[Federal Register Volume 59, Number 36 (Wednesday, February 23, 1994)] [Unknown Section] [Page 0] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 94-4044] [[Page Unknown]] [Federal Register: February 23, 1994] ----------------------------------------------------------------------- FEDERAL TRADE COMMISSION [File No. 932 3000] Eggland's Best, Inc.; Proposed Consent Agreement With Analysis To Aid Public Comment AGENCY: Federal Trade Commission. ACTION: Proposed consent agreement. ----------------------------------------------------------------------- SUMMARY: In settlement of alleged violations of federal law prohibiting unfair acts and practices and unfair methods of competition, this consent agreement, accepted subject to final Commission approval, would prohibit, among other things, a Pennsylvania company from misrepresenting the amount of nutrients or other ingredients in its eggs or foods containing egg yolks, and would require the respondent to have competent and reliable scientific evidence to substantiate future health-benefit claims for such foods and, for one year, to label certain egg packages with a corrective notice stating that no studies show Eggland's eggs are different from other eggs in their effect on serum cholesterol. DATES: Comments must be received on or before April 25, 1994. ADDRESSES: Comments should be directed to: FTC/Office of the Secretary, room 159, 6th Street and Pennsylvania Avenue NW., Washington, DC 20580. FOR FURTHER INFORMATION CONTACT: C. Lee Peeler, FTC/S-4002, Washington, DC 20580, (202) 326-3090. Agreement Containing Consent Order To Cease and Desist The Federal Trade Commission having initiated an investigation of certain acts and practices of Eggland's Best, Inc., a corporation, and it now appearing that Eggland's Best, Inc., hereinafter sometimes referred to as proposed respondent, is willing to enter into an agreement containing an order to cease and desist from the use of the acts and practices being investigated, It is hereby agreed by and between Eggland's Best, Inc., by its duly authorized officer and attorney, and counsel for the Federal Trade Commission that: 1. Proposed respondent Eggland's Best, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the State of Pennsylvania with its office and principal place of business located at 842 First Street, King of Prussia, Pennsylvania 19406. 2. Proposed respondent admits all the jurisdictional facts set forth in the draft complaint attached hereto. 3. Proposed respondent waives: (a) Any procedural steps; (b) The requirement that the Commission's decision contain a statement of findings of fact and conclusions of law; (c) All rights to seek judicial review or otherwise to challenge or contest the validity of the order entered pursuant to this agreement; and (d) Any claim under the Equal Access To Justice Act. 4. This agreement shall not become part of the public record of the proceeding unless and until it is accepted by the Commission. If this agreement is accepted by the Commission, it, together with the draft complaint contemplated thereby, will be placed on the public record for a period of sixty (60) days and information in respect thereto publicly released. The Commission thereafter may either withdraw its acceptance of this agreement and so notify the proposed respondent, in which event it will take such action as it may consider appropriate, or issue and serve its complaint (in such form as the circumstances may require) and decision, in disposition of the proceeding. 5. This agreement is for settlement purposes only and does not constitute an admission by proposed respondent of facts, other than jurisdictional facts, or of violations of law as alleged in the draft complaint here attached. 6. The agreement contemplates that, if it is accepted by the Commission, and if such acceptance is not subsequently withdrawn by the Commission pursuant to the provisions of Sec. 2.34 of the Commission's Rules, the Commission may, without further notice to proposed respondent: (1) Issue its complaint corresponding in form and substance with the draft complaint attached hereto and its decision containing the following order to cease and desist in disposition of the proceeding; and (2) make information public in respect thereto. When so entered, the order to cease and desist shall have the same force and effect and may be altered, modified or set aside in the same manner and within the same time provided by statute for other orders. The order shall become final upon service. Delivery by the U.S. Postal Service of the complaint and decision containing the agreed-to order to proposed respondent's address as stated in this agreement shall constitute service. Proposed respondent waives any rights it may have to any other manner of service. The complaint may be used in construing the terms of the order, and no agreement, understanding, representation, or interpretation not contained in the order or the agreement may be used to vary or contradict the terms of the order. 