FTC Challenges False and Unsubstantiated Claims
The Federal Trade Commission has filed a complaint in federal district court against A. Glenn Braswell and four of his corporations challenging allegedly false and unsubstantiated advertising claims for numerous dietary supplements marketed under the Gero Vita and Theraceuticals brand names. The complaint also names as a defendant corporate officer Ron Tepper. The complaint challenges claims that five dietary supplements treat or cure respiratory disease, diabetes, Alzheimer's disease, obesity, and erectile dysfunction. The FTC is seeking permanent injunctive relief, consumer redress, and a permanent ban against Braswell's participation in any business engaged in the advertising or sale of health-related products.
The Braswell enterprise, which operates out of Marina Del Rey, California, is comprised of numerous affiliated companies, including JOL Management Co., G.B. Data Systems, Inc., Gero Vita International, Inc., and Theraceuticals, Inc., all named as defendants in the complaint. According to the FTC, Braswell's operation is one of the largest U.S. direct marketers of health-related products. The FTC's complaint alleges sales totaling approximately $800 million since 1998.
"These defendants built their businesses on false and outrageous claims aimed at older consumers and those with chronic illnesses," said Howard Beales, Director of the FTC's Bureau of Consumer Protection. "Today's action demonstrates the Commission's continuing commitment to attacking fraud in the dietary supplement market."
Braswell is already under a 1983 federal court settlement resolving charges that he and several of his corporations violated the FTC Act and the FTC's Mail Order Rule in connection with the advertising and sale of various health-related products.
The FTC's complaint alleges that Braswell and the other defendants market numerous dietary supplement products through false and unsubstantiated claims. According to the FTC, the defendants' multi-page direct mail advertisements deceptively tout their products as "scientific breakthroughs" that can treat or cure a host of serious illnesses and medical conditions. The products identified in the FTC's complaint are: Lung Support Formula, claimed to cure or ameliorate nearly all respiratory problems, including asthma, emphysema and smoking damage; Antibetic Pancreas Tonic, claimed to treat or cure Type I and Type II diabetes, and to lower blood sugar levels by repairing the pancreatic cells that produce insulin; G.H.3 and Theraceuticals GH3 Romanian Youth Formula, claimed, among other things, to reverse and prevent Alzheimer's disease and other forms of dementia, and to increase lifespan; Chitoplex, a chitosan-based product purported to cause weight loss and reverse obesity without diet or exercise; and Testerex, claimed to treat erectile dysfunction in 62% to 95% of men.
In addition, the FTC complaint challenges the defendants' use of deceptive advertising formats and expert endorsements to market its products. Specifically, the complaint alleges that the defendants deceptively portrayed their "New Life Nutrition Magazine" as an independent health magazine, when in fact it was advertising written by the defendants for the purpose of selling their products. The complaint further alleges that the defendants claimed that an independent organization, the "Council on Natural Nutrition," conferred its "Golden Nutrition Awards" on the defendants' Arthro 7, ChitoPlex and G.H.3 products, when in fact, the defendants had established the "Counsel on Natural Nutrition." In addition, the complaint alleges that the defendants' representation that Dr. Ronald Lawrence, Director of the Council on Natural Nutrition, endorsed the defendants' products based on his independent, objective evaluation of the products, when in fact, Dr. Lawrence was a paid endorser of the defendants' products and was a member of defendant G.B. Data Systems' Board of Directors.
The Commission vote to authorize staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the Central District California, Western Division, on May 27, 2003.
NOTE: The Commission authorizes the filing of a complaint when it has "reason to believe" that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant actually has violated the law. The case will be decided by the court.
Copies of the complaint 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, 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. 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. 012-3087)
(Civil Action No. CV 03-3700 DT (PJWx)
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