Attorney David Castor, an attorney firm specializing in startups and SaaS businesses, emailed me over the weekend with the news that the FTC has settled with its first victim of new disclosure laws.
As part of the proposed settlement (PDF), PR firm Reverb Communications and owner Tracie Snitker must remove any iTunes reviews that were written by Reverb employees posing as ordinary customers and who failed to disclose a relationship between Reverb and its game developer clients. The agreement also bars Reverb and Snitker from posting further reviews on iTunes that pretend to be from independent consumers or that neglect to disclose any connection between the company and its clients, according to the FTC.
This could change everything. As your company wishes to deploy comment strategies, linking strategies, promotions, etc… it appears all of it could be a criminal act if it’s accomplished within the United States and doesn’t disclose a connection between the company and clients.
- Will Nascar drivers have to announce their sponsors in every interview because they’re wearing a hat or drinking a soda? Will they have to put a disclosure below each bumper sticker?
- Will Political Action Committees (PACs) have to announce on every comment on every site that they’re part of an organization with a paid relationship with the politician? How about when they send thousands of members to go answer polls online?
- If I mention a client in a presentation or speech as an example that’s not related to our relationship, do I now need to disclose they are a client?
- What about fans and follower counts? I don’t have a means of disclosing how many people follow me or how many people I follow because they’re clients or I’m a client. Isn’t that number swaying public opinion and used for marketing?
- I just wrote a blogging book where I utilized many of my clients and vendors (including Alerding Castor) as examples in the book. Am I going to get fined because I didn’t disclose that we may have, or once had, a business relationship?
- Will product evangelists at conferences need to wear a badge or hat that states that they’re going to talk about their clients, products or services?
- Sometimes I target companies and write about them, or introduce myself for the opportunity of building a business relationship in the future. Do I now need to disclose when I’m buying them a coffee or shaking their hand that I am doing it because I’m hoping to get their business?
- Will celebrity voice-overs and appearances in commercials now need to end with them telling you that they are a paid endorser of the product or service?
I understand that the law is attempting to thwart deceitful practices, but the problem is that my entire online persona, my twitter account, my Facebook statuses, my websites, and my writing are ALL based on relationships I’ve had with businesses. My company’s income is based on how well my clients are marketed. I am a paid advocate for them – twenty-four hours a day and seven days a week. I’m not trying to deceive anyone… but I am trying to increase authority, awareness, and evangelize on behalf of my clients. Who else am I going to talk about?!
You might as well put the cuffs on me now and throw away the key.
Or I could move to Canada and keep doing what I’m doing. There’s the loophole folks… move your deceitful practices offshore.
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