Recently, there have been insightful developments on the consumer understanding of arbitration clauses given by Professor Jeff Sovern, who specifically discussed the FTC’s June 2023 revisions to its Endorsement Guide.
Sovern’s blog spotlighted the FTC’s new definition of “clear and conspicuous” – a significant change that has a broad impact on the advertising industry. As defined, “clear and conspicuous” indicates that “a disclosure is difficult to miss (i.e., easily noticeable) and easily understandable by ordinary consumers.”
This revised definition by the FTC serves to provide greater clarity in order to ascertain that the advertising using endorsements or testimonials remains truthful and not misleading.
Interestingly, while the FTC’s updated guide is targeted principally towards advertisers and endorsers, there are also implications to consider for the wider legal community. The relation of “clear and conspicuous” to arbitration clauses, for instance, is an area of focus as these clauses are a common feature in consumer contracts.
As legal professionals, this provides a compelling opportunity to reflect on how these updates influence aspects of our practice, especially those dealing with contractual law, consumer rights, and business conduct. The understanding of this updated definition is essential to ensure future compliance and minimize potential disputes.
In addition to this, the FTC’s new ordinance may also stimulate further discourse on consumer understanding of complex legal concepts, such as arbitration clauses. It’s an ongoing challenge to make sure these important legal procedures are easily understandable to the general public, and the FTC’s recent amendments are a productive step towards addressing this issue.
With the continuous evolution of consumer protection laws and regulations, staying informed on these changes provides an opportunity to not only enhance our practices but also to better serve clients who rely on our expertise.