[Federal Register Volume 63, Number 95 (Monday, May 18, 1998)]
[Notices]
[Pages 27297-27298]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-13142]


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FEDERAL TRADE COMMISSION

[File No. 952-3235]


Western Direct Marketing Group, Inc., et al.; Analysis To Aid 
Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged violation 
of federal law prohibiting unfair or deceptive acts or practices or 
unfair methods of competition. The attached Analysis to Aid Public 
Comment describes both allegations in the draft complaint that 
accompanies the consent agreement and the terms of the consent order--
embodied in the consent agreement--that would settle these allegations.

DATES: Comments must be received on or before July 17, 1998.

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:
Joel Winston, FTC/S-4002, Washington, DC 20580. (202) 326-3153.

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 May 12, 1998), on the World Wide Web, at ``http://www.ftc.gov/os/
actions97.htm.'' A paper copy can be obtained from the FTC Public 
Reference Room, Room H-130, Sixth Street and Pennsylvania Avenue, NW, 
Washington, DC 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 To Aid Public Comment

    The Federal Trade Commission has accepted an agreement to a 
proposed consent order from Western Direct Marketing Group (``WDMG'') 
and Western Intentional Media Corporation (``WIMC'').
    The proposed consent order has been placed on the public record for 
sixty (60) days for receipt 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 withdrawn 
from the agreement or make final the agreement's proposed order.
    This matter involves alleged deceptive representations for 
Cholestaway, a dietary supplement marketed by Bodgana Corporation, 
purported to lower serum cholesterol. Advertisements for the product 
included 30-minute television infomercials.
    WDMG is the successor corporation to Television Marketing Group, 
the advertising agency for the Cholestaway television infomercials. 
MIMC is WDMG's corporate parent.
    According to the FTC complaint, through the infomercials, the 
respondent made claims that Cholestaway: significantly lowers serum 
cholesterol levels; significantly lowers serum cholesterol levels 
without changes in diet; significantly lowers serum cholesterol levels 
and causes significantly weight loss even if users eat foods high in 
fat, including fried chicken and pizza; substantially reduces or 
eliminates the body's absorption of dietary fat; lowers low density 
lipoprotein cholesterol and improves the high density lipoprotein 
cholesterol to low density lipoprotein cholesterol ratio; is effective 
in the treatment of hardening of the arteries and heart diseases; 
causes significant weight loss; causes significant weight loss without 
changes in diet; significantly reduces blood triglyceride levels; 
significantly reduces elevated blood pressure; and is scientifically 
proven to lower serum cholesterol levels and reduce elevated blood 
pressure significantly; and that

[[Page 27298]]

testimonials from consumers appearing in the advertisements for 
Cholestaway reflect the typical or ordinary experience of members of 
the public who use the product. The complaint alleges that the 
respondents did not have a reasonable basis for any of these 
representations at the time they were made.
    The consent order contains provisions designed to prevent the 
respondents from engaging in similar acts and practices in the future.
    Part I of the order prohibits the respondents from making the 
representations challenged in the complaint, unless they possess and 
rely upon competent and reliable scientific evidence that substantiates 
the representation.
    Part II prohibits respondents from making any representations about 
the efficacy, performance, safety or benefits of any food, dietary 
supplement of drug unless they possess and rely upon competent and 
reliable scientific evidence that substantiates the representation.
    Part III prohibits the respondents from mispresenting the 
existence, contents, validity, results, conclusions or interpretations 
of any test, study, or research.
    Part IV prohibits the respondents from representing that the 
experience represented by a user testimonial or endorsement of the 
product is the typical or ordinary experience of users of the product 
unless the representation is substantiated or they disclose what the 
generally expected results would be or that consumers should not be 
expect the same results.
    Part V allows the respondents to make respondentations for any drug 
that are permitted in labeling for that drug under any tentative final 
or final Food and Drug Administration (``FDA'') standard or under any 
new drug application approved by the FDA.
    Part VI allows the respondents to make representations for any 
product that are specifically permitted in labeling for that product by 
regulations issued by the FDA under the Nutrition Labeling and 
Education Act of 1990.
    Parts VII through X require the respondents to keep copies of 
advertisements making representations covered by the order; to keep 
records concerning those representations, including materials that they 
relied upon making the representations; to provide copies of the order 
to certain of the respondents' personnel; to notify the Commission of 
changes in corporate structure; and to file complaint reports with the 
Commission. Part XI provides that the order will terminate after twenty 
(20) years under certain circumstances.
    The purpose of this analysis is to facilitate public comment on the 
proposed order, and its is not intended to constitute an official 
interpretation of the agreement and proposed order or to modify in any 
way their terms.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 98-13142 Filed 5-15-98; 8:45 am]
BILLING CODE 6750-01-M