Judge Slaps Telebrands With Order, But No Fine
However, Chief Administrative Law Judge Stephen J. McGuire said that the Federal Trade Commission, which had filed a civil complaint against Telebrands, Fairfield, NJ, had failed to provide sufficient evidence of its theory that Telebrands made false claims indirectly in the infomercial by referencing infomercials for similar products. The FTC announced the ruling yesterday.
In its infomercials, Telebrands does not make direct claims about the purpose of its Ab Force product, McGuire said in the ruling. But the infomercials state that the Ab Force is cheaper and "technologically comparable" to other exercise belts.
The FTC has successfully pursued civil actions against other makers of ab belts for making false claims about weight loss and exercise benefits of using the belts, which the agency says don't work. By referencing other ab belt infomercials, Telebrands was piggybacking on those false claims and thus was equally liable, the FTC argued.
In his ruling, McGuire wrote that it was unclear from the evidence whether the FTC's theory was correct. But he said that Telebrands implied, through visual and other cues, that the Ab Force imparted these benefits, and thus misled consumers.
By naming the product "Ab Force" and showing actors in the infomercial using the product to exercise abdominal muscles, Telebrands conveyed health claims that were misleading, McGuire wrote. The judge rejected Telebrands' argument that another use of the product would be to give a "relaxing massage."
"If there is an intended purpose or effect of using the Ab Force other than losing inches, weight or fat; building well-defined abs; or being an effective alternative to regular exercise, that purpose or effect was never identified in any of the Ab Force advertisements," McGuire wrote.
In a statement, Telebrands president/CEO A.J. Khubani called the decision a "victory for all marketers" because the judge had found that the FTC had not proven its "novel theory." Telebrands said this was the first time the FTC had brought a case using such arguments.
The company previously had agreed to consent orders with the FTC rather than go to trial, and the FTC "unfairly" tried to use the consent orders to force Telebrands to obtain a performance bond before conducting some marketing activities, the company said. The judge rejected that part of the FTC's request.
Telebrands is concerned that McGuire "misconstrued" evidence in the case and may file an appeal, the company said.