The FTC says this guy didn’t follow the law, which means

In the words of Jeff Bridges’ character in this cult classic The Big Lebowski“, “I’m “Dude” or “His Dudeness” or “Duder” or “El Duderino” if you don’t like brevity. He might also respond with “Hey Dude,” which, ironically, is the name of a shoe company that just settled an FTC lawsuit for $1.95 million for alleged violations of the FTC Act and the Mail , Internet or telephone ordering rules. What’s more, the complaint alleges that Hey Dude Shoes posted five-star consumer reviews on its website but failed to post less favorable reviews. In the words of The Dude, “Such suppression is untenable.”

Hey Dude advertises its shoes on its website and social media, making clear claims about how quickly its products ship. In some ads, Hey Dude promises: “All orders placed Monday through Thursday will be processed and shipped within 1 business day. Orders placed Friday afternoon through Sunday will be processed the following Monday.”

But according to the FTC, Hey Dude engaged in a series of illegal fulfillment and chargeback practices. Among other things, the complaint alleges that in a number of cases:

• Hey Dude didn’t deliver on its shipping promises;
• When the item isNo In order to ship on time, Hey Dude failed to clearly provide buyers with the option to agree to delay or cancel the order and receive an immediate refund, as required by the mail, Internet or telephone ordering rules;
• When Hey Dude failed to ship goods on time, Hey Dude did not refund the purchase price to the consumer’s original payment method, but instead gave away gift cards that could only be used on the Hey Dude website; and
• Hey Dude did not maintain adequate records to provide consumers with notifications of shipping delays, prompt refunds, or otherwise ensure compliance with the rules.

The FTC also accused Hey Dude of deceptive practices regarding consumer reviews. A statement at the bottom of each product page claims to contain “authentic, unedited reviews from HEYDUDE fans” and includes a five-star rating. Hey Dude uses a third-party online product review management interface that automatically publishes five-star reviews but retains lower-star reviews for personalized reviews. According to the complaint, as of June 2022, Hey Dude withheld, rejected or failed to publish more than 80% of one-, two- and three-star reviews. In fact, until June 2022, the company had a written policy instructing its employees to post certain types of reviews only if the review was positive in nature. As a result, the company allegedly violated the Federal Trade Commission Act by falsely representing that product reviews on its website accurately reflected the views of all buyers who submitted Hey Dude product reviews to the website.

In addition to $1.95 million in financial relief, the proposed court order prohibits future violations of mail, online or telephone ordering rules. It also bans Hey Dude from making false statements about consumer reviews and requires the company to publish all reviews it receives, including reviews it previously withheld from publishing. (The order includes limited exceptions to content moderation to screen comments that contain profanity, discriminatory remarks, disclose personal information or certain sensitive business or financial information.)

In this case, what can other companies gain from the FTC’s action?we turn again The Big Lebowski Seek compliance wisdom.

“That’s bowling. There are rules.” There are also rules that dictate how a company must meet its shipping and fulfillment responsibilities. The requirements are specifically spelled out in the Mail, Internet or Telephone Ordering Rules. But what if a company’s supply chain suffers delays? The rule anticipates that sometimes (to paraphrase The Dude) breakdowns occur, and explains that companies must offer consumers choices to stay on the right side of the law.

“They didn’t receive the money. That’s our concern, man. “ It’s also a concern for the FTC when consumers don’t receive refunds in a timely manner, or when companies offer gift cards (rather than actual refunds) for unshipped orders.

“Blows and gutter, ups and downs.” Authentic product reviews are important to consumers, but let’s face it: some customers love a company’s products and services, while others are less than satisfied. It would be a mistake for a company to solicit reviews and then cherry-pick the good ones to publish. A better response to these “lows” and “troughs” is to use them to improve your products and processes and earn five-star reviews in a non-deceptive way.

“It’s not a very complex case. You know, there’s a lot in, a lot out, a lot what have you.” The FTC provides to-the-point materials to help simplify your compliance obligations. FTC Business Guide to Rules for Ordering Goods by Mail, Internet, or Telephone Provides step-by-step advice for handling fulfillment and shipping issues. Soliciting and Paying for Online Reviews: A Marketer’s Guide, FTC Accreditation Guidelines: What People Are Askingand other resources on the FTC Endorsement, influencer and review portal Can help you maintain compliance with your consumer review practices.

Because when it comes to protecting consumers from deceptive or unfair practices, the FTC complies, man.