7. Proposed respondent has read the proposed complaint and order contemplated hereby. It understands that once the order has been issued, it will be required to file one or more compliance reports showing that it has fully complied with the order. Proposed respondent further understands that it may be liable for civil penalties in the amount provided by law for each violation of the order after it becomes final. Definition For purposes of this Order, the phrase ``food containing egg yolk'' shall not include ``medical foods'' by 21 U.S.C. 360ee(b)(3) as currently in effect as of the date of this Order. I It is ordered, That respondent Eggland's Best, Inc., a corporation, its successors and assigns, and its officers, agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with the labeling, advertising, promotion, offering for sale, sale, or distribution of eggs or any food containing egg yolk in or affecting commerce, as ``food'' and ``commerce'' are defined in the Federal Trade Commission Act, do forthwith cease and desist from misrepresenting, in any manner, directly or by implication, through numerical or descriptive terms or any other means, the absolute or comparative amount of cholesterol, total fat, saturated fat or any other nutrient or ingredient in such food. II It is further ordered, That respondent Eggland's Best, Inc., a corporation, its successors and assigns, and its officers, agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with the labeling, advertising, promotion, offering for sale, sale, or distribution of eggs or any food containing egg yolk in or affecting commerce, as ``food'' and ``commerce'' are defined in the Federal Trade Commission Act, do forthwith cease and desist from making any representation, in any manner, directly or by implication, about the absolute or comparative effect of such food and serum cholesterol, whether or not such food is consumed as part of an unrestricted diet or as part of any specific dietary regimen, unless at the time of making the representation, respondent possesses and relies upon competent and reliable scientific evidence substantiating such representation; Provided, however, That any such representation that is specifically permitted in labeling for such food by regulation promulgated by the Food and Drug Administration pursuant to the Nutrition Labeling and Education Act of 1990 will be deemed to be substantiated as required by this paragraph. For purposes of this Order, ``competent and reliable scientific evidence'' shall mean tests, analyses, research, studies or other evidence based on the expertise of professionals in the relevant area, that has been conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results. III It is further ordered, That respondent Eggland's Best, Inc., a corporation, its successors and assigns, and its officers, agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with the labeling, advertising, promotion, offering for sale, sale, or distribution of eggs or any food containing egg yolk in or affecting commerce, as ``food'' and ``commerce'' are defined in the Federal Trade Commission Act, do forthwith cease and desist from making any representation, in any manner, directly or by implication, about the absolute or comparative health benefits of such food, including but not limited to its effect on heart disease, unless at the time of making the representation, respondent possesses and relies upon competent and reliable scientific evidence substantiating such representation; Provided, however, That any such representation that is specifically permitted in labeling for such food by regulations promulgated by the Food and Drug Administration pursuant to the Nutrition Labeling and Education Act of 1990 will be deemed to be substantiated as required by this paragraph. IV It is further ordered, That respondent Eggland's Best, Inc., a corporation, its successors and assigns, and its officers, agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with the labeling, advertising, promotion, offering for sale, sale, or distribution of any food in or affecting commerce, as ``food'' and ``commerce'' are defined in the Federal Trade Commission Act, do forthwith cease and desist from misrepresenting, in any manner, directly or by implication, the existence, contents, validity, results, conclusions or interpretations of any test or study. V It is further ordered, That respondent Eggland's Best, Inc., a corporation, its successors and assigns, and its officers, agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with the labeling, advertising, promotion, offering for sale, sale, or distribution of eggs or any food containing egg yolk in or affecting commerce, as ``food'' and ``commerce'' are defined in the Federal Trade Commission Act, do forthwith cease and desist from: A. Failing to disclose clearly and prominently in any advertisement or promotional material that refers, directly or by implication, to the absolute or comparative amount of cholesterol, fat or saturated fat in such food, the average cholesterol content of such food expressed in the following terms: 1. The number of milligrams; and 2. The percentage of ``Maximum Daily Value.'' The statements required by subparagraphs A.1 and A.2 of