After a surprise three-month hiatus, we are back in business with our Federal Trade Commission (FTC or Commission) public and totally unscripted meetings. Candidly, we were a bit surprised to see the return of these meetings, but not quite as surprised as the realization that Kate Bush had the Song of the Summer in 2022. This also was the first Commission meeting since Commissioner Noah Phillips announced that he would be leaving the agency at an unspecified time in the fall. There’s no intel on where he is going, but campaigning for his slot has apparently already commenced.
Back to the meeting – and we will start with the dark patterns discussion because we keep hearing about this topic. For those of us with long memories, you may recall that back in April 2021, the FTC conducted a workshop on dark patterns, exploring “ways in which user interfaces can have the effect, intentionally or unintentionally, of obscuring, subverting, or impairing consumer autonomy, decision-making, or choice.” (And as a disclaimer, one of us gave closing remarks at the workshop.) Although we have heard a fair amount from the agency about dark patterns, we haven’t had an actual readout from the workshop – and that’s not necessarily atypical, but given the high-profile nature of dark patterns, it’s a bit surprising. Well, today was the day, apparently. And we expect to provide a deeper dive into the dark patterns report in a future post here, which we hope may provide more clarity as to when a dark pattern becomes a deceptive or unfair practice.
FTC staff provided an overview of the report that categorizes practices, discusses the workshop and identifies key takeaways. A few points of the presentation jumped out at us. Staff noted that dark patterns often are not used in isolation and when combined can have a more dramatic effect. The presentation described dark patterns as “manipulative digital design practices” and said that they can be deployed at a larger and more sophisticated scale than in the brick-and-mortar environment. Overall, they stated that there are four categories of harms at issue: design elements that induce false beliefs; design elements that hide or delay disclosure of material information; design elements that lead to unauthorized charges; and design elements that obscure or subvert privacy choices.
As for the commissioners – well, some wondered what exactly a dark pattern is. Commissioner Phillips was on board with the report despite a “few quibbles,” such as the lack of clarity with the term “dark patterns.” He emphasized that there is very little agreement about what is and isn’t an illegal dark pattern, particularly since the definition does not line up with the definitions of unfairness or deception. Commissioner Rebecca Kelly Slaughter, who was acting chair when the workshop happened, praised the report. She also agreed that the term “dark patterns” isn’t a particularly precise term and expressed real concern about interfaces that impact kids and teens. As for Commissioner Christine Wilson, she also raised the ominous sound of the term and emphasized that not all dark patterns violate the law – and for the ones that do, the FTC has done a lot of work in this area. And Commissioner Alvaro Bedoya also focused on what dark patterns mean for children, particularly when they affect how much time children spend online.
A second agenda item was the continuation of the FTC’s rulemaking on impersonation issues, which started in December 2021 at the sixth public meeting. The imposter rulemaking is the first of three Mag-Moss rulemakings initiated recently by the FTC, and these rulemakings have a lot of procedural and substantive hurdles that make them take quite a while to complete. Of the three rulemakings, it is safe to say that the imposter rulemaking is the least controversial by far, with only 168 comments filed, which is 10 times lower than the number of comments filed in the earnings claims rulemaking. At this meeting, staff discussed the comments filed and asked the Commission to vote out a proposed imposter rule, and the Commission did just that, with a unanimous vote on the Notice of Proposed Rulemaking.
The proposed rule is straightforward and prohibits the impersonation of government and businesses. It would also outlaw providing the means and instrumentalities that enable others to do such impersonations. As the next step in the rulemaking process, the agency is seeking comments on this proposed rule. After that we can possibly look forward to the informal hearings, which can be part of Mag Moss proceedings. And at this rate, even the least controversial of the rules will certainly take quite a while to complete.
And finally, we had a third agenda item, which was another policy statement, because it apparently wouldn’t be a public Commission meeting without a policy statement. Now to be clear, policy statements aren’t actually rules or laws and they are a heck of a lot easier to get done than a rule. There are no responsive comments at all from the public and there’s just a statement that gets voted out by the Commission with yet another headline about an agency crackdown. And today’s statement was titled Policy Statement on Enforcement Related to Gig Work. The agenda described it as a “statement on enforcement against unfair, deceptive, and anticompetitive practices related to gig work, a business model where people can earn income through on-demand activities, often through a digital platform or app.” Commissioner Wilson raised significant concerns about the statement’s focus on competition issues involving workers, and Commissioner Phillips focused on the excessive number of policy statements and inaccuracies that he sees in the statement. The statement was voted out on party lines.
Interestingly, during the consumer portion of the show, we heard from a number of people emphasizing the positive role that gig work has had on their lives. One has to imagine that the consumer portion would have been far more enlightening if consumers had access to the policy statement that they were speaking about, before the event.
And because we started with a Kate Bush reference, we end with fond memories of rumors that circulated five years ago that she would perform at Coachella. As our favorite article on the rumor noted, “press coverage … made it sound like Bush already had her puppets and bird costumes packed.” Needless to say, she did not perform at Coachella.