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Yelp Cannot Be Held Liable for Negative Review

October 20, 2016

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Yelp Cannot Be Held Liable for Negative Review

October 20, 2016

Authored by: Bryan Cave and Flora Sarder

Retailers are familiar with Yelp.com as a ratings website with a star rating system that allows customers to rate products and services they receive, as well as add individual reviews and comments. Positive reviews can generate business for retailers, and negative reviews can be a source of concern.

The Ninth Circuit Court of Appeals has ruled, however, that Yelp’s multiple-choice star rating system does not make the review site a publisher or provider of allegedly defamatory content that may be subject to liability. In Kimzey v. Yelp! Inc., the Ninth Circuit affirmed dismissal of an action by a small business owner seeking to hold Yelp liable for a one-star rating by a third party, and challenging Yelp’s immunity under Section 230 of the Communications Decency Act of 1996.

Section 230 Immunizes Interactive Service Providers From Liability

Under Section 230, a provider of an “interactive computer service” is immune from liability

Retailers Seek Perfect Balance Between In-Store, Online and Mobile Customers

Retailers are increasingly under pressure to evaluate their business models and, in particular, the mix of their in-store, online and mobile offerings. Just as there are few pure-play e-tailers, there are very few retailers solely operating a bricks & mortar strategy because today’s customer wants to access their favorite brands in an omnichannel way: browsing online to get a sense of trends, dropping into a store to check the fit and shopping via mobile for impulse or last minute buys. But how do retailers find balance within the omnichannel world?

In our experience working with national and international retailers, getting the online and mobile experience right requires critical focus and serious investment in the three Ds: Distribution, Delivery and Data.

Successful ecommerce platforms require well located (and well managed) distribution centers capable of handling the nearly 24-hour demand profile.

Careful consideration needs to be given to whether an existing distribution

Congress Considers Legislative Solutions to Internet Sales Tax War

As we reported on September 15,  several states have enacted or proposed laws related to the collection of sales tax from online retailers without a physical presence in those states, as required by United States Supreme Court case Quill v. North Dakota.  South Dakota’s current lawsuit against several internet retailers was specifically brought by the state to force reconsideration of Supreme Court precedent.

However, there is a small change that Congress may decide the issue before it reaches the Supreme Court, with three bills having been introduced and a fourth pending.

One of the three bills, cited as the “No Regulation Without Representation Act of 2016“, is more or less a proposal to codify the decision in Quill.  Needless to say, the states who have challenged Quill are highly opposed to this bill.

The other two bills, the “Marketplace Fairness Act of 2015” and the “Remote

How to Respond to Civil Subpoenas and Document Requests That Ask For Personal Information

September 28, 2016

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Litigants in a civil dispute often use subpoenas, subpoenas duces tecum, and discovery requests to obtain personal information about individuals who may not be present in the litigation. A request for documents and information that include personal information about third parties may conflict with legal obligations imposed upon an organization not to produce information.

For example, if an organization promises within its privacy policy that

Prop. 65 Conference Focuses on Compliance With New Warning and Settlement Regulations

The Prop. 65 Clearinghouse held its annual conference in San Francisco recently, and the speakers and panelists had a number of recommendations for both retailers and manufacturers following the adoption of Proposition 65’s new warning regulations.

The New Warning Regulations

As we reported on September 7th, the Office of Environmental Health Hazard Assessment (OEHHA) has adopted new warning regulations which take effect in two years on August 30, 2018.  Businesses can choose to comply with either the current or new regulations in the interim, but all retailers and manufacturers who sell products in California should review their Prop. 65 compliance protocols to ensure that they will continue to comply.

The new regulations seek to put the primary responsibility for providing warnings on product manufacturers or suppliers, who must either label their products with any required warnings or provide notice and warning materials to retailers.

The regulations expressly

States Battle E-Retailers and Federal Precedent Over Digital Sales Tax

September 15, 2016

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South Dakota and several online retailers are currently engaged in a battle over the state’s new internet sales tax law (SB 106) aimed at online businesses who sell products to South Dakota residents but which are not obligated to pay sales tax to the state.

Decades ago, during the internet’s infancy, the U.S. Supreme Court concluded in Quill v. N. Dakota that states are prohibited from requiring companies without a physical presence in those states to collect sales tax from its residents. Among the four internet retailers sued by South Dakota are the popular Overstock.com and Newegg.com.

The state acknowledges in its complaint that SB 106 is a violation of Supreme Court precedent. However, it has stated that the purpose of the suit is to facilitate Supreme Court review, because Quill is outdated in the internet age.

