Spineless FTC Goes Weak on Astroturfing

Writing astroturf reviews is WRONG, people. Like, OBVIOUSLY wrong.

So you’d think that if you got caught instructing your employees, in sunny yet oh-so-detailed ways, on how to leave fake positive reviews for your products, you would get more than just a slap on the wrist.

Right?

I mean, that’s what happened to the sorry bastards running Lifestyle Lift, who got smashed by the NY AG’s office to the tune of $300K after creating an elaborate scheme of fake microsites and reviews. Dozens of other companies have also paid 5- and 6 figure sums to settle astroturfing complaints brought by regulators.

But for shlepper of high-end beauty products Sunday Riley? Who gave employees a nine-step guide to writing fake reviews on Sephora’s website (you can read it in all of its hyper-specific, fraud-tastic glory here)? They’ve earned merely a stern talking-to and a “please don’t be naughty again” from the FTC.

Timothy Geigner at Techdirt put it best, describing Sunday Riley’s practices as:

really blatant, really fake, and really shady. This was a coordinated attempt to falsely manipulate the review system of Sephora for the purposes of fooling the public into buying more product.

This wasn’t a foot-fault, a naive error, or a single instance of wrongdoing. It was a calculated effort to fool a public that already has a super-hard time staying informed about the rapidly-evolving skincare industry.

But instead of stomping on this, the FTC basically greenlit further wrongdoing. Its settlement with Sunday Riley doesn’t require payment of any money, agreement to any kind of oversight, or even an admission of wrongdoing. While I’m no fan of agency overreach, this is the kind of factual record that screams out for significant punishment – not this kind of “tsk-tsk” nonsense.

Another “Abortion Counseling” Law Knocked Back

It seems to be an equal opportunity area, the fight to control speech around abortion. Blue states want to force churchy “crisis pregnancy centers” to inform people about its availability, while red states want to force doctors to scare patients away from it.

Thankfully, at least the courts are still thinking about the First Amendment.

Last year, we saw the beatdown of California’s mandatory pregnancy center notification requirement in NIFLA v. Becerra (a case that noted the First Amendment right of the centers to not have to carry the state’s message, but which is also notable for FINALLY opening the door for SCOTUS to flesh out a “professional speech” doctrine).

And today, we’ve got a federal district court in North Dakota blocking a law that would have forced doctors to advise patients about, well, all sorts of nonsense in a transparent attempt to make them fear ending their pregnancies.

Other states have similar laws; expect them to see similar fates.

It’s ironic that the strongest precedent for striking these laws is a Supreme Court case nixing a law where the shoe was solidly on the other foot. But far from surprising — too many policymakers are only opposed to speech restrictions when they’re imposed on the other team.

Are ALL Licensing Restrictions OK Now?

I missed this when it was issued last month, but struck by the result in the del Castillo v Philip case, challenging the application of Florida’s licensing law for dietitians to prevent the sale of diet coaching services by a non-licensee.

While the court is foreclosed from asking the obvious question (“do we really need so many god damn occupational licensing laws?”), it could have, you know, paid a little deference to the First Amendment on its way to depriving Heather Kokesch del Castillo of her right to earn an honest living.

Because maybe I’m reading this wrong, but it seems like the court is saying that ANY entry-to-the-profession licensing requirement inherently does not raise First Amendment issues — even if the profession is fundamentally centered on speech.

And even if the licensing requirement involves having a college degree and at least 6 months of relevant experience.

Look, I understand if the state wants to require a business license and the payment of a nominal fee before someone starts selling services to clients. That seems generally applicable, not speech-impacting, and relevant to prosaic matters like being able to hold businesses accountable for fraud and crappy service.

But it’s another thing entirely when those licensing requirements are extensive – and instead of merely giving the licensees the right to advertise their services as having met a state-sanctioned level of putative quality, prohibit non-licensees from providing any sort of advice and counsel in an incredibly broad area like “diet and nutrition.”

Shouldn’t the court have run this through something like intermediate scrutiny analysis – which likely would have found that the state could have achieved its desired objective through a less-speech-impacting means, such as certification?

I mean, there’s nothing keeping Florida from setting up a fancy “certified dietician” program with these educational and experience requirements. Ms. del Castillo couldn’t call herself one of those, but she would still be free to sell her services. And consumers could choose for themselves. Is there some consumer protection need here that is SO pressing we need to keep diet-interested bloggers from sharing their thoughts on a paid basis?

Here’s hoping the Supreme Court takes this case, and provides some much-needed clarity to the nascent professional speech doctrine.

[and yes, the implications for legal licensing should be obvious]

Is Real Change Finally Arriving to Lawyer Regulation?

