FOR RELEASE: JANUARY 16, 1992
FEDERAL COURT BANS FALSE AND MISLEADING CLAIMS
FOR DIET PROGRAM AND PURPORTED GAS-SAVING DEVICE
FOLLOWING FEDERAL TRADE COMMISSION CHARGES
A federal court in Arizona has permanently banned false and
misleading claims made by Amerdream Corporation for its "Ultimate
Solution Diet Program," and by Advanced Automotive Technologies,
Inc. for the "PetroMizer," a purported gasoline-saving device,
following Federal Trade Commission charges. The court also
ordered the companies -- and an Arizona man who is president of
both these firms -- to pay nearly $675,000 for consumer redress.
The default judgments stem from an April 1991 FTC complaint
against the makers and marketers of Ultimate Solution and the
PetroMizer, and alleging that they made numerous false and
deceptive claims in their advertising and marketing practices.
Among the claims were that consumers of the Ultimate Solution
program would receive a 100 percent money-back guarantee and a
$1,000 U.S. Treasury Bond just for buying and testing a two-month
supply, which the court now has found to be false. The court
also found that Amerdream and its president Frank J. Sarcone, who
is also president of Advanced Automotive, falsely claimed that a
Harvard University study showed an ingredient in the Ultimate
Solution's "Night Trim" diet tablets to be effective in achieving
significant weight loss and reducing cholesterol levels and blood
pressure.
In addition, the court found that Advanced Automotive and
Sarcone falsely represented that the PetroMizer increases gas
mileage by more than 28 percent, increases automobile horsepower
and acceleration by 11 percent, and reduces automobile emissions,
including a 100 percent reduction in carbon monoxide emissions,
and that various federal and state organizations helped develop
or had tested the product and proven its effectiveness.
- more -
Amerdream/AAT Injunctions--01/16/92)
Upon the filing of the FTC complaint containing these alle-
gations last April, the court immediately granted a temporary re-
straining order pending review of the case, and froze the assets
of the corporate defendants and the president of both firms,
Frank J. Sarcone of Arizona.
After finding that the defendants did, indeed, violate the
law as alleged by the FTC, the court now has entered permanent
injunctions banning the false and misleading claims, determined
that the consumer injury resulting from the claims amounted to a
total of at least $673,496, and ordered the defendants to pay
that amount into a fund the FTC may use to compensate consumers
who purchased the products.
The permanent injunction naming Sarcone and Advanced Auto-
motive, signed by the judge Dec. 16, permanently prohibits them
from making any false or misleading statement in the promotion or
marketing of any after-market automotive product (for Sarcone,
the prohibition extends to any product, program or service).
Further, the defendants must possess a reasonable basis for
making any statement about the performance or efficacy of these
types of products. In addition, they are ordered to pay $622,634
for consumer redress.
The other permanent injunction, naming Sarcone, Amerdream,
and Amerdream Securities Corporation, prohibits them -- in
connection with the marketing of any diet product, program or
service -- from making any misrepresentations as to:
-- gifts that purchasers of such products, programs or
services receive;
-- the terms and conditions under which refunds will be
given to dissatisfied customers; and
-- the identity of those who have tested the product,
program or service, or the results of such a test or tests
concerning the performance, safety or efficacy of these
products, programs or services.
Sarcone, Amerdream, and Amerdream Securities must have
substantiation for any representations regarding the performance,
safety or efficacy of diet products, programs or services. The
court also ordered them to pay $50,862 for consumer redress.
This permanent injunction and order was signed by the judge last
Oct. 30.
Amerdream/AAT Injunctions--01/16/92)
Not yet decided by the court are related FTC charges against
the remaining defendant in this case, Robert H. Morrison, Jr., a
director of Advanced Automotive Technologies, Inc.
The injunctions announced by the FTC today were issued by
the U.S. District Court for the District of Arizona, in Phoenix.
Amerdream has offices in North Miami Beach, Florida, and in Kula,
Hawaii. Advanced Automotive is located in Phoenix, Arizona.
Copies of the permanent injunctions and orders are available
from the FTC's Public Reference Branch, Room 130, 6th Street and
Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222;
TTY 1-866-653-4261.
# # #
MEDIA CONTACT: Bonnie Jansen, Office of Public Affairs
202-326-2161
STAFF CONTACT: Eileen Harrington, Division of Marketing
Practices, 202-326-3127
or
Claude C. Wild III, Denver Regional Office
1405 Curtis Street, Suite 2900
Denver, Colorado 80202-2393
303-844-2271
(Civil Action No. CIV-91-0505 PHX RCB)
(amer-aat)