this Part shall appear in close proximity. For purposes of this Part, the term ``Maximum Daily Value'' shall mean: (1) The daily reference value or other daily intake limit for cholesterol established in an effective final regulation of the Food and Drug Administration; or (2) in the absence of such a regulation, the daily intake limit of cholesterol advised by any one of the following three organizations: the National Academy of Sciences, the Surgeon General of the Public Health Service, or the American Heart Association. In the event that the Food and Drug Administration does not have a final effective regulation and none of the three named organizations advises that daily cholesterol intake be limited to a specific maximum amount, subparagraph A.2 of this Part shall not apply. Provided, however, That this Part will not be deemed to apply to any representation that is specifically permitted in labeling for such food product by regulations promulgated by the Food and Drug Administration pursuant to the Nutrition Labeling and Education Act of 1990. B. For a time period of one year, beginning no later than forty- five (45) days from the date this Order becomes final, offering for sale, selling, or distributing eggs unless the package label for such eggs clearly and prominently states, in the exact language that follows, that: ``There are no studies showing that these eggs are different from other eggs in their effect on serum cholesterol.'' Provided, however, That this requirement shall apply only in those geographic areas where respondent has disseminated or caused to be disseminated advertising or promotional materials containing any representation, directly or by implication, about the effect of Eggland's Best eggs or other eggs on serum cholesterol over a period of 12 weeks or more, or at any time between January 1, 1993 and the date of the acceptance of this Order by the Commission for public comment, including but not limited to those geographic areas listed in Attachment A to this Order. For purposes of this Order, ``clearly and prominently'' shall mean as follows: 1. In a television or videotape advertisement, the disclosure shall be presented simultaneously in both the audio and video portions of the advertisement. The audio disclosure shall be delivered in a volume and cadence and for a duration sufficient for an ordinary consumer to hear and comprehended it. The video disclosure shall be of a size and shade, and shall appear on the screen for a duration, sufficient for a ordinary consumer to read and comprehend it; 2. In a print advertisement, the disclosure shall be in type size which is at least the same size as that in which the principal portion of the text of the advertisement appears, shall be located in close proximity to the statement or other reference requiring the disclosure and shall be of a color or shade that readily contrasts with the background of the advertisement; 3. In a radio advertisement, the disclosure shall be delivered in a volume and cadence and for a duration sufficient for an ordinary consumer to hear and comprehend it; 4. On a package label, the disclosure shall be in a conspicuous and prominent place on the package, in a conspicuous format, and in conspicuous and legible type in contrast by typography, layout, or color with all other printed material on the package. Provided, however, That if the disclosure is displayed on the top or front panel of a standard twelve-egg carton or on the top, front or side panel of a standard six-egg carton, is in at least ten (10) point type and is either on a separate label or enclosed within a border, and both the type and the border are of a color or shade that readily contrasts with the background of the carton, the disclosure shall be deemed to have been made clearly and prominently for purposes of this Order. VI It is further ordered, That for five (5) years after the last date of dissemination of any representation covered by this Order, respondent Eggland's Best, Inc., or its successors and assigns, shall maintain and upon request make available to the Federal Trade Commission for inspection and copying; A. All materials that were relied upon in disseminating such representation; and B. All test, reports, studies, surveys, demonstrations or other evidence in their possession or control that contradict, qualify or call into question such representation, or the basis relied upon for such representation, including complaints from consumers and complaints or inquiries from governmental organizations. VII It is further ordered, That respondent Eggland's Best, Inc. shall, within thirty (30) days after service upon it of this Order, distribute a copy of the Order to each of its operating divisions, to each of its franchisees, to each of its managerial employees, and to each of its officers, agents, representatives or employees engaged in the preparation or placement of advertising or other materials covered by this Order and shall secure from each such person a signed statement acknowledging receipt of this Order. VIII It is further ordered, That respondent Eggland's Best, Inc. shall, notify the Commission at least thirty (30) days prior to any proposed change in its corporate structure, including but not limited to dissolution, assignment or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries or affiliates, or any other corporate change that may affect compliance obligations arising out of this Order. IX It is further ordered, That respondent Eggland's Best, Inc. shall, within sixty (60) days after service of this Order, and at such other times as the Federal Trade Commission may require, file with the Commission a report, in writing, setting forth in detail the manner and form in which it has complied with this Order. Attachment A.