Go read Jayne Reardon’s latest, “Re-Regulating Lawyers for the 21st Century,” which provides an excellent overview of a series of attorney regulatory changes being floated in a number of states. While the process in California seems to be attracting the most attention, developments in other states may well outpace it. I wouldn’t have thought it possible a year ago, but Arizona seems to be on the road to doing two things I’ve long called for:

These changes may seem like small potatoes next to proposals like allowing outside investment in law firms. But eliminating these rules should be a much easier proposition, and doing so could unblock a lot of potential innovation in consumer legal offerings.

Louisiana Tired of Lawyer Ads

Well, or maybe business/insurance interests, a coalition of which is calling on the Louisiana Bar to crack down on “misleading” lawyer ads.

Misleading lawyer ads? That sounds bad!

Except those complaining don’t offer any specifics, pivoting seamlessly from “misleading” to the volume of lawyer ads that reach Louisianans. I mean, sure – it’s obviously a bummer when you’re just trying to run a business and your customers are constantly being reminded that they have rights and remedies. But it’s safe to say that this particular issue has been decisively settled in favor of consumers getting more information about legal services.

In an effort to ramp up the pressure, the coalition is pressing a bill through the state legislature that would require the Louisiana Bar to re-evaluate its rules governing attorney advertising.

Hey, study and re-evaluation is always good. Here’s hoping that in so doing the Bar decides that its current rules – which include an advertising review process that is both unconstitutional and anti-competitive – need to actually be simplified in the name of greater flow of information about legal services.

#newtox, and Doctors’ Social Media Disclosures

So, plastic surgeons: they LOVE Instagram. And with good reason. While Twitter is great for conversing with other surgeons and catching up on professional news, Instagram actually has an audience of potential patients. Savvy plastic surgeons have caught on to this, and many of them are streaming before-and-after shots and candid videos on the daily.

Many of these posts promote certain treatments. That’s one thing for say, rhinoplasty, but what about branded treatments, like Botox or Coolsculpting? And what if one of those branded treatments can be viewed as sponsoring the doctor’s post?

Case in the point: the splashy launch of a new Botox competitor, Jeaveau. At a party for the brand’s advisory board in Mexico, the doctor members of the board didn’t miss the opportunity to share photos and praise with abandon. And this being Instagram, hashtags were ubiquitous, including Jeaveau’s own “#newtox.”

Now, the Federal Trade Commission has long taken issue with social media “influencers” promoting brands without disclosing they were being paid to do so (or receiving complimentary products).

But is this REALLY that sort of situation?

The purpose of the FTC’s endorsement guidelines can be roughly summed up as “consumers should know if endorsers are being paid to endorse.” But while these doctors are getting a form of compensation – their expenses to attend advisory board meetings are covered, and there are often stipends and honoraria for talks they give – they aren’t being paid to endorse. Rather, they’re being paid to advise Jeaveau’s makers and take back what they’re learned to their busy practices.

Hashtag love for #newtox? That’s just a by-product of their affection for Instagram.

Ultimately, though, while a party like this offers a crystallizing example, it’s tricky to try to unpack the relationship between doctors, brands, and the mention of branded treatments on social media. Many doctors attend multiple events, for multiple brands, every year. Nearly every doctor gets some form of free or discounted product. Should disclaimers be required in all such instances? Perhaps it’s my general distaste for disclaimers, or the fact that this isn’t some social media influencer being paid to promote a new brand of shoes. Let’s save the disclaimers for the Kardashians of the world, and let the plastic surgeons enjoy their Instagram moments.

Lying lawyers who lie

Paul Manafort, President Donald Trump’s one-time campaign manager, has joined the growing list of Trumpelos modeling orange jumpsuits for the 2019 season. Upon Manafort’s second sentencing – he’s getting two terms, totaling out to close to a decade, for a dogs’ breakfast of financial crimes – his attorney, Kevin Downing, made a curious claim:

“Judge Jackson conceded that there was absolutely no evidence of any Russian collusion in this case. So that makes two courts. Two courts have ruled no evidence of any collusion with any Russians.”

Except that she didn’t.

Manafort wasn’t being tried for “collusion,” and Judge Jackson didn’t make any rulings regarding “collusion.” What she DID say was:

“The ‘no collusion’ refrain that runs through the entire defense memorandum is unrelated to the matter at hand.”

and

“The ‘no collusion’ mantra is simply a non sequitur.”

and

“The ‘no collusion’ mantra is also not accurate, because the investigation is still ongoing.”

Oh. That’s pretty much NOTHING LIKE ruling that there was “no Russian collusion.”

But Downing said two courts had made this determination. What did the other court say?

“He [Manafort] is not before the court for anything having to do with colluding with the Russian government to influence this election.”

Uh, right. He’s before the court for being a swindler. That doesn’t foreclose the possibility that he committed other crimes; just that he’s not being tried for other crimes right now.

It would be an insult to Downing’s intelligence to think he didn’t know the difference between a comment about the limited scope of the proceeding and a ruling, so let’s just call his statement what it is: a lie.

