P.S. Docket No. 20/17
May 14, 1985
In the Matter of the Complaint Against
KINGSBRIDGE MEDIA & MARKETING, INC.,
6835 Valjean Avenue,
Van Nuys, CA 91406-4713, et al .
P.S. Docket No. 20/17
May 14, 1985
APPEARANCES FOR COMPLAINANT:
Nan M. Kalthoff, Esq.
James A. Harbin, Esq.
Consumer Protection Division
Law Department
United States Postal Service
Washington, DC 20260-1112
APPEARANCE FOR RESPONDENTS:
Dennis M. Gronek, Esq.
Dilling, Dilling, and
Gronek 150 N. Wacker Drive
Suite 1242
Chicago, IL 60606-1606
BEFORE: Randolph D. Mason
Administrative Law Judge
INITIAL DECISION
This proceeding was initiated on October 31, 1984, when the General Counsel filed a Complaint in the above cases against the following Respondents: Kingsbridge Media & Marketing, Inc., Frank E. Robinson, and Nutrimarketing, at 6835 Valjean Avenue, Van Nuys, CA 91406-4713; Highcliff, Inc., and Mel Korey, at 7339 Highcliff Drive, Scottsdale, AZ 85253-2825; Steve Korey at 7475 E. Raintree Court, Scottsdale, AZ 85258-2005; Vista Advertising at 6710 East Camel Back Road, Scottsdale, AZ 85251-2093; and Dream Away at P. O. Box 1313, Burbank, CA 91507-1313 and P. O. Box 7500, Atlanta, GA 30357-0500. At the hearing the Complaint was amended to add the following address for Dream Away: P. O. Box 1020, Stamford, CT 06904-1020 (Tr. 243).
The Complaint alleges that Respondents are engaged in conducting a scheme or device for obtaining money or property through the mails by means of false representations concerning a product known as "Dream Away" in violation of 39 U.S.C. 3005. Respondents deny that any violation of the statute has occurred. The Complaint alleges that Respondents falsely represent:
14 . . . Directly or indirectly, in substance and effect, whether by affirmative statements, implication or omission that:
(a) Dream Away causes the user to lose weight while sleeping.
(b) Dream Away causes the user to lose weight.
(c) Dream Away causes the user to lose fat.
(d) Dream Away causes the user to lose weight without restricting his or her accustomed calorie intake (i.e., dieting) or exercising.
(e) Dream Away causes the user to lose weight at the rate of two pounds in one day, seven pounds in one week, 10 pounds in two weeks, 16 pounds in 30 days, 18 pounds in three weeks, and twenty pounds in 30 days.
(f) Dream Away causes the user to lose a substantial amount of weight in a short period of time.
(g) Dream Away promotes muscle development in the user.
(h) Dream Away stimulates the release of human growth hormone and thereby promotes muscle growth and repair.
(i) Obese persons are likely to have a deficiency of the human growth hormone.
(j) Dream Away stimulates the release of the human growth hormone and thereby causes a loss of fat.
(k) Dream Away causes an increase in the user's muscle tissue without exercise.
(l) The human growth hormone burns fat.
(m) Use of Dream Away makes a significant contribution to a loss of weight when used in conjunction with diet.
(n) Use of Dream Away makes a significant contribution to a loss of weight when used in conjunction with diet."
The hearing was held before the undersigned in Santa Ana, California, on January 9 and 10, 1985. Complainant introduced the expert testimony of Ernst J. Drenick, MD.; Respondent presented the expert testimony of Jorge M. Lima, MD, and Jack Hegenauer, Ph.D. Both parties were represented by counsel and afforded full opportunity to be heard, adduce relevant evidence and examine and cross-examine witnesses. Both parties filed Proposed Findings of Fact and Conclusions of Law on March 7, 1985, which have been duly considered. Although both briefs were excellent, Complainant's brief was particularly helpful to the undersigned in drafting this Initial Decision.
