The FTC is clearly on the tail of those making bogus weight loss claims, and this week they announced another prosecution. This one is against Sili Neutraceuticals, LLC and Brian McDaid, individually and doing business as Kaycon, Ltd. According to the FTC, the defendants were responsible for spam messages that were sent to consumers. The illegal e-mails then drove traffic to the defendants’ websites selling "hoodia" and HGH boosting products. The products were sold under a variety of names such as "HoodiaHerbal," "Hoodia Maximum Strength," "Perfect HGH" and "Dr-HGH."
According to the FTC complaint, the defendants falsely claimed that their supposed "hoodia" products cause rapid and substantial weight loss, including as much as forty pounds in a month; cause users to lose safely three or more pounds per week for multiple weeks; and cause permanent weight loss. In fact, the weight-loss claims were false. The complaint also charges that the defendants falsely claimed that their supposed HGH products would contain human growth hormone and/or cause a clinically meaningful increase in a consumer’s growth hormone levels. According to the FTC, the defendants also falsely claimed that their HGH products would turn back or reverse the aging process, including: lowering blood pressure, reducing cellulite, improving vision, causing new hair growth, improving sleep, improving emotional stability, speeding injury recovery, relieving chronic pain, increasing muscle mass, and causing fat and weight loss.
The FTC alleges that the operation violated the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 "CAN-SPAM Act" by initiating commercial e-mails that: contained materially false and misleading header information; contained deceptive subject headings; failed to provide clear and conspicuous opt-out links; and failed to include a physical postal address.
Apparently, this is the first time the FTC has filed a case against spammers for using "Web form hijacking." The FTC calls Web form hijacking "a particularly insidious form of spamming." According to the FTC, in "Web form hijacking, the spammer injects the spam message into form fields on an innocent, third-party Web site (often a "Contact Us" form). The message uses the resources of, and appears, deceptively, to come from the victim Web site operator’s mail server."
There are several things I think it’s important to note about this case:
1. The FTC is continuing its quest to shut down purveyors of bogus weight loss products.
2. The FTC really is pursuing the really bad guys, if in fact the defendants in this case did as alleged.
3. The FTC is getting more sophisticated in its prosecution of these cases.
If you’re an affiliate who runs weight loss or other health and nutrition offers, it’s a good idea to be out in front of what the FTC is doing in this area. They’re active, and they’re aggressively looking for, and pursuing the bad guys. Pay attention, review your offers closely, and don’t get caught running offers which make unverifiable and seemingly outrageous claims. In other words, use common sense, and don’t advertise anything you don’t believe yourself.
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Come back to the iLegal column every week as we get specific about the rules, regulations, laws and trends that affect the online advertising industry. Each week we discuss important legal issues, talk about how to avoid the pitfalls, and cover the breaking legal and regulatory advertising industry news.
Legal Disclaimer: Information conveyed in this column is provided for informational purposes only and does not constitute legal advice. These materials do not necessarily reflect the opinions of Digital Moses, and is not guaranteed to be complete, correct, or up-to-date. The column is provided for "information purposes" only and should not be relied upon as "legal advice." This information is not intended to substitute for obtaining legal advice from an attorney. No person should act or rely on any information in this column without seeking the advice of an attorney.
Mark Meckler is the General Counsel for UniqueLeads.com, Inc., and Unique Lists, Inc. Mark sits on the eCommerce and Technology Committee of the Association of Corporate Counsel, and is a member of the International Association of Privacy Professionals.
Copyright 2007 Mark J. Meckler
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