--Geographic Areas With Cholesterol-Related Advertising or Promotion Pursuant to Paragraph V.B of Agreement Containing Consent Order 1. Iowa 2. Maine 3. Rhode Island 4. Western and Central Pennsylvania 5. Virginia 6. Maryland 7. Washington, DC 8. Georgia 9. South Carolina 10. Alabama 11. Mississippi 12. Louisiana 13. Arkansas 14. California 15. Nevada 16. Idaho 17. Michigan 18. Colorado 19. South Dakota 20. Washington 21. Montana 22. Alaska 23. Wyoming 24. Missouri 25. Oklahoma 26. Salt Lake City, Utah 27. Raleigh-Durham, North Carolina 28. Southern Illinois (St. Louis Market) Analysis of Proposed Consent Order To Aid Public Comment The Federal Trade Commission has accepted an agreement to a proposed consent order from Eggland's Best, Inc. (``Eggland's''). The proposed consent order has been placed on the public record for sixty (60) days for reception of comments by interested persons. Comments received during this period will become part of the public record. After sixty (60) days, the Commission will again review the agreement and the comments received and will decide whether it should withdraw from the agreement or make final the agreement's proposed order. This matter concerns claims made by Eggland's in its advertising and promotional materials for eggs. The Commission's complaint in this matter charges Eggland's with engaging in unfair or deceptive practices in connection with the advertising of its eggs. According to the complaint, Eggland's falsely represented that it had a reasonable basis for claims that eating its eggs will not increase serum cholesterol in an absolute sense and that eating its eggs will not increase serum cholesterol as much as eating ordinary eggs. The complaint also alleges that Eggland's falsely represented that clinical studies have proven that adding twelve Eggland's eggs per week to a low-fat diet does not cause an increase in serum cholesterol. Finally, the complaint alleges that Eggland's falsely represented that its eggs are both low in saturated fat in an absolute sense, and are lower in saturated fat than ordinary eggs. The consent order contains provisions designed to remedy the violations charged and to prevent Eggland's from engaging in similar deceptive and unfair acts and practices in the future. Part I of the order prohibits Eggland's from misrepresenting the absolute or comparative amount of cholesterol, total fat, saturated fat or any other nutrient or ingredient in eggs or in any food containing egg yolk. Part II of the order prohibits Eggland's from making any claims about the absolute or comparative effect on serum cholesterol of eggs or any food containing egg yolk unless, prior to making such claims. Eggland's has competent and reliable scientific evidence to substantiate the claims. This requirement applies to claims about the effect of such foods on serum cholesterol when consumed either as part of a regular, unrestricted diet or as part of a specific dietary regimen, for instance, a low-fat diet. Part II of the order also provides that representations that would be specifically permitted in food labeling, under regulations issued by the Food and Drug Administration (``FDA'') pursuant to the Nutrition and Labeling Education Act of 1990 (``NLEA''), will be deemed to be adequately substantiated. Part III of the order prohibits Eggland's from making any claims about the health benefits, including the effect on heart disease, of eggs or food containing egg yolk unless, prior to making such claims, England's has competent and reliable scientific evidence to substantiate the claims. This requirement applies to claims about both the absolute and comparative health benefits associated with consuming such foods. Like Part II, this Part provides that claims specifically permitted in food labeling, under regulations issued by FDA pursuant to the NLEA, will be deemed to be adequately substantiated. Part IV of the order prohibits Eggland's from misrepresenting the existence, contents, validity, results, conclusions or interpretations of any test or study. Part V.A of the order requires a clear and prominent disclosure of the cholesterol content of eggs or any food containing egg yolk, in any advertisement or promotional material that references the absolute or comparative amount of cholesterol, fat or saturated fat in such food. This disclosure of cholesterol content must be expressed both in terms of the number of milligrams and as a percentage of the ``Maximum Daily Value'' for