Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: HCG weight-loss products barred in FTC action, (Dec 11, 2014)

As the result of legal action taken by the FTC alleging that claims of quick and substantial weight loss from using homeopathic human chorionic gonadotropin (HCG) drops were deceptive and unsubstantiated, marketers of the HCG drops have agreed to pay $1 million, discontinue selling the products and refrain from making similar weight-loss claims in future, the FTC announced today.

Human chorionic gonadotropin (HCG), is a hormone produced by the human placenta that for decades has been falsely promoted for weight loss. In November 2011, Kevin Wright and six other HCG marketers received warning letters issued jointly by FDA and FTC staff, advising them that their products are mislabeled drugs under the Federal Food, Drug, and Cosmetic Act, and warning that it is illegal to make weight-loss claims that are not supported by competent and reliable scientific evidence.

Kevin Wright and his Utah-based companies, HCG Platinum, LLC and Right Way Nutrition, LLC, sold "HCG Platinum" drops at retailers GNC, Rite Aid, Walgreens, on Facebook, in internet ads and on their own websites, promising consumers that the drops would cause rapid and substantial weight loss of as much as 50 pounds. They typically charged between $60 and $85 for a 30-day supply of all three formulations, and sold approximately $10 million of the products from 2010 to earlier this year, when they were sued.

Under the stipulated final order, entered by the federal district court in Salt Lake City (FTC v. Wright, File No. 122-3193, December 8, 2014, Waddoups, C.), the defendants are barred from making a number of specific weight-loss claims about any over-the-counter drug, patch, cream, wrap, or any other product. It also requires the defendants to substantiate any future claims that using a product causes weight loss, rapid weight loss, or a specific amount of weight loss or that consumers can expect to lose as much weight as the product’s endorser, unless they have at least two adequate and well-controlled human clinical studies. Claims regarding the health benefits, safety, performance, or efficacy cannot be made unless they are not misleading and are substantiated by competent and reliable scientific evidence. The defendants also are barred from misrepresenting the results of any scientific study.

The order also imposes a $10 million judgment, representing all net sales of HCG Platinum drops, which will be suspended, provided the defendants make the $1 million payment to the FTC. If it is determined that the financial information the defendants gave the FTC was untruthful, the full amount of the judgment will become due.

Companies: HCG Platinum, LLC; Right Way Nutrition, LLC; Weekes Holdings, LLC; Primary Colors, LLC; KMATT Holdings, LLC; Nutrisport Holdings, LLC.

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