April 2008 - Legal Series

Seminar for Legal Practitioners: Clear-cut Knowledge Concerning Behavioral Advertising

By Sieglinde Friedman

At the end of 2007, the Federal Trade Commission (FTC) proposed online behavioral advertising policy principles to address consumer privacy concerns. These principles were put forward to guide the development of self-regulation online. Not only do these principles encourage more meaningful and enforceable self-regulation, but the purpose of them recognizes both the need to maintain vigorous competition in online advertising, as well as the importance of accommodating the wide variety of business models that exist in the space. The proposals include:

  • All websites where behavioral advertising is collected should provide an ear, consumer-friendly and prominent statement that data is, in fact, being collected to provide ads targeted to the consumer and give consumers the ability to choose whether or not to have their information collected.

  • Any company that collects or stores consumer data for behavioral advertising should provide reasonable security for that data and should retain data only as long as is necessary to fulfill a legitimate business or law enforcement need.

  • Companies should obtain affirmative express consent from affected consumers before using data in a manner materially different from promises the company made when it collected the data.

  • Companies should only collect sensitive data for behavioral advertising if they obtain affirmative, express consent from the consumer to receive such advertising.

Following the FTC workshop on behavioral advertising, the agency called on the industry to work on self-regulation in this area. ERA, along with multiple other trade associations in the space, has formed a loose coalition to respond to the FTC. Additionally, ERA has been approached by some in the membership to make supplemental comments expressing concern with the FTC’s approach to behavioral advertising, as the agency has not released a subsequent report, nor asked for clarification on harms in the marketplace.

In an effort to ensure that its members are fully aware of these and a number of other legal issues facing the industry, ERA will present a full-day’s legal seminar, which offers 9.5 CLE credits, on Practical Knowledge for the New Technology Landscape on Tuesday, April 29, 2008, from 8:00 a.m. to 5:00 p.m. at the American Conference Center in New York. The distinguished faculty includes experts from the FTC and representatives from prominent legal firms, such as: Manatt, Phelps & Phillips, LLP, Venable, LLP, Kelley Drye Collier Shannon, Satterlee Stephens Burke & Burke, LLP, Frankfurt Kurnit Klein & Selz, and Baker & Hostetler, LLP.

The program will include the following sessions:

Impact of New Technologies and Behavior Advertising: includes the legal, business and ethical issues that arise as direct-to-consumer commerce responds to the new technologies;
Avoiding Third-Party Liability Online: presenting strategies for confronting infringers and defending claims of fair use on the Internet;

Data Security Issues: strategies on how to avoid potential enforcement actions and liability;

Key Issues of Ownership, Trademark & Copyright of Ideas: offers a number of components among which include the goals of a licensing agreement and how they may differ-depending on the degree of maturity of the brand, grants of rights for both traditional and new media, protection of trademarks through quality control provisions, and enforcement and alternative dispute resolution;

Complying with FTC Regulations in Electronic Retailing: will be presented as the luncheon keynote address;

FTC Updates on Behavior Marketing Initiatives: discusses proposed online behavioral advertising policy principles to address consumer privacy concerns;

Online Testimonials: speaks to an advanced look at identifying claims that require substantiation, determining the type of substantiation that is required, the role of disclaimers, the use of testimonial groups, and product demonstrations; and

Direct Response Advertising Self-Regulation Issues – Update on the Big Cases of the Year: highlights the major cases of the year that ERA’s Self-Regulation Program has reviewed.

As the direct-to-consumer industry succeeds and increases across all channels, the significance of the associated legal landscape expands. This legal series-along with ERA’s commitment to its members-not only serves to broaden and sharpen marketers’ knowledge base in order to ensure compliance, but also establishes best practices so that consumers continue to enjoy a safe and gratifying shopping experience.

Sieglinde Friedman is ERA’s vice president of strategy. She can be reached at (703) 908-1021, or via e-mail at [email protected].

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