82 FR 43020 - CSGOLotto, Inc.; Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

Federal Register Volume 82, Issue 176 (September 13, 2017)

The consent agreement in this matter settles alleged violations of federal law prohibiting unfair or deceptive acts or practices. The attached Analysis to Aid Public Comment describes both the allegations in the complaint and the terms of the consent order-- embodied in the consent agreement--that would settle these allegations.

[Federal Register Volume 82, Number 176 (Wednesday, September 13, 2017)]
[Notices]
[Pages 43020-43021]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-19390]


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FEDERAL TRADE COMMISSION

[File No. 1623184]


CSGOLotto, Inc.; Analysis To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices. The attached Analysis to Aid Public Comment describes both 
the allegations in the complaint and the terms of the consent order--
embodied in the consent agreement--that would settle these allegations.

DATES: Comments must be received on or before October 10, 2017.

ADDRESSES: Interested parties may file a comment online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write: ``In the Matter of CSGO 
Lotto, Inc., File No. 1623184'' on your comment, and file your comment 
online at https://ftcpublic.commentworks.com/ftc/csgolottoconsent by 
following the instructions on the web-based form. If you prefer to file 
your comment on paper, write ``In the Matter of CSGO Lotto, Inc., File 
No. 1623184'' on your comment and on the envelope, and mail your 
comment to the following address: Federal Trade Commission, Office of 
the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex D), 
Washington, DC 20580, or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, Constitution Center, 
400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 
20024.

FOR FURTHER INFORMATION CONTACT: Michael Ostheimer (202-326-2699), 
Bureau of Consumer Protection, 600 Pennsylvania Avenue NW., Washington, 
DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing a consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of thirty (30) days. The 
following Analysis to Aid Public Comment describes the terms of the 
consent agreement, and the allegations in the complaint. An electronic 
copy of the full text of the consent agreement package can be obtained 
from the FTC Home Page (for September 7, 2017), on the World Wide Web, 
at https://www.ftc.gov/news-events/commission-actions.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before October 10, 
2017. Write ``In the Matter of CSGO Lotto, Inc., File No. 1623184'' on 
your comment. Your comment--including your name and your state--will be 
placed on the public record of this proceeding, including, to the 
extent practicable, on the public Commission Web site, at https://www.ftc.gov/policy/public-comments.
    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/csgolottoconsent by following the instructions on the web-based 
form. If this Notice appears at http://www.regulations.gov/#!home, you 
also may file a comment through that Web site.
    If you prefer to file your comment on paper, write ``In the Matter 
of CSGO Lotto, Inc., File No. 1623184'' on your comment and on the 
envelope, and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite 
CC-5610 (Annex D), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024. If possible, submit your paper comment to the 
Commission by courier or overnight service.
    Because your comment will be placed on the publicly accessible FTC 
Web site at https://www.ftc.gov, you are solely responsible for making 
sure that your comment does not include any sensitive or confidential 
information. In particular, your comment should not include any 
sensitive personal information, such as your or anyone else's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure that your comment does not include 
any sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 
16 CFR 4.10(a)(2)--including in particular competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies

[[Page 43021]]

the comment must include the factual and legal basis for the request, 
and must identify the specific portions of the comment to be withheld 
from the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the public FTC Web site--as legally required by FTC Rule 
4.9(b)--we cannot redact or remove your comment from the FTC Web site, 
unless you submit a confidentiality request that meets the requirements 
for such treatment under FTC Rule 4.9(c), and the General Counsel 
grants that request.
    Visit the FTC Web site at http://www.ftc.gov to read this Notice 
and the news release describing it. The FTC Act and other laws that the 
Commission administers permit the collection of public comments to 
consider and use in this proceeding, as appropriate. The Commission 
will consider all timely and responsive public comments that it 
receives on or before October 10, 2017. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Analysis of Agreement Containing Consent Order To Aid Public Comment

    The Federal Trade Commission (``FTC'' or ``Commission'') has 
accepted, subject to final approval, an agreement containing a consent 
order from CSGOLotto, Inc., Trevor Martin (``Martin''), and Thomas 
Cassell (``Cassell'') (collectively ``respondents'').
    The proposed consent order (``order'') has been placed on the 
public record for 30 days for receipt of comments by interested 
persons. Comments received during this period will become part of the 
public record. After 30 days, the Commission will again review the 
agreement and the comments received, and will decide whether it should 
withdraw from the agreement or make the final the agreement's order.
    This matter involves respondents' advertising for their Web site, 
www.csgolotto.com (``CSGO Lotto''), which offered consumers the 
opportunity to gamble using what is in effect a virtual currency. The 
complaint alleges that respondents violated section 5(a) of the FTC Act 
by misrepresenting that videos of Martin, Cassell, and other 
influencers gambling on CSGO Lotto and their social media posts about 
CSGO Lotto reflected the independent opinions or experiences of 
impartial users of the service. According to the complaint, Martin is 
the President, Cassell is the Vice President, and both are owners of 
the company operating CSGO Lotto, and the other influencers were paid 
to promote CSGO Lotto and were prohibited from impairing its 
reputation. The complaint further alleges that respondents deceptively 
failed to disclose that Martin and Cassell were owners and officers of 
the company operating CSGO Lotto and that other influencers received 
compensation, including monetary payment, to promote CSGO Lotto.
    The order includes injunctive relief to address these alleged 
violations and fences in similar and related violations.
    Provision I prohibits respondents, in connection with the sale of 
any product or service, from misrepresenting that any endorser of such 
product or service is an independent user or ordinary consumer of the 
product or service.
    Provision II prohibits respondents from making any representation 
about any consumer or other endorser of a product or service without 
disclosing, clearly and conspicuously, and in close proximity to that 
representation, any unexpected material connection between the consumer 
or endorser and (1) any respondent, (2) any other individual or entity 
affiliated with the product or service, or (3) the product or service 
(``relevant material connections''). The order defines ``clearly and 
conspicuously'' as the term applies to the required disclosures.
    Provision III sets out certain monitoring and compliance 
obligations to ensure that when respondents advertise or promote any 
product or service through endorsers with relevant material 
connections, the endorsers comply with Provisions I and II of the 
order. These obligations include: Obtaining signed acknowledgements 
from such endorsers that they will disclose their relevant material 
connections; monitoring the endorsers' representations and disclosures; 
maintaining records of monitoring efforts; and, under certain 
circumstances, terminating and ceasing payment to endorsers who 
misrepresent their independence or fail to properly disclose a relevant 
material connection.
    Provision IV mandates that respondents acknowledge receipt of the 
order, distribute the order to principals, officers, and certain 
employees and agents, and obtain signed acknowledgments from them.
    Provision V requires that respondents submit compliance reports to 
the FTC one year after the order's issuance and submit notifications 
when certain events occur.
    Provision VI requires that for ten years respondents must create 
and retain certain records.
    Provision VII provides for the FTC's continued compliance 
monitoring of respondent's activity during the order's effective dates.
    Provision VIII provides the effective dates of the order, including 
that, with exceptions, the order will terminate in 20 years.
    The purpose of this analysis is to facilitate public comment on the 
order, and it is not intended to constitute an official interpretation 
of the complaint or order, or to modify the order's terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2017-19390 Filed 9-12-17; 8:45 am]
 BILLING CODE 6750-01-P