Case 4:20-cv-10249-TSH Document 8 Filed 02/19/20 Page 1 of 24 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS BOSTON DIVISION FEDERAL TRADE COlvlMISSION, Plaintiff, v. EXCELLENT MARKETING RESULTS, INC., a corporation, and MICHAEL MCGAHEE, individually and as an officer of EXCELLENT MARKETING RESULTS, INC., Defendants. Case No. JO - l O). lf q -,r/J STIPULATED ORDER FOR PERMANENT INJUNCTION AND MONETARY JUDGMENT Plaintiff, the Federal Trade Commission ("Commission" or "FTC"), filed its Complaint for Pennanent Injunction and Other Equitable Relief ("Complaint"), for a permanent injunction, and other equitable relief in this matter, pursuant to Section 13(b) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. § S3(b). The FfC and Defendants stipulate to the entry of this Stipulated Order for Pennanent Injunction and Monetary Judgment ("Order") to resolve all matters in dispute in this action between them. THEREFORE, IT IS ORDERED as follows: 1
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Case 4:20-cv-10249-TSH Document 8 Filed 02/19/20 Page 1 of 24
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS
BOSTON DIVISION
FEDERAL TRADE COlvlMISSION,
Plaintiff,
v.
EXCELLENT MARKETING RESULTS, INC., a corporation, and
MICHAEL MCGAHEE, individually and as an officer of EXCELLENT MARKETING RESULTS, INC.,
Defendants.
Case No. JO - l O). lf q -,r/J
STIPULATED ORDER FOR PERMANENT INJUNCTION AND MONETARY JUDGMENT
Plaintiff, the Federal Trade Commission ("Commission" or "FTC"), filed its Complaint
for Pennanent Injunction and Other Equitable Relief ("Complaint"), for a permanent injunction,
and other equitable relief in this matter, pursuant to Section 13(b) of the Federal Trade
Commission Act ("FTC Act"), 15 U.S.C. § S3(b). The FfC and Defendants stipulate to the
entry of this Stipulated Order for Pennanent Injunction and Monetary Judgment ("Order") to
resolve all matters in dispute in this action between them.
THEREFORE, IT IS ORDERED as follows:
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Case 4:20-cv-10249-TSH Document 8 Filed 02/19/20 Page 2 of 24
FINDINGS
1. This Court has jurisdiction over this matter.
2. The Complamt charges that Defendants participated in deceptive acts or practices in
violation of Sections S and 12 of the FTC Act, 15 U.S.C. §§ 45 and 52, in the marketing and sale of
StimTein.
3. Defendants neither admit nor deny any of the allegations in the Complaint, except as
specifically stated in this Order. Only for purposes of this action, Defendants admit the facts
necessary to establish jurisdiction. .
4. Defendants waive any claim that they may have under the Equal Access to Justice
Act, 28 U.S.C. § 2412, concerning the prosecution of this action through the date of this Order,
and agree to bear their own costs and attorney fees.
5. Defendants and the Commission waive all rights to appeal or otherwise challenge
or contest the validity of this Order.
DEFINITIONS
For the purpose of this Order, the following definitions apply:
A. "Clearly and conspicuously" means that a required disclosure is difficult to miss (i.e.,
easily noticeable) and easily understandable by ordinary consumers, including in all of the
following ways:
1. In any communication that is solely visual or solely audl"ble, the disclosure must
be made through the same means through which the communication is presented. In any
communication made through both visual and audible means, such as a television advertisement,
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the disclosure must be presented simultaneously in both the visual and audible portions of the
communication even if the representation requiring the disclosure is made in only one means.
2. A visual disclosure, by its size, contrast, location, the length of time it appears,
and other characteristics, must stand out from any accompanying text or other visual elements so
that it is easily noticed, read, and understood.
3. An audible disclosure, including by telephone or streaming video, must be
delivered in a volume, speed, and cadence sufficient for ordinary consumers to easily hear and
understand it.
4. In any communication using an interactive electronic medium, such as the
Internet or software, the disclosure must be unavoidable.
S. On a product label, the disclosure must be presented on the principal display
panel.
6. The disclosure must use diction and syntax understandable to ordinary consumers
and must appear in each language in which the representation that requires the disclosure
appears.
7. The disclosure must comply with these requirements in each medium through
which it is received, including all electronic devices and face-to-face communications.
8. The disclosure must not be contradicted or mitigated by, or inconsistent with,
anything else in the communication.
9. When the representation or sales practice targets a specific audience, such as
children, the elderly, or the terminally ill, "ordinary consumers0 includes reasonable members of
that group.
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B. "Corporate Defendant" means Excellent Marketing Results, Inc., and its successors and
assigns.
C. "Covered Product'' means any Dietary Supplement, Food, o~ Drug, including but not
limited to StimTein.
D. "Defendants" means the Individual Defendant and Corporate Defendant, individually,
collectively, or in any combination.
