Questions About Legalities With Robert Freund Of Robert Freund Law (@robertfreundlaw)

[00:00:00] Jessy: Hi everyone and welcome to the WIIM Podcast. Women in Influencer Marketing is a first-of-its-kind exclusive networking group made up of inspirational women. This podcast is where we explore influencer marketing and get real about women in business. Find us wherever you download podcasts, and of course, you can always find us at iamwiim.com. That’s iamwiim.com. Hello everyone and welcome back. We are back you guys for another week of the WIIM Podcast. For anyone who is new, big, giant, warm welcome. I’m excited for you to like, check out our community. And this podcast is just a sliver of a component of our community. It’s actually so much further beyond myself.

I wanna give our members credit for one second. And you guys are listening, you guys are like really diving in so heavily to our virtual resources and like chime in every day to our private Facebook group and our Slack community. And then coming to our IRL experiences, I just wanna give you credit because credit is freaking due. 

This community would literally mean nothing if it wasn’t for you guys. No one’s showing up to hear me. People wanna hear from our guests, people wanna hear from our members, and you guys are just constantly leaning heavily into the community and it would be nothing without you guys. 

So huge shout out to you guys. I also hope that you guys are tuning in on YouTube. Follow us we’re @WIIM on there. It’s the only platform that we got, WIIM guys the only one. So we gotta we gotta appreciate it.

So subscribe to our channel on YouTube. You could also see the visual, which is just fun to see our guests, in the flesh, on Spotify as well. Cause Spotify’s so cool now for the past, like it’s been at least a year that when we upload, you can watch your favorite podcasts and not presuming that it’s us, but you can watch all your favorite podcasts. The visual one, watch them. 

I love watching podcasts. I just sit on my couch and pull it up on my tv. I’m not really doing it through Spotify, honestly. I’m doing it through YouTube. But, anyways, I encourage you guys to check it out and if you’re podcast listeners, you might become podcast watchers. I promise. It’s really fun. 

All right, so before we get into. Awesome guest today, Robert Freund, who I’m gonna introduce in just a sec. I also wanna remind you guys that on March 15th coming up so soon, we have our next influencer marketing job fair where you can get hired or hire from our community.

It’s at 6:00 PM .We’ve done it before. You probably have gone. It’s absolutely incredible and it’s gonna be the highlight of that week for sure. So the next event and then I will tell you where to sign up. But the next event I also wanna make sure is on your radar is March 28th, which is the best in influencer tech event.

We have hosted this, I think this is ours sixth time hosting it. Don’t quote me on that number. It’s like sixth or seventh. anyways the marriage of two things that I personally love, influencer marketing and technology. 

So we have incredible sponsors for that event that are coming in. It’s completely free to you. It’s why we’re super grateful to our sponsors for allowing it to be completely free where you get demos of their latest and greatest product offerings. 

So I’m just a huge component for, you are working hella hard at your job and tools are incredibly important to amplify all of that hard work that you’re doing.

So the best influencer tech event, that’s why we do it at least two times every single year we have for the last three. It’s a great event. Again, it’s completely free and you just get to sit back and compare, contrast, and see the latest and greatest in influencer tech. I cannot recommend it enough.

It is probably my favorite event that we do. It’s why we do it so often. So you can find out information on those events and also others that we have coming up. We’re doing more in-person events, so keep an eye up for those. Go to iamwiim.com/events and of course we will drop that in the show notes.

All right, you guys. So I am now going to introduce to you our special guest of the hour, Robert Freund. He has his own law firm called Robert Freund Law. And, a little bit about him. So he is an experienced advertising attorney and advisor. He focuses his practice on social media, marketing and e-commerce issues, specifically.

You might have seen him on his social channels because I know I follow him and sometimes we repost his stuff. It’s so good and insightful. So before opening his own law firm, he honed his legal skills working for, another incredible law firm, one of the largest and most respective international law firms.

In fact, he’s lectured about advertising law at the University of Southern California and the University of San Diego, and he is also been quoted in incredible publications. You’ve definitely heard of like the Wall Street Journal, the New York Times, and Vox on all of those issues. 

He was named Southern California Super Lawyers Rising Star in Media and Advertising for the last bunch of years from 2020 to 2023. Let’s hope that he gets it for 2024. I’m super excited for you to meet Robert. 

All right, so Robert, thank you so much for joining today, and your dog as well. Hi Kimmy.

[00:05:57] Robert: Say hello. 

[00:05:58] Jessy: Am sure he’ll say hello at some point.

I hope everybody’s watching the YouTube or Spotify on camera version. If not, you’re missing out. Cause Robert has a really adorable dog work from home life. Aw, that’s the perfect shot right there.

So good. I’m so excited to chat with you today for a variety of different reasons. So I’m appreciative that you came on. But first and foremost, how’s your day going?

