Consumer Protection Law Commons^™

Birthdate Phaseout, Katharine B. Silbaugh

Faculty Scholarship

This Article explores the Nicotine Free Generation ("NFG") policy, an emerging endgame strategy for tobacco products that employs a completely novel legal design. Tobacco remains the leading cause of preventable death, killing almost half of its users and imposing $600 billion in social costs each year. We see two basic choices for regulating sales: prohibition or a legal age-gate, such as twenty-one, for retail sales. NFG charts a third way. Recognizing the dire harm of tobacco and the serious consequences of abrupt prohibition, NFG lays the groundwork for a gradual transition to a sales sunset. In place of the twenty-one …

Beyond Digital Pessimism: How A Focus On Trust Can Enhance Eu Digital Law, Neil Richards, Woodrow Hartzog, Claire Boine, Lea Despotis

Faculty Scholarship

Lawmakers looking to foster technological innovation on the European market are adopting laws they hope will promote consumer trust in digital products. Their strategy can be broken down into three components. First, they aim to empower consumers to choose how much data they want to share with companies through an express consent framework. Second, they seek to avoid harms from digital products through product safety law such as adapting the Product Safety Regulation to digital products or adopting the AI Act. Third, they endeavor to prevent manipulation of consumers through digital means.

In this essay, we argue that while laudable, …

Defending Form Contract Consent, Wayne R. Barnes

Faculty Scholarship

The issue of standard form contracts has bedeviled Contracts scholars for a century. The basic problem has long been known. Contract is supposed to be a quintessentially consensual activity, whereby both parties are operating with full knowledge and comprehension of the array of terms and conditions being negotiated and agreed to. But by employing standard forms replete with boilerplate fine print, companies have created a regime whereby it is most likely irrational for consumers to bother reading the terms before consenting to the transaction. The existing “duty to read” doctrine is that consumers fully consent to all terms when they …

Bridging The Expectations Gaap In Financial Reporting, Neal F. Newman

Faculty Scholarship

The true nature of auditing publicly traded companies’ financial statements has been somewhat of an enigma to the general public. Due to this mystery, an “expectations gap” has formed between the public expectations of auditors’ roles and what the auditor actually does in their analysis of financial statements. Auditors are an extremely important piece of the financial reporting puzzle because they determine whether or not a company’s financial statements are a fair and accurate reflection of the company’s financial position, a determination that can be a major influence on how the financial strength of a company is perceived. Newman’s Article …

The Gamification Of Banking, Colleen Baker, Christopher K. Odinet

Faculty Scholarship

Gamification is coming to banking. This phenomenon is already gain-ing ground in advertising, healthcare, manufacturing, and, more recently, with the GameStop and AMC meme stock saga in securities trading. The idea behind gamification is to make transactions seem fun, playful, and even casino-like in order to elicit habit-forming, addictive-like effects with consumers. This Article argues that the rise of financial technology (“fintech”) firms and their ever-growing business relationships with incumbent financial institutions has created the necessary conditions for gamification to take hold in the banking sector. In order to explore this observation, we undertake a study of current examples of …

Measuring And Mitigating Drip Pricing Overcharge: Evidence From An Online Marketplace Experiment With A Digital Shopping Assistant, Benjamin Lu, Daniel Markovits, Andrew Miller, Rory Van Loo

Faculty Scholarship

We study how much drip pricing (hidden mandatory fees revealed after consumers have begun the buying process) raises prices paid for identical goods and whether an automated shopping assistant mitigates the effect. In a randomized online marketplace experiment (n = 1608) with real purchases of gift cards funded by a $15 endowment, we vary the initial and final presentation of the gift cards’ prices across 33 levels and randomly assign participants to an automated assistant that flags a lower-price identical option and links to it. Relative to transparent pricing, drip pricing increases the average price paid by up to a …

After Notice And Choice: Reinvigorating “Unfairness” To Rein In Data Abuses, Lina M. Khan, Samuel A.A. Levine, Stephanie T. Nguyen

Faculty Scholarship

The Federal Trade Commission (FTC) has long served as America’s default privacy enforcer. Yet for much of its history, the agency relied on self-regulation through a “notice and choice” framework that left the public vulnerable in an era of rampant data collection and digital surveillance. Businesses overwhelmed users with dense privacy notices while amassing and exploiting vast troves of personal data. The agency’s historical approach, rooted in outdated assumptions about self-correcting markets and an ideologically cramped view of the FTC’s authorities and mandate, helped usher in a digital economy where data abuses became routine.

