Snack box company settles FTC charges on incentives for positive reviews and phony ‘free’ offers

UrthBox Inc. has agreed to settle a Federal Trade Commission lawsuit alleging the company said customer reviews were independent when it provided customers with free products and other incentives to post positive reviews online.

The order settling the lawsuit, which also alleges that UrthBox failed to disclose the terms of its “free trial” automatic renewal programs, bars the company from engaging in these activities. It also requires UrthBox to pay $100,000 to the commission to compensate consumers deceived by the trial offers.

“People should be able to trust that good customer reviews aren’t the result of companies secretly paying the reviewers,” said Andrew Smith, director of the commission’s Bureau of Consumer Protection.

From January through November 2017, UrthBox offered to send customers a free snack box to post positive reviews on the Better Business Bureau’s website, the FTC contends.

While the BBB requires consumers who post reviews to certify that they haven’t been offered any incentive, many of UrthBox’s reviewers didn’t disclose they’d been offered one.

UrthBox also encouraged consumers to post positive reviews on other sites, including TrustPilot.com. Between 2014 and 2017, it offered store credit and/or free snack boxes in exchange for positive consumer reviews on Twitter, Instagram, Tumblr, and Facebook.

From October 2016 to November 2017, UrthBox offered a “free” trial of its snack boxes for a small shipping and handling fee. However, UrthBox used desktop and mobile websites that didn’t disclose key terms of the offer, including that UrthBox would charge them for six months of shipments if they didn’t cancel in time. The cost was usually $77 to $269 a month depending on the box size.

The order requires UrthBox to remove any review by any endorser it gave an incentive to from online review websites, including the BBB’s site, unless disclosure requirements are met. The company also must monitor any endorsers they engage.

The order also requires the company to disclosures any negative option features and get a consumer’s permission before using billing information for this option.

The company also must provide consumers with a simple mechanism they can use to avoid charges for products with a negative option feature.