Several outcomes to the case are possible, including a grant

California Adopts New Prop. 65 Warning Regulations

California Adopts New Prop. 65 Warning Regulations

September 7, 2016

Authored by: Bryan Cave, Merrit Jones and Marcy Bergman

California’s Office of Environmental Health Hazard Assessment (OEHHA) has adopted new Proposition 65 warning regulations.  The new regulations will take effect in two years, on August 30, 2018.  In the interim, businesses may choose to comply with either the current or new regulations.

Prop. 65 prohibits businesses from knowingly and intentionally exposing California consumers to a chemical known to the state of California to cause cancer or reproductive harm without first providing a “clear and reasonable warning.”  As we reported on a draft of the regulations in April 2016, the new regulations substantially change what constitutes a clear and reasonable warning.

Products with label warnings manufactured prior to the effective date of the new regulations would continue to receive protection from liability. Parties to existing settlement agreements or court-approved consent judgments also can continue to provide warnings that comply with those agreements or orders.

Regulations Seek to

Online Seller Wins Dismissal of RICO Claims in Counterfeiting Action by Fashion Retailers

A New York federal court recently held that defendant Alibaba Group Holding Ltd. (“Alibaba”), which is notorious for allegedly enabling the sale of counterfeit products, did not violate federal racketeering law by selling allegedly counterfeit products on its e-commerce venues.

Alibaba owns and operates the popular shopping sites Alibaba.com, Taobao.com, and AliExpress.com, and generated $248 billion in gross merchandise volume in 2014 – more than Amazon and eBay combined. Luxury fashion retailers, including Gucci and Yves Saint Laurent, filed suit against Alibabi and seven other corporate entities that had roles in online platforms through which Chinese merchants could connect with consumers worldwide.

The lawsuit alleges that fourteen Chinese merchants, also named as defendants, sold counterfeit products bearing plaintiffs’ marks in the Alibaba marketplaces. It further alleges that the Alibaba defendants provided the online marketing, data collection, payment processing, financing, and shipping services necessary to sell the products, even though they

Receipt With Credit Card Data Constitutes Sufficient Injury for Class Action to Proceed

A recent federal court ruling allows a class action lawsuit to proceed against luxury fashion retailer Jimmy Choo for violating the Fair and Accurate Credit Transactions Act of 2003 (FACTA).  This ruling, which will likely be appealed, has important implications for other consumer class action lawsuits against retailers.

Jimmy Choo was accused of violating FACTA by printing credit card expiration dates on customer receipts in Wood v. J Choo USA, Inc., S.D. Fla. Case No. 15-cv-81487.  Jimmy Choo argued that the plaintiff had no standing to sue because she was not damaged when the retailer printed her credit card expiration date on her receipt. The court disagreed, holding that the consumer was sufficiently damaged to maintain the action as soon as soon as the receipt was printed.

Companies facing lawsuits alleging FACTA violations should be aware that although the U.S. Supreme Court held in Spokeo Inc. v. Robins,

FDA Releases Final Rule Allowing Voluntary Risk Reviews of Food Additives to Continue

The Food and Drug Administration (FDA) says its final rule allowing outside groups to evaluate food additive risks will streamline its “Generally Recognized as Safe” (GRAS) reviews.

The agency recently released its GRAS final rule for its food additive program, switching reviews from a more formal but slower “petition-based” process to a voluntary “notification” process.  For retailers with private label food products, that means that they or their vendors can continue to convene their own expert panels to review the safety of many food additives, and provide notice of their findings to the FDA.

Under the federal Food, Drug and Cosmetic Act (FD&C Act), any substance that is intentionally added to food is a food additive that is subject to premarket review and approval by FDA, unless the substance is generally recognized, among qualified experts, as having been adequately shown to be safe under the conditions of its

New Federal Law Will Require Disclosure of GMO Content in Food

A new federal law will require food makers to disclose when foods contain genetically modified ingredients.

The law, which was recently signed by President Obama, will require such food products to be labeled with text, a symbol, or an electronic code readable by smartphone indicating the presence of GMOs. Small businesses will also have the option to label food products with a telephone number or Internet website directing customers to additional information.

The U.S. Department of Agriculture (USDA) has two years to draft regulations concerning which products require such disclosure, and additional details concerning what food makers must do to comply. After the regulations are finalized, food makers will have at least another year before the law takes effect.

Law preempts state and local GMO labeling laws.