During the Biden Administration, the FTC …

The Financial Sector And Global Dollar System, Gary Gensler, Lev Menand, Joshua Younger

Faculty Scholarship

The second Trump administration’s approach to financial markets and institutions mixes familiar deregulatory policies with a range of other policies (financial and non-financial) that are largely without precedent and may lead to significant structural change in the long term. Combined, these policies have the potential to affect the financial sector in at least four ways. First, they could threaten the foundations of the global dollar system – mutual cooperation, trust, and interdependency, both between the producers and consumers of financial instruments and among the nations that constitute the dollar bloc. Second, they may undermine financial stability by loosening prudential standards, …

Eviction Sealing: A Lifeline In The Fight For Housing Justice, Allison Freedman

Faculty Scholarship

In January 2023, the White House released a Blueprint for a Renters Bill of Rights. The Blueprint called for immediate sealing of eviction case filings to reduce the likelihood that tenants would be locked out of future housing opportunities without the chance to defend themselves. Shortly thereafter, the Federal Trade Commission and the Consumer Financial Protection Bureau issued a request for public comment on how the use of eviction records and screening algorithms may affect tenant housing opportunities and drive discriminatory outcomes. The eviction crisis, its discriminatory effects, and the idea that sealing eviction records may provide a solution to …

The Sec, Fraud, And Cryptocurrencies, Lawrence J. Trautman, Brian Elzweig, Neal F. Newman

Faculty Scholarship

The SEC’s Strategic Plan for Fiscal Years 2022–2026 is focused on the impact of the rapidly developing rate of change in new technologies that provide for markets to be more interconnected and interdependent than ever. Because Congress has yet to give the SEC, or any other agency, express authority to regulate cryptocurrency, the SEC has taken a regulation-by-enforcement approach. The SEC’s recent enforcement efforts relating to crypto asset securities were substantial, with enforcement actions addressing a range of alleged misconduct in the crypto asset securities space, including billion- dollar crypto fraud schemes; unregistered crypto asset offerings, platforms, and intermediaries; and …

"Price Discrimination" Discrimination, Talia B. Gillis

Faculty Scholarship

Credit price personalization, where lenders set prices based on individual borrower and loan characteristics, is a common practice across many loan types, with conventional accounts of its harms focusing on the ways in which risk-based pricing, or setting prices based on borrowers’ credit risk, can lead to disparities for protected groups like racial minorities and women. This Article examines an often-overlooked yet potentially harmful form of price personalization — charging borrowers different rates based on their willingness-to-pay, known as price discrimination — and argues that this practice can exploit vulnerable borrowers, including protected groups like racial minorities and women, by …

Against Monetary Primacy, Yair Listokin, Rory Van Loo

Faculty Scholarship

To reduce inflation, the Federal Reserve (Fed) raises interest rates. But every month with high interest rates increases the risk of a devastating recession. Recessions impose not only short-term pain in the form of widespread unemployment but also lifelong harm for many, as vulnerable workers and those who start their careers during a downturn never fully recover. Yet hiking interest rates is the centerpiece of U.S. inflation-fighting policy. When inflation is high, the Fed raises interest rates until inflation is tamed, regardless of the consequent sacrifices. We call this inflation-fighting paradigm “monetary primacy.” Despite its great risks, monetary primacy has …

Promises, Promises: Understanding Claims Made In Social Robot Consumer Experiences, Johanna Gunawan, Sarah Elizabeth Gillespie, David Choffnes, Woodrow Hartzog, Christo Wilson

Faculty Scholarship

Social robots are a class of emerging smart consumer electronics devices that promise sophisticated experiences featuring emotive capabilities, artificial intelligence, conversational interaction, and more. With unique risk factors like emotional attachment, little is known on how social robots communicate these promises to consumers and whether they adequately deliver upon them within their overall product experiences prior to and during user interaction.