But is it a sanctionable lie? Should Downing’s license to practice law be in jeopardy for this statement?

Many lawyers think so, and some have already filed Bar complaints against Downing. But I think this case aptly illustrates the appropriate limits of the Bar’s ability to sanction lawyerly lies.

Like all Americans, lawyers have a First Amendment right to lie. 1 There are some conditions on this right – defamation and fraud, for example. And lawyers, as a condition of being licensed, take on a few more. But these conditions are all about ensuring the proper functioning of the judicial system – attorneys are ethically bound to duties of candor to clients, opposing parties, witnesses, and tribunals. They cannot say things – truthful or not – that materially interfere with the administration of justice in their own cases. And they can’t mislead or engage in undue suasion in attempting to acquire clients.

At most, there’s the requirement in Model Rule 8.4(c) that lawyers not:

engage in conduct involving dishonesty, fraud, deceit or misrepresentation

But that rule turns on the word “conduct,” which we know – from a whole line of “conduct-or-speech” cases I’m not getting into here 2 – is not the same as pure speech from a First Amendment perspective.

Which Downing’s statement was. Pure speech. And any application of Rule 8.4(c) to that speech would be surely unconstitutional.

Downing’s comments certainly were not admirable, praiseworthy, or wise. They were venal and pathetic. But we must think twice before summoning the awful power of government sanction against even the most ill-advised of statements. As Justice Kennedy wrote for the majority in Alvarez:

“Our constitutional tradition stands against the idea that we need Oceania’s Ministry of Truth.”

Indeed.

Notes:

  1. See, for example, US v. Alvarez).
  2. Fine – Planned Parenthood v. Casey.

“Self-Defense” and Negative Online Reviews

It seems doctors have the same blocks as lawyers when it comes to dealing with online reputational ecosystems. I can’t tell you how many times while at Avvo I heard lawyers complain about their inability to defend themselves from (surely false/scurrilous/overstated!) negative online reviews.

“I’d be revealing client confidential information,” they’d say.

“It would get me in trouble with the Bar if I set the record straight,” they’d complain.

And they’re not wrong!

For doctors, too have the same concerns. And besides professional liability, there’s the bugaboo of the HIPAA Privacy Rule, which broadly covers virtually any disclosure of private health information.  As a clinic in New York just found out – via payment of a $125,000 settlement – even disclosing protected health information that has already been publicly disclosed by the patient can lead to liability under HIPAA.

Oh, the injustice of it all! It’s enough to have some calling for a leveling of the playing field, of finding a way to give doctors a right of defense in online public forums.

But these suggestions miss the forest for the trees. For while there’s  a good argument that keeping patient or client secrets – even in the face of attack on one’s reputation – is part of the price doctors and lawyers pay for the privilege of enjoying our licensed monopolies, there’s an even more fundamental problem . . .

Arguing in public about the details of an online review is profoundly counterproductive.

No matter what the facts might be, getting down in the mud and bickering with a reviewer leaves the impression that the professional is thin-skinned, defensive, and not adequately patient- or client-focused.

This in no way means that doctors have no recourse. There are numerous strategies far more effective than “setting the record straight.” The best of these are:

  • Regularly soliciting reviews. Not only does this give you powerful market research insights, it also ensures that any negative feedback is in context with (hopefully) a wealth of positive feedback. 1
  • Responding generally. Just because you can’t argue doesn’t mean you can’t use a negative review as a mini-marketing platform. It can be tricky – you’ve got to really rise above, and resist the urge to condescend – but the payoff can be great. A simple message such as this can be highly effective at showing that a doctor is a confident professional who cares about patient outcomes:

“I’m sorry you had a bad experience. This does not sound familiar, or at all like what we expect in our practice. Please don’t hesitate to contact me directly to see how we can make things right.”

When it comes to online reviews, what’s important isn’t that you’re right, but that potential patients perceive you as the professional you (hopefully) are. So don’t fret about HIPAA keeping you from defending yourself. Focus instead on making sure your approach to online reputation is putting your practice in the best light with potential patients.

(Oh, and it doesn’t hurt to be caring, on-time, and really good at what you do as well.)

 

“DoNotPay” App Expands; Attorneys Tremble

The “DoNotPay” app, originally launched to script people through the process of fighting traffic tickets, has vastly expanded its scope to include some 15 different areas.  DNP founder Joshua Browder has a thread on twitter running down the changes:

 
The wringing of lawyerly hands began immediately; here’s just one example:

The general themes of the complaints I’ve seen – which are very familiar from my days at Avvo – seem to be that DNP is engaged in the practice of law, consumers have no recourse when something goes wrong, and that legal issues are far too special and complicated to be left to scripting and algorithms. Let’s address.