[00:06:27] Robert: It’s good, off to a busy start this morning and, got a fair amount of work to do and some fun stuff like this as well. So all good on this end.

[00:06:36] Jessy: It’s interesting that you say that. I feel like there are so many lawyers who would look at how you have cultivated your own career and be like that looks much more fun than what I experience on a daily basis. And we’re gonna get into a little bit of that, as we chat today. 

I think a really interesting place to start so our audience can learn a little bit more about you is the following. Like you could have focused on so many different areas of the law. You go to law school, you come out, and the world is your oyster. Why did you end up focusing on advertising and influencer marketing in particular.

[00:07:21] Robert: It wasn’t by design initially. It wasn’t like I graduated law school or even in law school, had an idea that I want to focus on issues related to advertising and marketing.

What happened was, when I graduated, I started working here in Los Angeles at a large international firm, a big law firm, so to speak. I was in the commercial litigation department. So they cover, lawsuits regarding all kinds of business matters, some intellectual property litigation, and a lot of the cases that I was working on was defending against consumer class actions.

So representing big companies that have been sued on a classwide basis for, any number of things. In California there are a lot of, definitely more than in other jurisdictions, a lot of consumer class actions based around false advertising claims. 

So whether that’s, deceptive pricing or some kind of misleading claim in an ad or something like that, California is a place where there’s a ton of activity around those sorts of claims. 

And I found that working on those cases versus, financial disputes or real estate litigation or something like that, the subject matter is just more interesting to me inherently, like reading about the psychological side of advertising and how we’re applying these laws that in many cases were written a very long time ago and trying to catch up to how innovative marketers are changing their tactics and seeing how the legislature responds and then how the court interprets what we have in applying it to advertising cases.

It was just more inherently interesting to me than anything else I was doing. And it’s the kind of stuff that I’ll read about on a weekend just cuz I’m interested in it.

And so I was at that firm for close to seven years and towards the end of my time there, we had more and more clients who had come to use to serve as like an outside general counsel type role with respect to their ad. So before any lawsuit or dispute is even on the horizon, they’d say, for example, we’re about to run this ad campaign promoting our new video game. Can you take a look at what we’re about to do and let us know where it falls on the risk spectrum stuff to avoid?

Have our competitors gotten in trouble for this sort of thing? And I like that a lot more than doing the actual litigation. There’s more control over your time, clients are usually less upset when they’re not trying to get out of a lawsuit. 

And so we can discuss this a little bit later, but when I decided to leave that firm and start my own practice, I thought what I want to do is focus on that litigation avoidance type work to try to help people, keep the money they’ve made by selling things online and avoid litigation in the first place.

And because the advertising subject matter was the most interesting to me, I thought my goal is let me build a practice where I can do that type of work full-time. And here we are.

[00:10:32] Jessy: I mean that’s incredible. I think it’s really interesting to hear about your professional journey, but also see it play out because I follow you on social media. That’s how I found you in the first place because a lot of people in the WIIM community, definitely follow you and share yourself and talk about the interesting posts that you’re posting.

So I love that you’re, combining all of those things to be able to like, get these interesting topics out to the masses using social media, making it fun, making it, educational, and also of course it just supports your business. And as a business person, I think it’s like phenomenal to be able to be, leading the charge of your own marketing efforts.

So I love exploring everybody’s unique path and I love sort of a role that feels different from the rest. So is there anything in your career journey that you think is like a little unexpected or unique or something that we might not know about that you think is worth mentioning?

Because there might be people watching this there like how do I get in Robert’s shoes or like, how do I explore that for myself? Is there anything you think we should know?

[00:11:46] Robert: Yeah I, think that especially the feedback that I get from lawyers, there are a lot of lawyers who are in my position getting more senior to a large firm, questioning whether that’s what they want to stay doing, and they’re not sure if they really can just leave and start their own thing.

It’s a pretty daunting thing to try to think about. You’re taking on a significant amount of risk in terms of what you’re getting paid at a large firm versus trying to do your own thing. And it turns out there are a ton of resources available online, and there’s communities that will basically give you step-by-step instructions on what you need to get in order and how to start a firm with not as much money upfront as you might think.

And it certainly takes planning and preparation and a a little bit of risk tolerance but you can be operational in not a lot of time and without very much upfront expense, like you don’t necessarily need to have a physical office and a high rise. I do have an office that I use, not today cause I’m helping take care of my dog today, but I didn’t at first and I didn’t need very much more than, you know email a couple pieces of software that helped me run the practice and an address where I can get mail. 

And then from there you can scale up as necessary and however much you want. And I think that applies to anyone who’s interested. Maybe you work at a larger ad agency and you wanna start your own thing.

It’s simpler now probably than it’s ever been to start your own business and get it off the ground without a ton of overhead that you might think, would hamstring you.