To the extent indicated below proposed findings and conclusions have been adopted; otherwise they have been rejected as irrelevant or contrary to the evidence. Based on the entire record herein, including my observation of the witnesses and their demeanor, the exhibits, stipulations, and other relevant evidence adduced at the hearing, I make the following Findings of Fact and Conclusions of Law:
FINDINGS OF FACT
1. By means of television advertisements, Respondents solicit remittances of money through the mails for the product Dream Away at P. O. Box 1313, Burbank, California 91507, at P. O. Box 7500, Atlanta, Georgia 30357, and at P. O. Box 1020, Stamford, Connecticut, 06904 (Answer, 9; Stipulation, 2, 9; JX-A.).
2. Respondents' television commercials invite their viewers to place collect-on-delivery (COD) orders by calling one of Respondents' toll-free telephone numbers. Respondent Nutrimarketing delivers the COD-ordered product(s) to the customer through the United Parcel Service (UPS). UPS accepts cash or other payment for the product(s) from the customer and then mails the tendered payment for the COD parcel to Nutrimarketing at 6835 Valjean Avenue, Van Nuys, California 91406-4713 (Ans., 11).
3. Persons who until January 15, 1984 requested information about Dream Away received a pamphlet entitled "The Secrets of Dream Away/The Amino Acid Diet/Lose Weight While You Sleep Naturally" and an invitation to order Dream Away (Stip., 5; JX-F). Respondents used this pamphlet in conjunction with the reorder form to obtain the remittances of money through the mail to Dream Away, P. O. Box 1313, Burbank, California 91507 (Stip., 5; JX-G).
4. Respondents include in packages of Dream Away, inter alia , a letter on Nutrimarketing letterhead, a business return envelope, and a reorder form. JX-D-1 is the letter used until approximately February 15, 1984. JX-D-2 is the letter that has been used since then. Respondents use the letter and reorder form to solicit the remittances of money through the mail for Dream Away to Nutrimarketing at 6835 Valjean Avenue, Van Nuys, California 91406 (Stip., 3; Ans. 13, Complaint Ex. 1).
5. Respondents have used three television commercials to promote the sale of Dream Away (JX-A). These commercials have been transcribed and will be referred to hereafter by their transcript exhibit numbers (JX-A1, A2, and A3). The first commercial, JX-A1, appeared January 9 through 13, 1984, on KHJ-TV in Los Angeles, California. The second commercial, JX-A2, was in use from approximately January 15, 1984 to August 1, 1984. The third commercial, JX-A3, has been in use since June 27, 1984 (Stip. 1).
6. Respondent Nutrimarketing is a partnership which engages in the sale and distribution of Dream Away. Respondents Kingsbridge Media & Marketing, Inc. (Kingsbridge) and Highcliff, Inc. (Highcliff) comprise the partners of Nutrimarketing. Respondent Frank Robinson has represented himself as the chief officer of Nutrimarketing. Nutrimarketing's address is 6835 Valjean Avenue, Van Nuys, California, 91406 (Ans., 7; Stip., 7).
7. Kingsbridge is a corporation organized and doing business under and by virtue of the laws of the State of California. Frank Robinson is the president of Kingsbridge and is active in the conduct of the advertising practices of the corporation. The address of Kingsbridge and Frank Robinson is 6835 Valjean Avenue, Van Nuys, California 91406 (Ans., 2, 4).
8. Highcliff is a corporation organized and doing business under and by virtue of the State of Nevada. Respondent Mel Korey is the president of Highcliff and is responsible for its advertising practices. The address of Mel Korey and Highcliff is 7339 Highcliff Drive, Scottsdale, Arizona 85253 (Ans., 6; Stip., 6).
9. Respondent Vista Advertising is a company engaged in creating and arranging for placement of various advertisements. Respondents Mel and Steve Korey, doing business as Vista Advertising have placed advertisements for Dream Away, paid for such advertisements, and maintained records of Dream Away sales activity. Vista Advertising's address is 6900 East Indian School Road, Scottsdale, Arizona 85251 (Ans., 8; Stip., 8).
10. The label currently used by Respondents on bottles of Dream Away reads as follows:
FORTIFIED BREWERS
YEAST PLUS
AMINO ACIDS
DREAM AWAYTM
Distributed by:
NUTRI MARKETING
6835 Valjean Avenue
Van Nuys, California 91406
Contents: 42 TABLETS
STORE IN A COOL PLACE
2 Tablets Supply Amount
USRDA*
Vitamin B-1 2 mg. 133
Vitamin B-2 2 mg. 117
Vitamin B-6 2.4 mg. 120
Vitamin B-12 2 mcg. 33
Niacin 3 mg. 15
*U. S. Recommended Daily Allowance
Recommendation: For best results
take two tablets at bedtime. Avoid
eating four hours before taking Dream
Away and follow the Dream Away Menu Plan.
