POM Sues FTC Charging Radical Shift on Claim Substantiation Not So WonderfulSeptember 22, 2010
In recent consent decrees against Nestle, discussed here, and Iovate, discussed here, the Federal Trade Commission (“FTC”) appeared to be tightening its substantiation standard, prohibiting future claims for defendants’ food and dietary supplements unless they are supported by two well-controlled clinical studies. A Complaint by POM Wonderful LLC (“POM”) against FTC filed on September 13, 2010, alleges that the FTC intends to apply this requirement to all claims for food and dietary supplements. If POM’s allegations accurately reflect current FTC policy, the agency has embarked on a radical shift in direction on the core issue of advertising, substantiation of claims.
According to the Complaint, in its communications with POM, the FTC asserted that the standard described in these recent consent orders is the FTC’s “new standard.” POM alleges that the standard is no longer “competent and reliable evidence,” which may vary case by case depending on the claim. POM maintains that the FTC now asserts that “competent and reliable evidence” equates two well-controlled clinical studies. Although the FTC Act authorizes the FTC to define the standard for substantiation, POM points out that the FTC must follow the proper process of notice and comment rulemaking, which the FTC has not done. According to POM, FTC’s actions violate the FTC Act and the Administrative Procedures Act.
POM also alleges that the FTC now requires that FDA approve “certain health-related claims” for a food or dietary supplement, even if the claims are supported by two well-controlled clinical studies. The requirement for approval by FDA was apparently first included in the recent consent decree against Nestle. However, it was not clear from the decree that the FTC intended that this requirement would apply to parties not subject to the consent decree. POM alleges that wholesale application of this requirement constitutes a violation of an advertiser’s First Amendment rights and is beyond FTC’s authority. The FTC Act prohibits deceptive advertising; it does not authorize FTC to require that FDA approve claims in order for the claims to be non-deceptive. Further, were the FTC to attempt to impose such a requirement, besides raising legal and constitutional issues, an approval requirement would be difficult if not impossible to implement in the many cases where the Federal Food, Drug, and Cosmetic Act requires approval but FDA exercises enforcement discretion or otherwise chooses not to require approval.
POM asks the Court to declare FTC’s new standard invalid.