FTC settles final charges against supplement sellers

The final three of nine defendants that marketed joint health and a cognitive health supplements have agreed to settle allegations brought by the Federal Trade Commission (FTC) and Maine that they engaged in misrepresentations in promoting the products, the FTC announced. The defendants were charged with violating the FTC Act, the Electronic Fund Transfer Act and its implementing Regulation E, the Telemarketing Sales Rule, and the Maine Unfair Trade Practices Act. Synergixx, LLC, an ad agency, and two individuals including the company’s principal, are barred from engaging in a wide range of marketing practices and ordered to pay a $6.5 million monetary judgment that is suspended based on their inability to pay. The settlement orders are similar to the orders against the other defendants, which the FTC announced in February.

The FTC and Maine charged nine defendants with making false and misleading claims that purported cognitive health supplement CogniPrin: (1) reversed mental decline by 12 years; (2) improved memory by 44 percent; and (3) improved memory in as little as three weeks and is clinically proven to improve memory; and that purported cognitive health supplement FlexiPrin: (1) reduced joint and back pain, inflammation, and stiffness in as little as two hours; (2) rebuilt damaged joints and cartilage and; (3) had been clinically proven to reduce the need for medication in 80 percent of users and to reduce morning joint stiffness in all users.

Synergixx and Fusco advertised CogniPrin and FlexiPrin through 30-minute radio spots that were formatted to sound like educational talk shows, and created inbound call scripts that allegedly deceptively claimed that consumers could try the supplements “risk-free” with an unconditional 90-day money-back guarantee, without disclosing that consumers would have to enroll in an auto-ship continuity plan to qualify for the “risk-free” trial offer, and would have 14 days or less to try the products. The FTC also charged Synergixx and its principal with failing to make important disclosures when they “up-sold” consumers negative option buying clubs and discount medical programs with ongoing fees, charging many consumers for poorly disclosed auto-ship continuity plans they did not want.

One individual, whom defendants presented as an objective medical expert, was charged with providing endorsements without examining the products or exercising his represented expertise. Synergixx and its principal allegedly failed to disclose that he was paid a percentage of FlexiPrin and CogniPrin sales revenues.

The two orders against Synergixx and its principal and the medical expert bar the defendants from making the false or unsubstantiated health claims challenged in the complaint, require them to have competent and reliable scientific evidence when making health-related claims, and require them to clearly disclose their material connections between product sellers and product endorsers. Also, the defendants are barred from misrepresenting the existence or outcome of tests and studies when they promote health products. Additionally, Synergixx and its principal are barred from employing deceptive marketing practices relating to cancellations, negative-option payment plans, upsold merchandise, and deceptive pricing practices.

FTC nails opiate withdrawal supplement company for misleading statements

Catlin Enterprises, Inc. (Catlin) is now barred from making scientifically unsubstantiated claims that their opiate withdrawal treatment alleviates withdrawal symptoms and increases the chances of overcoming opiate dependency. A Texas district court ordered the permanent injunction following the Federal Trade Commission’s (FTC) complaint against Catlin.

Complaint and order

The FTC alleged that Catlin falsely advertised its products Withdrawal Ease and Recovery Ease and participated in deceptive acts throughout the process of labeling, advertising, distribution, and sale of the products. According to Catlin’s statements, Withdrawal Ease significantly alleviates opiate withdrawal symptoms and significantly increases the likelihood of overcoming dependency, while Recovery Ease significantly alleviates post-acute withdrawal symptoms.

The injunction prevent Catalin and its officers, agents, employees, and other people actively participating in the company from engaging in any steps of the process of making and selling any dietary product intended to provide withdrawal assistance or other health benefits and represented as having such benefits unless such statements are not misleading. Any representation of benefits much be based on reliable scientific evidence, obtained from human clinical testing of the product or an equivalent product. The testing must be conducted by qualified researchers and be randomized, double-blind, and placebo controlled.

A $6.6 million judgment was entered and suspended premised upon the accuracy of sworn financial statements. Catalin must provide the FTC with customer information to allow the FTC to “administer consumer redress,” when requested, then destroy this information when instructed to do so by the FTC.