least you choose not to respond to them.

Maybe you’ve just been busy.  I guess with all of the BBB and FTC complaints you have to deal with it must get pretty hectic around there.  I saw in my research that you do get a huge number of those.  Sorry I had to initiate my own, but your customer service really stinks.

You still have not corrected my invoice so I can pay you, even though I have submitted proof on a dozen occasions that I had no ability to cancel the domains due to 1and1′s internal technical problems.

Just in case you have forgotten the details (although after a dozen reiterations I don’t see how), here are the pertinent details:

The contract transfer was requested on December 8, 2008.

On December 10, 2008, Employee Name Removed acknowledged the request and promised a 24 hour completion.  (I sent you the email.)

December 18, 2008, Employee Name Removed acknowledges that they are still having trouble transferring the contract.  (I sent you the email.)

December 22, 2008, Employee Name Removed acknowledges that they are still having trouble transferring the contract.  (I sent you the email.)

January 7, 2009, YOU, David Rubel, admitted the problem, and promised Mr. Seller it would be completed that day.

The domains were not placed into my account until January 15, 2009.  That was the first time since December 10 that anyone outside of 1and1 had any control whatsoever over the domains.  I could not cancel what I could not access.

Every one of the domains in question expired between December 20, 2008, and January 3, 2009.

I had no ability to cancel them.

My account is locked, so I can’t change my DNS entries, therefore I cannot redirect any of my 240+ domains to the websites I am building to generate revenue.  That includes all of the domains that have not expired.  You are denying me access to domains I own that have nothing to do with this invoice dispute.  You are now costing me money.

The good news is that in the same bulk domain purchase I picked up another great domain, and I have been working to get it online.  Luckily, it is registered with a competent registrar, so I have not been denied access to it for even one day, much less the six weeks you cost me trying to transfer the contract, and now two more weeks because you can’t remember to fix my invoice.  You can visit it at http://RippedOffConsumers.org.  I really think it’s going to be very popular once I get some good content posted.

Listen, I know you are very busy, but I think you should be able to spare a few minutes to correct my invoice so that I can pay it and we can move on.

I look forward to hearing back from you at your earliest convenience.

Sincerely,
Brian Gothard

http://RippedOffConsumers.org

David Rubel never replied.  I didn’t hear a word for five days, when I received this:

From: complaints@1and1.com
Sent: Friday, March 06, 2009 10:33 AM
To: Brian Gothard
Subject: C122680964

Dear Brian Gothard, (Customer ID: XXXXXXXXX)

Thank you for contacting us.

I apologize for the delay of response.  We have further review the account with our billing department regarding this matter.

Please provide us a list of the domain names that you wish to have canceled and refunded.  I apologize for the frustration this may have caused you.

If you have any further questions please do not hesitate to contact us.

–
Sincerely,
Damion Son
Customer Service
1&1 Internet

Hmmm, Damion Son is the name David Rubel claimed was the “upper management” person looking into the original transfer problem.  He is the one who was supposed to fix this originally.  Considering that I have sent that list over a dozen times already, his apologies are not helping much.

But, I sent them again.  With the whole story included.

Next post – Damion’s response