| U.S. Federal Trade Commission |
FTC News Release, Jul 1, 2003
FTC Charges Direct Marketers of Ephedra Weight Loss Products With Making Deceptive Efficacy and Safety Claims
FTC Also Challenges Advertising Claims for Additional Dietary Supplements
The Federal Trade Commission
today announced three enforcement actions against direct
marketers of weight-loss products containing ephedra. The two
settlements and one complaint, filed in U.S. district court,
target deceptive efficacy, safety, and “no side effects”
claims for weight loss supplements containing ephedra (also
known as Ma Huang). The FTC actions challenge false
advertising claims that the ephedra supplements cause rapid,
substantial, and permanent weight-loss without diet or
exercise, and that “clinical studies” or “medical research”
prove these claims. The FTC also challenges claims that the
ephedra weight-loss products are “100% safe,” “perfectly
safe,” or have “no side effects.”
The FTC previously brought four
enforcement actions challenging deceptive safety and “no side
effects” claims for ephedra supplements marketed for
body-building and energy, and as alternatives to street drugs
like Ecstasy.
“In these
cases, the marketers both overstated the benefits and
understated the risks of using the products,” said Howard
Beales, Director of the FTC’s Bureau of Consumer Protection.
“With these enforcement actions, we’re putting the marketers
of ephedra supplements on notice that the law demands
substantiation for your advertising claims, and the FTC will
do its best to make sure you have it.”
The FTC also is challenging
weight-loss claims for several other non-ephedra dietary
supplements. One case challenges safety and efficacy claims
for a dietary supplement used to treat impotence in men, and
another challenges claims that a glucosamine and chondroitin
dietary supplement “cures” arthritis.
The two settlements announced
today require Health Laboratories of North America, Inc., USA
Pharmacal Sales, Inc., and their principals to stop making
false and deceptive advertising claims, to include warnings
about the health risks of ephedra and certain other products,
and to pay a total of $370,000 in consumer redress. The third
case, against Michael S. Levey and others, will proceed to
litigation.
Michael S. Levey
The FTC charges California residents Michael
S. Levey and Gary Ballen; Bentley Myers International Co.,
based in Vancouver, Canada; and Publisher’s Data Services,
Inc. and Nutritional Life, Inc., both based in Beverly Hills,
California, with violating the FTC Act in marketing dietary
supplements purported to cause rapid and substantial weight
loss without diet or exercise and to “cure” arthritis. Levey
and Ballen control the companies. In addition, the FTC is
charging Levey and the three companies with violating a 1993
FTC order in connection with these marketing activities. The
complaint, filed by the Department of Justice on behalf of the
FTC, alleges that the defendants:
- made false or unsubstantiated
claims that three purported weight loss products - Zymax and
MillinexES (both containing ephedra), and Serotril
(containing St. John’s wort) - cause substantial weight loss
in a short period of time, without the need to diet or
exercise;
- made unsubstantiated “no side
effects” claims for the Zymax and MillinexES ephedra
products;
- falsely represented that clinical
studies prove that Zymax and MillinexES cause substantial
weight loss in a short time without diet or exercise;
and
- made unsubstantiated claims that
CartazyneDS, a dietary supplement containing glucosamine and
chondroitin, “cures” arthritis, “rebuilds” cartilage in
human joints “within days,” and is an effective alternative
to joint replacement surgery.
The complaint alleges that the defendants
advertised these weight loss and arthritis products in
brochures that used fictitious expert endorsements, fake
consumer testimonials, and false “before and after” pictures.
The defendants allegedly used different business names in
marketing their products, such as “Denman Scientific Research”
in ads for Zymax, “Cartazyne Sciences International” in ads
for CartazyneDS, and “Serotril Sciences, International” in ads
for Serotril.
The complaint also alleges that Levey
violated the 1993 order by failing to notify the FTC within 30
days after he became affiliated with Bentley Myers and
Publisher’s Data Services. The FTC’s 1993 cease and desist
order against Michael Levey and his company, Positive Response
Marketing, Inc., was based on allegations that Levey made
false and misleading representations in television
infomercials for the EuroTrym Diet Patch, the Foliplexx
hair-loss product, and the Y-Bron impotence treatment, and
performed deceptive demonstrations in infomercials for the
Magic Wand kitchen mixer. In addition to
requiring a $275,000 redress payment, the order prohibits
Levey from making unsubstantiated advertising claims and from
using deceptive endorsements and demonstrations, and imposes
certain recordkeeping and reporting obligations.
The FTC is seeking monetary civil penalties
from Levey and the three companies for violations of the 1993
order, and also is seeking consumer redress and injunctive
relief from all the defendants.
The Commission vote to refer the Levey
complaint to the Department of Justice for filing was 5-0. The
complaint was filed at the FTC’s request by the Department of
Justice in U.S. District Court for the Central District of
California, on June 30, 2003.
Health Laboratories of North
America
The FTC’s complaint names Health
Laboratories of North America, Inc. (HLNA), based in
Scottsdale, Arizona, and its director, Marc Kaplan. According
to the FTC, the defendants marketed two products under the
brand name “Berry Trim Plus” primarily through direct mail.