The Practice of Law

“The practice of law” is a frustratingly ill-defined term. It is malleable enough to be wielded by lawyers in all sorts of ways to extend the legal monopoly to its broadest extent – lawyers routinely use it to exclude others from providing “legal advice.” But the rub has always been that such advice must be in the context of a client relationship of trust and reliance for it to be “the practice of law.” Attempts to take on non-specific forms of legal advice – books, articles, talks, etc. – have flailed, in several cases with settlements and legislative bailouts saving Bars from sure First Amendment losses.

Why? Because the First Amendment requires that any content-based speech restrictions (apart from a few specific categories not relevant here) survive strict scrutiny – and any limitation or sanction for publishing would be such a restriction.

(And as an aside: there’s also a good argument that the First Amendment even prohibits states from monopolizing for lawyers the sale of individualized legal advice, but I’ll stick to my central point for now.)

DNP is, for all legal purposes, a publishing exercise in that it offers generalized guidance. It doesn’t matter that this guidance is user-centric, interactive, and detailed: there is no client relationship of trust and reliance, no human intervention, no exercise of legal judgment.  There’s simply no way it meets any constitutional definition of “the practice of law.” 1

Legal Recourse

Many lawyers have made much of “what happens to the poor consumers when something goes wrong? Who can they sue?”

How about nobody?

Not every injury requires a remedy. As I’ve often pointed out, consumers make price/quality trade offs all the time. And they’re making them right now in law: they’re choosing the DIY path instead of engaging with lawyers. One of the things consumers give up, when they choose to rely on books, or court forms, or something their friend’s brother’s girlfriend told them about HER legal issue, is the ability to sue someone for sending them astray with bad advice.

And that’s fine. Consumers should have the right to make this choice.

So: my answer is that while consumer protection and contract law principles could apply to tools like DoNotPay (depending on representations made by those offering such tools, or agreements they make with their users), there’s no reason to require liability as a condition of such tools existing.

[It’s also ironic that lawyers make so much of the availability of malpractice remedies when precisely ONE state (Oregon) requires that its attorneys carry malpractice insurance.]

The Specialness of Legal Issues

The final species of complaint is that legal issues are just far too complex for one-size-fits-all solutions to address. This is so frustratingly wrong it hurts. The bottom line is that most consumer legal issues are simple and straightforward, and thus CAN be met with cookie-cutter solutions, and for many of these consumers such solutions are superior to working with an attorney. 2

For more detail on why this is so, read my piece on why lawyers need to embrace mediocrity, or Bill Henderson’s excellent take on consumer perspective and how expert systems – like LegalZoom – are often the optimal solution for routine legal issues.

I have no idea if DoNotPay is any good, but I applaud any and all good faith efforts to empower consumers to better address their legal needs.

And as for attorneys, I’d like to see a lot more focus on building the value proposition for hiring a lawyer (including adopting attorney-centric expert systems to better and more cost-effectively serve consumers with routine legal issues) than trying to exclude better DIY tools.

Notes:

  1. And consider, too, one of the fundamental reasons why this matters: consumers know the difference between relying on a DIY resource – even a detailed, interactive one – and talking to a trained advisor. Their expectations are a big part of the reason why special duties attach when a client relationship of trust and reliance is created.
  2. Yes, exceptions abound, which is why lawyers stay employed. But letting these exceptions lead you to believe that ALL legal issues require custom advice is to succumb to a massive case of survivorship bias.

ABA Tweaks the Ad Rules

The ABA House of Delegates has now approved a significant number of changes to the attorney advertising rules.

If I sound less than excited about that, it’s because the changes don’t amount to much. As I wrote at the beginning of the year, the amendments fail to address the litany of constitutional, antitrust, and plain bad-for-the-public problems inherent within the Rules.

The rules as adopted DID tweak the definition of “recommendation,” removing an earlier change that would have defined “recommendation” even more broadly than in the current rules. But alas, it keeps the existing definition and adds a caveat that is surely going to cause even more trouble:

A communication contains a recommendation if it endorses or vouches for a lawyer’s credentials, abilities, competence, character, or other professional qualities. Directory listings and group advertisements that list lawyers by practice area, without more, do not constitute impermissible “recommendations.”

Having been through the meat grinder of multiple Bar ethics committees trying to evaluate the “ethics” of innovative new advertising and legal services delivery models, I can guarantee you this: a whole bunch of overbroad and unconstitutional interpretations of the ad rules are going to turn on the “without more” in the comment above.

I know that many of those who pushed these changes through agree that far more change is needed (including the wholesale elimination of Rule 7.2), but believed that the path forward was through this kind of incremental change. They may well be right that this is the best path to getting the Rules where they ultimately need to be. But forgive me if I lack any enthusiasm about these amendments.

Although if anyone wants suggestions about the NEXT set of changes, I’ve already prepared a helpful list.