Do you sell health products? Court opinion offers truth-in-advertising recap
Advertisers that sell health products should know the legal standards by now, but to those resistant to the message, a federal judge in California spelled them out again in a $2.2 million judgment against the marketers of two diabetes products – Diabetic Pack and Insulin Resistance Pack.
Wellness Support Network and co-owners Robert Held and Robyn Held marketed their products through their own website, on Amazon.com, and on eBay. According to the FTC's complaint, ads for the products made impressive claims:
New Diabetes Breakthrough
Clinically Proven Natural Solution
Have Normal Blood Sugar Levels
Control Blood Sugar Level
Clinically Proven Natural Solution
To Diabetes With A 90% Success Rate
The company made equally dramatic claims through consumer testimonials: “Since I’ve been using the Diabetic Pack, I have lost 9 pounds, I have all kinds of energy and my sugar is down in the low 100s. And I don’t have to take insulin anymore!” and “I threw all the medicines out the window and went a month with no medicine and just the Diabetic Pack supplements. I leveled off in the 120 range.”
But don’t just take our word for it, the company claimed: “A recent independent clinical trial was done on these herbal ingredients from this amazing product. This study was done on type 2 diabetics (mildly insulin dependent) and reported an average drop of blood glucose levels of 31.9% and average weight loss of 4.8 pounds in just 30 days.”
How else did the defendants convey their representations? The trial judge looked to their selection of keywords, metatag data, and Google Adword Campaigns. Keywords included “diabetes control,” “cure for diabetes,” “natural diabetes cure,” and “diabetes treatment.”
So what proof did the defendants have that their products delivered on those promises?
As the Court concluded, “It is undisputed that no scientific studies were ever conducted to establish the effectiveness of WSN’s Products. Rather, Defendants’ claims about the Products are based on research studies addressing the benefits of the individual ingredients” in the packs. However, the opinion went on to discuss the testimony of the FTC’s diabetes expert, who explained in detail “why the studies of these ingredients that have been conducted do not provide competent and reliable scientific evidence to support the therapeutic claims” the defendants made. You’ll want to read the Order re Summary Judgment Motions for the details, but here’s a recap of some of the key findings.
- FDA. The Court rejected the Defendants’ argument regarding the relevance of the FDA’s standard for medical foods, ruling “the degree of regulation which Defendants’ advertising claims would be subject by the FDA is not relevant to the issues in this case.”
- First Amendment. The Court was unpersuaded by the company’s First Amendment claim, finding no legal authority “for the proposition that a manufacturer or seller of dietary supplements – or for that matter, any product – has a First Amendment right to make claims that are false or deceptive.”
- Substantiation. The Court credited the testimony of the FTC’s medical expert and ruled that he had “offered detailed reasons for concluding that all nine of Defendants’ claims lack adequate substantiation and, as to the establishment claims, are actually false.”
- Individual liability. The judge found “extensive and undisputed evidence that Robert Held was at least recklessly indifferent to the truth or falsity of the representations” made in the ads. What about Robyn Held? Despite her argument that “she justifiably relied on Robert regarding the claims made, no reasonable fact finder could conclude that she was anything but reckless.” Although she wasn’t involved in formulating the products, she played “a significant role in running the company, and was extensively involved in the creation of the advertising that is the subject of this action, including drafting and editing website content, and helping with the selection of testimonials and key-words.”
The Court’s final order includes a $2.2 million judgment and put provisions in place to protect consumers in the future.
Interested in keeping your company’s ad claims within the law? Refer to free resources on the Business Center’s Health Claims page.