[00:13:26] Jessy: I love that you’re saying that so much for a bunch of different reasons. I hear so many people, even people today were ping me being like, oh my God, I got laid off. Oh my gosh. What do I do? Where am I at?

And isn’t it interesting that the entrepreneurial route used to feel the most risky and now, your livelihood could be, just taken from you in the drop of a hat because people are just like laying off folks from their company and the economy is wild and it almost feels as if being an entrepreneur, you’re a little bit more in control of your own destiny.

So I love that you’re bringing this up and I think there’s a high likelihood that it could feel reassuring to hear from a lawyer like yourself that starting your own thing is less cumbersome than one might think. 

So are there, from a leak perspective and from doing it yourself, is there anything in particular that people should keep in mind? People should, make sure that they check these boxes. Does it depend, I assume a little bit on where they live? Is there any advice that you can give for just people wanting to start their own businesses?

[00:14:41] Robert: Yeah, I think having a plan in place, of course that sounds like such simple thing to say. But it’s really important in terms of what kind of services you’re gonna be offering through your business, how you’re gonna set it up and where you’re operating comes into play a bit. 

But the very basics, once you have your roadmap and your plan set up in terms of timing and so forth, is as soon as possible, make your business a separate legal entity from yourself.

So whether that’s typically through a single member LLC, or a corporation depending on, what your accountant tells you makes the most sense from a tax perspective. 

But it’s really important to have that legal separation between you as a sole proprietor and this separate legal entity that’s your business, if you’re doing any significant amount of business.

And I would suggest doing that pretty much in all cases as early as possible because you get such a benefit in terms of exposure of your personal assets in case something goes wrong. 

If you’re in business long enough, you’re going to be sued or someone is going to threaten to sue you. It’s just a fact whether you’ve done anything wrong or not, eventually someone’s going to cause some kind of trouble from a legal perspective.

And so the sooner you have it in place, the better off you are in terms of shielding your personal assets from being involved in that kind of situation at all. So that’s like the foundational first step is set up that LLC or that corporation. 

It’s not especially complicated to do in most cases. It’s not that expensive and it will give you a lot of peace of mind. And then it gives you a foundation to build from a lot easier, whether that’s taking on contractors or eventually hiring employees or engaging the services of vendors or what have you. Running all that through the business entity rather than you individually, is a really important step to take.

[00:16:42] Jessy: Question. Let’s say from the beginning, you know you wanna start a business, but you’re like, I don’t know, is this ultimately gonna be just me as like a solopreneur? Or am I gonna grow this into an enterprise sized corporation? Are there different approaches for how you start, or do you start in the same way?

[00:17:03] Robert: A lot of the conversation of choosing what entity to set up, whether it’s an LLC or a corporation or maybe a partnership or something, is a tax driven question that your CPA can help you answer. 

Unless you really expect, like you’re a startup that’s gonna raise, capital through investors and take on shareholders, in the not long term, an LLC usually makes sense, especially for somebody starting out as an individual and I’m saying at least in California where I’m licensed. But generally, the most common thing people set up first is an LLC. 

If you know that you’re gonna be taking a lot of investor money giving out equity, a corporation can make that easier in some respects but it really is a conversation for a tax professional to make sure that you’re set up appropriately to make all of that smoothly. 

But spending a lot of time obsessing over which particular, structure makes the most sense is less the issue. And it’s more about, okay, my CPA says LLC makes sense for this amount of revenue that’s expected and how I’m gonna be running my business, so we’ll go with that.

And then, in either structure you can add employees, you can scale up, and down the road maybe that whatever form you selected initially no longer makes sense for your business and there’s ways to switch into another, form or another structure that can be handled. So it’s not if you get it wrong, so to speak, that you’re locked into something, that you should have had. done differently.

[00:18:36] Jessy: You’re not doomed forever if you no start in one place and then you learn later that you have different needs and you wanna, switch to a different format. So I appreciate that very much.

I appreciate your recommendation to seek out a CPA for that sort of like tax and structural advice. So I think that’s great. Let’s dig a little bit more into your area of expertise, which I know a lot of our members, new or old, like experienced or new in the industry are always wanting to make sure that they’re crossing their T’s, dotting their I’s, when it comes to FTC rules.

You talk about so many different topics on your social media. I almost feel like FTC stuff is like, there’s way more interesting stories, but I would be remiss if we didn’t touch on that a little bit. What’s something about FTC rules that you don’t think enough people talk about?

[00:19:34] Robert: I think that there’s so much to cover in terms of what’s under the FTCs umbrella, and their rules apply to any advertising in the US or even directed to the us.

So it is an Important area of discussion. I think one thing that people don’t necessarily understand is that the FTC, the laws and the rules that they enforce apply, to anyone involved in whatever advertising we’re talking about. So let’s say you have a situation where, a brand is selling, let’s just say like a dietary supplement and they’ve hired an ad agency to find influencers to, promote their products.

