The Federal Trade Commission announced that it sent a second round of warning letters to multi-level marketers, telling them to stop making false claims about their products' ability to treat and cure COVID-19 and about the earnings that people can make selling these products. The FTC sent the letters to six companies, and told them to let the agency know within forty-eight hours what they have done to address the FTC's concerns.
For example, in the FTC's letter to the The Juice Plus+ Company, the agency told the company that social media posts made by its business opportunity participants or representatives falsely claimed that its products prevent or treat COVID-19 and misrepresent that consumers who become Juice Plus business opportunity participants are likely to earn substantial income. The FTC cited claims such as:
- "I for one will NEVER take a vaccine for the #WuhanVirus #KungFlu. I have never had an influenza shot why the hell would I get this one? And I have never had the flu as an adult. #JuicePlus @juiceplus" and
- "What would you do-especially now, so many people have lost their jobs or their income-if you had an extra $500 to $1,000 a month or more? Because it can be whatever you want it to be."
The FTC told Juice Plus that it is unlawful under the FTC Act to advertise that a product can prevent, treat, or cure human disease unless the company possesses competent and reliable scientific evidence, including, when appropriate, well-controlled human clinical studies, substantiating that the claims are true at the time they are made. The FTC also told Juice Plus that, "Express and implied earnings claims must be truthful and non-misleading to avoid being deceptive, which means that claims about the potential to achieve a wealthy lifestyle, career-level income, or significant income are false or misleading if business opportunity participants generally do not achieve such results."
The FTC issued general guidance to multi-level level marketers, about how to comply with consumer protection laws, in early 2018. In April of 2020, the FTC sent warning letters ten companies about their COVID-19 claims and related earning claims.
Originally published 7 Jun 2020
This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.