‘FTC slams 1-800-Contacts’ reciprocal PPC bidding agreements with 14 competitors’ – Marketing Land

Greg Sterling says, “The US Federal Trade Commission (FTC) announced that it was suing 1-800 Contacts for allegedly pursuing “anticompetitive agreements with rival online contact lens sellers that suppress competition in certain online search advertising auctions.” The FTC complaint alleges the bidding agreements “unreasonably restrain price competition in internet search auctions, and restrict truthful and non-misleading advertising to consumers . . .”

According to a source with knowledge of the agreements, they had been in place for roughly a decade. The stated intention was to protect the trademarks of 1-800 Contacts and roughly 14 other sellers, which presumably didn’t want to engage in a bidding war over each others’ brand terms.

The FTC explicitly rejected that notion in its statement about the case: “[T]he bidding agreements are overly broad and not necessary to safeguard any legitimate trademark interest.”

Attorney Eric Goldman offered a lengthy historical and legal analysis of the case, highly critical of 1-800 Contacts and its legal and business practices. There’s an extended discussion of trademark law and the implications of this FTC enforcement action”.

FTC slams 1-800-Contacts’ reciprocal PPC bidding agreements with 14 competitors

Marketing Land