Taking in the New FTC Guides

FTC logo First of all, a disclaimer – Nothing in this piece is meant to be taken as legal advice by anyone reading here. Individual situations may vary widely, and anyone with a legal question should consult his or her own attorney for a legal opinion on this topic.

When I saw in the New York Times that the previously rumored changes by the Federal Trade Commission (FTC) to the Guides Concerning the Use of Endorsements and Testimonials in Advertising had indeed been adopted, my first inclination was to hit the blog immediately. Oh, dear God! The sky is falling! Whatever shall we do? Then I did my research. Research before comment – gotta make my old Admin Law prof proud every once and again.

What I found in the guides and the various comments was rather a mixed lot. From the commentary available, it’s obvious that the FTC is trying to rein in some of the advertising claims that abound on the internet. I’m sure you’ve all seen blogs proclaiming things like this: “Try Colon Blow! Lose 40 pounds in 2 months – and who really needs those last couple feet of intestine anyway?” or perhaps this: “Try this cheap, easy tooth whitening method designed by a mom at home – because we all know children make your teeth whiter!”.

However, it appears to me that the FTC is painting with a pretty broad brush here. A review of the examples provided in their notice of the revised guides cover products from acne remedies to fast-dry paint, and are culled from mediums as varied as television interviews of celebrities, advertisements and blogs. Ah, blogs and websites – therein lies the beginnings of the online book world’s problem. The FTC appears to exempt paid reviewers from many of the regulations in this instance. However, those of us who take to the internet simply for love of our subject need to pay attention.

So, where do book reviews fit into this? After all, the FTC regs cover skincare, paint, food and all manner of consumer goods, but the guides themselves don’t contain specific mentions of book blogs or language indicative of a vast conspiracy against book bloggers. However, FTC representative Richard Cleland has spoken on the new guides and in this interview, makes it clear that the FTC considers book bloggers who receive ARCs/books from authors or publishers, or who have purchase links to items reviewed on their sites to be subject to the rules governing the disclosure of relationships. When someone from the FTC speaks like that regarding his interpretation of his agency’s own guides, I know I’m listening – and I suspect other prudent bloggers out there are, too.

Before I join bloggers and site owners in collapsing into collective panic over what we must disclose and where we must post it, I’m keeping a few things in mind. First of all, from my own conversations and from the commentary posted around the web, it’s rapidly becoming obvious that book reviews and the book industry just don’t work like other industries and that regulations covering books may need to be tailored to fit the industry a bit more. This idea was readily apparent to me quite a while ago (and to most of you as well, I suspect), but more importantly, the FTC, who is not regulating the book trade exclusively from day to day, is starting to be educated on this. Judging by what I’m seeing online, dozens of us writing online covering all kinds of different literary genres are contacting the FTC and trying to give them good information on this issue.

More importantly, Richard Cleland of the FTC has stated several places (including in this interview I cited above) that the implementation of the guidelines is still being worked out. We’re being told what we have to do, but there still seems to be room for discussion on the actual enforcement of the regulations. I personally would suggest that the FTC send noncompliance letters of some kind to bloggers, telling them what they need to do to cure before taking any other action such as filing charges or seeking to levy monetary penalties. I’ve seen that suggestion on several other blogs as well, and it’s also my understanding from conversations I’ve had with various people that this idea may ultimately be seen as workable.

Lastly, don’t forget that we have until December 1, 2009 to have our disclaimers up as they are needed. I am not in a position to give legal advice here on this blog, so I would urge anyone with questions about how the regulations will affect them to get in touch with an attorney to work out a compliance strategy during these weeks before the deadline.

If you want to educate yourself further about the FTC Guide revisions, I did find a couple of other sources helpful and very informative. One is this FAQ article written by a media attorney. The other is a very helpful guide posted by PC World.

Upcoming: I will be blogging in the near future about how the new guides will be affecting AAR specifically as well as detailing some new information that I have gotten.

- Lynn Spencer

10 thoughts on “Taking in the New FTC Guides

  1. My feeling is that this is mostly about money/goods exchanging hands without being declared.

  2. Great information in this post. At first it was a bit overwhelming, but I think I’m understanding it a bit more. I would really like to know the tax penalties on the ARC’s. I’ll donate them to my mother if need be.

