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Multi -Level Marketing
Company to Settle FTC Charges
That It Made Unsubstantiated Claims That Its "God's Recipe"
Dietary Regimen Could Cure ADD/ADHD
New Vision International, Inc., a multi-level marketing company that sells nutritional supplements, its affiliated company, NVI Promotions, L.L.C., and their principals, Jason P. Boreyko and Benson K. Boreyko (collectively "New Vision") have agreed to settle Federal Trade Commission charges that they made unsubstantiated claims in their advertisements for a combination of New Vision dietary supplements they called "God's Recipe." In a separate agreement, Max F. James, a high-level distributor of New Vision products, has also agreed to settle FTC charges over his role in selling God's Recipe. The ads claim that God's Recipe can cure Attention Deficit Disorder or Attention Deficit Hyperactivity Disorder ("ADD/ADHD").
New Vision International, Inc., and NVI Promotions, L.L.C. are based in Scottsdale, Arizona. Max F. James resides in Roseville, California.
This is the FTC's first case involving ADD/ADHD, a behavioral disorder which affects up to 2.5 million school-aged children in the United States. ADD/ADHD's symptoms include inattention, impulsiveness and hyperactivity. Although these behaviors are common in nearly all children at times, in children with ADD/ADHD the behaviors are chronic and age inappropriate. The most commonly prescribed medications for treatment of ADD/ADHD are stimulants, such as Ritalin.
"The ads exploited parents' fears of prescription drugs like Ritalin by making claims that God's Recipe was a natural, safer alternative for treating ADD and ADHD," said Jodie Bernstein, Director of the FTC's Bureau of Consumer Protection. "New Vision lacked the substantiation the Commission requires for that claim. Companies or individuals who make health-benefit claims for dietary supplements or other products must substantiate those claims under Commission law. Supplement marketers should refer to the FTC's recently released 'Dietary Supplements: An Advertising Guide for Industry' for specific guidance on how to comply with this requirement," Bernstein advised.
New Vision sells a wide variety of dietary supplements through independent distributors. New Vision has developed a multilevel marketing plan that allows distributors to earn money by selling the products at suggested mark-ups to consumers and by recruiting and training other individuals to be distributors of New Vision products.
New Vision's written materials and audiotapes touted three dietary supplements that comprise God's Recipe -- "PC Grape Seed Extract with an Herbal Blend" (a mineral tonic drink); "Essential Minerals" (an antioxidant capsule); and "Multi-Enzymes with Alfalfa/Barley Sprouts" (a multi-enzyme tablet) -- as a natural alternative to the prescription drug Ritalin for children suffering from ADD/ADHD. Similar products are also found in a typical health food store, as well as through other marketers of nutritional supplements.
According to the FTC's complaint detailing the charges, the respondents did not have a reasonable basis to substantiate their claims that:
In two separate settlements to these charges, announced today for a public comment period, the respondents, when advertising God's Recipe or any other food, drug or dietary supplement, would be prohibited from representing that:
unless they possess competent and reliable scientific evidence to support the representation at the time the representation is made.
In addition, the respondents would be prohibited from representing that the use of any food, drug, or dietary supplement can treat, cure, alleviate the symptoms of, prevent, or reduce the risk of developing any disease or disorder, unless they possess and rely upon competent and reliable scientific evidence that substantiates the claims at the time they are made. The proposed settlements would allow the respondents to make representations specifically permitted by the Food and Drug Administration.
The proposed settlements would also prohibit the respondents from deceptively representing that any user testimonial or endorsement of a product represents the typical or ordinary experience of members of the public who use the product.
In addition, the proposed settlement with the New Vision respondents contains requirements designed to ensure that they effectively police the advertising practices of their independent distributors.
Finally, both settlements contain standard record keeping provisions designed to assist the FTC in monitoring the respondents' compliance.
An announcement regarding the proposed consent agreements will be published in the Federal Register shortly. The agreements will be subject to public comment for 60 days, after which the Commission will decide whether to make them final. Comments should be addressed to the FTC, Office of the Secretary, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580.
The Commission vote to accept the two consent agreements for public comment was 4-0. The FTC's San Francisco Regional Office handled the investigation.
NOTE: Consent agreements are for settlement purposes only and do not constitute an admission of a law violation. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of $11,000.
Copies of the complaints, two consent agreements and analyses of the agreements to assist the public in commenting are available from the FTC's web site [search for New Vision] or by calling 202-326-3627. Copies of the documents are also available from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC-HELP (202-382-4357); TDD for the hearing impaired 202-326-2502. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.
(FTC File No. 962-3270)