September 25, 2022

Volume XII, Number 268

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September 22, 2022

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FTC Reports Rise in “Dark Pattern” Tactics in Consumer Markets

On September 15, the FTC released a reportBringing Dark Patterns to Light, that shows an increase in the use of sophisticated “dark pattern” design practices by retailers intended to manipulate consumers into making decisions that benefit the retailers at the consumers’ expense. The report examined the use of dark patterns across a variety of industries and contexts, including e-commerce, cookie consent banners, children’s applications, and subscription sales. The report highlighted four common tactics:

  • Disguising Ads: The report cited the following types of web content as deceptive:

    • Ads designed to look like independent, editorial content;

    • Comparison shopping sites claiming neutrality that ranked companies based on compensation they received;

    • Countdown timers claiming that consumers had only a limited time to make a certain purchase that were not actually time-limited deals.

  • Difficult cancellation processes: The report discussed subscription sellers that made it extremely difficult to cancel free trials and subscription plans despite touting “easy cancellation” processes. For example, some subscription companies made the cancellation process very lengthy, requiring consumers to click through several pages of promotions, or hard to find.

  • Buried terms and junk fees: The report also found that some companies hid terms on key limitations on products or services in dense terms that consumers did not see before the purchase, and others that advertised only part of a product’s total price to lure consumers in and failed to disclose other mandatory charges until much later in the buying process.

Putting It Into Practice: As we previously reported, the FTC has shown a recent focus on the use of digital dark patterns, including taking enforcement action against companies for violations under the FTC Act. The FTC press release on the report also mentions that it has sued companies for making the cancellation process difficult and other deceptive marketing tactics. Companies offering consumer products and services should take heed of the FTC’s report and ensure that their marketplaces do not subject consumers to the tactics identified by the report. Appendix A of the report, in particular, describes more than 30 common dark patterns, a clear signal of the focus of future FTC scrutiny.

Copyright © 2022, Sheppard Mullin Richter & Hampton LLP.National Law Review, Volume XII, Number 266
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About this Author

Moorari Shah Bankruptcy Lawyer Sheppard Mullin Law Firm
Partner

Moorari Shah is a partner in the Finance and Bankruptcy Practice Group in the firm's Los Angeles and San Francisco offices. 

Areas of Practice

Moorari combines deep in-house and law firm experience to deliver practical, business-minded legal advice. He represents banks, fintechs, mortgage companies, auto lenders, and other nonbank institutions in transactional, licensing, regulatory compliance, and government enforcement matters covering mergers and acquisitions, consumer and commercial lending, equipment finance and leasing, and supervisory examinations,...

213-617-4171
A.J. S. Dhaliwal Bankruptcy Attorney Sheppard Mullin Washington DC
Associate

A.J. is an associate in the Finance and Bankruptcy Practice Group in the firm's Washington, D.C. office. 

A.J. has over a decade of experience helping banks, non-bank financial institutions, and other companies providing financial products and services in a wide range of matters including government enforcement actions, civil litigation, regulatory examinations, and internal investigations.

With a diversified regulatory, compliance, and enforcement background, A.J. counsels financial institutions in matters involving...

202-747-2323
Associate

Pouneh Almasi is an associate in the Intellectual Property Practice Group in the firm's San Francisco office.  

Areas of Practice

Pouneh’s practice focuses on intellectual property litigation with an emphasis on copyright and trademark issues.  She is also a member of the firm’s Blockchain Technology & Digital Currency Team.

During law school, Pouneh worked as a judicial extern to the Honorable Jacqueline Scott Corley at the Northern District of California in San Francisco...

415-774-3103
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