Those that help faciliate deceptive marketing can also be held liable

Posted by Clyde Hutchins | Oct 10, 2016 | 0 Comments

On September 23rd, 2016, the U.S. Court of Appeals for the Second Circuit affirmed a lower court ruling that LeadClick Media, LLC is liable for assisting third party affiliate marketers in the deceptive marketing of a weight-loss supplement. LeadClick recruited affiliate marketers that utilized fake news sites to direct online consumers to a weight-loss supplement website. LeadClick knew that the sites were fake and assisted in creating content on the sites. LeadClick also purchased advertising space from legitimate online news sites and used it for the fake news sites.

This is the first decision by a court of appeals holding that an affiliate marketing group could be liable for the deceptive acts of third party affiliate marketers. In making its ruling, the Court held, "that under the FTC Act, a defendant may be held liable for engaging in deceptive practices or acts if, with knowledge of the deception, it either directly participates in a deceptive scheme or has the authority to control the deceptive content at issue." This ruling extinguishes the otherwise clear division between the affiliate marketing group and the affiliate marketers when the affiliate marketing group is involved in the deceptive marketing.

The name of the case is: FTC v. LeadClick Media, LLC

About the Author

Clyde Hutchins

Clyde Hutchins is the founder of Harmony Law. Mr. Hutchins started his legal career in Cheyenne, Wyoming as a law clerk for the district court judges. Mr. Hutchins then entered private practice with a Wyoming based litigation and business law firm. Later, Mr. Hutchins went to Alaska, where he was the chief litigator for a firm that engaged in bond law, corporate law, securities law, and municipal law. The State of Wyoming hired Mr. Hutchins from Alaska to represent the State of Wyoming in the national tobacco arbitration and act as its tobacco settlement attorney. While in that position, as a hobby, he developed an enforcement unit for consumer protection for Wyoming residents. Mr. Hutchins moved to Colorado in 2016 and founded Harmony Law, LLC. Harmony Law is primarily engaged in civil litigation. It is also a general practice firm in the areas of business law, estate planning, consumer law and family law. Harmony Law is active in all state and federal courts throughout Wyoming and Colorado.


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