Animated by a consumer protection lens, this paper systematically investigates manufacturer claims made for four commercially available social robots, evaluating these claims against the provided user experience and consumer reviews. We find that social robots vary widely in the …

Who Teaches Consumer Law?, Jeff Sovern

Faculty Scholarship

This paper reports on a survey of 31 law professors teaching consumer protection law conducted in connection with the Center for Consumer Law & Economic Justice at the UC Berkeley School of Law and the Center for Consumer Law at the University of Houston Law Center’s 2024 Teaching Consumer Law Conference. Surveys posed at previous editions of the Teaching Consumer Law Conference focused largely on what topics are covered in consumer law courses. The 2024 iteration of the survey instead explored responding professors’ goals in consumer law courses and experiences with and views on consumer law matters. Among the findings: …

Consumer Agents, Rory Van Loo

Faculty Scholarship

In the twenty-first century economy, individuals need market help that they are not getting. The technology has long existed for a browser plug-in that would filter out toxic social media content or a virtual shopping assistant that would find and even purchase the best deals online without having to go to many different websites and product pages. Yet tech platforms have used lawsuits and data control to stifle such tools. The lack of digital helpers has potentially profound consequences. Social media use is linked to alarming increases in teenage depression and anxiety. Businesses’ ability to manipulate consumers into paying higher …

Shifting Toward Boilerplate Regulation, Wayne R. Barnes

Faculty Scholarship

Consumer assent to standard form contracts has been creating cognitive dissonance among contracts scholars for a century. Businesses impose standard forms on consumers, who never read the terms. But consumers would not understand them if they did. And they don’t have the bargaining power to change them anyway—the terms are famously “take it or leave it.” Contracting is ideally theorized as an act of voluntary, knowing consent to all the terms agreed to. The dissonance is that consumers, although ostensibly signaling their assent to the boilerplate by signing (or clicking, or tapping their phone screen), do not in fact know …

“Can I Have It Non-Personalised?” An Empirical Investigation Of Consumer Willingness To Share Data For Personalized Services And Ads, Monika Leszczynska, Daria Baltag

Faculty Scholarship

European regulators, courts, and scholars are currently debating the legality of data processing for personalization purposes. Should businesses require separate consent for processing user data for personalized advertising, especially when offering free services reliant on such ads for revenue? Or is general consent for the contract enough, given personalized advertising’s role in fulfilling contractual obligations? This study investigates whether these legal distinctions reflect differences in people’s willingness to share data with businesses for personalization. Are consumers less willing to share their data for personalized advertising than for personalized services that they clearly contracted for? Does that change if the service …

Impact Ipsa Loquitur: A Reverse Hand Rule For Consumer Finance, Edward Janger, Susan Block-Lieb

Faculty Scholarship

No abstract provided.

Consumer Law For Gen Z Law Students, Neil Sobol

Faculty Scholarship

Whether they are consumers, representing consumers, or advising clients dealing with consumers, law school graduates will inevitably confront numerous consumer law issues. Moreover, most students entering law school are members of Generation Z and face a new wave of consumer laws arising from the 2007–2009 recession and the rapid growth of new technologies. Clickwrap agreements, email spoofing, cybercrimes, cryptocurrencies, fintech, identity theft, online disparagement, data privacy, artificial intelligence, robocalling, and autonomous vehicles are among the evolving topics in modern consumer law. Despite the growth in consumer law concerns, many law students have limited access to consumer law options, with almost …

Online Disinhibited Contracts, Wayne R. Barnes

Faculty Scholarship

There have been at least two dominant forces at work in the realm of consumer contracting over the past several decades. One has been the rise and domination of the standard form contract (whereby merchants contract with consumers via the use of standardized, boilerplate terms and conditions that consumers do not read or understand). The second force has been the rise of e-commerce and the purchase of goods and services via websites and other online platforms, and the use of “wrap” formation methodology (whereby merchants obtain consumer assent to the online terms and conditions via the consumer’s informal click, scroll, …

Tyrannical Hoas And How To Reign In Their Foreclosure Power And Further Protect Homeowners, Juliette Koves

Faculty Scholarship

No abstract provided.

A Reputational View Of Antitrust’S Consumer Welfare Standard, Murat C. Mungan, John M. Yun

Faculty Scholarship

A reform movement is underway in antitrust. Citing prior enforcement failures, deviations from the original intent of the antitrust laws, and overall rising levels of sector concentration, some are seeking to fundamentally alter or altogether replace the current consumer welfare standard, which has guided courts over the past fifty years. This policy push has sparked an intense debate over the best approach to antitrust law enforcement. In this Article, we examine a previously unexplored potential social cost from moving away from the consumer welfare standard: a loss in the information value to the public from a finding of liability. A …

