Nutrition Business Journal

FTC upholds deceptive advertising decision against POM Wonderful

POM made false and misleading claims in 36 advertisements and promotions, the agency said, bolstering an earlier Administrative Law Judge decision. But the fierce and well-heeled POM may take the case to Federal Appeals Court.

The Federal Trade Commission (FTC) decided on Wednesday to uphold a previous Administrative Law Judge ruling that POM Wonderful made false claims on its supplement and food products.

After initially suing the pomegranate-based product company in September 2010, the Commission denied the appeal filed by POM and maintained in a 5-0 ruling that POM marketers made deceptive and false advertising claims in 36 of their advertisements and promotional materials. The recent decision actually goes beyond the initial ruling which found only 19 deceptive or false claims.

The Commission rejected POM’s arguments that the action violated their First Amendment rights and Fifth Amendment right to due process.

In the Final Order, the Commission prohibited POM marketers from making claims that supplements, food or drugs are “effective in the diagnosis, cure, mitigation, treatment or prevention of any disease,” such as erectile dysfunction, heart disease and prostate cancer. The FTC also banned misrepresentations of research, tests or studies.

Ivan Wasserman, attorney at Manatt, Phelps & Phillips, isn’t surprised by the FTC’s decision. “Things haven’t changed,” he said. “The FTC expects advertisers to possess adequate science for all claims for food or supplements and for expressed or implied disease treatment or prevention claims.”

POM invested $35 million into scientific research, which included 17 clinical trials, 65 studies on POM products and 90 scientific investigations. But it wasn’t good enough. Flaws were found in the company’s studies and, after an initial hearing, FTC attorney Heather Hippsley pointed out company documents that acknowledged weaknesses in the studies.

Unlike the Administrative Law Judge, FTC asserted in the Final Order that nothing other than randomized, placebo-controlled, human clinical trials could be used to support POM’s claims. This is similar to the standard required for pharmaceuticals by the U.S. Food & Drug Administration (FDA). The clinical trial standard became an informal precedent after lawsuits between the FTC and Nestle Healthcare Nutrition and Iovate Health Sciences in 2010.

But the FTC Complaint Council did not get everything they wanted.

No pre-approval necessary

“The commission did not include in the order a requirement that any disease claim be pre-approved by FDA going forward,” Wasserman said. “Commissioners were of the opinion that the requirement to have two clinical trials was specific enough with respect to what POM needs going forward.”

The advertisements in question appeared in national publications, including The New York Times, Parade, Prevention and Fitness magazines; billboards, newsletters and websites.

It’s possible, though, that the decision could change.

POM Wonderful may appeal the decision to a Federal Appeals Court within 60 days of receiving the Final Order. Wasserman said it’s probable that POM will file the petition, in which case stakeholders in the natural products industry should keep tabs on what happens.

“It’s likely that we do not yet have the final word in this battle,” he said. “It will be interesting to see whether the requirement of FDA prior approval for disease related claims will continue given this decision.”

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