Stay ADvised: From 'Junk Fees' to 'Surveillance Pricing': Regulators Take Aim at How You Price
In This Issue:
- FTC Targets "Junk Fees" in Food Delivery with New Rulemaking
- Maryland Targets "Surveillance Pricing" With New Limits on Data-Driven Food Retail Pricing
- FTC's "Made in USA" Sweep: From Signals to Enforcement
- Falling Short: TruHeight FTC Settlement Highlights Substantiation and Reviews Risk
- Washington Amends CEMA: Incremental Relief, Core Framework Remains
FTC Targets "Junk Fees" in Food Delivery with New Rulemaking
On April 14, 2026, the Federal Trade Commission announced an Advance Notice of Proposed Rulemaking (ANPRM) seeking public comment on whether to regulate "unfair or deceptive" fee practices in online food and grocery delivery services. The proceeding squarely targets "drip pricing" where additional mandatory or optional fees are gradually revealed during the purchase process, often increasing the final cost significantly. These fee practices have faced scrutiny in the form of state "junk fee" laws as well.
What the FTC Is Focused On
The ANPRM reflects growing concern that delivery platforms may obscure the true cost of purchases through layered or poorly explained fees because consumers are disadvantaged in understanding the true cost of the transaction and whether a better option exists.
The FTC is specifically evaluating:
- Hidden or delayed fees (e.g., service, delivery, small order, or regulatory response fees)
- Inadequate upfront pricing disclosures
- Personalized or variable pricing practices
- Whether fee practices distort competition among platforms and restaurants
Who Is Impacted?
Although the ANPRM is formally directed at online food and grocery delivery services, its practical reach is broader. The FTC is not just examining delivery platforms. Rather, it is scrutinizing the entire pricing ecosystem surrounding those transactions, including restaurants, grocers, and other sellers that influence item pricing, fees, promotions, or disclosures. Because the rulemaking focuses on "unfair or deceptive fee practices"—including when and how total price is presented, how fees are labeled, and whether pricing varies across consumers—it is effectively a behavior-based inquiry rather than a platform-limited one. As a result, any company participating in or shaping the consumer-facing price in a covered transaction could be impacted.
Key Takeaways
- "All-in pricing" is becoming the default expectation. Regulators increasingly expect mandatory fees to be included—or clearly disclosed—upfront, not revealed at checkout.
- Fee labeling matters as much as fee disclosure. Vague or potentially misleading labels (e.g., "service fee") may draw scrutiny if they do not accurately convey the nature of the charge.
- The deadline for submitting comments is May 18, 2026. Interested stakeholders need to move quickly to get their voices heard.
Maryland Targets "Surveillance Pricing" With New Limits on Data-Driven Food Retail Pricing
The Maryland General Assembly passed HB 895 in April 2026, marking a notable shift from traditional privacy regulation into the realm of pricing conduct. The law directly targets how retailers and platforms use data to set prices, rather than how they collect it. It prohibits food retailers and third-party delivery platforms from engaging in "dynamic pricing" defined as "the discriminatory practice of offering or setting a personalized price for a good or service that is specific to a consumer based on the consumer's personal data, regardless of whether the seller collected or purchased the personal data." "Personal data" is defined as "any information that is linked or can be reasonably linked to an identified or identifiable consumer," with some exclusions. Through these provisions, Maryland takes direct aim at emerging AI- and algorithm-driven pricing models that could result in different consumers seeing different prices for the same product.
The statute also prohibits the use of protected class characteristics in pricing decisions and by placing these practices squarely within the state's unfair and deceptive trade practices framework. As a result, companies face meaningful enforcement risk from the state as well as potential exposure in private litigation. The law applies broadly across the food retail ecosystem, covering both brick-and-mortar grocery operations and online delivery platforms, and it will take effect October 1, 2026.
Key Takeaways
In practical terms, HB 895 signals that legislators have begun moving beyond disclosure-based privacy regimes and toward substantive limits on data-driven commerce. By effectively banning individualized or algorithmic pricing in a major retail category, Maryland positions itself at the forefront of efforts to police "surveillance pricing." (See our coverage of the NY AG's enforcement of its surveillance pricing law here.) Companies that rely on dynamic pricing tools, electronic shelf labels, or AI-driven pricing engines—particularly in retail food and third-party delivery contexts—will need to reassess whether those systems can operate within a framework that prioritizes uniform pricing over personalization.
FTC's "Made in USA" Sweep: From Signals to Enforcement
In April 2026, the Federal Trade Commission announced a coordinated initiative targeting allegedly deceptive U.S.-origin claims, combining three enforcement actions with a broader round of warning letters. The announcement follows closely on the March Executive Order emphasizing domestic sourcing and truthful origin marketing—reinforcing that this is part of a sustained enforcement posture.
