Activist Vladek Steps Down As Head Of FTC Unit

To get a measure of the impact David Vladeck has had on the relatively tiny unit of the Bureau of Consumer Protection at the Federal Trade Commission, consider some of the adjectives used to describe his leadership after he formally announced yesterday that he would step down at the end of the year: “hard charging,” “aggressive,” “tireless,” “effective.”

Vladeck, 61, is returning to Georgetown Law school, from whence he came in December 2009 after a long career at Public Citizen Litigation Group. His appointment to head the 425-person unit had been “lauded by consumer advocates, who felt that the bureau had shown a pro-business bias under commissioners appointed by George W. Bush in areas such as consumer financial services and online privacy,” according to his Wikipedia entry (citing stories in the New York Times and Mother Jones). 

Vladeck will remain as a consultant to the bureau, whose stated mission is “to prevent fraud, deception, and unfair business practices in the marketplace.”

“He's revitalized the bureau,” Randy Shaheen, an attorney with the Washington, D.C., law firm Venable tells Ad Age’s Jack Neff. “It's been a very active three years, with a lot of new initiatives and guidance” on such issues as how to substantiate health claims, privacy and environmental marketing.

Among the consumer-friendly achievements cited in a column by the Philadelphia Inquirer’s Jeff Gelles earlier this month:

  • “Nestle agreed in 2010 to drop claims that its Boost Kid Essentials protected against colds and flu by strengthening children's immune systems, all thanks to probiotics …;

  • “Bureau lawyers won similar settlements with Dannon over digestive- and immune-system health claims for Activia yogurt; Kellogg, over claims that children who ate Frosted Mini-Wheats daily ‘improved their attentiveness by nearly 20%’ and that Rice Krispies improved immune function…;

  • The FTC also took on Skechers and Reebok “over claims that their toning shoes could lead, as Reebok put it, to ‘better legs and a better butt with every step,’ in agreements that won $65 million in refunds for consumers.”

Vladeck is also very proud of a $2.5 million settlement earlier this year with Asset Acceptance L.L.C., a Michigan company that allegedly browbeat consumers into paying “zombie debt,” Gelles reported. "For us, the highest priority was trying to protect consumers who were rendered vulnerable by the economic downturn," Vladeck said.

In addition, “during Vladeck's time at the FTC, the agency crafted a comprehensive privacy framework and brought privacy enforcement cases against Google and Facebook,” Brendan Sasso and Jennifer Martinez point out in The Hill’s “Hillicon Valley” blog. “He also created the agency's Mobile Technology Unit, which helped coordinate the agency's mobile enforcement actions, according to the FTC.”

"I think we'll all remember the Vladeck years, for sure," Linda Goldstein, chair of the advertising division of Manatt Phelps & Phillips in New York tells Ad Age’s Neff. "He created a legacy. He was both feared and greatly respected."

Charles Harwood, who has served as deputy director of the bureau since November, 2009, will be acting director until a permanent director is appointed. Harwood previously had been the director of the FTC’s Northwest Regional Office in Seattle for 20 years.

In an address to the Promotional Marketing Association in Chicago in November 2011, Harwood indicated that that the “small” agency was acutely keyed into demographic trends in developing its regulatory enforcement and policymaking agenda.  

“We need to pay attention to trends and developments such as population changes, technological advances, and changing societal concerns,” he said. “Otherwise, we are at risk of falling far behind in fulfilling our mandate to prevent unfair and deceptive actives and practices.” 

Harwood was front and center when the FTC announced its crackdown on telemarketing “robocallers” a few months ago

Matthew Shultz, posting on Arnold & Porter LLP’s “Consumer Advertising Law Blog,” writes that the firm does not believe that Vladeck’s departure will have an immediate effect on the aggressive stance the bureau has taken in recent years. But “it remains to be seen whether it will have any significant, long-term effect on the FTC’s consumer protection enforcement actions and priorities.” 

“Harwood is likely to continue Vladeck's legacy,” Katy Bachman writes in Adweek. "I don't expect we'll see a major shift in priorities," Amy Mudge, a partner with Venable, tells Bachman. "This is a strong signal from [FTC chairman] Jon Leibowitz that he wants things to continue down the same path."

“David has been an extraordinarily effective advocate for American consumers,” Leibowitz said in a statement yesterday. “Under his leadership, the Bureau of Consumer Protection has worked tirelessly to respond to, and to anticipate, the risks consumers face in a rapidly changing marketplace.” 

Leibowitz also announced that Eileen Harrington, the FTC’s executive director, will retire on Dec. 31, and that Pat Bak, who currently serves as deputy executive director, will serve as acting executive director.

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