FTC begins refunding consumers in false memory claims case

18-Apr-2018 - Last updated on 18-Apr-2018 at 15:10 GMT

The Federal Trade Commission has begun refunding more than $355,000 to consumers who bought what the agency ruled to be a deceptively marketed ‘memory improvement’ product

FTC's contractor recently began mailing checks averaging $168 to 2,116 consumers who bought the product. More than a year ago FTC ruled the product had been deceptively marketed via 30-minute radio spots that were formatted to sound like radio talk shows. The programs featured two alleged experts, Ronald Jahner and Brazos Minshew. In the case of Jahner, the original FTC complaint alleged that the spots did not disclose that he stood to benefit monetarily from the sale of the supplements. In Minshew’s case, he was billed as an expert on neurology and memory support, expertise he does not have, the complaint alleged.

The ads also featured a range of claims for the product which FTC said were false and misleading. Among these were claims that CogniPrin: 1) reverses mental decline by 12 years; 2) improves memory by 44%; and 3) improves memory in as little as three weeks and is clinically proven to improve memory.

Radio seen as problem area

Radio ads tend to be a problem area for compliance, said New York-based attorney Marc Ullman, of counsel with the firm Rivkin Radler. The urge to make full use of the expensive air time for marketing messages often leaves disclosure language out in the cold.

“There is a problem on radio with making adequate disclosures. My experience is that the content is barely able to be jammed into the time allotted , and that they don’t get around to disclosing the fact that the endorsers might be paid or that the people who sound like physicians might not be,” Ullman told NutraIngredients-USA when commenting on the original complaint.

In addition to the problems with the way the supplements were marketed and the claims that were made for them, the complaint took the defendants to task over the way consumers paid for them. The complaint alleged that the defendants (several other individuals and companies were included in addition to Jahner and Minshew) made a false and misleading promise for a 90-day return policy, when in fact consumers had to return the products within 14 days to qualify for the offer.

The complaint lodged a $6.6 million judgement against the defendants, most of which was suspended. In addition, it barred Minshew from acting as an “expert endorser” in the future unless he has the expertise he claims to have. Minshew was associated with an earlier FTC claims enforcement action on the cactus drink Nopalea.