The Throughline: Assembly Isn't Enough
The three enforcement actions and stipulated settlements tell a consistent story: U.S. assembly or finishing will not support an unqualified claim where key components are imported, and the FTC will evaluate the full consumer takeaway—including branding and messaging.
- FTC v. TouchTunes Music Company
The FTC alleged that electronic gaming equipment marketed as "Made in USA" relied on critical imported components (e.g., chips, monitors, cameras), resulting in a stipulated $625,000 settlement "towards consumer redress"—underscoring that core functionality, not final assembly, drives the analysis. - FTC v. Americana Liberty
The FTC challenged allegedly false and sweeping "100% Made in the USA" and patriotic branding claims where products were imported or heavily foreign-sourced, while also alleging Textile Act violations concerning the true nature and origin of these products, resulting in a stipulated settlement.
- FTC v. Oak Street Manufacturing Company
The FTC alleged that footwear marketed as "handcrafted 100% in the USA" used key imported components (e.g., uppers and outsoles), reinforcing that substantial U.S. work does not overcome foreign sourcing of core inputs, and resulting in another stipulated settlement.
In announcing the three settlements, the FTC also noted that it issued closing letters to two other companies that had been under investigation for making unqualified "Made in USA" claims allegedly without proper substantiation or support. The FTC stated that both companies undertook remedial actions and commitments to future compliance as conditions precedent to the closing letters.
Key Takeaways
As we noted earlier this year, "Made in USA" claims remain an area of enforcement interest for the FTC. Companies seeking to market products based on their domestic presence and production should pay attention to the enforcement environment and carefully vet supply chains to manage risk.
Falling Short: TruHeight FTC Settlement Highlights Substantiation and Reviews Risk
In April 2026, the Federal Trade Commission announced a proposed settlement with TruHeight (Vanilla Chip LLC) and its principals over claims that their products could increase height in children and teenagers. The FTC alleged that TruHeight marketed a range of products—including powders, gummies, and capsules—with claims that children and teens could grow taller than they otherwise would, often framed as "clinically proven" outcomes. The FTC's complaint focuses heavily on the company's reliance on a small, company-sponsored study involving roughly 30 participants, which the agency alleges did not demonstrate meaningful differences between treatment and control groups.
The FTC further alleged that TruHeight offered free products and other incentives in exchange for positive consumer reviews and that the TruHeight website contained several thousand five-star reviews that were purportedly written by customers, but which were actually written by company employees. In addition to alleging that this conduct violated Sections 5 and 12 of the FTC Act, the FTC alleged that the respondents' conduct violated the Trade Regulation Rule on the Use of Consumer Reviews and Testimonials. The proposed order includes a $4 million judgment (largely suspended) and imposes injunctive provisions addressing both future health claims and endorsement practices.
Key Takeaways
Based on the alleged facts, TruHeight appears to have been an attractive enforcement target for several reasons: bold "clinically proven" health claims promising benefits to kids (a vulnerable audience), promoted across social media and amplified through insufficiently disclosed and employee-written testimonials. Compared to prior administrations, the current FTC has not prioritized health claims or testimonial enforcement and this case may not necessarily signal a change to that. What it may suggest, though, is that where a number of factors align to use the FTC's authority efficiently to address what it views as multiple aggressive practices, it is willing to do so. Companies marketing in the consumer health space in particular should consider the "net impression" of their marketing practices to determine whether they may be a future target.
Washington Amends CEMA: Incremental Relief, Core Framework Remains
Washington has enacted amendments to its Commercial Electronic Mail Act (CEMA) through HB 2274, following increased litigation over allegedly misleading email subject lines. The amendments take effect June 11, 2026, and are intended to narrow, but not eliminate, exposure under the statute. Here is a summary of what has changed and what's staying the same:
Key Changes
- Reduced statutory damages: The law lowers damages from $500 to $100 per email.
- Knowledge element: Plaintiffs must show the sender knew or should have known the subject line was misleading.
What Remains the Same
- Subject lines still drive liability: The statute continues to focus on representations made in email subject lines, including promotional and urgency claims.
- Private right of action: The amendments did not remove the ability to bring individual or class claims.
- Prospective application: The changes do not apply retroactively to pending cases.
Key Takeaways
The amendments modestly recalibrate risk by narrowing the types of actionable claims and reducing damages. At the same time, CEMA continues to treat subject lines as advertising claims subject to scrutiny. See our prior coverage of CEMA-related developments here, here, and here.