In recent years, The Federal Trade Commission (“FTC”) has taken steps to protect consumers from potentially deceptive marketing related to the use of online reviews. On August 14, 2024, the FTC added to that protection by announcing a final rule (16 CFR Part 465) directed at companies that utilize fake reviews, testimonials, or celebrity endorsements. The enforcement provisions of this rule are significant, allowing courts to assess civil penalties on offending companies and allowing the FTC to seek compensation for any affected customers.
The rule requires that customer reviews should be from actual individuals who have experience with the product or service. It also prohibits a business from paying or incentivizing consumers to leave reviews with specific opinions. In addition, the rule does not allow restrictions on negative reviews – the rule provides that all reviews should be published regardless of their opinion (excluding any reviews that contain offensive or inappropriate content). Finally, the rule requires disclosure of any websites that post reviews who are also affiliated with the company. (465.2-465.8).
It is important to note that this rule does not apply to third party review platforms (such as Google or Yelp) that post reviews that are not of their products. In addition, this rule does not require a company to manually monitor every consumer review or post, as the rule is directed at companies that advertise through consumer reviews, testimonials, and social media.
When taken with the FTC’s recent history of enacting protections for consumers regarding deceptive or misleading online customer reviews, this new rule, with strong enforcement provisions, shows that this area is and remains a priority for the FTC.
Attorney Joseph J. Two is Of Counsel DeBlasio Law Group. For over 25 years, Mr. Two has focused his practice on complex civil, business and employment litigation cases, working for some of Chicago’s best national and multinational law firms. At DeBlasio Law Group, he provides added depth and experience on select client matters and supports the firm’s litigation and counseling teams. For information on scheduling a consultation, call DeBlasio Law Group at (630) 560.1123, or you may reach us through our firm’s website at www.DGLLC.net/contact.