[Federal Register Volume 59, Number 175 (Monday, September 12, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-22432]
[[Page Unknown]]
[Federal Register: September 12, 1994]
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FEDERAL TRADE COMMISSION
[File No. 9123145]
RN Nutrition, et al.; Proposed Consent Agreement With Analysis To
Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement.
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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
require, among other things, the California marketers of the calcium
supplement product, BoneRestore, to possess competent and reliable
scientific evidence to substantiate the claims that any food, drug, or
food or dietary supplement products will treat or cure any disease or
condition; would prohibit the respondents from using the name
BoneRestore in a misleading way; and would restrict the use of
testimonial endorsements that do not represent typical results.
DATES: Comments must be received on or before November 14, 1994.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
Room 159, 6th St. and Pa. Ave., NW., Washington, DC 20580.
FOR FURTHER INFORMATION CONTACT:
Phoebe Morse, Boston Regional Office, Federal Trade Commission, 101
Merrimac St., Suite 810, Boston, MA 02114-4719 (617) 424-5960.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Sec. 2.34 of the
Commission's Rules of Practice (16 CFR 2.34), notice is hereby given
that the following consent agreement containing a consent order to
cease and desist, having been filed with and accepted, subject to final
approval, by the Commission, has been placed on the public record for a
period of sixty (60) days. Public comment is invited. Such comments or
views will be considered by the Commission and will be available for
inspection and copying at its principal office in accordance with
Sec. 4.9(b)(6)(ii) of the Commission's Rules of Practice (16 CFR
4.9(b)(6)(ii).
In the Matter of RN Nutrition, a limited partnership, and George
Page Rank and James W. Nugent, individually and as co-partners,
trading and doing business as RN Nutrition; Agreement containing
consent order to cease and desist.
The Federal Trade Commission having initiated an investigation of
certain acts and practices of RN Nutrition, a limited partnership, and
George Page Rank and James W. Nugent, individually and as co-partners,
trading and doing business as RN Nutrition, hereinafter sometimes
referred to as proposed respondents, and it is now appearing that
proposed respondents are 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 proposed respondents, and their
attorney, and counsel for the Federal Trade Commission that:
1. Proposed respondent RN Nutrition is a limited partnership
organized, existing and doing business under and by virtue of the laws
of the State of California, with its principal office or place of
business at 3402-M West MacArthur, Santa Ana, California 92704.
2. Proposed respondent George Page Rank is an individual who has
been, and is now, a general partner of RN Nutrition. As such, he
formulates, or participates in the formulation of, directs and controls
the acts and practices of RN Nutrition. His business address is 3402-M
West MacArthur, Santa Ana, California 92704.
3. Proposed respondent James W. Nugent is an individual who has
been, and is now, a general partner of RN Nutrition. As such, he
formulates, or participates in the formulation of, directs and controls
the acts and practices of RN Nutrition. His business address is 3402-M
West MacArthur, Santa Ana, California 92704.
4. Proposed respondents admit all the jurisdictional facts set
forth in the draft complaint here attached.
5. Proposed respondents waive:
(a) Any further 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) All claims under the Equal Access to Justice Act.
6. 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 attached
draft complaint, 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 respondents, 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.
7. This agreement is for settlement purposes only and does not
constitute an admission by proposed respondents that the law has been
violated as alleged in the attached draft complaint, or that the facts
alleged in the attached draft complaint, other than jurisdictional
facts, are true.
8. This 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 Section 2.34 of the
Commission's Rules, the Commission may, without further notice to
proposed respondents, (1) issue its complaint corresponding in form and
substance with the attached draft complaint 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 decision containing the agreed-to order to proposed
respondents' address as stated in this agreement shall constitute
service. Proposed respondents waive any right they might 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.
9. Proposed respondents have read the proposed complaint and order
contemplated hereby. Proposed respondents understand that once the
order has been issued, they will be required to file one or more
compliance reports showing that they have fully complied with the
order. Proposed respondents further understand that they may be liable
for civil penalties in the amount provided by law for each violation of
the order after it becomes final.
Order
I
It is ordered that RN Nutrition, a limited partnership, and George
Page Rank and James W. Nugent, individually and as co-partners, trading
and doing business as RN Nutrition, or under any other name, their
successors and assigns, and respondents' agents, representatives, and
employees, directly or through any partnership, corporation,
subsidiary, division or other device, in connection with the labeling,
advertising, promotion, offering for sale, sale, or distribution of
BoneRestore or any food or dietary supplement, food, or drug, as
``food'' and ``drug'' are defined in section 15 of the Federal Trade
Commission Act, in or affecting commerce, as ``commerce'' is defined in
the Federal Trade Commission Act, do forthwith cease and desist from
representing, in any manner, directly or by implication, that such
product:
1. builds new bone, builds strong bones, increases bone and causes
significant bone gain;
2. builds bone better than estrogen or other forms of calcium;
3. slows or stops bone loss;
4. helps persons who suffer from weak or weakening bones;
5. prevents and heals osteoporosis;
6. rebuilds bone and restores lost bone;
7. eliminates pain associated with bone ailments;
8. is absorbed by the body better than other forms of calcium;
9. prevents bone fractures;
10. straightens spinal curvatures; and
11. provides any benefit in the prevention, treatment, or cure of
osteoporosis, arthritis, back pain, or any other bone ailment or
condition;
unless, at the time of making such representation, respondents possess
and rely upon competent and reliable scientific evidence that
substantiates the representation. 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.
