Supplement Purveyors Sued for Deceptive Weight Loss Claims on Fake News Sites

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1186277_41392762In its continuing effort to remove deceptive weight loss advertising from the Internet, on May 14, 2014, the Federal Trade Commission (FTC) brought suit in Federal District Court in Florida against various companies and their respective principals for violating Section 5 of the FTC Act, which prohibits unfair or deceptive acts or practices in or affecting commerce.  Specifically, the Florida-based operation is accused of advertising and selling green coffee bean extract touting its effectiveness in causing weight loss through use of fake online news sites and testimonials.

Weight Loss Claims Lack Support

With claims such as, “Lose 20 pounds in just 4 weeks,” and “Users lost an average of 17 pounds in just 12 weeks,” defendants began selling their Pure Green Coffee extract in May of 2012, following a Dr. Oz Show episode that discussed the purported benefits of the extract.  Charging approximately $50 for a one-month supply of the product, the defendants marketed Pure Green Coffee through use of unauthorized video footage from The Dr. Oz Show, as well as online banner and text advertisements that appear in paid search results.  According to the FTC, these advertisements included substantial weight and fat loss claims that lack clinical support, violating Sections 5 and 12 (which prohibits false food and drug advertisement in or affecting commerce) of the FTC Act.   The one clinical study relied upon by defendants to support their advertising claims had flaws that, according to the FTC, “undermine the reliability of all of the study data.”  Ultimately, the complaint alleges, this study did not prove that use of the product could result in substantial weight or fat loss, without diet or exercise.

Product’s Weight Loss Benefits Advertised through Fake News Sites

To induce consumers to purchase their Pure Green Coffee, defendants used websites designed to look like legitimate consumer news sites that were in fact paid advertisements.  The fake news sites featured mastheads of fictitious news organizations, such as Women’s Health Journal and Healthy Living Reviewed, as well as logos of actual news organizations, such as CNN and MSNBC.  These fake news sites, and constituent false consumer comments (and undisclosed paid testimonials), failed to disclose in a clear and conspicuous manner that they were not objectively evaluating green coffee extract and were defendants’ own marketing sites, in violation of the FTC’s Product Endorsement and Testimonial Guidelines.   As stated by Jessica Rich, Director of the FTC’s Bureau of Consumer Protection: “[n]ot only did these defendants trick consumers with their phony weight loss claims, they also compounded the deception by advertising on pretend news sites, making it impossible for people to know whether they were seeing news or an ad.”

FTC Asks Court to Award Relief

The FTC has petitioned the court to enter a permanent injunction to prevent future violation of the FTC Act by the defendants and monetary relief to redress injury to affected consumers, including restitution, the refund of monies paid and the disgorgement of ill-gotten gains.

Takeaway

As evidenced by our regular blog posts involving quite similar fact patterns, in this regulatory environment online marketers of weight loss supplements must be careful to comply with applicable state and federal marketing regulations.  Prior to launching an online weight loss product campaign, the best advice is to: 1) secure two double-blind independent clinical studies that substantiate any and all weight and fat loss claims; and 2) make sure that the entire campaign is vetted by seasoned advertising counsel.

If you are looking for Internet marketing advice or are interested in learning more about this topic, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney.  Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.

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David O. Klein

David O. Klein

David Klein is one of the most recognized attorneys in the telemarketing, technology, Internet marketing, sweepstakes and telecommunications fields. Skilled at counseling clients on a broad range of technology-related matters, David Klein has substantial experience in negotiating and drafting complex licensing, marketing and Internet agreements.

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