Markets Wired

The Federal Trade Commission has charged a business operation with violating federal law by falsely claiming that its weight-loss pills cause users to lose weight without dieting or exercise.

According to the FTC’s complaint, since 2005 the defendants have marketed their product throughout the nation under the names Zyladex Plus, Questral AC, Questral AC Fat Killer Plus, Rapid Loss 245, and Rapid Loss Rx. Their advertising, which has included statements such as “Lose up to 15 pounds a week,” “Not Even Total Starvation Can Slim You Down and Firm You Up This Fast – This Safe!,” and “No Dieting, No Exercise,” has appeared in Sunday newspaper supplements, including SmartSource by News America Marketing FSI, Inc.

The defendants, Medlab, Inc., Pinnacle Holdings, Inc., Metabolic Research Associates, Inc., U.S.A. Health, Inc., and their principal, L. Scott Holmes, located in California, are charged with violating Sections 5 and 12 of the FTC Act by making false and unsubstantiated claims that their product causes users to lose substantial amounts of weight rapidly, including as much as 15 to 18 pounds per week and as much as 50 percent of all excess weight in just 14 days, without dieting or exercise; that clinical studies prove those claims; and that their product causes permanent or long-term weight loss.

The FTC ultimately seeks to permanently bar the defendants from further violations and to obtain redress for affected consumers.

Through its “Red Flag” education campaign, announced in December 2003, the Commission encourages media outlets not to run ads for weight-loss products that contain false claims. As part of this effort, the FTC may notify media outlets when ads making bogus weight-loss claims appear in their publications. More information about the “Red Flag” campaign is available at http://www.ftc.gov/redflag/

The Commission vote to authorize the staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the Northern District of California, San Francisco Division.

NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.

Copies of the complaint are available from the FTC’s Web site at http://www.ftc.gov and
the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W.,
Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, click http://www.ftc.gov/ftc/complaint.shtm or call 1-877-382-4357. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to more than 1,600 civil and criminal law enforcement agencies in the U.S. and abroad. For free information on a variety of consumer topics, click http://ftc.gov/bcp/consumer.shtm.