iLegal – adtech San Francisco – Legal Hope in the Air
When I’m at a show like adtech, even though I’m not attending in a legal role, I often end up in conversations with people about legal issues facing our industry. Sometimes the conversations are just random, covering the latest news about who is under investigation for what, to guessing games about what States are considering legislation that might make them litigation hot spots in the future. But occasionally at a convention, I’ll start to notice a theme in these conversations.
As I wandered the show and saw people I knew, from compliance officers, to CEOs and other in-house counsel, the topic of the recent court decision regarding Impulse Marketing kept coming up. And the tones of the conversations were quite hopeful.
Just to bring you up to speed, in the Impulse case, a jury ruled that because Impulse had a reasonable, working compliance program, they could not be held liable for the actions of an affiliate who failed to follow those rules. This is good news for the industry, because the FTC had been pushing a strict liability standard, which the jury rejected in this case.
For those in the industry that were aware of it, there was some comfort in the Impulse decision. In essence, a jury had held that a company simply needs to act reasonably in their compliance efforts in order to not be liable for the actions of their misbehaving affiliates. This is a fair and reasonable standard to which I believe many in our industry would be happy to be accountable (and for the most part already are).
While I appreciate the hopefulness that springs from this decision, it’s important that we not put too much stead in the decision in the case. This case will not necessarily change the FTC’s approach in subsequent cases, and they may continue to push the theory of strict liability for the actions of affiliates onto networks and direct advertisers. However, it is a significant step in the right direction, and does create a basis for future companies to argue along these lines in the future.
So, to those who’ve been watching this case, and who pay attention to these things, I’d say, be hopeful. But don’t let hope substitute for vigilance in the operation of your compliance program.
Come back to the iLegal column every week as we get specific about the rules, regulations, laws and trends that affect the online advertising industry. Each week we discuss important legal issues, talk about how to avoid the pitfalls, and cover the breaking legal and regulatory advertising industry news.
Legal Disclaimer: Information conveyed in this column is provided for informational purposes only and does not constitute legal advice. These materials do not necessarily reflect the opinions of Digital Moses, and is not guaranteed to be complete, correct, or up-to-date. The column is provided for "information purposes" only and should not be relied upon as "legal advice." This information is not intended to substitute for obtaining legal advice from an attorney. No person should act or rely on any information in this column without seeking the advice of an attorney.
Mark Meckler is the General Counsel for UniqueLeads.com, Inc., and Unique Lists, Inc. Mark is the Vice Chair of the eCommerce and Technology Committee of the Association of Corporate Counsel, and is a member of the International Association of Privacy Professionals. www.UniqueLeads.com
Copyright 2008 Mark J. Meckler