E. "Dietary Supplement" means: (1) any product labeled as a dietary supplement or
otherwise represented as a dietary supplement; or (2) any pill, tablet, capsule, powder, sofmel,
gelcap, liquid, or other similar form containing one or more ingredients that are a vitamin,
mineral, herb or other botanical, amino acid, probiotic, or other dietaty substance for use by
humans to supplement the diet by increasing the total dietary intake, or a concentrate, metabolite,
constituent, extract, or combination of any ingredient described above, that is intended to be
ingested, and is not represented to be used as a conventional food or as a sole item of a meal or
the diet
F. "Drug" means: (1) articles recognized in the official United States Pharmacopoeia,
official Homeopathic Pharmacopoeia of the United States, or official National Formulary, or any
s~pplement to any of them; (2) articles intended for use in the diagnosis, cure, mitigation,
treatment, or prevention of disease in humans or other animals; (3) articles ( other than food)
intended to affect the structure or any function of the body of humans or other animals; and (4)
articles intended for use as a component of any article specified in (1 ), (2), or (3); but does not
include devices or their components, parts, or accessories.
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G. "Essentially Equivalent Product'' means a product that contains the identical
ingredients, except for inactive ingredients (e.g., binders, colors, fillers, excipients), in the same
fonn and dosage, and with the same route of administration (e.g., orally, sublingua)ly), as the
Covered Product; provided that the Covered Product may contain additional ingredients if
reliable scientific evidence generally accepted by experts in the field indicates that the amount
and combination of additional ingredients is unlikely to impede or inlnoit the effectiveness of the
ingredients in the Essentially Equivalent Product.
H. "Food" means: (a) any article used for food or drink for humans or other animals; (b)
chewing gum; and (c) any article used for components of any such article.
I. "Individual Defendant" means Michael McGahee.
J. ''StimTein,, means the orally administered product marketed by Defendants.
ORDER
I.
PROHIBITED REPRESENTATIONS: REGARDING HEALTH-RELATED CLAIMS REQUIRING HUMAN CLINICAL TESTING FOR SUBSTANTIATION
IT IS ORDERED that Defendants, Defendants' officers, agents, employees, and attorneys,
and all other persons in active concert or participation with any of them, who receive actual notice of
this Order, whether acting directly or indirectly, in connection with the manufacturing, labeling,
advertising, promotion, offering for sale, sale, or distnoution of any Covered Product, are
permanently restrained and enjoined from making, or assisting others in making, expressly or by
implication, including through the use of a product name, endorsement, depiction, or illustration, any
representation that such product:
A. Grows bone, including in persons with osteoporosis and osteopenia;
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B. Grows cartilage;
C. Provides rapid, substantial, or long-lasting relief from joint pain, including chronic or
severe pain caused by arthritis, bursitis, and stenosis; or
D. Cures, mitigates, or treats any disease
unless the representation is non-misleading, and, at the time of making such representation, they
possess and rely upon competent and reliable scientific evidence substantiating that the
representation is 1rue. For purposes of this Section, competent and reliable scientific evidence must
consist of human clinical testing of the Covered Product, or of an Essentially Equivalent Product, that
is sufficient in quality and quantity based on standards generally accepted by experts in the relevant
disease, condition, or function to which the representation relates, when considered in light of the
entire body of relevant and reliable scientific evidence, to substantiate that the representation is true.
Such testing must be: (1) randomized, double-blind, and placebo-controlled; and (2) conducted by
researchers qualified by training and experience to conduct such testing. In addition, all underlying or
supporting data and documents generally accepted by experts in the field as relevant to an assessment
of such testing as descnoed in the section entitled Preservation of Records Relating to Competent and
Reliable Human Clinical Tests or Studies must be available for inspection and production to the
Commission. Persons covered by this Section have the burden of proving that a product satisfies the
definition of Essentially Equivalent Product.
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Il. PROHIBITED REPRESENTATIONS:
OTHER BEAL TB-RELATED CLAIMS
IT JS FURTHER ORDERED that Defendants, Defendants' officers, agents, employees,
and attorneys, and all other persons in active concert or participation with any of them, who receive
actual notice of this Order, whether acting directly or indirectly, in connection with the
manufacturing, labeling, advertising, promotion, offering for sale, sale, or distnbution of any
Covered Product, are pennanently restrained and enjoined from making, or assisting others in
making, expressly or by implication, including through the use of a product name, endorsement,
depiction, or illustration, any representation, other than representations covered llllder the Section of
this Order entitled Prolu"bited Representations: Regarding Health-Related Claims Requiring Human
Clinical Testing For Substantiation, about the health benefits, performance, efficacy, safety, or side
effects of any Covered Product, unless the representation is non-misleading, and, at the time of
making such representation, they possess and rely upon competent and reliable scientific evidence
that is sufficient in quality and quantity based on standards generally accepted by experts in the
relevant disease, condition, or function to which the representation relates, when considered in light
of the entire body of relevant and reliable scientific evidence, to substantiate that the representation is
true.
