[Federal Register Volume 62, Number 66 (Monday, April 7, 1997)]
[Notices]
[Pages 16586-16587]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-8800]
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FEDERAL TRADE COMMISSION
[File No. 962-3137]
Guildwood Direct Limited, Also d/b/a Intermed Laboratories;
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 or deceptive acts or practices and unfair methods of
competition, this consent agreement, accepted subject to final
Commission approval, would prohibit, among other things, the New York-
based company from representing that any product causes weight loss,
with or without changes in diet or exercise, or provides any weight
loss, fat loss, weight regulation, weight control or weight maintenance
benefit, and from using the name ``Slimming Insoles'' or any other name
in a manner that represents that any product causes weight loss unless
the respondent possesses competent and reliable scientific evidence
that substantiates the representation. The consent agreement also would
prohibit the respondent from representing that Advance Bio/Natural
Research Labs in a bona fide, independent research organization or from
making any misrepresentations of the existence, contents, validity,
results, conclusions or interpretations of any test, study or research
or the existence, nature, purpose or activities of any organization. In
addition, the consent agreement would require the respondent to pay, to
purchasers of the Slimming Insoles, $40,000 for consumer redress or
disgorgement, with that liability being suspended upon payment of
$7,500 once the order becomes final.
DATES: Comments must be received on or before June 6, 1997.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.
FOR FURTHER INFORMATION CONTACT:
Richard Cleland, FTC/H-482, Washington, D.C. 20580. (202) 326-3088.
SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Section 2.34 of
the Commission's Rules of Practice (16 CFR 2.34), notice is hereby
given that the above-captioned 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. The following Analysis to Aid
Public Comment describes the terms of the consent agreement, and the
allegations in the complaint. An electronic copy of the full text of
the consent agreement package can be obtained from the FTC Home page
(for March 25, 1997), on the World Wide Web, at ``http://www.ftc.gov/
os/actions/htm.'' A paper copy can be obtained from the FTC Public
Reference Room, Room H-130, Sixth Street and Pennsylvania Avenue, N.W.,
Washington, D.C. 20580, either in person or by calling (202) 326-3627.
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 Section 4.9(b)(6)(ii) of the
Commission's Rules of Practice (16 CFR 4.9(b)(6)(ii)).
Analysis of Proposed Consent Order
The Federal Trade Commission has accepted an agreement to a
proposed consent order from Guildwood Direct Limited (``respondent'').
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.
The Commission's complaint in this matter charges respondent with
deceptively advertising Slimming Insoles, insoles worn in the shoes
that purportedly cause weight loss through ``reflexology,'' without
changes in diet or exercise. According to advertisements for the
product, the Slimming Insoles purportedly cause weight loss by
massaging certain ``reflex points'' on the bottom of the foot during
the course of a normal day's walking, thereby stimulating the body's
digestive system to burn stored fat and cause weight loss.
Advertisements for the product appeared in newspapers such as the
Washington Post, New York Post, Denver Post and St. Louis Post, in
newspaper inserts, in magazines such as American Women, Soap Opera
Update and Woman's Own as well as in nationwide direct mailings.
The complaint alleges that, through the product name ``Slimming
Insoles'' and the advertisements, respondent made unsubstantiated
representations that the Slimming Insoles cause significant weight loss
and that the weight loss occurs without changes in diet or exercise.
According to the complaint, the ads also claim, without
[[Page 16587]]
adequate substantiation, that testimonials from consumers appearing in
the ads reflect the typical or ordinary experience of people who have
used the product.
The complaint also alleges that respondent falsely represented that
scientific studies demonstrate that the Slimming Insoles cause
significant weight loss without changes in diet or exercise. In
addition, the complaint alleges that respondent falsely represented
that an organization named Advanced Bio/Natural Research Labs is a bona
fide, independent research organization that has published a report
containing the results of valid, independent testing of the Slimming
Insoles.
The proposed consent order contains provisions designed to remedy
the violations charged and to prevent respondent from engaging in
similar acts and practices in the future.
Part I of the order requires respondent to possess competent and
reliable scientific evidence to support any claim that any product
causes weight loss, with or without changes in diet or exercise, or
provides any weight loss, fat loss, weight regulation, weight control
or weight maintenance benefit. Part II prohibits respondent from using
the name ``Slimming Insoles'' or any other name in a manner that
represents that any product causes weight loss, unless respondent
possesses competent and reliable scientific evidence that substantiates
the representation.
Part III prohibits respondent from claiming that the experience
represented in any user-testimonial or endorsement of any food, dietary
supplement, drug, device, or weight loss product or program represents
the typical or ordinary experience of members of the public who use the
product, unless, at the time, respondent possesses and relies upon
competent and reliable scientific evidence substantiating the
representation or respondent discloses, clearly and prominently, and in
close proximity to the testimonial or endorsement, what the generally
expected results would be or that consumers should not expect to
experience similar results.
Part IV prohibits respondent from representing that Advance Bio/
Natural Research Labs is a bona fide, independent research organization
or that it has published a report containing the results of valid,
independent testing of any product. Part V prohibits, in connection
with the sale of any food, dietary supplement, drug, device or weight
loss product or program, misrepresentations of the existence, contents,
validity, results, conclusions or interpretations of any test, study or
research or the existence, nature, purpose or activities of any
organization.
Part VI requires respondent to deposit $40,000 into an escrow
account, which will be used by the Commission to provide either direct
redress to purchasers of the Slimming Insoles or will be paid to the
United States Treasury, if the Commission determines that direct
redress to consumers is wholly or partially impracticable. The order
suspends the full $40,000 liability, however, provided that respondent
pays $7,500 to the Commission no later than the date the order becomes
final. The full $40,000 becomes due, however, should respondent default
in making the $7,500 payment. In addition, the Commission's acceptance
of the order is expressly premised upon financial statements and
related documents provided by the respondent, and the Commission
reserves the right to re-open the proceeding to determine if the
financial information provided by respondent contains any material
misrepresentations or omissions. If the Commission determines that
there are any material misrepresentations or omissions in the financial
information provided, then the full $40,000 becomes due and payable.
Parts VII through X relate to respondent's obligations to maintain
and make available to the Commission certain records; to provide copies
of the order to respondent's personnel; to notify the Commission of
changes in corporate structure; and to file compliance reports with the
Commission. Part XI provides that the order will terminate after twenty
years, under certain circumstances.
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 in any
way their terms.
Donald S. Clark,
Secretary.
[FR Doc. 97-8800 Filed 4-4-97; 8:45 am]
BILLING CODE 6750-01-M