Markets Wired

Two brothers have agreed to settle Federal Trade Commission charges that in marketing and selling their trampolines, they deceived consumers by directing them to review websites that claimed to be independent but were not, and by failing to disclose that one of the brothers posted online product endorsements without disclosing his financial interest in the sale of the products.

Under an administrative consent order announced today, Son “Sonny” Le and Bao “Bobby” Le are barred from engaging in such deceptive behavior in the future and must clearly and conspicuously disclose any material connections between a reviewer or endorser and the product being reviewed.

According to the FTC’s complaint, working together and using several fictitious business names, the Les marketed and sold Infinity and Olympus Pro brand trampolines on several websites. These sales websites prominently featured logos from supposedly independent review entities, including “Trampoline Safety of America,” the “Bureau of Trampoline Review,” and “Top Trampoline Review.”

Consumers who clicked on the logos were directed to the websites of those reviewing organizations, which claimed to provide objective information, including unbiased “expert reviews” of specific brands and models, as well as ratings based on safety, performance, and other qualities. Each review site recommended the Les’ Infinity and Olympus Pro trampolines.

In reality, the review sites were not what they appeared nor were they unbiased, as all were owned and run by the Les. The FTC alleges that the logos were fake, as were claims on the sites stating, for example, that Trampoline Safety of America (one of the purported reviewing entities) “is a third-party organization involved in studying the technical aspects of all the major trampoline sites in America” comprised of structural engineers, trampoline gymnastic coaches, and professionals whose goal was to educate the public about “the safeties of trampolines.”

The FTC also charged in its complaint that Bobby Le posted online reviews that appeared to be from ordinary trampoline owners – praising the “strong frames” and other attributes of the Les’ products, while disparaging other brands – without disclosing his connection to the products he was promoting.

The proposed order settling the FTC’s charges prohibits the Les from making any of the misrepresentations alleged in the complaint and requires them to disclose clearly, conspicuously, and in close proximity to an endorsement any unexpected connection between an endorser and the company or anyone associated with it. Finally, the order requires that if the Les review a product that they sell or that competes with one they sell, that they clearly and conspicuously disclose this fact, as well.

The Commission vote to issue the administrative complaint and to accept the consent agreement was 2-0. The FTC will publish a description of the consent agreement package in the Federal Register shortly. The agreement will be subject to public comment for 30 days, beginning today and continuing through June 30, 2017, after which the Commission will decide whether to make the proposed consent order final.

Interested parties can submit comments electronically by following the instructions in the “Invitation To Comment” part of the “Supplementary Information” section.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $40,654.

The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs and subscribe to press releases for the latest FTC news and resources.