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FTC bombs POM (and researchers beware)

The Federal Trade Commission legal action alleging POM Wonderful made unsubstantiated claims for its pomegranate products, adds to a stream of claim actions the increasingly active agency has taken this year.

By Shane Starling, 28-Sep-2010

The Federal Trade Commission legal action alleging POM Wonderful made unsubstantiated claims for its pomegranate products, adds to a stream of claim actions the increasingly active agency has taken this year.

Kellogg’s, Nestlé, Wrigley, Iovate Health Sciences have all felt the wrath of the FTC this year over misleading claims – although in those cases the result was a settlement between the company and the FTC.

Here the FTC has upped the ante by filing a complaint that is slated to be heard by an Administrative Law Judge of the Federal Trade Commission on May 24 next year. It has also reached a settlement with a former POM Wonderful researcher, Mark Dreher, that strictly limits his research activity and which signals that individuals involved in the gathering and promulgation of research materials can also come under FTC scrutiny.

Then there is POM’s own action against the FTC – lodged last week – that alleges the agency’s claim standards breach free speech principles. While it cannot be construed as the sole reason for the agency issuing a complaint, its existence cannot be written out of the equation.

As Virginia-based food attorney, Jonathan Emord, from Emord and Associates, observed: “Based on the claims POM has made, it is likely that the FTC would act against the company regardless of the POM suit being filed, albeit the suit is a clear indication that POM prefers the litigation option over settlement at this point.”

Researchers beware

Marc Ullman, from the New York legal firm, Ullman, Shapiro and Ullman, agreed the POM action sent a clear signal a settlement was unlikely.

“[POM’s action] made it perfectly clear that POM was not going to settle and that the matter would need to be resolved through an enforcement action,” he said. “The FTC does not bring these cases at the drop of a hat, I am certain that it has been in the works for some time now.”

On Dreher being singled out for a separate action, Ullman said, “it was unusual for the FTC to pursue the researcher. I am aware of a couple of instances where something to that effect has been on the table, but it is very rare to see it followed through to completion. It should send a message to researchers to make sure that their work can withstand the scrutiny of their peers and to be careful about getting caught up in marketing hype.”

Increased enforcement action

Both attorneys backed the FTC to succeed in its complaint.

“The new regime at FTC intends to increase the amount of enforcement action taken against food and dietary supplement advertisers,” said Emord. “POM is waging an uphill battle.”

He added: “The claims recited by FTC include ones that the FDA would regard as drug claims, but the issue for FTC is not whether ‘drug claims’ have been made (that is squarely within FDA’s jurisdiction). The issue is whether the claims made can be proven false and misleading. Rightly construed consistent with the First and Fifth Amendments, FTC should carry the burden of proof and must establish that the claims are false rather than, as it often does (improperly in my view) presume the claims false based on inadequacies in the accused party’s supporting evidence.”

POM issued a statement yesterday defending claims it said were not drug claims but Ullman observed, “I’m still trying to figure out how POM came to that conclusion.”

POM stated: “POM Wonderful fundamentally disagrees with the FTC and believes that the commission’s allegations against POM are completely unwarranted."

The FTC complaint against POM and Dreher can be found here.

Correction: This article initially stated that the FTC had paid some attention to Ovos when it was in fact Iovate Health Sciences as the article now states.