August 05, 2021

Advertising Law News and Analysis

3 min

You Asked, We Answered: NFTs and Virtual Currency in Games: Compliance Issues and Legal Risks

Game developers and platform providers are increasingly integrating non-fungible tokens (NFTs), virtual currencies, and digital marketplaces into their games and platforms, creating seamless, novel, and interactive experiences. While the industry has moved ahead quickly, federal and state regulators are taking a much closer look at how these technologies fit within existing legal frameworks.

In a recent webinar, partner Ellen Berge and associate Chris Boone of Venable’s Advertising Law and Payments groups explored the latest regulatory developments and addressed how to spot and avoid compliance and regulatory risks associated with NFTs, virtual currencies, and other platform-based monetization mechanics.

Will the Bipartisan Infrastructure Framework Hold Together?

Senators are spending this first week of August debating and digesting a 2,700-page infrastructure bill drafted by a bipartisan group of senators and the White House. In this alert we'll look at how the bill came together, what happens next, and what an agreement may signal for other congressional work this year.

Restitution or Disgorgement: Seventh Circuit Holds They Are Birds of a Feather

It feels like only yesterday we were analyzing the Supreme Court’s opinion in Liu v. SEC and its initial impact on FTC cases. As a refresher: Liu held that a disgorgement award may not exceed a firm’s net profits. Subsequent to that, the Court ruled in AMG Capital Management LLC v. FTC that the FTC cannot obtain equitable monetary relief under Section 13(b) of the FTC Act. The House has passed legislation that would “restore” the FTC’s ability to obtain equitable monetary relief, and that bill is now being considered by the Senate. The new bill provides for the FTC to recover both restitution and disgorgement. A decision from the Seventh Circuit, however, found that those remedies are essentially the same thing and that the remedy is properly limited to profits, not revenue.

FTC Turns Focus to Repair Restrictions in New Policy Statement

On July 21, 2021, and in response to President Biden’s Executive Order calling on the FTC to address repair restrictions, the FTC unanimously adopted the Right to Repair Policy Statement related to manufacturer and seller restrictions to product repairs. In the policy statement, the FTC announced its plans to prioritize enforcement against unlawful repair restrictions, including promoting possible updates to state and federal legislation. Manufacturers and sellers should ensure compliance with current consumer protection and antitrust laws and monitor potential rulemaking, a path the FTC is careening toward.

New Changes at the FTC: Return of the Rulemaking

With a new leader at the Federal Trade Commission comes new rules of practice. Chair Lina Kahn convened a first-of-its-kind open Commission meeting, allowing for live public comments following the meeting. In addition to issuing the Made in the USA Final Rule at the meeting, the FTC revised the procedures for issuing Magnuson-Moss Rules. This carries out Commissioner Chopra and now-Chair Khan’s call for more rulemaking, and the next step to former Chair Slaughter’s creation of a rulemaking group within the Commission. The changes concentrate the rulemaking process in the Chair’s office and strip away many of the procedures that helped lead to rules based on bipartisan consensus among the commissioners and support from FTC staff.