[Federal Register: June 24, 2003 (Volume 68, Number 121)]
[Notices]
[Page 37496-37498]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24jn03-71]
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FEDERAL TRADE COMMISSION
[File No. 022 3260]
Guess?, Inc. and Guess.com, 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 or unfair methods of competition. The attached Analysis to
Aid Public Comment describes both the allegations in the draft
complaint that accompanies the consent agreement 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 July 18, 2003.
ADDRESSES: Comments filed in paper form should be directed to: FTC/
Office of the Secretary, Room 159-H, 600 Pennsylvania Avenue, NW.,
Washington, DC 20580. Comments filed in electronic form should be
directed to: consentagreement@ftc.gov, as prescribed in the
SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: Joel Winston, FTC, Bureau of Consumer
Protection, 600 Pennsylvania Avenue, NW., Washington, DC 20580, (202)
326-3153.
SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Section 2.34
of the Commission's Rules of Practice, 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)
[[Page 37497]]
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 June 18, 2003), on the World
Wide Web, at http://www.ftc.gov/os/2003/06/index.htm. A paper copy can
be obtained from the FTC Public Reference Room, Room 130-H, 600
Pennsylvania Avenue, NW., Washington, DC 20580, either in person or by
calling (202) 326-2222.
Public comments are invited, and may be filed with the Commission
in either paper or electronic form. Comments filed in paper form should
be directed to: FTC/Office of the Secretary, Room 159-H, 600
Pennsylvania Avenue, NW., Washington, DC 20580. If a comment contains
nonpublic information, it must be filed in paper form, and the first
page of the document must be clearly labeled ``confidential.'' Comments
that do not contain any nonpublic information may instead be filed in
electronic form (in ASCII format, WordPerfect, or Microsoft Word) as
part of or as an attachment to e-mail messages directed to the
following e-mail box: consentagreement@ftc.gov. Such comments will be
considered by the Commission and will be available for inspection and
copying at its principal office in accordance with section
4.9(b)(6)(ii) of the Commission's Rules of Practice, 16 CFR
4.9(b)(6)(ii)).
Analysis of Proposed Consent Order to Aid Public Comment
The Federal Trade Commission has accepted, subject to final
approval, a consent agreement from Guess?, Inc. and Guess.com, inc.
(``Guess'').
The consent agreement has been placed on the public record for
thirty (30) days for receipt of comments by interested persons.
Comments received during this period will become part of the public
record. After thirty (30) days, the Commission will again review the
agreement and the comments received, and will decide whether it should
withdraw from the agreement and take appropriate action or make final
the agreement's proposed order.
Guess is an international company that designs and produces men's,
women's, and children's clothing and accessory products. The company's
products are marketed, distributed, and sold under various Guess brand
names through its own stores, a limited number of independent
retailers, and, its online store at www.guess.com. This matter concerns
alleged false or misleading representations Guess made to consumers
about the security of personal information collected online through
www.guess.com, Guess' online store.
The Commission's proposed complaint alleges that Guess
misrepresented that the personal information it obtained from consumers
through www.guess.com was stored in an unreadable, encrypted format at
all times. The complaint alleges that this representation was false
because a commonly known attack could and was used to gain access in
clear readable text to sensitive personal information, including credit
card numbers, that Guess obtained from consumers.
The proposed complaint also alleges that Guess represented that it
implemented reasonable and appropriate measures to protect the personal
information it obtained from consumers through www.guess.com against
loss, misuse, or alteration. The complaint alleges this representation
was false because Guess did not employ appropriate measures to detect
reasonably foreseeable vulnerabilities and prevent their exploitation.
The proposed order applies to Guess' collection and storage of
personal information from or about consumers in connection with its
online business. It contains provisions designed to prevent Guess from
engaging in practices similar to those alleged in the complaint in the
future.
Specifically, Part I of the proposed order prohibits Guess, in
connection with the online advertising, marketing, promotion, offering
for sale, or sale of any product or service, from misrepresenting the
extent to which it maintains and protects the security,
confidentiality, or integrity of any personal information collected
from or about consumers.
Part II of the proposed order requires Guess to establish and
maintain a comprehensive information security program in writing that
is reasonably designed to protect the security, confidentiality, and
integrity of personal information collected from or about consumers.
The security program must contain administrative, technical, and
physical safeguards appropriate to Guess's size and complexity, the
nature and scope of its activities, and the sensitivity of the personal
information collected from or about consumers. Specifically, the order
requires Guess to:
[sbull] Designate an employee or employees to coordinate and be
accountable for the information security program;
[sbull] Identify material internal and external risks to the
security, confidentiality, and integrity of customer information that
could result in the unauthorized disclosure, misuse, loss, alteration,
destruction, or other compromise of such information, and assess the
sufficiency of any safeguards in place to control these risks. At a
minimum, this risk assessment must include consideration of risks in
each area of relevant operation.
[sbull] Design and implement reasonable safeguards to control the
risks identified through risk assessment, and regularly test or monitor
the effectiveness of the safeguards' key controls, systems, and
procedures.
[sbull] Evaluate and adjust its information security program in
light of the results of testing and monitoring, any material changes to
its operations or business arrangements, or any other circumstances
that Guess knows or has reason to know may have a material impact on
its information security program.
Part III of the proposed order requires that Guess obtain within
one year, and on a biannual basis thereafter, an assessment and report
from a qualified, objective, independent third-party professional,
certifying that: (1) Guess has in place a security program that
provides protections that meet or exceed the protections required by
Part II of this order; and (2) Guess's security program is operating
with sufficient effectiveness to provide reasonable assurance that the
security, confidentiality, and integrity of consumer's personal
information has been protected.
Parts IV through VII of the proposed order are reporting and
compliance provisions. Part IV requires Guess's to retain documents
relating to compliance. For most records, the order requires that the
documents be retained for a five-year period. For the assessments and
supporting documents, Guess must retain the documents for three years
after the date that each assessment is prepared. Part V requires
dissemination of the order now and in the future to persons with
responsibilities relating to the subject matter of the order. Part VI
ensures notification to the FTC of changes in corporate status. Part
VII mandates that Guess submit compliance reports to the FTC. Part VIII
is a provision ``sunsetting'' the order after twenty (20) years, with
certain exceptions.
The purpose of this analysis is to facilitate public comment on the
proposed order. It is not intended to constitute an official
interpretation of the proposed order or to modify their terms in any
way.
[[Page 37498]]
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 03-15909 Filed 6-23-03; 8:45 am]
BILLING CODE 6750-01-P