II
It is further ordered that RN Nutrition, a limited partnership, and
George Page Rank and James W. Nugent, individually and as co-partners,
trading and doing business as RN Nutrition, or under any other name,
their successors and assigns, and respondents' agents, representatives,
and employees, directly or through any partnership, corporation,
subsidiary, division or other device, in connection with the labeling,
advertising, promotion, offering for sale, sale, or distribution of
BoneRestore or any food or dietary supplement, food, or drug, as
``food'' and ``drug'' are defined in section 15 of the Federal Trade
Commission Act, in or affecting commerce, as ``commerce'' is defined in
the Federal Trade Commission Act, do forthwith cease and desist from
representing, directly or by implication, that any endorsement (as
``endorsement'' is defined in 16 CFR 255.0(b)) of the product
represents the typical or ordinary experience of members of the public
who use the product, unless, at the time of making such representation,
respondents possess and rely upon competent and reliable evidence,
which when appropriate must be competent and reliable scientific
evidence, that substantiates such representation.
III
It is further ordered that RN Nutrition, a limited partnership, and
George Page Rank and James W. Nugent, individually and as co-partners,
trading and doing business as RN Nutrition, or under any other name,
their successors and assigns, and respondents' agents, representatives,
and employees, directly or through any partnership, corporation,
subsidiary, division or other device, in connection with the labeling,
advertising, promotion, offering for sale, sale, or distribution of
BoneRestore or any food or dietary supplement, food, or drug, as
``food'' and ``drug'' are defined in section 15 of the Federal Trade
Commission Act, in or affecting commerce, as ``commerce'' is defined in
the Federal Trade Commission Act, do forthwith cease and desist from
using the name ``BoneRestore,'' or any other name, in a manner that
represents, directly or by implication, that such product has the
ability to restore, build, or increase bone unless, at the time of
making the representation, respondents possess and rely upon competent
and reliable scientific evidence that substantiates the representation
that it restores, builds, or increases bone. This provision does not
otherwise affect respondents' ability to use the trade name
``BoneRestore,'' or any other brand name, to make a qualified
representation that is substantiated by competent and reliable
scientific evidence.
IV
It is further ordered that RN Nutrition, a limited partnership, and
George Page Rank and James W. Nugent, individually and as co-partners,
trading and doing business as RN Nutrition, or under any other name,
their successors and assigns, and respondents' agents, representatives,
and employees, directly or through any partnership, corporation,
subsidiary, division or other device, in connection with the labeling,
advertising, promotion, offering for sale, sale, or distribution of
BoneRestore or any food or dietary supplement, food, or drug, as
``food'' and ``drug'' are defined in section 15 of the Federal Trade
Commission Act, in or affecting commerce, as ``commerce'' is 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 RN Nutrition, a limited partnership, and
George Page Rank and James W. Nugent, individually and as co-partners,
trading and doing business as RN Nutrition, or under any other name,
their successors and assigns, and respondents' agents, representatives,
and employees, directly or through any partnership, corporation,
subsidiary, division or other device, in connection with the labeling,
advertising, promotion, offering for sale, sale, or distribution of
BoneRestore or any food or dietary supplement, food, or drug, as
``food'' and ``drug'' are defined in section 15 of the Federal Trade
Commission Act, in or affecting commerce, as ``commerce'' is defined in
the Federal Trade Commission Act, do forthwith cease and desist from
making any representation, in any manner, directly or by implication,
that any such product will treat, cure, alleviate the symptoms,
prevent, or reduce the risk of developing any disease, disorder, or
condition, unless, at the time of making such representation,
respondents possess and rely upon competent and reliable scientific
evidence that substantiates the representation.
VI
Nothing in this Order shall prohibit respondents from making any
representation that is specifically permitted in labeling for any such
product by regulations promulgated by the Food and Drug Administration
pursuant to the Nutrition Labeling and Education Act of 1990.
VII
Nothing in this Order shall prohibit respondents from making any
representation for any drug that is permitted in labeling for any such
drug under any tentative final or final standard promulgated by the
Food and Drug Administration, or under any new drug application
approved by the Food and Drug Administration.
VIII
It is further ordered that for five (5) years after the last date
of dissemination of any representation covered by this Order,
respondents, or their 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 tests, 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.
IX
It is further ordered that respondents shall forthwith distribute a
copy of this Order to all principals and managers and to all personnel,
agents, licensees and distributors, engaged in the preparation or
placement of advertisements or promotional materials covered by this
Order and shall obtain from each such employee, agent, licensee and
distributor a signed statement acknowledging receipt of the Order.
X
It is further ordered that for a period of five (5) years from the
date of entry of this Order, respondents George Page Rank and James W.
