The Federal Trade Commission has won a preliminary injunction against Donald Barrett, Direct Marketing Concepts, Inc. (DMC) and ITV Direct, Inc. (ITV), as part of the FTC's case alleging that defendants deceptively marketed their dietary supplement product, Supreme Greens with MSM. A U.S. District Court judge found that the FTC has demonstrated that Barrett, DMC, and ITV likely made numerous false and unsubstantiated claims in an infomercial promoting Supreme Greens and that they likely made unauthorized charges to consumers' credit or debit cards. The preliminary injunction - which prohibits the challenged disease claims and any asset dissipation - will remain in effect pending the outcome of a trial on the FTC's allegations.
In June 2004, the FTC filed charges against Barrett, DMC, and ITV, along with their business partners, alleging that they deceptively marketed Supreme Greens to consumers through a widely aired infomercial, claiming that the product can cure, treat, or prevent cancer, diabetes, arthritis, and heart disease. In addition, the complaint alleges that DMC, ITV, and Barrett failed to disclose that the infomercial promoting Supreme Greens is a paid commercial advertisement and not an independent television program, and that these defendants also charged consumers' credit cards for automatic product shipments without authorization.
The preliminary injunction prohibits Barrett, DMC, and ITV from making the challenged disease-cure claims, prohibits Barrett, DMC, and ITV from disseminating any advertisement that misrepresents that it is not a paid advertisement, and mandates that infomercials prominently display disclaimers to that effect. The Court also found in the preliminary injunction that the Commission is likely to succeed in holding Barrett, DMC, and ITV jointly and severally liable for violations of the FTC Act and stated that the defendants' "business operations are permeated by deceptive practices."
Barrett, DMC, and ITV are prohibited from dissipating any assets and are ordered to pay for a detailed accounting relating to their assets and Supreme Greens sales. Further, the Court stated that if the accounting or additional evidence demonstrates that the defendants have concealed or are likely to conceal assets, it will consider additional FTC requests for the relief necessary to ensure the enforceability of any judgment, such as the appointment of a receiver or an asset freeze.
The preliminary injunction also prohibits the defendants from selling or distributing products, programs, or services by means of a continuity program without first obtaining the express, informed consent of consumers to participate in that program before any shipment is made.
Five additional defendants in this case - Healthy Solutions, LLC and Health Solutions, Inc., and their principals Alejandro Guerrero (a.k.a. Alex Guerrero), Michael Howell, and Greg Geremesz - have signed stipulated preliminary injunctions that prohibit the challenged claims and contain additional injunctive relief.
Copies of the preliminary injunction are available from the FTC's Web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.
(FTC File No. 023-3138)
(Civil Action No. 04-CV-11136-GAO)
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