Defective HIV Test Kit Marketer Settles FTC Charges

Canadian operators who sold defective HIV test kits over the Internet have settled Federal Trade Commission charges of making deceptive advertising claims. The settlement bars the defendants from selling the “Discreet” HIV test kits to U.S. consumers unless the kit has been approved by the U.S. Food and Drug Administration, and prohibits them from making false or misleading claims about any medical diagnostic device or service. The order also provides for notification to purchasers of the Discreet kits and requires destruction of hundreds of the defective kits seized by the U.S. Customs Service and Federal Express.

In May 2004, the FTC filed a suit in U.S. district court against Seville Marketing, Ltd., and its principal, Gregory Stephen Wong, both of British Columbia, Canada. The agency alleged that defendants Seville and Wong deceptively advertised that the Discreet test results were 99.4 percent accurate. In fact, testing conducted by the Centers for Disease Control and Prevention and submitted to the court showed that 59.3 percent of tested kits provided inaccurate results, including both inaccurate HIV-positive results and inaccurate HIV-negative results.

A stipulated final judgment and order, approved by the district court judge on May 18, 2005, bars the defendants from advertising or selling HIV test kits that the FDA has not approved for sale in the U.S. It also prohibits the defendants from making false or misleading statements about any device or service marketed to assist in the diagnosis of any disease or health condition. It authorizes the FTC to notify past Discreet purchasers that the agency believes that the defendants misrepresented the efficacy of the product, and advises purchasers who relied on the kits to contact a health professional. In addition, the settlement requires the destruction of several hundred test kits previously seized by U.S. Customs and Border Protection and Federal Express under a temporary restraining order entered by the court in May 2004. The final order contains standard record-keeping provisions to allow the agency to monitor compliance.

The Commission vote to accept the settlement was 5-0.

The case was brought with the substantial assistance of the Centers for Disease Control and Prevention, the U.S. Food and Drug Administration, U.S. Customs and Border Protection, and the British Columbia Business Practices and Consumer Protection Authority.

The case was filed in U.S. District Court for the Western District of Washington at Seattle.

NOTE: Stipulated final judgments and orders are for settlement purposes only and do not constitute an admission by the defendant of a law violation. Consent judgments have the force of law when signed by the judge.

Copies of the complaint and stipulated judgment for permanent injunction are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

(FTC File No. X04 0047)