Western Direct Marketing Group, Inc., et al.; Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 952-3235]

Western Direct Marketing Group, Inc., et al.; Analysis To Aid

Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged violation

of federal law prohibiting unfair or deceptive acts or practices or

unfair methods of competition. The attached Analysis to Aid Public

Comment describes both allegations in the draft complaint that

accompanies the consent agreement and the terms of the consent order--

embodied in the consent agreement--that would settle these allegations.

DATES: Comments must be received on or before July 17, 1998.

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

Room 159, 6th St. and Pa. Ave., NW. Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT:

Joel Winston, FTC/S-4002, Washington, DC 20580. (202) 326-3153.

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 May 12, 1998), on the World Wide Web, at ``http://www.ftc.gov/os/

actions97.htm.'' A paper copy can be obtained from the FTC Public

Reference Room, Room H-130, Sixth Street and Pennsylvania Avenue, NW,

Washington, DC 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 To Aid Public Comment

The Federal Trade Commission has accepted an agreement to a

proposed consent order from Western Direct Marketing Group (``WDMG'')

and Western Intentional Media Corporation (``WIMC'').

The proposed consent 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 withdrawn

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

This matter involves alleged deceptive representations for

Cholestaway, a dietary supplement marketed by Bodgana Corporation,

purported to lower serum cholesterol. Advertisements for the product

included 30-minute television infomercials.

WDMG is the successor corporation to Television Marketing Group,

the advertising agency for the Cholestaway television infomercials.

MIMC is WDMG's corporate parent.

According to the FTC complaint, through the infomercials, the

respondent made claims that Cholestaway: significantly lowers serum

cholesterol levels; significantly lowers serum cholesterol levels

without changes in diet; significantly lowers serum cholesterol levels

and causes significantly weight loss even if users eat foods high in

fat, including fried chicken and pizza; substantially reduces or

eliminates the body's absorption of dietary fat; lowers low density

lipoprotein cholesterol and improves the high density lipoprotein

cholesterol to low density lipoprotein cholesterol ratio; is effective

in the treatment of hardening of the arteries and heart diseases;

causes significant weight loss; causes significant weight loss without

changes in diet; significantly reduces blood triglyceride levels;

significantly reduces elevated blood pressure; and is scientifically

proven to lower serum cholesterol levels and reduce elevated blood

pressure significantly; and that

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testimonials from consumers appearing in the advertisements for

Cholestaway reflect the typical or ordinary experience of members of

the public who use the product. The complaint alleges that the

respondents did not have a reasonable basis for any of these

representations at the time they were made.

The consent order contains provisions designed to prevent the

respondents from engaging in similar acts and practices in the future.

Part I of the order prohibits the respondents from making the

representations challenged in the complaint, unless they possess and

rely upon competent and reliable scientific evidence that substantiates

the representation.

Part II prohibits respondents from making any representations about

the efficacy, performance, safety or benefits of any food, dietary

supplement of drug unless they possess and rely upon competent and

reliable scientific evidence that substantiates the representation.

Part III prohibits the respondents from mispresenting the

existence, contents, validity, results, conclusions or interpretations

of any test, study, or research.

Part IV prohibits the respondents from representing that the

experience represented by a user testimonial or endorsement of the

product is the typical or ordinary experience of users of the product

unless the representation is substantiated or they disclose what the

generally expected results would be or that consumers should not be

expect the same results.

Part V allows the respondents to make respondentations for any drug

that are permitted in labeling for that drug under any tentative final

or final Food and Drug Administration (``FDA'') standard or under any

new drug application approved by the FDA.

Part VI allows the respondents to make representations for any

product that are specifically permitted in labeling for that product by

regulations issued by the FDA under the Nutrition Labeling and

Education Act of 1990.

Parts VII through X require the respondents to keep copies of

advertisements making representations covered by the order; to keep

records concerning those representations, including materials that they

relied upon making the representations; to provide copies of the order

to certain of the respondents' personnel; to notify the Commission of

changes in corporate structure; and to file complaint reports with the

Commission. Part XI provides that the order will terminate after twenty

(20) years under certain circumstances.

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

proposed order, and its is not intended to constitute an official

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

way their terms.

By direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 98-13142 Filed 5-15-98; 8:45 am]

BILLING CODE 6750-01-M