FTC Charges Craftmatic with Making False Claims
in Its Sale of Home Water Treatment Systems
Consent Decree and Consumer Redress to Settle Charges
FTC News Release
May 21, 1991
The Federal Trade Commission has charged Craftmatic/Contour Industries, Inc., and its subsidiary, American Aqua Systems, Inc., of Trevose, Pennsylvania, with inducing consumers to purchase home water treatment systems by misrepresenting that their water was unsafe to drink. Under the terms of a proposed consent decree, filed in federal court to settle the charges, Craftmatic and American Aqua Systems would be prohibited from misrepresenting the results of in-home water testing and would have to pay $700,000 in consumer redress.
According to the Commission's complaint, Craftmatic, through American Aqua and regional distributorships, conducted in-home testing of consumers' water and claimed that such testing could detect the presence of cancer-causing agents, toxic metals, pesticides, or other substances believed to be harmful to human health. The companies also claimed that the results of those tests could indicate that the consumers' water is polluted, contaminated, or of poor quality. In fact, the complaint charges, such tests are unable to detect the presence of pollutants, contaminants, or other possibly harmful substances in water.
According to the complaint, Craftmatic also represented to consumers that its American Aqua home water treatment system would pay for itself by saving consumers stated percentages on certain household expenditures, such as 75% on plumbing repairs, 33% on water heater fuel bills, and 80% on cleaning products. The complaint further alleges that consumers were told that, by using an American Aqua home water treatment system, they could save a substantial amount of money, from about $50 to $150 per month.
Such representations are false and misleading, according to the Commission's complaint, because the defendants did not have a reasonable basis for making them.
The consent decree, if approved by the court, would require the defendants to disclose to consumers the specific substances that can be detected from any in-home test done on their water. The consent decree would also prohibit the defendants from making any of the following representations without competent and reliable scientific evidence to support them:
- that the results of any tests performed on consumers' water indicate that the water is or may be polluted, contaminated, or unhealthy to drink;
- that such pollutants may have caused or be contributing to the health problems of any individual who uses or consumes the water;
- that consumers will save certain amounts on household expenses after having a home water treatment system installed; or
- that any water treatment system can or will purify or remove a certain percentage of contaminants from water.
The consent decree also would prohibit the defendants from misrepresenting the purpose, content, reliability, or results of any test performed in connection with the sale of any product or service. It also would prohibit unsubstantiated representations concerning the efficacy or performance capabilities of any product offered for sale by the defendants.
The FTC filed the complaint and consent decree in the US District Court for the District of Massachusetts. This matter was handled by the FTC's Boston Regional Office.
- Civil Action No. 91-11448K (District of Massachusetts). FTC File No. 882-3042.
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This page was posted on August 27, 2006.