9723157 UNITED STATES OF AMERICA In the Matter of Herbal Worldwide Holdings Corp., a corporation, José Diaz, individually and as an officer of the corporation, and Eduardo N. Naranjo, individually and as an officer of the corporation DOCKET NO. C-3827 COMPLAINT The Federal Trade Commission, having reason to believe that Herbal Worldwide Holdings Corp., a corporation, José Diaz, individually and as an officer of the corporation, and Eduardo Naranjo, individually and as an officer of the corporation ("respondents"), have violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that this proceeding is in the public interest, alleges: 1. Respondent Herbal Worldwide Holdings Corp. ("Herbal") is a Florida corporation with its principal office or place of business at 3326 Mary Street, Miami, Florida, 33133. 2. Respondent José Diaz is an owner and officer of respondent Herbal. Individually or in concert with others, he formulates, directs, or controls the policies, acts, or practices of Herbal, including the acts or practices alleged in this complaint. His principal office or place of business is the same as that of Herbal. 3. Respondent Eduardo N. Naranjo is an owner and officer of respondent Herbal. Individually or in concert with others, he formulates, directs, or controls the policies, acts, or practices of Herbal, including the acts or practices alleged in this complaint. His principal office or place of business is the same as that of Herbal. 4. Respondents have manufactured, advertised, labeled, offered for sale, sold, and distributed an over-the-counter weight-loss product to the public called "Fattaché." The ingredients of Fattaché include psyllium, chitosan (from deacetylated shellfish shells), glucomannan, and apple pectin. Fattaché is a "food" and/or "drug," within the meaning of Sections 12 and 15 of the Federal Trade Commission Act. 5. The acts and practices of respondents alleged in this complaint have been in or affecting commerce, as "commerce" is defined in Section 4 of the Federal Trade Commission Act. 6. Respondents have disseminated or have caused to be disseminated Spanish-language advertisements for Fattaché, including but not necessarily limited to the attached Exhibit A, which is the transcription of a television advertisement with an English-language translation. The advertisement contains the following statements:
7. Through the means described in Paragraph 6, respondents have represented, expressly or by implication, that:
8. Through the means described in Paragraph 6, respondents have represented, expressly or by implication, that they possessed and relied upon a reasonable basis that substantiated the representations set forth in Paragraph 7, at the time the representations were made. 9. In truth and in fact, respondents did not possess and rely upon a reasonable basis that substantiated the representations set forth in Paragraph 7, at the time the representations were made. Among other reasons, much of the research relied on by respondents did not address the weight loss and fat absorption effects discussed in the advertisement, and/or the results of the research could not be extrapolated to the population as a whole because of methodological weaknesses. Therefore, the representation set forth in Paragraph 8 was, and is, false or misleading. 10. The acts and practices of respondents as alleged in this complaint constitute unfair or deceptive acts or practices, and the making of false advertisements, in or affecting commerce in violation of Sections 5(a) and 12 of the Federal Trade Commission Act. THEREFORE, the Federal Trade Commission this sixteenth day of September, 1998, has issued this complaint against respondents. By the Commission. Donald S. Clark SEAL: TRANSLATION
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EXHIBIT A |