cholesterol intake as established by FDA or other specified organizations. Part V.A exempts from this disclosure requirement any representation that is specifically permitted in food labeling under regulations issued by FDA pursuant to the NLEA. Part V.B of the Order requires Eggland's to include a clear and prominent notice on the package label for its eggs that ``There are no studies showing that these eggs are different from other eggs in their effect on serum cholesterol.'' This corrective notice requirement applies for a period of one year beginning forty-five (45) days from the date the order becomes final in those geographic areas where Eggland's disseminated advertising or promotional materials discussing the effect of its eggs on serum cholesterol either for a period of twelve (12) weeks or more, or at any time between January 1, 1993 and to the date of the acceptance of this order by the Commission for public comment. Part V also includes various specific provisions as to what constitutes a clear and prominent disclosure and corrective notice for purposes of this order. Part VI of the order requires Eggland's to maintain copies of all materials relied upon in making any representations covered by the order. Part VII or the order requires Eggland's to distribute copies of the order to its franchisees and to various officers, agents and representatives of Eggland's. Part VIII of the order requires Eggland's to notify the Commission of any changes in corporate structure that might affect compliance with the order. Part IX of the order requires Eggland's to file with the Commission one or more reports detailing compliance with the order. The purpose of this analysis is to facilitate public comment on the proposed order, and it is not intended to constitute an official interpretation of the agreement and proposed order, or to modify any of their terms. Donald S. Clark, Secretary. Separate Statement of Commissioner Mary L. Azcuenaga, Concurring in Part and Dissenting in Part, in Eggland's Best, Inc., File No. 932-3000 The Commission today accepts for public comment a consent agreement settling charges that Eggland's Best made deceptive advertising claims about its eggs. I agree that there is reason to believe that these claims were deceptive and join in approving the order except for V.B. I do not agree that the corrective advertising provision contained in V.B. is warranted, and I dissent from the order to that extent. In imposing a corrective advertising remedy, the Commission must consider whether an advertisement has played a substantial role in creating in the public's mind a false belief about a product that will linger on after the false advertisement ceases. Warner-Lambert Co. v. FTC, 562 F.2d 749, 762 (D.C. Cir. 1977), cert. denied, 435 U.S. 950 (1978). Corrective advertising is intended to dissipate the lingering effects of a deceptive advertisement so that future advertisements do not become part of a continuing deception of the public. Id. at 769. Here, there is no direct evidence, such as the consumer surveys and expert testimony in Warner Lambert Co., that Eggland's Best's advertisements created a lingering false impression about the effects on serum cholesterol of its eggs. Given the relatively short period of time during which Eggland's Best's advertisements were run, it seems unlikely that any such lingering false impression has been created. Without a stronger showing of the need for corrective advertising under the Warner-Lambert test, I cannot support including a corrective advertising provision in the proposed order. Statement of Commissioner Deborah K. Owen, Concurring in Part and Dissenting in Part, in Eggland's Best Inc., File No. 932-3000 I concur in the Commission's decision to issue a complaint, and to provisionally accept a consent agreement in this matter, except as to section V.B. of the Order. With respect to that Section, which requires corrective advertising, I dissent. The seminal case on corrective advertising is the Listerine case, Warner-Lambert Company, 86 F.T.C. 1398 (1975), where the Commission opined: [I]f a deceptive advertisement has played a substantial role in creating or reinforcing in the public's mind a false and material belief which lives on after the false advertising ceases, there is clear and continuing injury to competition and to the consuming public as consumers continue to make purchasing decisions based on the false belief. Since this injury cannot be avoided by merely requiring respondent to cease disseminating the advertisement, we may appropriately order respondent to take affirmative action designed to terminate the otherwise continuing ill effects of the advertisement. 86 F.T.C. at 1499-1500. As the complaint alleges, Eggland's ads, in my judgment, certainly create a false impression that its eggs will not increase serum cholesterol, or, comparatively, increase cholesterol as much as ordinary eggs. However, we must also find that the beliefs created by the challenged ads are likely to linger after the deceptive advertising ceases. As to that likelihood, it seems to me important to compare and contrast the facts in Warner-Lambert to the situation here. In Warner-Lambert, decided in 1975, the Commission noted that the challenged advertising claims had been made directly to the consuming public since 1921, and involved expenditures of large sums in print and television media. 