Each tablet contains:
L-Arginine 500 mg.
L-Ornithine HCL 250 mg.
L-Lysine HCL 100 mg.
Brewer's Yeast, fortified 100 mg.
(Stip., 3; JX-B-2).
11. Dream Away contains the ingredients listed on the above label (Stip., 4).
12. As alleged in Complaint 14 (a), Respondents' advertisements represent to the ordinary viewer and reader that the product causes the user to lose weight while sleeping.
In the television commercials, the opening scenes picture a woman sleeping in bed, and announce that the woman is "burning fat" or "losing unwanted pounds and inches" while she sleeps and introduce Dream Away while a man holds a bottle of the pills:
a. This woman is sound asleep and while she dreams she's actually losing unwanted pounds and inches. Introducing Dream Away. The incredible new overnight weight loss plan that burns away fat while you sleep. (JX-A1, Scenes 1 and 2; JX-A2, Scenes 1 and 2)
b. This is Dream Away. The incredible weight loss plan that helps burn away fat while you sleep. (JX-A3, Scenes 1 and 2)
A graphic statement reinforces this message: "LOSE WEIGHT WHILE YOU SLEEP" (JX-A1, Scene 2; JX-A2, Scene 2) or "LOSE WEIGHT EVEN WHILE YOU SLEEP", JX-A3, Scene 2). The product name and the remainder of the commercials convey the impression that with this product, one can "dream away" fat:
a. Just take Dream Away before going to bed. You will wake up the next morning slimmer, trimmer and looking better than you did the night before. It's so easy you have to lose weight. (JX-A1, Scenes 3-5)
b. With the Dream Away plan, take Dream Away before going to bed and you can wake up feeling slimmer and looking better than you did before. (JX-A2, Scenes 3 and 4; JX-A3, Scenes 3-4)
c. I thought it was too good to be true but I lost weight almost overnight. JX-A2, Scene 5; JX-A3, Scene 6)
d. Researchers have discovered a natural amino formulation and diet plan that helps to attack fat and can aid people to lose weight even while they sleep and you can lose that weight without dangerous drugs or tiresome exercise. (JX-A2, Scene 8)
e. In fact, just take Dream Away, and follow the plan whenever you're too tired to exercise and you can be losing weight the easy way. (Split-screen picture of woman sleeping and woman exercising) (JX-A, JX-A2, Scene 9)
f. Now you can Dream Away those extra pounds] (Picture of woman sleeping.) (JX-A2, Scene 17; JX-A3, Scene 22)
g. The sooner you call, the sooner you can be losing weight while you sleep] (JX-A2, Scene 18; JX-A3, Scene 23)
The reorder letter and the information pamphlet also represent that the typical consumer can lose weight while sleeping.
a. Congratulations on joining our growing DREAM AWAY family. DREAM AWAY is truly effortless way of losing weight. You lose weight naturally, while you sleep.
The G-H FACTOR
(JX-D-1)
b. THE SECRETS OF DREAM AWAY THE AMINO ACID DIET
LOSE WEIGHT NATURALLY WHILE YOU SLEEP]]
DREAM AWAY, A NATURAL WEIGHT-LOSS MEANS
This is an all-natural diet which consists of high potency amino acids (proteins) which are extracted through a special laboratory fermentation process. This diet enables a person to lose weight naturally while they sleep, without the hassles of exercise or dieting. DREAM AWAY attacks fat at night, and helps promote better muscle development instead.
(JX-F, pp. 1 and 2)
13. As alleged in Complaint 14 (b)-(c), Respondents represent that Dream Away causes the user to lose weight and fat.
As set forth in the previous finding, the Dream Away television commercials state that Dream Away is a product that will enable viewers to lose weight while they sleep.
