Max F. James; Analysis to Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 9623270]

Max F. James; 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

violations of federal law prohibiting unfair or deceptive acts or

practices or unfair methods of competition. The attached Analysis to

Aid Public comment describes both the allegations in the draft

complaint that accompanies the consent agreement and the terms of the

consent order--embodied in the consent agrement--that would settle

these allegations.

DATES: Comments must be received on or before February 16, 1999.

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

Room 159, 600 PA Ave., N.W., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT:

Matthew Gold or Sylvia Kundig, San Francisco Regional Office, Federal

Trade Commission, 901 Market Street, Suite 570, San Francisco,

California 94103, (415) 356-5270.

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 December 8, 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, 600 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 to Aid Public Comment

The Federal Trade Commission has accepted an agreement, subject to

final approval, to a proposed consent order from Max F. James

(hereinafter ``James'' or ``respondent''). James is a distributor of

nutritional supplements for New Vision International, Inc., a multi-

level marketing company. In a separate action, the Commission has also

accepted a similar agreement involving New Vision International, Inc.,

an affiliated company, and two individuals.

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

sixty (60) days for the reception 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 any comments received and will decide whether it should

withdraw from the agreement and take other appropriate action or make

final the agreement's proposed order.

This matter has focused on James' participation in the creation and

dissemination of advertisements for a regimen of nutritional

supplements that he has called ``God's Recipe.'' The advertisements

claimed that God's Recipe could mitigate or cure the effects of

Attention Deficit Disorder or Attention Deficit Hyperactivity Disorder.

The proposed complaint alleges that James could not substantiate

the following claims: (1) That God's Recipe can cure, prevent, treat or

mitigate Attention Deficit Disorder or its symptoms; (2) that God's

Recipe can cure, prevent, treat or mitigate Attention Deficit

Hyperactivity Disorder or its symptoms; (3) that God's Recipe is an

effective alternative treatment to the prescription drug Ritalin for

Attention Deficit Disorder and Attention Deficit Hyperactivity

Disorder; and (4) that testimonials from consumers appearing in the

advertisements for God's Recipe reflect the typical or ordinary

experience of members of the public whose children have used the

product.

Part I of the proposed consent order prohibits James, when

advertising God's Recipe or any other food, drug or dietary

supplements, from making claims (1) through (3), above, unless the

claim is substantiated at the time it is made. Part II of the proposed

order addresses

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claims made through endorsements or testimonials. Under Part II,

respondent may make such representations if he possesses and relies

upon competent and reliable evidence that substantiates the

representations; or the respondent must disclose either what the

generally expected results would be for users of the advertised

products, or the limited applicability of the endorser's experience to

what consumers may generally expect to achieve. The proposed order's

treatment of testimonial claims is in accordance with the Commission's

``Guides Concerning Use of Endorsements and Testimonials in

Advertising,'' 16 CFR 255.2(a).

Part III of the proposed order prohibits James from making

unsubstantiated claims about the safety of any food, drug or dietary

supplement, or about the ability of such product to treat, cure,

alleviate the symptoms of, prevent, or reduce the risk of developing

any disease or disorder. Part IV of the proposed order contains

language permitting James to make drug claims that have been approved

by the FDA pursuant to either a new drug application or a tentative

final or final standard. Part V states that James would be permitted to

make claims that the FDA has approved pursuant to the Nutrition

Labeling and Education Act of 1990.

Part VI of the proposed order requires James to retain, and make

available to the Commission upon request, all advertisements and

promotional materials containing any representation covered by the

order, as well as any materials that he relied upon in disseminating

the representation and any materials that contradict, qualify, or call

into question the representation.

Part VII of the proposed order requires James to distribute the

order to all current and future employees, agents and representatives

having responsibilities under the order. Part VII would permit James to

distribute a summary, in the form of a letter attached to the order as

Appendix A, in lieu of the actual order.

The remainder of the proposed order contains standard requirements

that James notify the Commission of changes in their employments

status, and that he file one or more reports detailing his compliance

with the order.

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

proposed order, and it 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. 98-33283 Filed 12-15-98; 8:45 am]

BILLING CODE 6750-01-M