2943174 Canada Inc., Also d/b/a United Research Center, Inc.; Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 962-3224]

2943174 Canada Inc., Also d/b/a United Research Center, Inc.;

Analysis To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: In settlement of alleged violations of federal law prohibiting

unfair or deceptive acts or practices and unfair methods of

competition, this consent agreement, accepted subject to final

Commission approval, would prohibit, among other things, the Quebec-

based company and its president from making health benefits,

performance, or efficacy claims regarding the ``Svelt-PATCH'' or any

other drug or device unless, at the time the representation is made,

the respondents possess and rely upon competent and reliable scientific

evidence that substantiates the representation, and from

misrepresenting the existence, contents, validity, results,

conclusions, or interpretations of any test or study. In addition, the

proposed consent agreement would require the respondents to pay

$375,000 in consumer redress or disgorgement.

DATES: Comments must be received on or before June 6, 1997.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT: Michael Bloom or Ronald Waldman,

Federal Trade Commission, New York Regional Office, 150 William St,

13th Floor, New York, N.Y. 10038-2603, (212) 264-1201 or 264-1242.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal

Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Section 2.34 of

the Commission's Rules of Practice (16 CFR 2.34), notice is hereby

given that the above-captioned consent agreement containing a consent

order to cease and desist, having been filed with and accepted, subject

to final approval, by the Commission, has been placed on the public

record for a period of sixty (60) days. The following Analysis to Aid

Public Comment describes the terms of the consent agreement, and the

allegations in the complaint. an electronic copy of the full text of

the consent agreement package can be obtained from the FTC Home page

(for March 25, 1997), on the World Wide Web, at ``http://www.ftc.gov/

os/actions/htm.'' A paper copy can be obtained from the FTC Public

Reference Room, Room H-130, Sixth Street and Pennsylvania Avenue, N.W.,

Washington, D.C. 20580, either in person or by calling (202) 326-3627.

Public comment is invited. Such comments or views will be considered by

the Commission and will be available for inspection and copying at its

principal office in accordance with Section 4.9(b)(6)(ii) of the

Commission's Rules of Practice (16 CFR 4.9(b)(6)(ii)).

Analysis of Proposed Consent Order

The Federal Trade Commission has accepted, subject to final

approval, an agreement to a proposed Consent Order (``proposed order'')

from 2943174 Canada Inc., also doing business as United Research

Center, Inc., and its principal, Patrice Runner.

The proposed order has been placed on the public record for sixty

(60) days for receipt of comments by interested persons. Comments

received during this period will become part of the public record.

After sixty (60) days, the Commission will again review the agreement

and the comments received and will decide whether it should withdraw

from the agreement or make final the agreement's proposed order.

This matter concerns print advertisements for proposed respondents'

Svelt-PATCH, a purported weight loss product The Commission's complaint

alleges that proposed respondents engaged in deceptive advertising in

violation of Sections 5 and 12 of the FTC Act by making unsubstantiated

claims that: (1) Svelt-PATCH controls appetite; (2) Svelt-PATCH

significantly increases human metabolism; (3) Svelt-PATCH significantly

reduces body fat; (4) Svelt-PATCH causes significant weight loss; (5)

Svelt-PATCH causes long-term or permanent weight loss; and (6) Svelt-

PATCH lowers serum cholesterol levels.

The complaint further alleges that proposed respondents made a

false claim that clinical evidence proves that Svelt-PATCH causes users

to lose weight.

The proposed order contains provisions designed to remedy the

violations charged and to prevent proposed respondents from engaging in

similar acts in the future.

Paragraph I of the proposed order prohibits proposed respondents

from claiming that Svelt-PATCH or any other product or program: (1)

controls appetite; (2) increases human metabolism; (3) reduces body

fat; (4) causes weight loss; (5) causes long-term or permanent weight

loss; and (6) reduces cholesterol; (7) provides any weight loss, fat

loss, weight regulation, weight control, or weight maintenance benefit,

unless, at the time the

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representation is made, proposed respondents possess and rely upon

competent and reliable scientific evidence that substantiates the

representation.

Paragraph II of the proposed order prohibits proposed respondents

from making any representation for Svelt-PATCH, or any other drug or

device, about the health benefits, performance, or efficacy of such

product unless, at the time the representation is made, proposed

respondents possess and rely upon competent and reliable scientific

evidence that substantiates the representation.

Paragraph III of the proposed order prohibits proposed respondents

from misrepresenting the existence, contents, validity, results,

conclusions, or interpretations of any test, study, or study.

Paragraphs IV of the proposed order provides that nothing in this

order shall prohibit proposed respondents from making any

representation permitted by the Food and Drug Administration.

Paragraph V of the proposed order requires proposed respondents to

pay three hundred and seventy-five thousand dollars ($375,000) in

consumer redress, or if consumer redress is impracticable or

unwarranted, said money shall be payable to the United States Treasury.

Paragraph VI of the proposed order contains recordkeeping

requirements for materials that substantiate, qualify, or contradict

covered claims and requires the proposed respondents to keep and

maintain all advertisements and promotional materials containing any

representation covered by the proposed order. In addition, paragraph

VII requires distribution of a copy of the consent decree to current

and future officers and agents. Further, paragraph VIII provides for

Commission notification upon a change in the corporate respondent.

Paragraph IX requires proposed respondent Patrice Runner to notify the

respondents when he discontinues his current business or employment and

of his affiliation with certain new businesses or employment. The

proposed order also requires the filing of a compliance report

(Paragraph X).

Finally, paragraph XI of the proposed order provides for the

termination of the order after twenty years under certain

circumstances.

The purpose of this analysis is to facilitate public comment on the

proposed order. It is not intended to constitute an official

interpretation of the agreement and proposed order or to modify in any

way their terms.

Donald S. Clark,

Secretary.

[FR Doc. 97-8801 Filed 4-4-97; 8:45 am]

BILLING CODE 6750-01-M