As we reported back in September, a Florida district court found that the enforcement of "gag clauses" by weight loss supplement maker Roca Labs to stop consumers from posting negative reviews about the company and its products is "unfair" and likely to cause substantial harm, in violation of the FTC Act. The court also found that the defendants lacked reliable and competent evidence for their weight loss claims, failed to disclose endorsers' material connection to the company, misrepresented the supposedly independent nature of a website touting their products and failed to keep consumers' private health information confidential. The court thus granted the FTC's motion for summary judgment and gave it twenty-one days to supplement its evidence of the amount of money the defendants should be ordered to pay to provide redress to defrauded consumers.
The court has now decided that that amount is a little over $25,000,000, "a sum that the Court found to be a reasonable approximation of the Defendants' unjust gains from their unlawful practices."
In addition, the court ordered a permanent injunction against the defendants regarding what types of claims they can and cannot make and what testing they'll need to support them. The order also permanently enjoins the defendants from suppressing negative consumer reviews through their contracts or otherwise threatening consumers with legal liability for speaking about the products, prohibits defendants from misrepresenting that any website or other publication is an independent, objective resource, and prohibits defendants from failing to disclose material connections with endorsers.
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