The commercials then present testimonials of ordinary people who successfully lost weight with Dream Away to represent that Dream Away causes rapid and substantial weight loss. The testimonials convey the impression that the ordinary viewer can achieve the same dramatic results:
a. It's so easy you have to lose weight.
I lost over seven pounds the very first week.
I lost almost two pounds last night.
(JX-A1, Scenes 5, 6, 7,; JX-A2, Scenes 11, 12, 13; JX-A3, Scenes 16, 17, 18)
b. I thought it was too good to be true but I lost weight almost overnight.
With the Dream Away plan, I've already lost sixteen pounds.
I couldn't believe it. I lost eighteen pounds in just three weeks.
(JX-A2, Scenes 5, 6, 7; JX-A3 Scenes 6, 7, 8)
c. I lost ten pounds in two weeks. I think the plan is great.
I am losing weight for the first time.
(JX-A3, Scenes 11 and 13)
Interspersed among the testimonials, the narrator claims that "you" the viewer can achieve these same results:
a. Researchers have discovered a natural amino acid formulation and diet plan that helps to attack fat and can aid people to lose weight even while they sleep and you can lose that weight without dangerous drugs or tiresome exercise.
In fact, just take Dream Away, and follow the plan whenever you're too tired to exercise and you can be losing weight the easy way. (JX-A2, Scenes 8 and 9)
b. Even if you've tried other ways of losing weight and failed, here's help. . . . (JX-A2, Scene 14)
c. Now you can dream away those extra pounds. (JX-A2, Scene 17; JX-A3, Scene 22)
d. Thousands of people just like you have been losing weight with this amazing product. . . . (JX-A3, Scene 9)
e. Now you, too, can be losing pounds and inches the safe and easy way. (JX-A3, Scene 19)
The overall impression of each television commercial is that Dream Away causes rapid and substantial weight and fat loss. In both JX-A2 and JX-A3, the commercial attempts to disclaim the promised weight loss with perceptually obscure graphics. In Scene 5 of JX-A2 and Scene 6 of JX-A3, a small white graphic message appears too briefly to be read in a scene where attention is drawn to the speaker who claims to have lost weight overnight. The disclaimer reads: "Individual weight loss varies. Results may be achieved through reduced calorie diet and exercise." This fails to diminish the overall message that the product causes rapid and substantial weight loss and that the viewer can achieve the same results as those in the testimonials.
Respondents' reorder form and letter and the information pamphlet also make the representations of weight loss.
a. By the time you read this you should be convinced that Dream Away is the easiest way to lose weight ever developed. (Complaint, Exhibit 1, Ans., 13)
b. Dream Away is truly an effortless way of losing weight. You will lose weight naturally. . . . while the body rests, the product works by dissolving fat. (JX-D-1)
c. This diet enables a person to lose weight naturally without the hassles of exercise or dieting. Dream Away attacks fat at night. (JX-F, p. 2)
d. There have been several documented reports whereby individuals on this type of amino acid diet have lost up to twenty pounds of fat. . . (JX-F, p. 4)
As alleged in Complaint 14 (e), Respondents represent that Dream Away causes the user to lose weight at the rate of two pounds in one day, seven pounds in one week, 10 pounds in two weeks, 16 pounds in 30 days, 18 pounds in three weeks, and 20 pounds in 30 days. Moreover, as alleged in Complaint 14 (f), Respondents represent that Dream Away causes the user to lose a substantial amount of weight in a short period of time. These representations are found in the following:
a. I lost over seven pounds the very first week.
I lost almost two pounds last night.
(JX-A1, Scenes 6-7; JX-A2, Scenes 11-13; JX-A3, Scenes 16-18)
b. I couldn't believe it. I lost eighteen pounds in just three weeks. (JX-A2, Scenes 5, 6, 7; JX-A3, Scenes 6, 7, 8)
c. I lost ten pounds in two weeks. I think the plan is great. (JX-A3, Scenes 11 and 13)
d. With the Dream Away plan, I've already lost sixteen pounds. .... Try Dream Away for thirty days. If you don't see incredible results.... (JX-A2, Scenes 7 and 21)
14. As alleged in Complaint 14 (d), Respondents' advertising represents that Dream Away causes the user to lose weight without restricting his or her accustomed calorie intake (i.e., dieting) or exercising.
