FTC Upholds Charges Against Brake Guard; Add-on Brakes are not ABS

The Federal Trade Commission has ordered Brake Guard Products, Inc. to discontinue advertisements that claim their add-on braking system performed as effectively as factory installed antilock braking systems and has barred the company from using the term ABS in marketing their braking devices. Writing for a unanimous Commission, Commissioner Mary L.Azcuenaga said, "Because of the potential implications of this case for motor vehicle safety, the Commission takes this case particularly seriously. ... [T]he Commission concludes that there are no competent and reliable scientific data to support the respondents’ advertising claims." The Commission order also prohibits Brake Guard Products, Inc. and Ed F. Jones, its president, from misrepresenting the performance characteristics of the braking devices, the availability of insurance discounts resulting from installation of the brakes and their compliance with certain government standards. The Commission has ordered the respondents to take steps to notify all distributors and purchasers that the FTC has found that the ad claims and promotional material that stated that Brake Guard was an antilock braking system with the safety and economy advantages of factory installed ABS brakes are false and misleading.

In 1995, the FTC alleged that Brake Guard made false and unsubstantiated advertising claims that its Brake Guard Safety System, also known as Advanced Braking System or Brake Guard ABS, is an antilock braking system as effective as manufacturer-installed ABS brakes; complies with a performance standard established by the Society for Automotive Engineers; and will qualify a vehicle for automobile insurance discounts in a significant proportion of cases. The Commission alleged that the false and unsubstantiated claims violated federal law. Administrative Law Judge Lewis F. Parker upheld the charges in a May 1997 decision, following trial. Brake Guard and Jones appealed Judge Parker’s decision to the full Commission.

The Commission order announced today would bar representations that Brake Guard Safety System, Advanced Braking System, Brake Guard ABS or any substantially similar product:

• is an antilock braking system;
• prevents or substantially reduces wheel lock-up, skidding, or loss of steering control in emergency stopping situations;
• will qualify a vehicle for an automobile insurance discount in a significant proportion of cases;
• complies with a performance standard pertaining to antilock braking systems set forth by the National Highway Traffic Safety Administration;
• reduces stopping distances by 20 to 30%;
• provides antilock braking system benefits that are at least equivalent to factory- installed ABS systems; or
• will stop a vehicle in a shorter distance than a vehicle that is not equipped with the product, in emergency stopping situations.

Brake Guard sold the systems to dealers who charged consumers between $283 and $349 and it sold between 400,000 and 500,000 of the systems between 1990 and 1994, earning revenue in excess of $10 million during that time, according to the Commission opinion.

The order issued by the Commission would require Brake Guard and Jones to have substantiation for any claims of enhanced safety from the use of any braking system, accessory, or device, or any other system, accessory, or device designed to be used in, on, or in conjunction with any motor vehicle; claims of insurance discounts as a result of installation of the brakes; and bars misrepresentations of endorsements.

The order also would require that Jones send a letter to all Brake Guard distributors notifying them that the FTC has determined that the ad claims for Brake Guard are false and misleading and instructing them to stop using the promotional material. In addition, Jones must follow up by sending consumers notification of the FTC findings.

Finally, the order contains various reporting, distribution and record keeping requirements that are designed to ensure compliance.

The Commission vote to issue the decision was 3-0, with Commissioners Mozelle Thompson and Orson Swindle not participating. The order will be effective 60 days after it is served on the respondents. Under Commission rules, ex parte communications regarding this matter are barred until the Commission has disposed of any petition for reconsideration, or until the time for filing such petitions (14 days after service) has elapsed.

Copies of the Commission decision, as well as other documents associated with the Brake Guard case, and the companion cases, are available on the Internet at the FTC’s World Wide Web site at: http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-3128; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

(Docket No. 9277)