The Cornucopia Institute, a consumer watchdog and proponent of “family-scale farming,” has reportedly filed a complaint with the Federal Trade Commission (FTC), alleging that an Oregon-based cereal maker is misleading consumers with its “all natural” product claims. According to the institute, Hearthside Food Solutions, which makes Peace Cereal, labels its products as “natural” and then states on its website that “natural foods are foods without pesticides or artificial additives, as well as being minimally processed and preservative-free.” Noting that the federal government has not adopted a definition of or requirements for “natural” food products, the Cornucopia Institute alleges that by using conventionally grown food ingredients, Hearthside is selling products routinely sprayed with pesticides and herbicides. Peace Cereal was apparently certified organic in the past, but has not been since 2008. Yet, according to the Cornucopia Institute, stores in several states continue to carry “organic” signs on shelves containing non-organic Peace…
Category Archives Federal Trade Commission
The Federal Trade Commission (FTC) has announced that final approval was given to a settlement reached with a Nestlé S.A. subsidiary over claims that its children’s drink, BOOST Kid Essentials®, conferred specific health benefits, such as reducing the risk of colds and flu and reducing the duration of acute diarrhea. More information about the settlement appears in Issue 356 of this Update. And the summary of a related lawsuit that the National Consumers League filed against the company can be found in Issue 360 of this Update. The FTC said that this case was the agency’s “first one challenging advertising for probiotics.” See FTC News Release, January 18, 2011.
The Federal Trade Commission has announced the settlement of allegations that The Dannon Co. exaggerated the health benefits of its Activia® yogurt and DanActive® dairy beverage. Under the terms of the settlement, Dannon does not admit any law violations, but agrees to stop promoting its yogurt as a product that relieves temporary irregularity or its dairy beverage as a product that reduces the likelihood of getting a cold or the flu, unless certain conditions are met. These include that the immunity claims are specifically permitted by the Food and Drug Administration and the irregularity claims are substantiated by competent and reliable scientific evidence. The company also agreed to pay $21 million to the 39 states whose attorneys general were also investigating its advertising claims. According to a news source, Dannon has indicated that it will in the future clarify that Activia’s benefits require three servings of the product daily. The…
The Federal Trade Commission (FTC) has issued a preliminary staff report that proposes a framework for businesses and policymakers to protect the privacy of consumers using the Internet. FTC staff seeks stakeholder comments on the proposed framework until January 31, 2011, and a final report will follow. The report coincides with a recent congressional hearing during which FTC officials testified that a “persistent” browser setting could allow consumers to choose whether companies can collect data about their online searching and browsing. According to an agency press release, although online tracking can help targeted advertising efforts, FTC “supports giving consumers a ‘Do Not Track’ option because the practice is largely invisible to consumers, and they should have a simple, easy way to control it.” The option could be accomplished through legislation or “potentially through robust, enforceable self-regulation,” FTC said. “The advantage of industry doing something themselves is that they can move much…
The Federal Trade Commission (FTC) has filed a motion to dismiss a complaint charging the agency with exceeding its authority in requiring Food and Drug Administration (FDA) pre-approval for health-related claims on food products, violating advertisers’ constitutional rights by requiring compliance with these standards and failing to comply with notice-and-comment rulemaking procedures in establishing the standards. POM Wonderful LLC v. FTC, No. 10-1539 (D.D.C., motion filed November 16, 2010). Additional information about POM Wonderful’s complaint appears in Issue 364 of this Update. FTC contends that the court lacks jurisdiction to consider the matter because the complaint is moot, the company lacks standing, the company is attempting to preclude an enforcement action, and the complaint does not challenge final agency action. Specifically, FTC claims (i) the agency merely created a possible remedy of FDA pre-approval in consent agreements with food producers making health-related claims and not an enforceable rule; (ii) it…
