Marketer of Dietary Supplement Purporting to Treat Liver Diseases Agrees to Settle FTC Charges:

Liverite Products, Inc., based in Tustin, California, its two principals, and two other individuals agreed to settle Federal Trade Commission charges that they made numerous unsubstantiated claims in Internet, radio, and print ads about the ability of "Liverite" dietary supplement products to treat or prevent a wide range of liver diseases or disorders, including cirrhosis and hepatitis. In an agreement to settle the charges, Liverite Products, Inc. and its principals will be required to pay $60,000 in redress, and all of the defendants will be prohibited from claiming that the Liverite products or any food, drug or dietary supplement treats, cures or prevents any disease or disorder, unless they have scientific evidence to support the claims.

The FTC's complaint names Liverite Products, Inc., Corinne and Steven Jacobson, and James and Sheri Grant. According to the complaint, defendants Corinne and Steven Jacobson direct and control Liverite Products, and defendants James and Sheri Grant developed the websites through which the Liverite products were advertised and sold. The Liverite products included: Liverite, the Ultimate Liver Aid; Liverite 3 in 1 for Men; Liverite 3 in 1 for Women; and Liverite Sports. The primary ingredient in each of these products was extract of beef liver. The products were sold at retail outlets, such as GNC and CVS, by telephone, and on the Internet at "liverite.com," "liveriteproducts.com," and "healthylifemarketing.com."

According to the FTC's complaint, the defendants' advertisements represented that Liverite can prevent and treat hangovers; prevent and treat alcohol-induced liver disease, including cirrhosis; treat liver diseases, including cirrhosis and hepatitis; and alleviate the toxic side effects of various drugs. The FTC complaint alleges that these representations were not supported by competent and reliable scientific evidence. The complaint further alleges that the defendants falsely claimed that clinical tests proved that Liverite is effective for the treatment of liver problems.

In addition to the defendants' advertisements that made unsubstantiated claims, the defendants also used "metatag" technology to deceive consumers. Metatags are key words embedded in the source code for a webpage that are invisible to the average consumer, but are used by search engines to respond to consumers' search requests. The complaint also alleges that the defendants embedded in the metatags of the Liverite websites terms such as AIDS, hepatitis A, B & C, liver problems, liver disease, liver detoxification, alcohol, hangover, cirrhosis, anabolic steroids, interferon, and hepatatoxicity, thereby increasing the likelihood that consumers who researched these topics on the Internet would be directed to defendants' websites.

The proposed stipulated final order, which requires the court's approval, will require the defendants to have scientific substantiation that the Liverite products or any food, drug, or dietary supplement:

is effective in the prevention and treatment of hangovers and liver damage due to alcohol consumption, cirrhosis or hepatitis;

is effective in the treatment of cirrhosis, hepatitis, damaged liver, and candida imbalance;

is superior to traditional treatments for hepatitis C;

lowers or regulates liver enzymes, restores liver cell integrity, and improves liver function;

prevents liver damage and other side effects from use of pain killers, allergy medications, prescription drugs, interferon, medications used for Hepatitis C and HIV, immuno-suppressant drugs, chemotherapeutic drugs, cholesterol-lowering drugs, and anabolic steroids;

protects and detoxifies the liver from toxins in the diet and environment; and

reduces body fat.

The proposed stipulated final order also will require the defendants to possess scientific substantiation for claims that any food, drug or dietary supplement can treat, cure, alleviate the symptoms of, prevent, or reduce the risk of developing any disease or disorder. In addition, the defendants cannot claim that any Liverite product is "the ultimate liver aid," unless the claim is scientifically substantiated. The defendants also will be prohibited from misrepresenting the results of any test or study, and will be prohibited from misrepresenting that any testimonial or endorsement is the typical or ordinary experience of users of the advertised product, unless the claim is substantiated. Finally, the order requires Liverite Products, Inc. and the Jacobsons to pay $60,000.

The order would allow the defendants to make any claims that are approved for labeling by the Food and Drug Administration. The order also includes various recordkeeping and reporting requirements to help the FTC monitor the defendants' compliance with the order.

The Commission vote to authorize staff to file the complaint and proposed stipulated final order was 5-0. They were filed in the U.S. District Court for the Central District of California, Southern Division, in Santa Ana, on August 20, 2001, and require the court's approval.

NOTE: This stipulated final order is for settlement purposes only and does not constitute an admission by the defendants of a law violation. Stipulated final orders have the force of law when signed by the judge.

Copies of the complaint and the stipulated final order 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, 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. 002 3242)
(Civil Action No: SA 01-778 AHS (ANx))