- November 24, 2010
- Posted by: Seth Heyman
- Categories: Featured, Marketing & Advertising Law
For centuries, slick marketers have been hawking the magical curative powers of everything from cocaine to radium water. Today’s restrictions make such claims difficult, but not impossible to maintain. Just back them up.
The FTC recently brought a lawsuit against Direct Marketing Concepts and Triad ML Marketing Co. in the Central District Court of Massachusetts, claiming that the Defendants received more than $60 million in profits from the sale of their products through the use of deceptive infomercials selling the products Supreme Greens and Coral Calcium. See Federal Trade Commission v. Direct Marketing Concepts, Inc.
The court granted judgment in favor of the FTC, finding that the defendants made millions of dollars by selling “panaceas, products that they claimed cured literally every disease, from cancer to Parkinson’s to obesity.” For example, Coral Calcium claimed that it “helped thousands of people with cancer, diabetes, arthritis, lupus, fibromyalgia, chronic fatigue,” and more. The FTC alleged that these claims were wholly unsubstantiated, and the advertiser’s had no reasonable basis to make them. The District Court’s decision was upheld on appeal.
Advertisers would do well to keep in mind what the government must present to support a contention that advertising is misleading because it lacks a reasonable basis to support a claim. First, it must establish what evidence would be required to substantiate an advertiser’s claim in the relevant scientific community, and then it must compare the advertiser’s evidence to that required to determine if the advertiser’s claims were substantiated and the advertiser had a reasonable basis for the claims made.
In this case multiple scientists testified on behalf of the FTC on the types of studies necessary to substantiate the health claims presented by the defendants, including “double-blind, placebo-controlled human studies.” The defendants presented no evidence of having completed any such studies. The FTC experts further testified that there was no scientific evidence to support the majority of the health claims presented by the Defendants for their Supreme Greens and Coral Calcium products. Although the Defendants did present their own expert witnesses, they failed to adequately rebut this finding as well. One of the experts relied purely on his own general knowledge, and not on any studies or scientific evidence.
Lesson: The FTC has been targeting health product marketers like hunters in duck season, and any health product seller must be extremely cautious about the claims made in infomercials and in any other advertisements. It should also be noted that flashing a general disclaimer is not enough to shield marketers from liability for any specific health claims. In other words, if you state that your product helps treat the symptoms of diabetes, it is insufficient to state that it “has not been scientifically proven to diagnose, treat, prevent, or cure any disease.” Your disclaimer has to state that the product “has not been scientifically proven to diagnose, treat, prevent, or cure diabetes.” That makes it a pretty tough sell.
On its surface, overcoming this challenge is simple: just conduct a double-blind, placebo controlled human study under the auspices of a qualified professional, and if the stuff works, feel free to tout the results and avoid the disclaimer. If you haven’t got the patience or the money to go that route (or the results are “inconclusive”), then be certain to consult with an attorney on the nature of the claims you can make before you start advertising.
DISCLAIMER: This article is not intended to diagnose, treat, prevent, or cure Cancer, Diabetes, Arthritis, Lupus, Fibromyalgia, Chronic Fatigue, or any other disease or condition.