Two operations that marketed oral sprays that were supposed to help users lose weight, reverse the aging process, and prevent or treat diseases have settled Federal Trade Commission charges that their claims were bogus. The FTC alleged that these businesses falsely claimed the sprays were a “fountain of youth,” containing or causing the body to produce human growth hormone (HGH). The FTC also accused one company and owner of sending illegal spam messages. One group of defendants will pay $172,500 for consumer injury.
The defendants marketed their oral sprays on Web sites and in emails, making false claims, such as:
“LOSE WEIGHT WHILE YOU SLEEP without DIETING or EXERCISE”
“Experience up to an 82% IMPROVEMENT in body fat loss while erasing 10 YEARS in 10 WEEKS!”
The defendants claimed the sprays would counter symptoms of aging and prevent, treat, or cure diseases and medical conditions associated with aging. The marketing pitches for the sprays referred to clinical studies and prestigious publications to give credibility to their claims.
In fact, the FTC alleged that those claims were unproven and untrue. The FTC charged that the sprays did not contain HGH, or cause the body to increase production of HGH, and did not offer anti-aging, weight loss, or disease prevention effects.
Consumers bought the sprays from the defendants’ Web sites. The sites assured consumers that the sites were safe with the message:
NOTE: To ensure your personal privacy, all of the information that you submit to us after this point will be secured using SSL encryption technology.
However, the FTC charged that encryption technology was not used, making the credit card information submitted for payment vulnerable to capture while in transit.
Court orders against all of the defendants prohibit misrepresentations in marketing food, drugs, devices, services, or dietary supplements, including misrepresentations about the product benefits, misrepresentations about studies and research, and representations made without possessing competent and reliable scientific evidence. The orders also prohibit misrepresenting the security of Web site pages.
The order entered against John A. Brackett, Jr. and his company, Pacific Herbal Sciences, Inc., also prohibits violations of the CAN-SPAM Act. The FTC charged that much of these defendants’ e-mail violated the CAN-SPAM Act by falsely identifying the sender, using deceptive subject headings, failing to include a mechanism for consumers to decline to receive future emails from the sender, and not disclosing the sender’s physical postal address. Some of the e-mails sampled from the FTC’s spam database included forgery of ftc.gov and uce.gov email addresses, making it appear the e-mails were coming from these legitimate sources. The order also entered a $762,000 monetary judgment, suspended based on their financial disclosures. The order entered against Lei Lu and his companies, Natural Health Product, Inc. and New Star Marketing Group, Inc., requires them to pay $172,500 for consumer injury. The rest of their $2,218,261 monetary judgment is suspended, also based on their financial disclosures. For both monetary judgments, if it is found that the defendants lied about their financial status, then they will be liable for the full judgment amount.
The Commission vote to authorize staff to file the stipulated final orders was 5-0. The stipulated final orders for permanent injunction were entered by the U.S. District Court for the Central District of California on April 26, 2007.
NOTE: These stipulated final orders are for settlement purposes only and do not constitute an admission by the defendants of a law violation. A stipulated final order has the force of law when signed by the judge.
Copies of the document 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 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 more than 1,600 civil and criminal law enforcement agencies in the U.S. and abroad.
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