The Federal Trade Commission (FTC) has announced the unanimous approval of a final order settling charges that a former POM Wonderful LLC executive made false and unsubstantiated claims that the company’s pomegranate products prevent or treat heart disease and prostate cancer. Under the agreement, Mark Dreher, a former POM Wonderful vice president, does not admit to violations of the law, but will cooperate in FTC’s investigation and action against his former company. He also agreed to abide by the conditions prescribed for making any health-related claims for a food or drug product in the future and to give present and future employees copies of the order. According to a news source, FTC has scheduled a May 24, 2011, hearing before an administrative law judge for POM Wonderful to respond to charges that it has made allegedly false health-related product claims. Dreher has agreed to participate in interviews with the agency in…
The Food and Drug Administration (FDA) has issued warning letters to four manufacturers of alcoholic energy drinks (AEDs), calling the caffeine added to these malt beverages an “unsafe food additive” and threatening further action against Charge Beverages Corp.; New Century Brewing Co., LLC; Phusion Projects, LLC; and United Brands Company Inc. FDA apparently released its decision after conducting a scientific review that encompassed peer-reviewed literature, expert consultations, information provided by manufactures, and its own independent laboratory analysis. The agency’s findings evidently raised concerns “that caffeine can mask some of the sensory cues individuals might normally rely on to determine their level of intoxication,” leading to “hazardous and life-threatening situations.” As FDA Principal Deputy Commissioner Joshua Sharfstein summarized in a November 17, 2010, press release, “FDA does not find support for the claim that the addition of caffeine to these alcoholic beverages is ‘generally recognized as safe [GRAS],’ which is the…
The Federal Trade Commission (FTC) has determined that its “Green Guides,” which “help marketers avoid making deceptive claims by outlining general principles that apply to all environmental marketing claims,” should be retained and updated. Initially developed in 1992 and last revised in 1998, the guides also provide information about how “reasonable consumers are likely to interpret particular claims, how marketers can substantiate them, and how they can qualify those claims to avoid consumer deception.” The proposed changes include new guidance on the “use of product certifications and seals of approval, ‘renewable energy’ claims, ‘renewable materials’ claims, and ‘carbon offset’ claims.” They do not address use of the terms “sustainable,” “natural” and “organic.” Public comments are requested by December 10, 2010. FTC Chair Jon Leibowitz was quoted as saying, “In recent years, businesses have increasingly used ‘green’ marketing to capture consumers’ attention and move Americans toward a more environmentally friendly future.…
The Federal Trade Commission (FTC) has ordered 48 food companies “to file a special report” on their youth marketing practices in an effort “to measure the effect that self-regulation has had over the last three years,” according to FTC spokesperson Carol Jennings. The companies have 90 days to respond to the subpoenas, which will assist FTC in compiling a follow-up to its 2008 report titled “Marketing Food to Children and Adolescents: A Review of Industry Expenditures, Activities, and Self-Regulation.” Additional information about this ongoing process appears in Issue 320 of this Update. See Advertising Age, September 1, 2010. “We are supportive of industry voluntary efforts to limit their marketing to kids and this will see whether more is needed,” stated Jennings, who noted that the commission is “not proposing any regulation” at this time. See Advertising Age, September 1, 2010.
The Federal Trade Commission (FTC) has taken action against companies that sell açai berry supplements, “colon cleansers” and other products online by featuring false Oprah Winfrey and Rachael Ray endorsements and illegally billing customer credit cards. According to an agency press release, a U.S. district court has temporarily ordered a halt to “an internet sales scheme that allegedly scammed consumers out of $30 million or more in 2009 alone through deceptive advertising and unfair billing practices.” The court order also imposes an asset freeze and appoints a temporary receiver over several companies “while the FTC moves forward with its case to stop the company’s bogus health claims and other deceptive and unfair conduct.” The companies purportedly made “free” trial offers for an açai berry supplement pitched as a rapid weight-loss product and a colon cleanser said to prevent cancer. The companies purportedly claimed that they would provide full refunds to…
