[Federal Register Volume 66, Number 221 (Thursday, November 15, 2001)]
[Notices]
[Pages 57468-57469]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-28582]


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FEDERAL TRADE COMMISSION

[File No. 012 3116]


Esrim Ve Sheva Holding Corp., 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 
violations of federal law prohibiting unfair or deceptive acts or 
practices or unfair methods of competition. The attached Analysis to 
Aid Public Comment describes both the allegations in the 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 December 8, 2001.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary, 
Room 159, 600 Pennsylvania Ave., NW., Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT: Jonathan Cowen or Joni Lupovitz, FTC/
S-4302, 600 Pennsylvania Ave., NW., Washington, DC 20580. (202) 326-
2533 or 326-3273.

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 by the 
Commission, has been placed on the public record for a period of thirty 
(30) 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 November 8, 2001), on the 
World Wide Web, at ``http://www.ftc.gov/os/2001/11/index.htm.'' A paper 
copy can be obtained from the FTC Public Reference Room, Room H-130, 
600 Pennsylvania Avenue, NW., Washington, DC 20580, either in person or 
by calling (202) 326-3627.
    Public comment is invited. Comments should be directed to: FTC/
Office of the Secretary, Room 159, 600 Pennsylvania Ave., NW., 
Washington, DC 20580. Two paper copies of each comment should be filed, 
and should be accompanied, if possible, by a 3\1/2\ inch diskette 
containing an electronic copy of the comment. 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, subject to final 
approval, an agreement for entry of a consent order from Esrim Ve Sheva 
Holding Corp., a corporation sometimes doing business as Gadget 
Universe, and its CEO, Alexander Elnekaveh, individually and as an 
officer of the corporation (referred to collectively as 
``respondents''). The agreement would settle a complaint by the Federal 
Trade Commission that respondents engaged in deceptive acts or 
practices in violation of section 5(a) of the Federal Trade Commission 
Act.
    The proposed consent order has been placed on the public record for 
thirty (30) days for receipt of comments by interested persons. 
Comments received during this period will become part of the public 
record. After thirty (30) 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 advertising representations made about Super 
FuelMAX, an automotive fuel-line magnet. The administrative complaint 
alleges that respondents violated the FTC Act by disseminating 
advertisements that made unsubstantiated performance claims about Super 
FuelMAX: The Complaint alleges that respondents represented that Super 
Fuel Max: (1) Causes fuel molecules to line up in straight columns and 
rows; (2) improves fuel burn through magnetic resonance; (3) reduces 
fuel consumption; (4) reduces fuel consumption by 27% or up to 27%; (5) 
reduces harmful emissions or pollutants; and (6) reduces harmful 
emissions or pollutants by 42% or up to 40%. The Complaint further 
alleges that respondents represented that they had a reasonable basis 
for making these claims, but in fact did not possess competent evidence 
supporting them. Additionally, the Complaint challenges, as false, 
claims that tests performed at a certified U.S. Environmental 
Protection Agency prove that: (a) Increases mileage by 27%; and (b) 
reduces harmful pollutants by 42%.
    The Complaint also alleges that respondents falsely represented 
that a testimonial from respondent Alexander Elnekaveh reflected: (a) 
Elnekaveh's actual findings and experience with the product; and (b) 
the typical or ordinary experience of members of the public who use the 
product.
    The proposed consent order contains provisions designed to prevent 
respondents from engaging in similar acts and practices in the future. 
Part I of the proposed consent order prohibits respondents from making 
unsubstantiated claims in connection with any fuel-line magnet or any 
purported fuel-saving or emission-reducing product for use with a motor 
vehicle, including claims about the effect of such product on fuel 
molecules and that such product improves fuel burn; reduces fuel 
consumption or reduces fuel consumption by any number, percentage, or 
rate; reduces emissions or pollutants or reduces emissions or 
pollutants by any number, percentage, or rate; or about the benefits, 
performance, or efficacy of such product. The evidence required to 
substantiate such claims must be competent and reliable evidence, 
which, when appropriate, must be competent and reliable scientific 
evidence.
    Part II of the proposed consent order prohbits respondents from 
misrepresenting that any user testimonial or endorsement of the product 
reflects the actual and current opinions, findings, beliefs, or 
experiences of the user.

[[Page 57469]]

    Part III of the proposed consent order prohibits respondents from 
representing that the experience represented by any user testimonial or 
endorsement of the product represents the typical or ordinary 
experience of members of the public who use the product, unless the 
representation is true and, at the time it is made, respondents possess 
and rely upon competent and reliable scientific evidence that 
substantiates the representation; or respondents disclose what the 
generally expected results would be for users of the product, or that 
consumers should not expect to experience similar results.
    Part IV of the proposed consent order prohibits respondents from 
misrepresenting the existence, contents, validity, results, 
conclusions, or interpretations of any test, study, or research.
    The remainder of the proposed consent order also contains 
provisions regarding record-keeping, distribution of the order, 
notification of changes in corporate status, notification of changes in 
employment of the individual respondent, the filing of a compliance 
report, and termination of 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 the proposed order or to modify 
their terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 01-28582 Filed 11-14-01; 8:45 am]
BILLING CODE 6750-01-M