The manufacturer of a magnetic “fuel saving” and emissions-reduction device that did not save fuel or reduce emissions will pay $4.2 million to settle Federal Trade Commission charges that his advertising claims were false. The FTC will seek to provide redress to consumers who bought the device based on the false advertising claims. In addition, the defendants will be banned from selling or manufacturing magnetic fuel savings and emissions reduction devices.
“Consumers are looking for ways to increase fuel efficiency and save money at the pump,” said Lydia Parnes, Director of the FTC’s Bureau of Consumer Protection. “There are some practical ways to do that, like following the maintenance schedule in your owner's manual, combining errands, and avoiding jack-rabbit starts. The fact is that many products that claim to save fuel don't work, and worse yet, may damage your car and end up costing you more.”
In October 2004, the FTC filed a suit in U.S. district court alleging that marketers, and the resellers working with them, were making deceptive claims for FuelMAX and Super FuelMax products. The Web site operators and their affiliates – spammers who drove traffic to their sites – made claims such as:
The FTC alleged that the magnetic “fuel saver” does not save fuel, does not increase gas mileage, and does not reduce emissions. The agency charged that the false claims violate the FTC Act. The agency also alleged that by providing promotional materials with false claims to affiliates, the defendants provided them with the means to violate the FTC Act.
In May 2005, the Web site marketers and spammers who promoted the products settled the FTC suits. The settlements barred violations of the FTC Act and the CAN-SPAM Act and barred them from making deceptive claims. The action announced today settles charges against the manufacturer, International Research & Development Corp. of Nevada, and its principal, Anthony Renda.
The settlement imposes a lifetime ban on the manufacture, advertising, or sale of FuelMAX, Super FuelMAX, or any similar fuel saving or emissions-decreasing product. It bars false or unsubstantiated claims and misrepresentations that products increase gas mileage or reduce emissions. The settlement bars the defendants from misrepresenting the contents, validity, results, conclusions, or interpretations of studies and bars them from performance or efficacy claims unless they possess and rely upon competent and reliable evidence. It also bars them from assisting others or providing others with the means and instrumentalities to commit deception. Finally, the defendants will pay $4.2 million for consumer redress.
The FTC has established a hotline containing a recorded message for consumers who think they are entitled to a refund. Consumers should call 1-877-382-2020 for more information about obtaining a refund.
These cases were brought with the assistance of the Environmental Protection Agency.
The FTC has tips on increasing fuel efficiency and saving money at the pump at http://www.ftc.gov/savegas
The Commission vote to approve the settlement was 5-0.
NOTE: Stipulated final judgments and orders are for settlement purposes only and do not constitute an admission by the defendant of a law violation. Consent judgments have the force of law when signed by the judge.
Copies of the complaint and stipulated final order 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 form at http://www.ftc.gov/ftc/complaint.htm. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to thousands of civil and criminal law enforcement agencies in the U.S. and abroad.
(FTC File No. X05 0002)