Outlawing Corporate Prosecution Deals When People Have Died, Peter Reilly

Faculty Scholarship

Two Boeing 737 MAX aircraft crashes, occurring less than five months apart in 2018 and 2019, resulted in 346 deaths—possibly the deadliest corporate crime in U.S. history. The United States Department of Justice (DOJ) used an alternative dispute resolution tool called a deferred prosecution agreement (DPA) to resolve criminal charges against Boeing and to immunize the company’s senior-level managers from prosecution. In the end, the company admitted to engaging in the criminal behavior, paid a monetary fine, and agreed to cooperate fully with the government—meaning there would be no courtroom trial, no formal adjudication of guilt, and no possibility of …

Amazon's Pricing Paradox, Rory Van Loo, Nikita Aggarwal

Faculty Scholarship

Antitrust scholars have widely debated the apparent paradox of Amazon seemingly wielding monopoly power while offering low prices to consumers. A single company’s behavior thereby helped spark an intellectual renaissance as scholars debated why Amazon’s prices were so low, whether antitrust enforcers should intervene, and, eventually, how the field should be reformed for the era of large online platforms. One of the few things that all parties have agreed upon amidst those contentious conversations is that Amazon offers low prices. This Article challenges that assumption by demonstrating that Amazon charges higher prices than commonly understood. More importantly, unraveling the disconnect …

Confidentiality Clauses In Settlement Agreements After The Consumer Review Fairness Act, Wayne Barnes

Faculty Scholarship

Online commerce has skyrocketed in recent years, and shoppers are purchasing goods or services online in greater numbers every year. The COVID-19 pandemic has only hastened the trend. One significant aspect of online shopping is the presence of consumer reviews posted by prior purchasers of goods or services, describing their experience with the products, the services and/or the selling merchant. A vast majority of online shoppers say that they rely on these reviews to help inform their purchasing decisions. Positive reviews can be tremendously beneficial to a business’ profitability, whereas negative reviews can be equally detrimental. Users of the internet …

Gamestopped: How Robinhood’S Gamestop Trading Halt Reveals The Complexities Of Retail Investor Protection, Neal Newman

Faculty Scholarship

Should brokers have the unfettered right to restrict investor trading? GameStop, a brick-and-mortar video game retailer, had been experiencing declining revenues since 2016. However, GameStop saw its share price climb almost 1000 percent in the span of a one- week period from January 21, 2021 to January 27, 2021 due to retail investors buying significant amounts of GameStop shares during that period. Melvin Capital, a hedge fund, ended up losing billions as they were betting that GameStop shares would lose value instead of increase—a practice referred to as short selling. On January 28, 2021, brokers inexplicably halted trading on GameStop …

The Public Stakes Of Consumer Law: The Environment, The Economy, Health, Disinformation, And Beyond, Rory Van Loo

Faculty Scholarship

This Article shows how consumer law, a field “derided as the law of small problems,”⁴ is more accurately viewed as important for addressing large-scale societal threats. It also offers a more integrated conceptual and institutional approach to consumer law so that the field can have a better chance of fulfilling its societal potential.

Part I of this Article outlines the importance of consumer law. It maps consumer law’s connections to some of the most pressing societal threats: climate change, public health, inequality, and disinformation. Part II focuses on consumer law’s place in the legal academy and government. Currently, important …

The Case Against The Debt Tax, Vijay Raghavan

Faculty Scholarship

No abstract provided.

The Price Of Fairness, Christopher Buccafusco, Daniel Hemel, Eric Talley

Faculty Scholarship

The COVID-19 pandemic led to acute supply shortages across the country as well as concerns over price increases amid surging demand. In the process, it reawakened a debate about whether and how to regulate “price gouging”—a controversy that continues as inflation has accelerated even as the pandemic abates. Animating this debate is a longstanding conflict between laissez-faire economics, which champions price fluctuations as a means to allocate scarce goods, and perceived norms of consumer fairness, which are thought to cut strongly against sharp price hikes amid shortages.

This Article provides a new, empirically grounded perspective on the price gouging debate …

Q&A With Lina Khan, Chair Of The U.S. Federal Trade Commission And Mark Glick, Professor Of Economics At The University Of Utah, Lina M. Khan

Faculty Scholarship

Let me tell you a little about Lina. Lina attended Yale Law school and while a third-year law student she wrote her famous and influential article Amazon’s Anti-Trust Paradox. Then, after graduating from law school, she worked as the legal director at the Open Markets Institute and during that period she continued to write a large number of influential antitrust papers. She then joined the faculty of my alma mater, Columbia Law School. In 2019, she was appointed as counsel to the U.S. House Judiciary Subcomittee on Antitrust, Commercial, and Administrative Law and, in 2021, President Biden appointed her …