Nutrition Research and Hi-Health Supermart
to Settle FTC Charges of Marketing Bogus Diet Pills
FTC News Release
October 22, 1993
Two Arizona firms and their president have agreed to pay $225,000 in redress as part of a settlement of Federal Trade Commission charges that they deceptively marketed HGH-3X, a purported diet pill, throughout the United States. The FTC alleged that Nutrition Research & Marketing, Inc., and Hi-Health Supermart Corporation falsely promoted the pill as, among other things, a way to "stimulate the production of human growth hormone and help your fat burner get rid of those unwanted pounds." In fact, the FTC charged, consuming HGH-3X does not boost the user's metabolism, and cannot cause weight loss without dieting or exercise.
The proposed settlement also would prohibit the defendants from making claims about any weight-control product they market in the future without scientific evidence to back them up, and from making the specifically-alleged false claims cited by the FTC.
The FTC complaint detailing the charges in the case also names Simon D. Chalpin, president of the firms and a resident of Phoenix. Nutrition Research does business as Nutrition Science Research & Marketing Institute, which does business as National Research & Marketing, Inc., according to the complaint. Both firms are based in Scottsdale, and have marketed HGH-3X in the print and broadcast media, and in 30-minute television ads — or infomercials — the complaint states.
Advertisements cited by the FTC state that Hi-Health has 20 health food stores in Arizona. The ads list a price of $39.95 for 200 tablets, and state that HGH-3X is the "one weight loss product our customers re-order more than any other.…"
The FTC listed numerous representations allegedly made by the defendants in marketing HGH-3X, including that consuming it:
- stimulates the production of human growth hormone;
- adjusts a consumer's metabolic rate enough to cause significant weight loss (for instance, one infomercial shows a doctor stating that HGH has "3 essential amino acids" that "have a direct effect on the metabolism of fat");
- causes weight loss without the need to decrease caloric intake or increase exercise; and
- causes a significant decrease in body fat.
These representations are all false and unsubstantiated, the FTC charged, as are alleged representations that HGH-3X has been proven effective by scientific research, and that an article in the New England Journal of Medicine shows that consuming HGH-3X effectively decreases body fat. Finally, the FTC challenged various testimonials and endorsements contained in the defendants' advertising, charging that they do not reflect the typical weight-loss experiences of consumers using the product, as represented by the defendants.
The proposed consent judgment to settle these charges would permanently prohibit the defendants from making the above allegedly-false representations for HGH-3X or any substantially similar product. Further, in connection with marketing any weight-control product, they would be prohibited from making false representations and required to have competent and reliable scientific evidence to support any representation about the benefits, efficacy or safety of the product.
The settlement also would prohibit the defendants from misrepresenting the results of any test or study, and from falsely representing that any endorsement they use in marketing any weight-control product represents the typical experience of those who use it.
The $225,000 payment required by the proposed settlement would be used, if practical, to provide refunds to consumers who purchased HGH-3X. The funds would be paid over two years, with the delayed payment secured by two parcels of real estate.
Finally, the proposed settlement contains various provisions to assist the FTC in monitoring the defendants' compliance, and would require that a copy of the settlement be given to each officer and director of the companies.
The FTC filed the complaint and proposed consent judgment in US District Court for the District of Arizona, in Phoenix, on Oct. 21. The Commission votes to file them were 5-0. The settlement requires the approval of the court to become binding on the defendants. The FTC's Denver Regional Office is handling the case.
This case is another in a long series of FTC cases challenging false and unsubstantiated claims for diet products and programs. A free FTC consumer fact sheet — "The Facts About Weight Loss Products and Programs" — notes that while an estimated 50 million consumers will go on diets this year, perhaps as few as 5 percent will keep off for the long term any of the weight they lose. The brochure offers helpful information and lists a number of clues to fraud, and can be ordered at the address below.
- Civil Action No. 93-2031 (D. Ariz.). FTC File No. 912-3065.
This page was posted on August 27, 2006.