If there’s a non-compliant piece of advertising, let’s say the influencer doesn’t include the disclosure, that they have relationship with that brand where they’re getting paid. That’s something that the FTC requires. 

So who’s responsible in that? You might think it’s the influencer’s fault, so liabilities on them or maybe the brand should have made it more clear what the influencers required to do. But the reality is that the brand, the ad agency and the influencer are all potentially liable and are responsible for complying with the FTCs rules.

So if there’s a non-compliant ad, potentially everyone is on the hook, regardless of what your contracts say. We can talk about what’s beneficial to have in agreements and how you can shift some of the financial responsibility. But the FTC sees a non-compliant ad. They’re gonna look at everybody involved in creating that ad across the entire chain.

[00:21:12] Jessy: How common is it for people to really be held accountable these days? I feel like it’s definitely changed over time, like maybe 10 years ago, like when there was a big case or whatever, it was like very rare to hear about that, and I felt almost as if it was more common to see people post ads all the time without any disclosures.

And you’re like, these people like seem to be fine. Nobody’s coming down on them. Like does it really necessary to disclose? And of course everybody will say yes, but are there really consequences that people are seeing in are there any specific stories that you think are really important for our audience to know about?

[00:21:51] Robert: Yeah, absolutely. The FTC is becoming more and more aggressive about policing disclosure rules and some other issues that are top of mind for them manipulating customer reviews, claims about if a product’s made in the USA or it’s not some other topics that they’ve identified as being priorities for them. But included in those priorities is these disclosure rules around influencer marketing and, the other rules that they have about making endorsements more generally.

There was a regime change at the FTC not that long ago, and the new chair has made it very clear that she wants the FTC to have more tools at their disposable, be more aggressive, bring more cases and part of that is because there is this perception out there that they only strike, the fashion Novas of the world and it’s only here and there. And, it gives that sense to some marketers that my number’s not gonna be drawn, so there’s not very much risk. 

And also I hear a lot from clients will say this competitor of ours is doing it. How come they’re not being sued? And the answer is they’ve just been lucky so far and it’s gonna get riskier and riskier as time goes on. And that’s just the FTC. 

There’s also the State Attorneys General who enforce very similar state laws, sometimes in conjunction with the FTC, sometimes on their own and those cases don’t make the headlines as often. You’re aware of a very small fraction of what’s actually going on, even in terms of lawsuits that are filed.

And then there’s also the element of, it’s not just regulators like the FTC and the state ags that can, file lawsuits about some of these rules, consumers can do it too. If I see a misleading ad. or if I buy something because I believed that this influencer endorsed it or I believe that this person just bought it because they liked it and I didn’t know they had this connection, or an influencer makes some claim about the product that isn’t true or can’t be substantiated or something like that, there’s an opportunity to start a class action about that, and we’re seeing that more and more as well.

And many cases, or many disputes are resolved before a lawsuit’s ever filed, and they’re resolved confidentially. So we don’t even know how many potential lawsuits have resulted in settlements before they even make it to court.

So it’s true that, in some ways, like you’re rolling the dice, maybe you’ll get away with everything forever, but that is becoming less and less likely as time goes on, especially because the FTC has been open and clear about how much more aggressive they intend to be, and that’s been playing out as well. There have been more cases brought by the FTC around the issues that I talk about.

[00:24:47] Jessy: So interesting. All right, so if you could give us like an FTC lesson, little brief lesson on like how to disclose, is it a hashtag enough? Does it have to be the branded partnership label? Can it be one or the other? Does it have to be above the fold? What are the rules that everybody should be aware of for compliance?

[00:25:10] Robert: Yeah. I’ll start by saying the FTC has their own documents that go into, they have one document called the Endorsement Guides that goes into great detail with a lot of examples that I couldn’t possibly cover.

They also have a document called Disclosures 101 for Influencers. It’s two pages long and it tries to summarize what I’m gonna talk about. 

So if we just want to focus on disclosure, the rule is this, anytime that there’s what the FTC calls a material connection between an advertiser like a brand and an endorser, like an influencer, that material connection needs to be disclosed to the audience.

if it’s not otherwise obvious, like you see an ad on tv, you know it’s a commercial, you know that whoever is in it is promoting the brand. So we don’t need like hashtag ad on TV commercial. 

The reason influencer, or part of the reason influencer marketing is effective is because it doesn’t immediately feel like advertising and the FTCs policy, or part of why they have these rules is people should know when they’re being advertised to.

So that material connection is any relationship that would affect the weight or the credibility that a consumer would give to the endorse. So if I see a video of somebody talking about a pair of shoes that they love, it might matter to me when I’m making a purchase choice to know that they got those shoes for free or that they’re being paid to promote them.

