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April 18th, 2011
Online Retailer Settles FTC Appliance Labeling Rule Investigation
An online retailer has agreed to pay $100,000 to settle Federal Trade Commission ("FTC") charges that it violated the agency’s "Appliance Labeling Rule". The FTC alleged that the retailer, Universal Appliances, Kitchens, and Baths, Inc., failed to post on its website required EnergyGuide information. Specifically, the FTC alleged that the retailer failed to disclose the estimated annual cost to operate the appliances advertised for sale on its website. In an unrelated investigation, the FTC also filed an administrative complaint seeking $540,000 in penalties against another retailer alleging similar violations. In the past six months, the FTC has filed charges against five other companies for alleged violations of the Appliance Labeling Rule.
The Appliance Labeling Rule requires retailers to provide information to consumers regarding energy costs when purchasing certain appliances, such as refrigerators, ceiling fans, shower heads, air conditioners, water heaters, plumbing and lighting products, dishwashers and heat pumps. In addition, while the Rule does not require a manufacturer to obtain FTC approval before labeling and selling its products, it does require manufacturers to meet FTC reporting requirements before covered appliances are distributed and to comply with Department of Energy testing and certification requirements. Under the Rule, the FTC is entitled to civil penalties against retailers that fail to provide required EnergyGuide information. Important information regarding these labeling requirements can be found here.
View full case timeline - "In the Matter of Universal Computers and Electronics, Inc., doing business as Appliancebestbuys.com, and doing business as universallcdtv.com, a corporation."
If you have any questions about the FTC’s announcement, please contact Jeffrey A. Greenbaum at (212) 826 5525 or jgreenbaum@fkks.com, Claudine Wilson at (212) 705 4842 or cwilson@fkks.com, or any other member of the Frankfurt Kurnit Advertising Group. For more alerts and general announcements from our firm, follow us on Twitter.
Disclaimer. This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.
Other Advertising Law Alerts
What the Advertising Industry Can Learn from Kim Kardashian’s Settlement with the SEC
On October 3, 2022, the Securities and Exchange Commission (SEC) announced that it entered into a $1.26 million settlement with Kim Kardashian over her social media promotion of the EMAX token without disclosing payment she received from token issuer, EthereumMax. The matter provides important lessons for advertisers. Read more.
October 10 2022
Get Ready for California’s New “Automatic Renewal” Rules
California recently amended its Automatic Purchase Renewals law. The amended statute - effective July 1st -- require marketers to provide consumers of automatic renewal or continuous service offers with more information and easier ways to terminate. Read more.
June 22 2018
“Made in the U.S.A.” Claims Continue to be Scrutinized
In 2016, California amended Section 17533.7 of the California Business and Professions Code ("Section 17533"), liberalizing the standard for selling products labeled "Made in U.S.A" to California consumers. Read more.
June 4 2018
