Markets Wired

A federal judge has ordered infomercial marketer Kevin Trudeau to pay more than $37 million for violating a 2004 stipulated order by misrepresenting the content of his book, “The Weight Loss Cure ‘They’ Don’t Want You to Know About.”

In August 2008, Judge Robert W. Gettleman of the U.S. District Court for the Northern District of Illinois had ordered Trudeau to pay more than $5 million and banned him, for three years, from producing or publishing infomercials for products in which he has an interest. The ruling confirmed an earlier contempt finding, the second such finding against Trudeau in the past four years.

Urged by both the FTC and Trudeau to reconsider aspects of its August order, on November 4 Judge Gettleman amended the judgment to $37,616,161, the amount consumers paid in response to the deceptive infomercials. The judge also revised the three-year ban to prohibit Trudeau from “disseminating or assisting others in disseminating” any infomercial for any informational publication in which he has an interest. On December 11, the court denied Trudeau’s request to reconsider or stay this ruling.

The FTC filed its first lawsuit against Trudeau in 1998, charging him with making false and misleading claims in infomercials for products he claimed could cause significant weight loss and cure addictions to heroin, alcohol, and cigarettes, as well as enable users to achieve a photographic memory. A stipulated court order resolving that case barred Trudeau from making false claims for products in the future, ordered him to pay $500,000 in consumer redress, and established a $500,000 performance bond to ensure compliance.

In 2003, the Commission charged Trudeau with violating the 1998 order by falsely claiming in infomercials that a product, Coral Calcium Supreme, could cure cancer. The court subsequently entered a preliminary injunction that ordered him not to make such claims. When Trudeau continued to make cancer-cure claims about Coral Calcium, he was found in contempt. In 2004, Trudeau agreed to an order that resolved the Coral Calcium matter. He was directed to pay $2 million in consumer redress and banned from infomercials, except for informational publications such as books, provided that he “must not misrepresent the content”
of those publications. The 2004 injunction remains in effect.

The Federal Trade Commission works for consumers 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, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

(Trudeau)