$9.8M in refunds for consumers purchasing ‘fat burning’ health products

Almost a quarter of a million refund checks totaling more than $9.8 million will be issued to consumers who purchased “fat burning” and “weight loss” products and other dietary supplements, DVDs, or skin creams, including Pure Green Coffee Bean Plus and RKG Extreme, from Health Formulas LLC and related companies. The Federal Trade Commission (FTC) noted that the average refund per consumer will be $43.

According to the FTC’s original complaint, Health Formulas LLC, its owners, and its related companies, including Simple Pure Nutrition, advertised their products using fake “free trials,” tricked people into disclosing credit and debit card information, and then enrolled them without their permission in a costly negative-option membership program that charged them monthly for new shipments.

A subsequent court order in 2016 settled the FTC’s charges by permanently banning Health Formulas and the other 41 related companies from advertising or selling weight-loss supplements and negative option sales plans, and prohibited them from making unsupported health claims for other products, debiting people’s bank accounts without their consent, and calling consumers who asked not to be called again. It also required them to turn over approximately $10 million in assets.

Lunada settlement settlement halts false marketing of Amberen®

Lunada Biomedical, Inc., and its principals (Lunada, collectively) agreed to settle charges by the Federal Trade Commission (FTC) that it deceptively marketed Amberen®, a dietary supplement, to perimenopausal and menopausal women over 40 by making a range of unsupported claims about the drug’s ability to aid in weight loss and relieve menopause-related symptoms. The proposed stipulated order prohibits Lunada from making unsubstantiated efficacy or health benefit claims for any dietary supplement, food, or drug or conducting any other illegal activities related to consumer satisfaction claims, “risk-free trial” offers, and consumer endorsements. Lunada will pay $250,000 of a $40 million judgment, based on its inability to pay the full amount.

Allegations

The FTC filed a complaint in May 2015 and amended it in December 2015. The amended complaint alleges that Lunada made unsubstantiated claims that Amberen causes substantial and sustained weight loss, loss of belly fat, and an increase in metabolism in women over 40 who are perimenopausal or menopausal and that it is clinically proven to cause substantial and sustained weight loss in such women. The FTC also alleged that Lunada made unsubstantiated claims that the drug was clinically proven to alleviate nearly all common symptoms of menopause, including hot flashes, night sweats, sleep problems, fatigue, and irritability. According to the FTC, a 2001 clinical trial by the scientists who developed the formula used a double dose of Amberen and did not specifically measure weight loss. A subsequent clinical study failed to show a statistically significant difference in the weight lost by control group and test group participants.

In addition to making unsubstantiated claims, the FTC alleged that Lunada failed to disclose its relationship with certain consumer endorsers and made false claims of consumer satisfaction and success rates of nearly 93 percent. It also falsely told consumers they could try Amberen “risk-free” for 30 days. In fact, instead of receiving a 30-day supply, consumers were given a 90-day supply of the product and, to qualify for a refund, were required to return two unopened product boxes at their own expense within 30 days of placing the order.

Settlement Terms

The proposed stipulated order bars Lunada from:

  • claiming that any dietary supplement, food, or drug causes weight loss, sustained weight loss, or loss of belly fat; boosts metabolism; relieves hot flashes, night sweats, and other specific symptoms of menopause; or cures, mitigates, or treats any disease, unless they have human clinical testing that meets certain requirements and is sufficient to substantiate that the claims are true;
  • making any misleading or unsubstantiated claim about the health benefits or efficacy of any dietary supplement, food, or drug;
  • misrepresenting the results of any test of the product;
  • misrepresenting any material fact about the product or any material terms and conditions of any offer for it; and
  • failing to disclose any material connections (such as financial relationships) they have with endorsers.