Home Shopping Network Settles FTC Charges that Advertising Claims Lacked Scientific Support

Home Shopping Network, Inc. (HSN) and two of its subsidiaries have agreed to secure scientific evidence to back up claims that any food, supplement or drug can treat a disease or affect a function of the body. HSN signed an agreement including this provision to settle the Federal Trade Commission’s 15-month-old deceptive advertising lawsuit against them. The settlement also requires HSN, Home Shopping Club, Inc., and HSN Lifeway Health Products, Inc. to have scientific substantiation before claiming that any stop-smoking product or program works for consumers. The settlement would end the FTC’s litigation against HSN, and contains substantially the same provisions the FTC said it would seek when it first announced charges against the network and the subsidiaries in March 1995.

“While HSN owns a network of stations that broadcast its commercial programming, in reality it is an advertiser,” said Jodie Bernstein, Director of the FTC’s Bureau of Consumer Protection. “The law requires all advertisers -- whether they are television shopping programs, catalog companies or more traditional marketers -- to have a reasonable basis for the objective product claims they make.” In this case, the FTC alleged, HSN made health claims for its spray vitamins without adequate support.

“Home shopping channels are one of an increasing array of new technologies used to sell products,” Bernstein continued. “These new avenues of marketing will have important benefits

for consumers. But it is vital that they also meet the basic standards of truthfulness and substantiation that apply to more traditional forms of marketing.”

The FTC complaint detailing the charges in the case challenges advertising for four mouth sprays -- three vitamin sprays and a stop-smoking spray. According to the complaint, the respondents made a number of health-related claims without having the necessary evidence to back them up, including claims that the vitamin sprays prevent the common cold and reduce the risk of infectious diseases, and that the stop-smoking spray enables users to stop smoking easily and eliminates the anxiety and weight gain that go along with quitting smoking.

HSN, based in St. Petersburg, Florida, markets a variety of consumer products via live, interactive television programs and through mail order brochures. Home Shopping Club produced and disseminated advertising called “Spotlight on Ruta Lee,” during which the “Lifeway” spray vitamins and smoking-cessation spray were promoted and sold. (In a related case, the FTC also filed charges against Ruta Lee and her firm, Live-Lee Productions, Inc. Those charges were resolved by a settlement in October 1995.) According to HSN’s 1995 Annual Report , HSN’s television advertising reaches more than 70 million American households.

Under the proposed consent agreement announced today, HSN, Home Shopping Club and HSN Lifeway Health Products would be required to have competent and reliable scientific evidence before making any claim:

• that a food, food or dietary supplement, or drug cures, treats or prevents any disease or has any effect on the structure or function of the human body; or
• about the performance, benefits or efficacy of any smoking-cessation program, product or service.

The consent agreement also contains various reporting and record-keeping provisions that would assist the FTC in monitoring the respondents’ compliance, and it would permit the respondents to make certain claims permitted by the Food and Drug Administration.

The Commission vote to announce the proposed consent agreement for public comment was 5-0. It will be published in the Federal Register shortly and will be subject to public comment for 60 days, after which the Commission will decide whether to make it final. Comments should be addressed to the FTC, Office of the Secretary, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580.

NOTE: A consent agreement is for settlement purposes only and does not constitute an admission of a law violation. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of $10,000.

Copies of the proposed consent agreement, as well as the March 1995 complaint and other documents associated with this matter, are available from the FTC’s Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; 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. FTC news releases and other materials also are available on the Internet at the FTC’s World Wide Web site at: http://www.ftc.gov

(FTC Docket No. D09272)