U.S. FTC’s New Rule on Fake and AI-Generated Reviews and Social Media Bots
On August 14, 2024, the United States Federal Trade Commission (FTC) announced a final rule that prohibits fake and artificial intelligence-generated consumer reviews, consumer testimonials, and celebrity testimonials, along with other types of unfair or deceptive practices involving reviews and testimonials. This new rule is the latest development in the FTC’s increased rulemaking efforts and increased focus on AI, and will take effect on October 21, 2024.
New York Attorney General Publishes Guide to Avoid “Key Mistakes” Regarding Online Tracking Technologies
On July 30, 2024, New York Attorney General Letitia James announced website privacy guides for New York consumers and businesses. The guides, a business-focused Business Guide to Website Privacy Controls and a consumer-focused Consumer Guide to Tracking on the Web, are available on the Office of the New York State Attorney General’s (the “OAG’s”) website. The Business Guide to Website Privacy Controls is instructive for businesses operating websites available in the state. The OAG’s announcement is made amid increasing regulatory scrutiny, including by the FTC, as well as increased litigation centered on the use of online tracking technologies.
Artificial Intelligence Tops Agenda for Global Competition Authorities: EU, UK, and U.S. Issue Joint Statement
On July 23, 2024, the competition authorities of the EU, the UK, and the U.S. issued a joint statement on competition in generative artificial intelligence (AI) foundation models and AI products (Joint Statement). Since the emergence of generative AI, each of the authorities has been individually ramping up its work in order to understand better the potential risks to competition that AI may pose. The Joint Statement may herald a more joined-up global approach with respect to scrutiny of competition in AI.
FTC Proposes Significant and Sweeping Changes to COPPA and Requests Public Comment
On January 11, 2024, the Federal Trade Commission (“FTC”) published its Notice of Proposed Rule Making (“NPRM”) seeking to update the FTC’s Children’s Online Privacy Protection Act (“COPPA”) Rule in the Federal Register. Among other things, the proposed changes would require more granular privacy notices, require fairly detailed identification of, and parental consent to, third-party data sharing (including targeted advertising), expand the scope of personal information subject to COPPA, make it easier for parents to provide consent via text message, clarify various requirements around EdTech, including school authorization for parental consent, and impose significant new programmatic information security and data retention requirements.
FTC’s New Biometric Policy Statement Articulates New Governance Standards and an Expansive View of Biometric Data
On May 18, 2023, the Federal Trade Commission (“FTC”) issued its 2023 Policy Statement on Biometric Information and Section 5 of the FTC Act (the “Policy Statement”) describing the agency’s concerns about these fast-proliferating technologies and articulating a set of compliance obligations for businesses that develop or use biometric technologies. To address potential risks of bias, discrimination, and security associated with the collection or use of biometric information, the FTC wants businesses to, among other things, conduct pre-release risk assessments evaluating the potential for bias and other potential consumer harms, assess these risks on an ongoing basis, and evaluate and potentially audit third parties with access to a business’s biometric data.
EU-U.S. Adequacy Once Again
On July 10, 2023, the European Commission issued its Final Implementing Decision granting the U.S. adequacy (“Adequacy Decision”) with respect to companies that subscribe to the EU-U.S. Data Privacy Framework (“DPF”).
FemTech Has Been Warned: UK’s ICO Indicates Closer Scrutinization of FemTech Apps
On 4 April 2023, John Edwards, the UK’s Information Commissioner, stated that the UK’s Information Commissioner’s Office (ICO) would be “going after providers of women’s health apps and auditing them, and getting them to change any practices that are non-compliant.” Speaking at the IAPP Global Privacy Summit in Washington DC, the Information Commissioner indicated that this proposed strategy forms part of the ICO’s new “agile” initiative, which will focus on “areas of vulnerability, targeting…intervention [where] that has the greatest impact”.
New FTC Guidance for Mobile Health Apps
Healthcare providers, health plans, and technology companies that use mobile health apps to access, collect, share, use, or maintain information related to an individual’s health should take note of the recently issued Federal Trade Commission (FTC) Mobile Health App Interactive Tool. The purpose of the tool is to help mobile health developers determine the federal regulatory, privacy, and security laws and regulations that may apply to the use of a consumer’s health information, such as information related to diagnosis, treatment, fitness, wellness, or addiction. While the tool should not be considered legal advice and cannot guarantee compliance with legal requirements, it can help healthcare providers, health plans, and technology companies issue-spot to manage risk in this heavily regulated space.
Drizly FTC Order Introduces Significant Minimization, Deletion and Retention Requirements
On October 24, 2022, the Federal Trade Commission (“FTC”) issued an order (the “Order”) against the online alcohol marketplace, Drizly, and its CEO, James Cory Rellas, alleging security failures that resulted in a data breach exposing the personal information of approximately 2.5 million consumers. In reaching this conclusion, the FTC alleges that Drizly failed to implement reasonable safeguards to protect the personal information it collected and stored, such as, two-factor authentication for GitHub, access controls for personal data, sufficient written security policies, and appropriate employee training regarding security.
Meru Data Podcast Features Sidley Associate Lauren Kitces
Sidley associate Lauren Kitces was featured on Simplify For Success, a podcast series presented by Meru Data and hosted by Priya Keshav. Lauren discussed FTC’s proposed rulemaking regarding data privacy and data security, and shared her thoughts on how to prepare for the FTC enforcement.