86 F.T.C. at 1501. The Commission cited to the ALJ's Findings of Fact, which noted that Listerine had made the contested representations since the product went on the market almost a century before; that cold and sore throat claims had been made continuously on its labelling since prior to 1938; and that over the ten years preceding the decision, Listerine had spent several million dollars on its colds advertising, the vast majority occurring on network and spot television, covering all parts of the day and evening and particularly in network prime time. Id. at 1468 (IDFF 219-220); see also id. at 1407-1408 (IDFF 5-8). The Commission pointed to record testimony indicating the high percentage of consumers taking such claims that would remain as long as five years after the ads ended. It concluded: ``The record demonstrates that long after Listerine cold efficacy advertising ceased, a substantial proportion of the public would continue to believe in Listerine's efficacy for the treatment and prevention of colds and sore throats.'' Id. at 1503 (emphasis supplied). If we contrast the length in time, and the magnitude of Listerine's advertising to the instant case, Eggland's advertising would hardly appear to rise to even a two-digit percentage thereof. We have no evidence that Eggland's campaign was so similarly saturated and extended that long after it ceases, a substantial portion of the public will continue to believe the challenged claims in the absence of the corrective advertising that the Commission has provisionally accepted. Moreover, one significant factor is in evidence here that was not present in the Listerine case: the barrage of contrary information to which the public is exposed. While the public received little, if any, information from sources other than the advertiser about the true effect of Listerine on colds and sore throats, the vast majority of information available to consumers challenges the Eggland claims, and links egg consumption with increased serum cholesterol. Articles in the popular press, television and radio programs, and many cookbooks recommend that consumers lower their consumption of eggs. Doctors and the American Heart Association advise people to limit their egg consumption for health reasons. The general ambient information and perception is that eggs are unhealthy, and this climate is highly relevant in determining whether the false beliefs created by Eggland's Best advertisements will likely linger. Eggland's Best advertisements attempted to counteract the common wisdom, but ran for only a short time. Because the information that eating eggs is likely to increase serum cholesterol will continue to be widely disseminated to consumers through media sources, it is unlikely that the false beliefs regarding the effects of Eggland's Best eggs on serum cholesterol, or their comparative benefits to other eggs, will be maintained. In sum, the half-life of Eggland's advertising campaign is probably very short. This is not to suggest, however, that corrective advertising is only appropriate where the ad campaign is decades-old and swamps the public. A classic opportunity for appropriately imposing the remedy was the Sun Company case two years ago. File No. 902-3268. There, the Commission challenged claims linking octane and automobile engine performance made by a company that was previously under a Commission order for earlier false performance and uniqueness claims for its gasoline. Sun Oil Co., 84 F.T.C. 247 (1974). Nonetheless, the Commission agreed to merely a cease-and-desist order, despite the fact that the challenged claims took advantage of, and further contributed to, widespread consumer misperception about the relationship between octane and performance. The contrast between the Commission's decision there, and here, suggests that the Commission's current posture on corrective advertising may be more a function of respondents' willingness to agree to the remedy, rather than of a well defined and implemented policy. Finally, a comment on the remedy itself. The corrective advertising is ordered to be placed on Eggland's Best carton label. Due to other legal limitations, Eggland's Best has not made serum cholesterol or heart health claims on the carton. Thus, while the attempt to limit the breadth of the remedy may be well-intentioned, I find it highly ironic that corrective advertising has been mandated in a medium where the original deceptive claims were never made. Statement of Roscoe B. Starek, III, in Eggland's Best, Matter No. 932- 3000 After very careful deliberation, I have decided to support the corrective advertising provision in this order. I arrived at this decision somewhat reluctantly, since I think this remedy should be used sparingly. The appeals court decision in Warner-Lambert accords the Commission substantial discretion in applying such a remedy.