Last Thursday, the Federal Trade Commission (the “FTC” or “Commission”) filed a lawsuit against a number of Florida-based individuals and companies for allegedly unlawful Internet weight-loss product marketing practices.
How did these marketers end up on the FTC’s bad side?
Advertisement and Sale of Weight-Loss Products
According to court records filed by the FTC, a Tampa-area resident, his employee and two of his Florida companies – Tachht, Inc. and Teqqi LLC – (collectively, “Defendants”) conducted a large-scale email marketing campaign to promote the sale of weight-loss products, such as Original Pure Forskolin, Original White Kidney Bean, and Mango Boost Cleanse.
The Defendants allegedly delivered email messages to consumers that included header information and email addresses indicating that the sender of the messages was someone who the recipients knew, such as a friend or family member. According to the Commission, the subject emails included short messages such as “Hi! CNN says this is one of the best,” followed by a hyperlink.
Consumers who clicked one of these hyperlinks were purportedly taken to fake news websites designed to look like news reports about Defendants’ weight-loss products, including supposed testimonials from Oprah Winfrey and evidence of effectiveness. The websites allegedly linked to Defendants’ e-commerce site, where consumers could purchase the subject weight-loss products.
FTC Deceptive Advertising and CAN-SPAM Lawsuit
On June 2, 2016, the FTC commenced legal action against the Defendants in the U.S. District Court for the Middle District of Florida (Case No. 8:16-cv-01397-JDW-AEP). The Commission claims that the Defendants violated the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (“CAN-SPAM”) by:
- Delivering commercial email with materially false or misleading from and subject headings;
- Failing to provide a means of opting out of receiving future emails; and
- Failing to include a valid physical postal address.
Additionally, the FTC alleges that the Defendants engaged in unfair or deceptive advertising in violation of the FTC Act by:
- Misrepresenting the effectiveness of their weight-loss products; and
- Using false celebrity endorsements.
The Commission is seeking preliminary and permanent injunctive relief to prevent the Defendants from engaging in such marketing practices, as well as civil penalties to redress consumer injuries caused by the Defendants’ actions.
Non-Compliant Weight-Loss Product Marketers Are at Risk
As we have previously reported, the marketing practices of individuals and businesses in the weight-loss product marketing space are continually challenged by the FTC. As the above-referenced case demonstrates, marketers of dietary supplements and weight-loss products that fail to adopt industry standard compliance practices and remain abreast of applicable regulations are placing themselves at serious legal risk.