That’s the idea. So that material connection, certainly if you’re paying an influencer to promote something that requires disclosure, but it’s not just payment. If you’re giving someone product for free, even if you don’t specifically ask them to make a post, the FTCs position is if they post promoting that product or talking about it, they need to disclose to their audience that they were given it for free.

Other relationships or if you get a discount code or if you’re given, some kind of benefit that’s not available to everybody or if you’re an employee of a brand and you go on Twitter and talk about how great the new product is, if it’s not obvious that you work for the company, you need to disclose that.

Family relationships. Your spouse has, some new product that they’re launching through their brand, and you talk about how great it is and it’s not obvious that you’re their spouse, that is another material connection that you have to disclose.

So that’s in a nutshell the situations that require a disclosure and then the next piece is like how do I go about doing that? Do I have to use hashtag ad? Do I have to use a certain hashtag? You don’t necessarily have to use a hashtag at all. Hashtag ad is one of the ways of making a disclosure that the FTC says is generally appropriate for any type of material connect. And so is hashtag sponsored or hashtag brand name partner. 

They specifically don’t like things like, abbreviations, like Spon or just S P O N or just hashtag gifted or something like that, because to them doesn’t clearly convey that this is a commercial relationship, that it’s sponsored content.

So the way to understand whether your disclosure’s compliant is the rule is that it has to be made in a way that’s clear and conspicuous, which basically means in a way that the audience can’t miss. So in terms of above the fold, below the fold, it’s important to think about this in terms of where the content resides and like what the platform allows you to do, and also the format of the content.

So if we’re talking about an Instagram static post caption, and you’re gonna use hashtag ad or just the word ad, if you don’t wanna include the hashtag, the FTC has been very specific that needs to be above the fold, so to speak, meaning person shouldn’t have to click or tap more to see that disclosure.

And that specific issue came up a case a few years ago against a brand called Teamy. That was running a very large influencer campaign and had celebrities like Cardi B and a few others, those posts included hashtag Teamy partner, which would be acceptable except that the hashtag disclosure was underneath that more, which made it not clear and conspicuous.

And that, case settled for, over 15 million. So we are talking about like that specific level of what regulators are looking at in terms of how disclosure’s made. 

[00:29:38] Jessy: And outta curiosity. So who was on the receiving end of that judgment? Was it the brand?

[00:29:45] Robert: It was the brand In that case, they didn’t go after the individual influencers, in that case. But the FTC has sent hundreds of warning letters to influencers about this issue and a lot of people like me who watch the space, it appears that the FTC is more interested in holding individual influencers accountable, and we know that because they put out documents like the disclosure guide pill influencers, that says in bold text disclosure is everyone’s responsibility, don’t just rely on the brand and so forth.

And generally, when the FTC comes out with new guidance or new document, enforcement actions and lawsuits about that subject matter followed pretty shortly thereafter. So in that case, it was demand.

[00:30:31] Jessy: And so if they were going after an influencer, what’s reasonable to expect in terms of like how much money somebody could be out and I feel like there’s like legal fees to consider and like a judgment to consider. Like what’s at risk here?

[00:30:47] Robert: It’s hard to tell exactly how the FTC comes up with the amounts that they settle for and why, and in what context. They haven’t historically been very consistent about that. You’ll see two brands of similar size do the same thing wrong, and then, oh, we’ve agreed to settle for widely different amounts.

But in, the context of what we’re talking about, the FTC is, has the authority to impose civil penalties for violating section five of the FTC Act, which is what we’re talking about. If, the person they’re suing has violated, a previous order like the FTC has gone after someone and you’ve agreed that, okay, according to this order, we’re not gonna do what you’ve accused of doing again or without getting too into the weeds about it, there are other situations where if you have noticed that a certain advertising practice is unlawful according to the FTC, and then you do it, these civil penalties apply.

The maximum civil penalty for a violation of section five is, a little bit over $50,000 per violation. And if the violation is ongoing, that can be that $50,000 amount per day that the violation continues. So in theory, if you are an influencer and you put up 20 pieces of content that don’t have the appropriate disclosure, you’re looking at 20 times, 50,000 potentially times every day that the content remains live, which gets pretty outta control pretty quickly, and you’re gonna have to hire a lawyer to deal with it and get you through the process of dealing with the FTC in the first place.

So we haven’t seen a case like that yet where the FTC has thrown the book at an individual influencer for violating these laws, but it’s not out of the realm of possibility. I should also mention like that’s not the only legal risk. You’re also probably, if you’re working with a brand that has, that’s sophisticated, you’re probably gonna breach your contract if you don’t comply with the FTCs rules.

Like most brands that know what they’re doing will include in their contract you agree that you’ve read and understand these rules, that you’ll use this hashtag, you’ll put it in this, part of the content, and if you don’t, then you’ve breached the contract and repercussions for that.