\1\ The Commission must take great care, however, to exercise such broad discretion judiciously. Thus, the question I had to answer was whether corrective advertising is appropriate in the absence of an extended period of deceptive advertising or extrinsic evidence demonstrating that the false impressions will persist in consumers' minds after the ads cease.\2\ --------------------------------------------------------------------------- \1\Warner-Lambert Co. v. F.T.C., 562 F.2d 749 (D.C. Cir. 1977). The court suggested that the purpose of advertising is to create enduring beliefs in consumers' minds, such that the FTC might well presume in some cases that the standard for imposing corrective advertising had been met. It stated that it need not rely upon such a presumption in Warner-Lambert, however, because the record contained evidence that the Listerine ads had created, in the minds of consumers exposed to the advertising, false beliefs that would persist after the ads ended. Id., 562 F.2d at 762-63; see, 86 F.T.C. 1398 (1975), at 1471 n.23 (data relied upon was survey of ``consumers who have seen or heard a lot of advertising for Listerine''). \2\It is certainly unrealistic to think that we will have this data when the respondents enter into a consent agreement before a complaint is filed. --------------------------------------------------------------------------- I have determined that a limited corrective advertising requirement is an appropriate remedy here. First, I have reason to believe that the Eggland's ads have created in consumers' minds enduring false impressions about these eggs. Because Eggland's is able to charge for its eggs about 200% of the typical price per dozen, we have strong evidence that the company's ads have been successful in creating in the minds of their consumers a belief that their eggs are meaningfully superior to other eggs. Second, the superiority touted by Eggland's ads--ads disseminated as recently as two months ago--pertains to their effect on serum cholesterol. Common sense tells me that this belief is not going to disappear overnight, simply because advertising making that claim ceases. Third, consumers who continued to believe that Eggland's had a demonstrated superiority over typical eggs would suffer an identifiable injury, again due to the price differential. Corrective advertising placed on the egg package would enable consumers to avoid further injury. Finally, I am persuaded by the careful crafting of the corrective remedy. In my view, corrective advertising should educate, not punish. The instant notice is designed to reach the Eggland's target (those who are preparing to purchase the product) rather than the population at large. It has a limited dissemination schedule and will not be unreasonably costly. Moreover, the notice itself is a statement of fact that is neither derogatory of Eggland's eggs nor implies criticism of other companies' products. Although I support the very narrow corrective advertising provision in this case, I am not an advocate of this type of remedy. Statement of Commissioner Dennis A. Yao, in Eggland's Best, Inc. I voted to accept the proposed consent agreement for public comment. Although I support the terms of the consent agreement, I would have preferred that the complaint include an implied heart disease allegation. The Commission alleges in its complaint that, among other things, Eggland's Best falsely represented that it had a reasonable basis for claims that eating its eggs will not increase serum cholesterol in an absolute sense and that eating its eggs will not increase serum cholesterol as much as eating ordinary eggs. I believe that reasonable consumers would interpret the express claim that Eggland's eggs will not increase serum cholesterol to imply that those eggs would therefore not increase the risk of heart disease--especially when the express claim was made for eggs, a product notoriously well known for its negative impact on heart health. Although the proposed order does include a requirement that health claims, including claims about heart disease, be substantiated by competent and reliable scientific evidence, I believe that industry and the public would best be served if the Commission communicated its belief that an implied health claim has been made here.\3\ --------------------------------------------------------------------------- \3\I would note that the complaint also alleges that Eggland's Best falsely represented that its eggs are low in saturated fat in an absolute sense, and are lower in saturated fat than ordinary eggs. Although I agree that the implied saturated fat claims challenged in the complaint were made, in my view this claim is further down the spectrum of implied claims towards those needing extrinsic evidence than the implied heart disease claim I discuss here. I thus can discern no reason for excluding the implied heart disease claim from the proposed complaint while including the saturated fat claims. --------------------------------------------------------------------------- [FR Doc. 94-4044 Filed 2-22-94; 8:45 am] BILLING CODE 6750-01-M