Nugent shall provide written notice to the Federal Trade Commission
within thirty (30) days of:
A. Any change in his business or employment that may affect
compliance obligations arising out of this Order;
B. The discontinuance of his business or employment; and
C. His affiliation with any new business or employment; each such
notice to include his business address and telephone number, home
address, and a statement describing the nature of the business or
employment and his duties and responsibilities.
XI
It is further ordered that respondents shall, within sixty (60)
days after service upon them of this Order, and at such other times as
the Commission may require, file with the Commission a report, in
writing, setting forth in detail the manner and form in which they have
complied with this Order.
Analysis of Proposed Consent Order To Aid Public Comment
The Federal Trade Commission has accepted an agreement, subject to
final approval, to a proposed consent order from respondents RN
Nutrition, a limited partnership, and George Page Rank and James W.
Nugent, individually and as co-partners, trading and doing business as
RN Nutrition.
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 and take other appropriate action or make
final the agreement's proposed order.
This matter concerns claims made in respondents' direct mail and
mail order catalog advertisements for their calcium supplement,
``BoneRestore.'' The Commission's complaint alleges that respondents
engaged in deceptive advertising by making unsubstantiated claims that
BoneRestore prevents, treats, and cures bone disease, bone ailments and
their related symptoms, and that the product is superior in this regard
to other calcium supplements and/or estrogen. The complaint also
alleges that respondents falsely claimed to have scientific
substantiation for these claims. In addition, the complaint alleges
that respondents made unsubstantiated claims that consumer testimonials
appearing in their advertisements reflect the typical or ordinary
experience of members of the public who have used BoneRestore.
The proposed consent order contains provisions designed to remedy
the violations charged and to prevent the respondents from engaging in
similar acts and practices in the future. Part I of the proposed order
prohibits the respondents from representing that BoneRestore, or any
food or dietary supplement, food, or drug: builds and restores bone;
stops bone loss; helps persons with weak bones; treats osteoporosis;
relieves pain; is superior to calcium or estrogen; prevents fractures;
straightens spinal curvatures; and that it provides any benefit in the
prevention, treatment or cure of osteoporosis, arthritis, back pain, or
other bone ailments, unless respondents possess competent and reliable
scientific evidence that substantiates the representation.
Part II of the proposed order prohibits respondents from
representing that any endorsement of BoneRestore represents the typical
or ordinary experiences of members of the public who have used the
product, unless respondents possess competent and reliable scientific
evidence that substantiates the representation.
Part III of the proposed order requires respondents to cease using
the name ``BoneRestore'' or any other brand name that represents that
such product has the ability to restore, build, or increase bone,
unless respondents possess competent and reliable scientific evidence
that substantiates the representation.
Part IV of the proposed order prohibits respondents from
misrepresenting the existence, contents, validity, results,
conclusions, or interpretations of any test or study.
Part V of the proposed order prohibits respondents from
representing that BoneRestore or any food or dietary supplement, food,
or drug, will treat, cure, prevent, or reduce the risk of developing
any disease, disorder, or condition, unless respondents possess
competent and reliable scientific evidence that substantiate the
representation.
Parts VI and VII of the proposed order include safe harbor
provisions allowing respondents to make any representation permitted in
labeling by the Food and Drug Administration for food under the
Nutrition Labeling and Education Act of 1990, and for drugs under any
tentative final or final standard promulgated by the Food and Drug
Administration.
The remaining portions of the proposed order require respondents to
maintain materials relied upon in disseminating any representation
covered by this order, to distribute copies of the order to certain
officials and employees, to notify the Commission of changes in the
business and employment of the individual respondents, and to file
reports detailing respondents' compliance with the order.
The purpose of this analysis is to facilitate public comment on the
proposed consent order. It is not intended to constitute an official
interpretation of the agreement and proposed order or to modify in any
way their terms.
Donald S. Clark,
Secretary.
Dissenting Statement of Commissioner Deborah K. Owen in the Matter of
RN Nutrition (File No. 912-3145)
The reasons for my dissenting vote in this matter are identical to
those expressed in my separate statement in the companion case,
Metagenics, Inc. (File No. 912-3347), which is attached.
Dissenting Statement of Commissioner Deborah K. Owen in the Matter of
Metagenics, Inc. (File No. 912-3347)
Although I believe that certain of Metagenics' claims were
unsubstantiated and, therefore, I would have been inclined to support a
more narrow complaint, I must dissent from today's Commission action
because I believe that, on balance, it runs contrary to the public
interest. I fear that the breadth of the allegations in the
administrative complaint may convey the wrong message to the public and
thereby discourage not only truthful and nondeceptive claims about
calcium supplements but, ultimately, their use.
The Commission has taken great pains in recent years to articulate
and justify its standards for advertising interpretation and
substantiation. In taking this action today, I believe that the
Commission has essentially ceded its authority to the FDA on both
counts. In short, I find today's Commission action overly restrictive
and inconsistent with the previously announced policies of the
Commission. Accordingly, I respectfully dissent.
[FR Doc. 94-22432 Filed 9-9-94; 8:45 am]
BILLING CODE 6750-01-M