The Federal Trade Commission ("FTC") recently reached an agreement with New York-based Telomerase Activation Sciences, Inc. and its CEO Noel Patton (collectively, "TA Sciences"), barring TA Sciences from making false or unsubstantiated claims regarding the efficacy and health benefits of two of TA Sciences' products. According to the FTC's administrative complaint, TA Sciences falsely advertised that its products reverse aging, prevent and repair DNA damage, restore aging immune systems, increase bone density, reverse the effects of aging skin and eyes, prevent or reduce the risk of cancer, and decrease the time needed for skin to recover after medical procedures. In addition, the FTC alleged TA Sciences misrepresented that a television segment it paid for in 2012 was independent, educational programing instead of advertising, and that TA Sciences deceptively represented that consumers in its advertisements were independent, impartial users, when in fact they received free product samples worth up to $4,000 in exchange for their endorsement. Finally, the FTC claimed TA Sciences gave promotional materials containing false or unsubstantiated claims to other supplement marketers.
The proposed order settling the FTC's complaint prohibits TA Sciences from making any representation about the health benefits, performance, efficacy, safety, or side effects of any covered product unless the representation is "non-misleading" and is supported by "competent and reliable scientific evidence." It also prohibits TA sciences from misrepresenting that any paid commercial advertising is independent programing or that any endorser is an independent user of the product, and requires disclosure of any material connection between a product endorser and the company. Finally, the proposed settlement order requires TA Sciences to notify its licensees of the order and monitor those licensees' advertisements to ensure compliance, and to inform consumers who purchased the disputed products within the past year about the order.
Takeaway: The FTC issues an administrative complaint when it has "reason to believe" that the law has been or is being violated and initiating a proceeding is in the public interest. To minimize risk of liability, advertisers should disclose paid television segments as advertisements rather than independent or educational programming, and also disclose when consumers in advertisements receive free product samples in exchange for endorsement.
This article is presented for informational purposes only and is not intended to constitute legal advice.
