Lack of Substantiation

We reported a few weeks ago about a new warning from FDA related to the safety of certain teething-related, non-prescription homeopathic drug products, and in that post we mentioned that both FDA and the Federal Trade Commission (FTC) held public workshops in 2015 to gather information about this uniquely-regulated class of consumer products.  Today, FTC released an Enforcement Policy Statement on Marketing Claims for OTC Homeopathic Drugs  (available here); a Staff Report on the discussions held during the September 2015 workshop (available here); and an FTC blog post summarizing these actions.

For readers who are not familiar with homeopathy, the practice dates back to the 1700s and posits that disease symptoms can be treated by tiny doses of substances that produce similar symptoms if given in larger doses to healthy people (“like cures like”).  Accordingly, modern-day homeopathic remedies that we find ubiquitously in drug stores today are highly diluted formulations, which some people consider to be no more effective than placebo.  The FTC Staff Report provides an excellent overview of how this OTC industry has grown over the past 50 years and the viewpoints presented by both supporters and skeptics of homeopathy.

 The upshot to the new FTC Enforcement Policy is this:
 “No convincing reasons have been advanced either in the comments or the workshop as to why efficacy and safety claims for OTC homeopathic drugs should not be held to the same truth-in-advertising standards as other products claiming health benefits.”

Continue Reading FTC Issues Long-Awaited Enforcement Policy on OTC Homeopathic Drugs

We blog frequently about new regulatory developments coming from CPSC or FDA and about enforcement actions brought by those federal agencies as well as state counterparts and private plaintiffs.  But we don’t very often discuss actions involving the Federal Trade Commission (FTC) and its enforcement of the FTC Act’s broad prohibition on unfair or deceptive acts or practices, which incorporates false advertising for consumer products such as food, cosmetics, OTC drugs, medical devices, and goods overseen by the CPSC.  We thought it was worth a quick reminder that this area can be fraught with booby traps for the uninitiated advertiser.

The FTC Act is the primary federal law enforcement tool for preventing false advertising that has the capacity to deceive consumers. Continue Reading Reminder – Truthful Advertising Is Not Optional

POM Wonderful vs. FTC in DC Court of AppealsIn this first post of a two-part series, we take a closer look at last Friday’s decision in POM Wonderful v. FTC by the U.S. Court of Appeals for the District of Columbia, which has meaningful implications for how companies advertise their products’ health benefits to consumers. The decision bolsters the Federal Trade Commission’s position that, when a company makes specific claims that its products’ health benefits are scientifically “established,” it must have “competent and reliable scientific evidence” to substantiate these claims–specifically, at least one randomized controlled trial (RCT), the “gold standard” in the medical and scientific fields. A company relying on studies that do not meet this gold standard, like POM Wonderful, risks being charged with false or misleading advertising by the Commission.

For consumer-product companies making health claims–especially in litigation-heavy states like California–the logical next question is whether POM Wonderful somehow exposes them to liability from consumer plaintiffs if they fail to meet the standard articulated in the decision. The short answer is that it does not; POM Wonderful is not likely to “change the game” in the world of private class actions for consumer fraud and false advertising. The reason: what courts and counsel have come to call the “prior substantiation” doctrine. And it has important ramifications for how companies should view and respond to class actions brought in the decision’s wake.

POM Wonderful at a Glance
Continue Reading No Representation Without Substantiation? What POM Wonderful v. FTC Means for Consumer Class Actions