FOR RELEASE: OCTOBER 22, 1993
NUTRITION RESEARCH AND HI-HEALTH SUPERMART
TO SETTLE FTC CHARGES OF MARKETING BOGUS DIET PILLS
Two Arizona firms and their president have agreed to pay
$225,000 in redress as part of a settlement of Federal Trade Com-
mission charges that they deceptively marketed HGH-3X, a purported
diet pill, throughout the United States. The FTC alleged that
Nutrition Research & Marketing, Inc. and Hi-Health Supermart Cor-
poration falsely promoted the pill as, among other things, a way to
"stimulate the production of human growth hormone and help your fat
burner get rid of those unwanted pounds." In fact, the FTC
charged, consuming HGH-3X does not boost the user's metabolism, and
cannot cause weight loss without dieting or exercise.
The proposed settlement also would prohibit the defendants
from making claims about any weight-control product they market in
the future without scientific evidence to back them up, and from
making the specifically-alleged false claims cited by the FTC.
The FTC complaint detailing the charges in the case also names
Simon D. Chalpin, president of the firms and a resident of Phoenix.
Nutrition Research does business as Nutrition Science Research &
Marketing Institute, which does business as National Research &
Marketing, Inc., according to the complaint. Both firms are based
in Scottsdale, and have marketed HGH-3X in the print and broadcast
media, and in 30-minute television ads -- or infomercials -- the
complaint states.
Advertisements cited by the FTC state that Hi-Health has 20
health food stores in Arizona. The ads list a price of $39.95 for
200 tablets, and state that HGH-3X is the "one weight loss product
our customers re-order more than any other...."
The FTC listed numerous representations allegedly made by the
defendants in marketing HGH-3X, including that consuming it:
- more -
HGH-3X--10/22/93)
-- stimulates the production of human growth hormone;
-- adjusts a consumer's metabolic rate enough to cause signi-
ficant weight loss (for instance, one infomercial shows a
doctor stating that HGH has "3 essential amino acids" that
"have a direct effect on the metabolism of fat");
-- causes weight loss without the need to decrease caloric
intake or increase exercise; and
-- causes a significant decrease in body fat.
These representations are all false and unsubstantiated, the
FTC charged, as are alleged representations that HGH-3X has been
proven effective by scientific research, and that an article in the
New England Journal of Medicine shows that consuming HGH-3X effec-
tively decreases body fat. Finally, the FTC challenged various
testimonials and endorsements contained in the defendants' adver-
tising, charging that they do not reflect the typical weight-loss
experiences of consumers using the product, as represented by the
defendants.
The proposed consent judgment to settle these charges would
permanently prohibit the defendants from making the above
allegedly-false representations for HGH-3X or any substantially
similar product. Further, in connection with marketing any weight-
control product, they would be prohibited from making false repre-
sentations and required to have competent and reliable scientific
evidence to support any representation about the benefits, efficacy
or safety of the product.
The settlement also would prohibit the defendants from misrep-
resenting the results of any test or study, and from falsely repre-
senting that any endorsement they use in marketing any weight-con-
trol product represents the typical experience of those who use it.
The $225,000 payment required by the proposed settlement would
be used, if practical, to provide refunds to consumers who pur-
chased HGH-3X. The funds would be paid over two years, with the
delayed payment secured by two parcels of real estate.
Finally, the proposed settlement contains various provisions
to assist the FTC in monitoring the defendants' compliance, and
would require that a copy of the settlement be given to each
officer and director of the companies.
The FTC filed the complaint and proposed consent judgment in
U.S. District Court for the District of Arizona, in Phoenix, on
Oct. 21. The Commission votes to file them were 5-0. The settle-
HGH-3X--10/22/93)
ment requires the approval of the court to become binding on the
defendants. The FTC's Denver Regional Office is handling the case.
NOTE: This consent judgment is for settlement purposes only and
does not constitute an admission by the defendants of law viola-
tions. Consent judgments have the force of law when signed by the
judge.
This case is another in a long series of FTC cases challenging
false and unsubstantiated claims for diet products and programs. A
free FTC consumer fact sheet -- "The Facts About Weight Loss Pro-
ducts and Programs" -- notes that while an estimated 50 million
consumers will go on diets this year, perhaps as few as 5 percent
will keep off for the long term any of the weight they lose. The
brochure offers helpful information and lists a number of clues to
fraud, and can be ordered at the address below.
Copies of the complaint and the consumer fact sheet 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 for the hearing impaired 1-866-653-4261.
# # #
MEDIA CONTACT: Bonnie Jansen, Office of Public Affairs
202-326-2161
STAFF CONTACT: Kelli Farrand Chan or Janice L. Charter
Denver Regional Office
1405 Curtis Street, Suite 2900
Denver, Colorado 80202-2393
303-844-2271
(FTC File No. 912 3065)
(Civil Action No. 93-2031-PHX-RCB)
(hgh-3x)