Not to mention the, PR aspect of it, like we saw with Mikayla and the whole lash gate thing. Like even if you could argue that she made the right disclosures, or even if she didn’t use the fake eyelashes in that specific context, consumers are much more, quick to cast criticisms that influencers today for not being transparent or not disclosing.

And legal issues aside, it seems like the environment is much more, primed for audiences to lash out at influencers that they suspect believe aren’t being completely truthful.

[00:33:44] Jessy: To lash out, pun intended. I love it.

[00:33:49] Robert: I didn’t even mean to do that.

[00:33:51] Jessy: I love it. I love it. So I’d like to focus also on some of the smaller companies that don’t necessarily have all of their ducks in a row yet.

Some of the larger agencies or brands been doing this for a while. They know what teased to cross and eyes to dot, but I think that for some of the smaller companies up and coming, or Just diving into influencer marketing, what should those influencer marketers keep in mind to cover themselves from a legal perspective?

[00:34:25] Robert: Yeah, I think that this is a good place to pivot away from just the FTC discussion.

I think, like I mentioned it’s important to have something in your agreement where the influencer acknowledges and agrees that they’re gonna comply with all advertising laws. Including the FTCs endorsement guide. So at least you have that in case some regulator wants to, investigate you. You can say look, we have this in our contracts.

We have some kind of monitoring and compliance program in place where we’ll look at content that’s out there and ask influencers to correct it if it’s not compliant, that’s pretty critical to have in the agreement. But what I see more commonly or more frequently, with small and mid-size agencies and big ones, has less to do with whether their influencers are complying with the FTC rules and more about have we defined who owns the content, the influencers creating, who can use that content and where like on what platforms and what media for how long can we use their name, image, and likeness, and in what way? 

Those ownership and usage rights in terms of the content that’s being created is, I would say, the most critical part of your agreements to get right. For example, maybe you’ve contracted with an influencer and they agree to post, an Instagram story or a video on their Instagram page, and that’s all the contract says. The brand then takes that video or that post and reposts it on their page.

If the brand’s agreement doesn’t say they get to do that, then they have a copyright violation on their hands, potentially a violation of the influencer’s publicity rights and those kinds of disputes are very tricky to try to get out of and usually you end up having to pay as the brand significantly more than you would’ve paid to have your agreements drafted correctly in the first place.

So that, kind of dispute comes up much more frequently than, the FTC stuff does.

[00:36:23] Jessy: That is really really good advice, and I hope that everybody listening writes that one down. I’d also love to chat with you from the influencer or creator’s perspective. What should influencers keep in mind to cover themselves from a legal perspective?

Because you’re talking about a $50,000 fine per day. And that makes me so anxious. Even just thinking about it. So basically like what should influencers or creators, all these people who are, doing incredible work and maybe don’t know, what should they know? What should they keep in mind? 

[00:37:03] Robert: Two of the best things you can do? Are just become aware, of what the FTC’s rules are. We talked about disclosures. It’s worth understanding, that the claims that you’re making about a product or a service that you’re endorsing, the law treats that as advertising.

Whether you have a million followers or you have one follower. A question I get a lot is, If I’m not an influencer, but I’m just a content creator or something, do these laws still apply? And the answer is, it applies to anybody regardless of size. 

There’s no like legal difference between a content creator or an influencer or an ambassador or something and there’s no like audience size threshold where these rules kick in. If you’re promoting or endorsing a product or a service and you’re getting paid or you have free product, it’s advertising and it’s treated as the brands advertising too.

So one of the core truth in advertising principles that goes into the FTC part is that every claim made in ad has to be truthful, not misleading and substantiated and in the context of influencer endorsements, whatever you say about a product has to reflect your, actual experience with that product and your honest belief.

So if you get sent a product and you haven’t tried it, and you go and make a piece of content that says, this is the best thing I’ve ever used, you’re violating the law because it’s not true and it doesn’t reflect your actual belief about the product. And the reason an influencer should care about that is because you’re potentially getting the brand in trouble, if someone wants to make an issue out of that, whether it’s a regulator or a consumer who felt misled or a brand’s competitor, competitors can sue under a different law for false advertising And that has come up in the context of one brand saying, hey, our competition’s having these influencers say X, Y, and Z. And we know that’s not true and we know that they didn’t use the product in the way they’re saying things like that. So make sure what you’re saying actually does reflect what you believe about the product.

Just having an understanding of the disclosure rules will allow you to get a baseline sense of, is there a disclosure here? Did they ask me not to make a disclosure? If any brand ever asks you not to make a disclosure, you should not work with ’em. That’s one of those very rarely give hard nos to things and try to make relationships work, but for me, that’s the kind of red flag that’s I’m not gonna work with somebody who’s asking me to break the law.