For purposes of this Section, competent and reliable scientific evidence means tests, analyses,
research, or studies (1) that have been conducted and evaluated in an objective manner by experts in
the relevant disease, conditio~ or function to which the representation relates; (2) that are generally
accepted by such experts to yield accurate and reliable results; and (3) that are randomiud,
double-blind, and placebo-controlled human clinical testing of the Covered Product, or of an
Essentially Equivalent Product, when such experts would generally require such human clinical
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Case 4:20-cv-10249-TSH Document 8 Filed 02/19/20 Page 8 of 24
testing to substantiate that the representation is true. In addition, when such tests or studies are
human clinical tests or studies, all underlying or supporting data and documents generally accepted
by experts in the field as relevant to an assessment of such testing as set forth in the section entitled
Preservation of Records Relating to Competent and Reliable Human Clinical Tests or Studies must
be available for inspection and production to the Commission. Persons covered by this Section have
the burden of proving that a product satisfies the definition of Essentially Equivalent Product
m.
PROHlBITED MISREPRESENTATIONS REGARDING TESTS, STUDIES, OR OTHER ~EARCH
IT IS FURTHER ORDERED that Defendants, Defendants' officers, agents, employees,
and attorneys, and all other persons in active concert or participation with any of them, who receive
actual notice of this Order, whether acting directly or indirectly, in connection with the
manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of any product,
are permanently restrained and enjoined from misrepresenting, in any manner, or assisting others in
misrepresenting, expressly or by implication, including through the use of a product name,
endorsement, depiction, or illustration:
A. That any Covered Product is clinically or scientifically proven to:
1. Grow bone, including in persons with osteoporosis and osteo_penia;
2. Grow cartilage;
3. Provide rapid, substantial, or long-lasting relief from joint pain, including
chronic or severe pain caused by arthritis, bursitis, and stenosis; or
B. That the performance or benefits of any product are scientifically or clinically proven
or otherwise established; or
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C. The existence, contents, validity, results, conclusions, or interpretations of any test,
B. For matters concerning this Order, the Commission is authorized to communicate
directly with each Defendant. Defendant must pemrlt representatives of the Commission to
interview any employee or other person affiliated with any Defendant who has agreed to such an
interview. The person interviewed may have counsel present.
C. The Commission may use all other lawful means, including posing, through its
representatives as consumers, suppliers, or other individuals or entities, to Defendants or any
individual or entity affiliated with Defendants, without the necessity of identification or prior notice.
Nothing in this Order limits the Commission's lawful use of compulsory process, pursuant to
Sections 9 and 20 of the FTC Act, 1 S U.S.C. §§ 49, S7b-1.
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D. Upon written request from a representative of the Commission, any consumer
reporting agency must furnish consumer reports concerning Individual Defendant, pursuant to
Section 604(1) of the Fair Credit Reporting Act, 15 U.S.C. § 168lb(a)(l).
XVII.
RETENTION OF JURISDICTION
IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for purposes
of construction, modification, and enforcement of this Order.
SO ORDERED this day otU /'l, 2;;}.C)
SO STIPULATED AND AGREED:
FOR PLAINTIFF FEDERAL TRADE COMMISSION:
ALDEN F. ABBOTT General Counsel
Isl Mary L. Johnson Date: February I 0, 2020
Mary Johnson, DC Bar No. 455345 Mamie Kresses, DC Bar No. 413467 Federal Trade Commission 600 Pennsylvania Avenue, N.W., CC-10528 Washington, DC 20850 202-326-3115, mjohnson [email protected] 202-326-2070, [email protected] 202-326-3259 (facsimile)
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DEFENDANTS: , /J hd/1-!~Date: /IJ-- .31-l'f
MICHAEL McOAHEE, INDMDUALLY AND AS AN OFFICER OF EXCBLLENT MARKETING RESULTS, INC.
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Case 4:20-cv-10249-TSH Document 8 Filed 02/19/20 Page 24 of 24
AITACHMENT A
[On EMR letterhead]
[on envelope]
IMPORT ANT NOTICE ABOUT STIMTEIN COURT SETTLEMENT
[content ofletter, 16-point font}
Dear [Recipient]:
We're writing because you bought StimTein pills that we claimed had many health benefits.
The Federal Trade Commission (FTC), the nation's consumer protection agency, sued us for
deceptive advertising.
As part of a court settlement, we have agreed to stop making claims that the product grows
bone or cartilage; relieves joint pain, including pain from arthritis, bursitis, or stenosis; or treats any
other disease or health condition. If you took StimTein for any of these conditions, please know
that, according to the FTC, we don't have scientific evidence to support what we said in our ads.