April 15, 2023

FTC Issues Warning to Hundreds of Supplement and Weight Loss Marketers for Failure to Maintain Adequate Substantiation for Marketing Claims

If your company markets health, wellness, and weight loss products, it is important to be aware of the recent warning issued by the Federal Trade Commission (FTC) to almost 700 marketing companies. The FTC has cautioned companies to substantiate their advertising claims or risk facing civil penalties for false or exaggerated claims.

Note that the FTC’s warning is not limited to manufacturers or retailers. If you are an online advertiser that earns commissions off the sales of such products by third parties, then your advertising claims are subject to the same scrutiny as those of the manufacturers themselves.

The level of substantiation required varies depending on the type of claim made. For health-related claims, companies must have competent and reliable scientific evidence to support their claims. This means that the evidence should be based on well-designed, well-conducted studies that are conducted by experts in the relevant field. At best, such evidence includes unbiased clinical studies of the product itself. Absent this, peer-reviewed studies published in a reputable medical or scientific journal about the active ingredients may suffice so long as the amount and use case scenarios are substantially similar to that of the product.

For claims made about the safety or effectiveness of a product, companies must have reliable evidence that the product does what it claims to do and that it is safe for consumers to use. It is essential for companies to have documentation to support their claims and to maintain this documentation for future reference.

To be clear, the following are not suitable forms of substantiation: (1) the advertising claims of a competitor who sells a similar product; (2) an article published in a popular media source, like WebMD or CNN (although these sources can sometimes lead you to relevant peer-reviewed studies); or (3) testimonials or reviews from a handful of customers who claimed to have experienced certain results from using the product.

As our firm regularly instructs clients, the time to research and create a record of the substantiation for your advertising claims is before you begin selling the product or running your advertising campaign. Do not fall into the trap of waiting until you receive a warning letter from the FTC, a state attorney general, or a class action attorney to attempt to reverse-engineer substantiation for your advertising claims. The best way to ensure your advertising claims are supported by the necessary substantiation is to base them directly on such substantiation.

It is crucial for companies to take note of this warning and take necessary measures to ensure that their advertising claims are truthful and can be substantiated by reliable evidence. Failure to comply with FTC guidelines can result in significant civil penalties of up to $43,280 per violation, and the agency may also seek injunctions or other relief to prevent future deceptive advertising practices.

In conclusion, the FTC's warning to almost 700 marketing companies highlights the importance of substantiating advertising claims. As a company that markets health, wellness, and weight loss products, it is crucial to ensure that your advertising claims are truthful and supported by reliable evidence. By doing so, you can avoid the risk of facing civil penalties and legal action by the FTC and build a reputation for honesty and transparency with your consumers.

If you have received a warning letter from the FTC about substantiation for your advertising claims or seek legal review of your claims with the hope of avoiding one, contact Kronenberger Rosenfeld, LLP using our online case submission form here.

This entry was posted on Saturday, April 15, 2023 and is filed under Resources & Self-Education, Internet Law News.

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