Both products contained Hydroxycitric Acid or “HCA,” an
extract from brindall berries, and one also contained
ephedrine alkaloids from Ma Huang. The FTC alleges that HLNA
made numerous false and unsubstantiated weight-loss claims for
Berry Trim Plus through testimonials such as, “Teacher Loses
70 lbs. In Only 8 Weeks Easily,” and other statements. The FTC
alleges that the HLNA defendants falsely represented that
Berry Trim Plus products cause rapid and substantial weight
loss, including as much as 70 pounds in eight weeks, without
dieting or increasing exercise, and that clinical studies
prove that Berry Trim Plus causes rapid and substantial weight
loss. The FTC complaint further alleges that the defendants
did not have a reasonable basis to advertise that Berry Trim
Plus is “100% safe” and “perfectly safe” to use, and that it
prevents fat absorption from whatever the user eats.
The HLNA settlement order prohibits the
defendants from making false and unsubstantiated weight-loss
claims, as well as unsubstantiated safety claims. The order
also prohibits the defendants from misrepresenting the
contents, validity, results, conclusions, or interpretations
of any test or study. The order requires that a prominent
warning about health risks be made in any advertisement,
promotional item, or product label for an ephedra product. The
warning includes information that ephedra use can result in
serious injury, and even death. The order requires HLNA to pay
$195,000 in consumer redress. If, however, the defendants have
made any material misrepresentation or omission on their
financial statements, the court may enter a $35 million
judgment against them.
USA Pharmacal Sales,
Inc.
The FTC’s complaint names USA Pharmacal
Sales, Inc., and its co-owners, John Pence and Arthur Sussman.
The defendants, based in Palm Harbor, Florida, marketed and
sold three weight-loss products and an erectile dysfunction
supplement. The META-BIOLOGICAL weight-loss cocktail contains
ephedrine alkaloids derived from Ma Huang, caffeine, and 19
other ingredients. FAT SPONGE IN A PILL is comprised of
chitosan and glucomannan, and digestive aids for
lactose-intolerant people. CALOTROL/MD contains chitosan,
gymnema sylvestre, HCA, and chromium picolinate. The
erectile dysfunction supplement, VIRILE V, contains yohimbine,
androstenedione (a steroid hormone), and 12 other active
ingredients. According to the FTC, the defendants advertised
their weight loss and erectile dysfunction products through
free-standing inserts in regional newspapers and direct mail.
The defendants also used an expert medical endorser in some
advertisements to tout their products’ efficacy and safety.
The FTC’s complaint alleges that
advertisements for the purported weight-loss products made
false claims that the products cause rapid, substantial, and
permanent weight loss without the need to reduce caloric
intake. The complaint also alleges that the ads made false
claims that “clinical tests” or “medical research” proves that
the products cause rapid, significant, or permanent weight
loss. The complaint further alleges that the defendants made
unsubstantiated claims that the META-BIOLOGICAL ephedra
weight-loss product is safe. In addition, the FTC alleges that
the defendants made deceptive efficacy and safety claims for
the erectile dysfunction supplement. According to the FTC,
there is no reliable evidence to suggest that ephedra, an
ingredient in META-BIOLOGICAL, or androstenedione and yohimbe,
ingredients in VIRILE V, are safe. In fact, the complaint
alleges that they have been associated with health risks.
The USA Pharmacal settlement order prohibits
the defendants from making false or unsubstantiated claims
that the weight-loss products or any substantially similar
product causes rapid, substantial, or permanent weight loss or
fat loss. The order also bars them from representing that
clinical or medical studies support such claims. The order
requires that the defendants place a prominent warning about
health risks in any advertisement, promotional item, or
product label for an ephedra product. The warning includes
information that ephedra use can result in serious injury, and
even death. USA Pharmacal likewise must place health risk
warnings on materials that make claims for any products that
contain yohimbe or androgen.
USA Pharmacal has agreed to pay $175,000 in
consumer redress. If, however, the defendants have made any
material misrepresentation or omission on their financial
statements, the court may enter a judgment for $9.2 million
against them.
Both the HLNA and USA Pharmacal settlements
require the defendants to take reasonable steps to monitor and
ensure that all employees and agents comply with the order,
and to terminate any employee who knowingly violates the
order. Also, both settlements contain various recordkeeping
requirements to assist the FTC in monitoring the defendants’
compliance.
The Commission vote to authorize the staff
to file the complaint and stipulated final judgment in the
HLNA case was 5-0. The documents are being filed in the U.S.
District Court for the District of Columbia.
The Commission vote to authorize the staff
to file the complaint and stipulated final judgment in the USA
Pharmacal case was 5-0. The documents are being filed in the
U.S. District court for the Middle District of Florida, Tampa
Division.
Consumer Tips:
The FTC has the
following tips for consumers who are interested in weight-loss
products or programs:
- Products and programs that promise quick and easy weight
loss are bogus. To lose weight, you have to lower your
intake of calories and increase your physical activity.
- There are no miracle weight-loss products. Be skeptical
of products and programs that claim they can keep weight off
permanently. Be skeptical about exaggerated claims.
NOTE: The Commission
authorizes the filing of a complaint when it has “reason to
believe” that the law has been or is being violated, and it
appears to the Commission that a proceeding is in the public
interest. The complaint is not a finding or ruling that the
defendant actually has violated the law. The case will be
decided by the court.
NOTE: The stipulated
final judgments and orders are for settlement purposes only
and do not constitute an admission by the defendants of a
law violation. A stipulated final judgment and order have
the force of law when signed by the judge.
The text in this article was prepared by the U.S. Federal Trade Commission.