Beyond having a baseline understanding of what I just talked about, really understand your contacts contracts. I’ve seen so many situations where a creator has inadvertently given away the right to use their own name or image, forever in a certain context. Or they didn’t realize that this video they’re shooting is going to then turn into a YouTube ad with like a million dollar ad spend behind it or they didn’t expect it because I promoted this fashion company, now my face is on the billboard for some medication that I have no relationship to those kinds of things happen and it’s because, they haven’t taken the time to ensure that they really understand everything that the agreement says.

So really having someone either yourself or someone on your team, look over an agreement to make sure you’re not giving up anything more than you wanted to, and make sure that you’re getting everything that you do want to get, is probably the most important thing that I would recommend.

[00:40:33] Jessy: Yeah, don’t be hesitant to redline an agreement or raise your hand if the contract doesn’t align to what you agree to in email. So related to this, I also wanna ask you for some practical advice For our listeners.

We hear stories on this podcast or we see them in our Facebook group, our Slack communities, where influencers have been scammed or just taken advantage of. And after reading these stories, I can imagine, they or their managers can feel nervous or disempowered, of what to do if they experience something like that.

Like they’re the smaller entity in comparison to the larger agency or brand on the other side. So what practical advice can you give to the smaller business owner or the solopreneur, in our industry who wants to protect themselves, when someone violates contract? What can they do?

[00:41:30] Robert: Yeah I, hear you that even thinking about legal process is very intimidating, especially if you’ve never gone through it before.

And a lot of times, like the cost of doing something about whatever the issue the will outweigh whatever you get out of it at the end, but not always. And it depends on what the issue is and where you’re located. So for example, in California, somebody violates my publicity rights. I have the opportunity to recover my attorney’s fees, if I prevail, which makes it much more appetizing for a lawyer to potentially represent me in that case because the longer it goes on, and these cases are generally not that complicated, like you either use my image in it for a commercial purpose without my permission, or you didn’t. There’s some very nuanced ones, but the majority of the disputes aren’t that complicated.

And if I’m the lawyer that knows I’m not just gonna get an hourly fee out of this, I’m gonna potentially, get the attorney’s fees award, and might want to take this on contingency. You’re much more likely to get a lawyer interested in taking that case. And the cost to you will be, if it’s taken on contingency, it would be nothing that’s not true in every state or with respect to every dispute.

But I mentioned that because if you do have some kind of issue going on where the thought has crossed your mind mind is there something I can do legally about this? Talk with a lawyer in your state about it. Just to see what your options are.

And, a lot of lawyers are happy to have that discussion with you just to see what might be available because it might be a win for them. And at a minimum, they’re helping educate somebody about what’s going on. So don’t just immediately think that or assume that this issue’s too small, it’s gonna cost me more than I get out of it, so I should just not explore it. Always explore it just so you know what your options are. 

And then the other piece is less of here’s what you should do legally and more, just do as much diligence as you can on whoever you’re about to engage in business with upfront.

There are tools available online that will give you a little bit of insight into who the person on the other end of the deal is. If you’re a creator and you’re about to work with a brand or some agency, figure out what state they’re located in and see if you can find their business name in the Secretary of State database if you can t that’s a red flag. 

See if you can find out if anyone else has worked with those people. If you are working with somebody who’s proposing to be your talent agent, many states, California, New York, and a handful of others require licensing for talent agencies.

And if they’re not licensed, then you don’t owe them any money. They can’t take agency fees from you. So there’s registries for licensed agencies as well. If they say they’re based in California and they’re a talent agency, look ’em up. If they’re not in that database, I wouldn’t work with them because they’re already lying to you at the outset.

So as, much investigation as you can do on your own and talking to other people in your space who may have experience working with that brand or that agency or on the other side, has anybody had an issue with this creator? Is their follower account real? What else can we learn about them before you sign something? Is really important to do.

[00:44:45] Jessy: I appreciate that so much. I think that’s the real world advice that everyone is gonna benefit from let’s save each other from this nightmare experience and, reach out to Robert when you have hopefully that once in a blue moon experience where you might need to litigate or you just need a little bit more advice, but let’s save each other. Let’s look out for each other and have each other’s backs. 

You share a lot of really interesting stories on your social media. I love following what you’re doing online. What was maybe the craziest case that you’ve covered that you think your audience was surprised to learn about?

[00:45:23] Robert: Yeah, it’s a funny question. I was thinking about how to answer that one. Cuz it’s hard for me to tell what surprises my audience. So I asked the question to my girlfriend yesterday and she was like, oh, the Bumble one easily. And I was like, oh yeah, people did engage with that one a lot. 

So there’s a class action lawsuit against Bumble where they agreed to pay, 6 million dollars to settle it. And the allegation was that Bumble discriminated against straight men because, if a man registers for Bumble and they set their preference to interested in women, only women can send the first message. And California has a law called the Unruh Civil Rights Act that prevents businesses from arbitrarily discriminating against people on the basis of a class like age or gender.

