The Federal Trade Commission announced that it entered into a consent order with Whole Leaf Organics, resolving charges that the company made false claims that its vitamin C product, called "Thrive," can treat, prevent, or reduce the risk of getting COVID-19. Although the FTC has sent hundreds of warning letters to marketers for making false coronavirus-related claims, this is the first COVID-19 related case that the FTC has brought. (In April, we blogged about the preliminary order the FTC obtained in the case.)
In a statement, Andrew Smith, Director of the FTC's Bureau of Consumer Protection, said, "This case, and the hundreds of warning letters we've sent, demonstrate that we will remain vigilant against companies that lack the scientific proof to back up their claims."
The FTC alleged that Whole Leaf Organics falsely promoted its Thrive product as an "anti viral wellness booster" that is clinically proven to be able to treat, prevent, and reduce the risk of COVID-19. The FTC alleged that the company made unsubstantiated claims such as, "Formulated with potent antiviral herbal extracts, Thrive by Whole Leaf Organics is the perfect way to strengthen your immunity against pathogens like 'COVID-19,' the coronavirus." The FTC also alleged that Whole Leaf Organics promoted the product as "Formulated with clinically tested and proven ingredients."
In addition, the FTC alleged that Whole Leaf Organics falsely promoted various products containing CBD and hemp extract as being scientifically proven to treat cancer. For example, the company promoted its CBD-EX product as one that, "combines the best in cancer fighting elements, into one simple capsule."
Under the consent order, Whole Leaf Organics agreed not to make any false COVID-19, disease, or health related claims. One of the interesting aspects of the order is that Whole Leaf Organics is required to send a notice to all purchasers of the products covered by the order warning them that the company made false claims about its products. For example, the notice to purchasers of Thrive must say, in part, "We're writing to let you know that some of the things we said in our advertising about Thrive aren't true. Scientific studies have not shown that Thrive reduces the risk of, prevents, or treats COVID-19."
The FTC's vote to accept the consent agreement was 3-1-1, with Commissioner Rohit Chopra voting "no" and Commission Rebecca Kelly Slaughter not participating. The order will be subject to public comment for thirty days after publication in the Federal Register, after which the Commission will decide whether to make the proposed consent order final.
It wasn't clear from the materials posted by the FTC why Commissioner Chopra dissented here -- but perhaps it had something to do with the fact that Whole Leaf Organics wasn't required to give consumers their money back. It will be interesting to see if, as a result of the comment process over the next month, we hear a bit more about that.
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