The federal law preempts a similar Vermont law, Act 120, that took effect in July, as well as any other state or local

FAA Regulations Clear Way for Delivery Drones

FAA Regulations Clear Way for Delivery Drones

August 9, 2016

Authored by: Bryan Cave and Flora Sarder

The Federal Aviation Administration (FAA) has finalized its regulations concerning operational drones, allowing retailers to start using drone delivery systems.

In making drones available for retail delivery use, the FAA has carved out a space for drones to operate without becoming an “air carrier” under federal law regulating air transportation.

As a result, drones can now be used to deliver cargo in the mainland United States, except in Washington D.C., or any U.S. territory if the cargo weighs less than a total of 55 pounds, the flight is conducted from the remote pilot’s visual line of sight, the drones fly a maximum speed of 100 mph, and gain a maximum of 400 feet.

The much anticipated drone regulations bode well for retailers and manufacturers making their way into the drone delivery space.  Just a couple of months ago, Switzerland’s postal service began testing out drone deliveries with Matternet, a company

New Colorado Laws Grant Employees Access to Personnel Files, Right to Pregnancy Accommodations

The Colorado General Assembly ended the 2016 session by passing significant employment legislation. In June 2016, Colorado Governor John Hickenlooper signed into law House Bill 16-1432, granting employees access to personnel files upon request, and House Bill 16-1438 expanding protections for pregnant employees. All Colorado employers should familiarize themselves with these new laws and update related policies before they take effect.

PERSONNEL FILES

House Bill 16-1432 grants current and former employees the right to access their personnel files upon request. When the Act takes effect, likely on January 1, 2017, the provisions will be found at C.R.S. § 8-2-129.

Summary

This new law provides current and former employees access to their personnel files and allows current employees to obtain a copy of their personnel files.

Defining “Personnel Files”

The Act defines personnel files as “the personnel records of an employee, in the manner maintained by the employer and using reasonable efforts by the

Personal Care Product Companies Targeted for “All-Natural” Claims

July 18, 2016

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The Federal Trade Commission (“FTC”) has approved four final consent orders against companies that allegedly misrepresented their personal care products as “All-Natural” or “100% Natural.”

In the past several years, numerous private lawsuits have been filed by consumers, particularly in California, alleging that food products labeled and advertised as “natural” violate false advertising laws. The FTC orders demonstrate that other products may be at risk for such claims as well.

The FTC has authority for enforcing the Federal Trade Commission Act, which broadly prohibits “unfair or deceptive acts or practices.” The FTC views labels and ads as deceptive if there is a material misrepresentation or omission that is likely to mislead consumers and affect their choices regarding a product.

The FTC complaints allege the following companies made deceptive all-natural claims in labeling and advertising a variety of personal care products, ranging from sunscreen to shampoo: Trans-India Products, Inc., doing business

Does Your Organization Collect Geo-Location Information?

July 14, 2016

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Smartphones, smartphone apps, websites, and other connected devices (e.g.,“wearables”) increasingly request that consumers provide their geo-location information.  Geo-location information can refer to general information about a consumer’s location, such as his or her city, state, zip code, or precise information that pinpoints the consumer’s location to within a few feet, such as his or her GPS coordinates.

Organizations request geo-location information for a variety of reasons.  For example, many apps – such as transportation or delivery services – require geo-location in order to provide services that are requested by the consumer.  Other apps – such as mapping programs, coupon programs, or weather programs – require geo-location information in order to provide consumers with useful information.  Because such information has become intertwined, in many cases, with products and services, some organizations require the user to “Accept” or ‘“Agree”’ to the collection of geo-location information as a condition to using a device,

California Proposition 65 Notices Allege BPA in Receipts, Water Cooler Jugs

July 11, 2016

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Since the Prop. 65 warning requirement for bisphenol-A (BPA) took effect on May 11, 2016, two 60-day notices have been served alleging harmful exposure to the chemical without providing a warning. Those notices, both served by the Center for Environmental Health (CEH) on June 27, 2016, allege the presence of BPA in receipt paper and polycarbonate plastic water containers used for water coolers.

The receipt paper notices were served against Del Taco and Grewal Superfoods Inc., and the water jug notice was served against Home Depot and DS Services of America, Inc.

BPA is listed under Prop. 65 as a chemical known to cause harm to the female reproductive system. OEHHA recently adopted a safe harbor exposure level for BPA, for dermal exposure from solid materials, of 3 micrograms per day. Exposure below this level does not require a warning. The safe harbor level would apply to BPA in receipt paper.  

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