So the allegation was women get this benefit that men don’t get or that men who identify a certain way don’t get, and that’s gender discrimination. And the case got far enough along through the courts, Bumble tried to dismiss it. They lost the motion to dismiss. And then because that law allows for, you can get $4,000 for a violation of it, 4,000’s not that much.

But when you multiply that by every man in California who’s signed up for Bumble since 2016, who identifies that way, the number is unbelievably large. So Bumble thought it was worth it to pay 6 million to resolve that. It was the kind of like really discrimination against straight guys the case here, but yeah, people seemed surprised and intrigued by that one.

[00:46:59] Jessy: I’m intrigued by that. That’s like a pretty wild story. I had no idea about that one. I must have missed it. So wow 6 million dollars, holy shit.

So I think it’s incredible how you have mastered your social medias so well. Your personal brand and just like marketing in general, your own business. How did you get to that point? What tips can you give to our audience? Like basically how did you master this and how are you doing it so well?

[00:47:27] Robert: it’s something I think about a lot and I think it’s a combination of, luck and just being consistent. When I started making posts consistently on my page, a friend of mine showed me this accountants page. There’s a guy named Tyler McBroom. He’s got close to a million followers now.

When I saw him for the first time, he had a hundred thousand. And he just did quick one minute tax tips that come up for small business owners. And my friend said, you should do that for legal stuff that comes up. And I thought that’s a good idea. I’ll try that. I’ll try to just copy basically what this guy is doing in terms of his style.

And at first I was trying to do a video every day that’s not really sustainable for more than a few months. So I tried to switch it up with static image posts about new cases that people might find interesting, in addition to general legal tips and stuff like that. And it was a combination of posting consistently and then through seemingly random connections, I would meet at networking events like conferences or speaking engagements.

I’d meet somebody and exchange information with them. And some of those people are very influential people in business with large followings. And if you can get a handful of re-shares without asking for them, from very large accounts, you can get, snowball effect in terms of your exposure where other influential people that they know will follow you and then they’ll re-share it. 

And so that sort of luck factor of having a few big accounts amplify what I was putting out plus just being consistent about getting content out has, made it pretty successful for a page that talks about the law. I’m still surprised that people will stop scrolling to read some of this stuff, but of course appreciate it very much.

But, yeah, I think consistency, l learning what my audience likes and doesn’t like over time, trial and error, and then a little sprinkling of love.

[00:49:27] Jessy: Do you enjoy that side of your business? Do you do that because you feel like you should, or do you feel like you’re exercising like a fun, creative side of yourself?

[00:49:38] Robert: Mostly? I really enjoy it. Like I like writing. I like to think that I’m a good communicator. Hopefully I’ve done okay on this podcast. I think that when I have the time to prepare a video write something that I can be happy with what I’ve done with it at the end. And that’s a satisfying thing.

And a lot of the content I put out is stuff that I’m paying attention to for my clients anyway. So I’ll get an alert about a case that includes the word influencer, for example, and I’ll read it to see if there’s something I can take away from that would help one of my current clients to know about.

And a lot of times I’ll think that is really interesting to me I bet, the internet or my followers would find it interesting too. And so I enjoy the process of taking that, putting it into a piece of content and then like anybody else, seeing how it does and the notifications that somebody’s reposted it or shared it or what have you.

So it’s addicting in a way, and it is a part of what I get to do that I really enjoy and something that I wouldn’t have the opportunity to do at a large firm, like the one I was at because, everything’s gotta go through five rounds of clearance from media teams, and I wouldn’t have the ability to see something online and then instantly make a Twitter thread or an Instagram post about it. So I like that a lot. I’m grateful that I get to do that.

[00:50:56] Jessy: Isn’t it awesome to be able to be nimble just because you don’t have as much red tape that you would working for a larger company. So I know that it can be intimidating to put yourself out there, but like the upside, like you’re describing is just so good.

You can meet so many more people. You have so many more opportunities. So to your point, man, find a way to enjoy it and just throw yourself in the deep end. So I have a feeling that our community is definitely want to, gonna wanna follow you, check you out. So where can our community find you if they want to connect with you?

[00:51:33] Robert: Yeah, I’m most active on Instagram. it’s @RobertFreudLaw and same username on Twitter. I just started using Twitter more seriously, maybe two months ago and I like it because I can be even quicker on there. There’s less editing involved and, some things that maybe don’t deserve a whole Instagram posts can just get thrown up on Twitter. But yeah, Instagram and Twitter at Robert Freund laws is where I’m most.

[00:51:56] Jessy: Perfect. Thank you so much. And we will link all of that in the show notes below. I am so appreciative that you can come on today. It’s been such a pleasure, like learning, picking your brain, learning from you. So I have a feeling that a lot of our members and community will reach out, follow you, do all the things.

So thank you so much for coming on today and we will see you guys next time.

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