FTC's Rich Praises Federal Court Ruling Upholding Order Against Jerk.com

FTC Consumer Protection Bureau Director Jessica Rich said last week's federal court ruling upholding the commission's summary decision against John Fanning, who operated the now-defunct Jerk.com, made it clear his "misrepresentations in this case were harmful to consumers." Rich said in a Wednesday statement the FTC "will closely monitor the defendant’s compliance with the order, as we do in all our cases.” The First U.S. Circuit Court of Appeals in Boston said May 9 it agreed with the commission's findings that the reputation website -- which passed off content as user-generated when it actually collected and misused content from Facebook -- misrepresented the source of its content and membership benefits (see 1404080080 and 1503250067). The FTC issued a summary decision in March 2015 against the site and Fanning, including barring him from making further deceptive statements, requiring him to keep advertising and marketing records and notifying the commission of any complaints about the misleading and deceptive statements. The federal court struck down parts of the remedial order's compliance monitoring provisions for Fanning, saying they were "overbroad." The court said the FTC order required Fanning to inform the commission of his future business affiliations and employment even if it's unrelated to the unlawful activity. The ruling said the commission acknowledged at oral argument that the "provision would ostensibly require Fanning to report if he was a waiter at a restaurant." Fanning, who is a Napster co-founder, did not comment in response to a direct message sent to his Twitter account.