    That’s our government…

  3. @CindyW Glad to help! The way I read the guides, the FTC is regulating advertising and requiring disclosure of relationships between bloggers and those who supply them with books or other items. I would expect that taxing of ARCs would be more of an issue for the IRS. Just my unofficial thoughts, though – you could probably contact an accountant or tax attorney for a more definitive answer.

  4. My biggest concern is when Cleland says that a blogger who has received goods (considered in-kind payment) cannot endorse those goods ANYWHERE without a disclaimer. So if I read an ARC and then write about it on my blog, I need a disclaimer. Fine. But what if I comment on someone else’s review? Or post on Twitter? Cleland has said that even in 140 characters you should be able to include a disclaimer. I am concerned that will have a chilling effect on book discussions online, unless they issue revised guidelines.

  5. @SonomaLass – And therein lies the craziness, as far as I’m concerned. Different industries work differently, and I just don’t see how a “one size fits all” approach to regulation will work.

  6. I wonder, does this also include Amazon? Authors always give out ARCs or even just backlist books with the hopes the reader will then write a review on Amazon. I am guessing Harriet Klauser (sp) has gotten a few arcs in her day, will everyday average readers who get free stuff in a contest be subjected to this? If so how are they going to monitor that? If not isn’t that a double standard?

    Also I imagin that this is an American law, so would it effect non American bloggers, or non American writers and or publishers? For example is a German blogger writes a review based on an arc they were given by an American writer does thsi apply? Or what if the book is given by a British writer? The internet excists as much in America as it does out the content and people this is so called protecting are as much Asian/European/Mexican/Candaian as they are American.

  7. ldb: The internet excists as much in America as it does out the content and people this is so called protecting are as much Asian/European/Mexican/Candaian as they are American.

    Well I am not sure what I was trying to say in this sentence.

    “The internet existes as much in America as it does out of America, the content is everywhere, and the people this law “protects” are as much Asia, European, Mexica, Canadian as they are American.”

  8. As far fas other nations go, the Internet is definitely worldwide, but how can the FTC enforce U.S. guidelines in other countries? Then you have situations where one person is in the U.S. (say an American reviewer) and someone else (say the writer) in the U.S. or Australia. (There are a lot of romance writers in England, Australia, New Zealand, Canada…) Then what? And what of reviewers in other countries who review books by U.S. author? Where is the head-spinning smilie?

    I’m wondering what the value of a review copy could be. One of the ways I keep track of issues with a review book is with little “dog ears.” Some of the books end up looking like Victorian fans by the time I’m done. ;) Even with just a few dog-ears, the books look read, and I haven’t been able to turn them into the local used book store. I know some writers are worried about people who become reviewers just to ask for free books, but if you look at my copies, you can tell I read it.

  9. Anne Marble: I’m wondering what the value of a review copy could be. One of the ways I keep track of issues with a review book is with little “dog ears.” Some of the books end up looking like Victorian fans by the time I’m done. Even with just a few dog-ears, the books look read, and I haven’t been able to turn them into the local used book store. I know some writers are worried about people who become reviewers just to ask for free books, but if you look at my copies, you can tell I read it.

    I want to point out that, of course, I don’t sell ARCs. Most of the books I reviewed over the past year were books I bought for myself — usually at Wal-Mart, Borders, Fictionwise, etc. So the “review copies” I was unable to sell were copies I bought at Wal-Mart. (It’s possible the used book store didn’t want to buy them because of the ugly Wal-Mart price stickers on the front covers, not just because of the dog-ears and general wear. The local Wal-Mart was using a really nasty glue during that time period.:))

    I did get about three review copies from publishers this way, but those are in no way going to be sold. Especially as I liked those books. :) In the past, I received ARCs (both bound and unbound), but I always kept those, even when I wasn’t crazy about the book, to avoid any issues with the ARCs ending up in the wrong hands. When I really liked the book, I often ended up buying my own copy anyway or buying copies of the book as Christmas presents. (Several people got shiny new copies of My Darling Caroline one Christmas.)

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