The television commercials feature the pills prominently and claim that the pills cause weight loss quickly and easily. The commercials' emphasis on the ability of Dream Away to cause weight loss while sleeping conveys the impression that the consumer only needs to take Respondents' pills in order to lose weight.
The pills are pictured in JX-A1 in Scenes 2, 3, 8, and 9, in JX-A2 in scenes 2, 3, 10, 15, and in JX-A3 in Scenes 1, 4, 14, 15 and 20. To lose weight, the announcer gives the impression that the viewer need only take Dream Away before going to bed (JX-A1, Scene 3; JX-A2, Scene 3; JX-A3, Scene 4). Dream Away is claimed to be "so easy, you have to lose weight" (JX-A1, Scene 5; JX-A2, Scene 11, JX-A3, Scene 16).
The television advertisements offer Dream Away as method of weight loss that is superior to dieting. "This is a lot better than any diet I have ever tried" (JX-A3, Scene 12). "I am losing weight for the first time" (JX-A3, Scene 13). While holding a bottle of Dream Away, the announcer acclaims Dream Away as the "dieter's dream come true" thus implying that Dream Away has the capability to cause weight loss without dieting (JX-A1, Scene 8; JX-A2, Scene 10).
The second commercial specifically states that exercising is not necessary to accomplsih the promised weight loss (JX-A2, Scenes 8, 9).
Representations that Dream Away causes weight loss overnight and while sleeping also imply that Dream Away causes weight loss without diet or exercise.
The oblique references to a "plan" or "diet" are insufficient to put the reader on notice that calorie restrictions are necessary. While holding a bottle of the product marked "Dream Away," the announcer in each commercial introduces Dream Away as a new overnight weight loss plan that burns away fat as you sleep. The plan is never defined beyond taking the pills.
The last two commercials (JX-A2, Scene 5 and JX-A3, Scene 6) contain the following disclaimer: "results may be achieved through reduced calorie diet and exercise." However, this statement is presented in a manner that fails to overcome the overall impression that weight loss is achieved without diet and exercise. The disclaimer appears in the scene where attention is drawn to a woman telling her success story. The disclaimer is in small, hard-to-read, white lettering and appears too briefly to be read in its entirety.
The information pamphlet calls Dream Away a "diet" yet defines diet as the pills and claims that the pills cause weight loss without diet or exercise:
a. This is an all-natural diet which consists of high potency amino acids (proteins) which are extracted through a special laboratory fermentation process. This diet enables a person to lose weight naturally while they sleep, without the hassles of exercise or dieting. (JX-F, p. 2)
b. There have been several documented reports whereby individuals on this type of amino acid diet have lost up to twenty pounds of fat and put on five pounds of muscle without the use of exercise or dieting. (JX-F, p. 4)
The remainder of the pamphlet talks solely about the composition and benefits of the pills.
15. As alleged in Complaint 14 (g) and 14 (k), Respondents represent that Dream Away promotes muscle development in the user, and that it causes an increase in the user's muscle tissue without exercise:
a. This diet enables a person to lose weight naturally while they sleep, without the hassles of exercise or dieting. Dream Away attacks fat at night and helps promote better muscle development instead. (JX-F, p. 2)
b. There have been several documented reports whereby individuals . . . put on five pounds of muscle without the use of exercise or dieting. (JX-F, p. 4)
c. The premise in this special weight loss formula is to provide the necessary amino acids which . . . aid muscle growth in place of fat. (JX-F, p. 2)
16. As alleged in Complaint 14 (h) and (j), Respondents represent that Dream Away stimulates the release of human growth hormone and thereby promotes muscle growth and repair and causes a loss of fat.
a. The Growth Hormone (GH) factor plays an important role in muscle growth and repair. After puberty, the release of the G-H factor diminishes sharply. It can, however, be stimulated once again by supplemental amino acids, and therefore, while the body rests, the product works by dissolving fat. (JX-D-1)
b. The G-H Factgor.
This factor is a growth hormone (GH) . . . and plays an important role in the muscle growth and repair . . . . The GH factor is also no longer at its natural peak in an individual after the age of 25, but can be increased or stimulated once again in an individual by supplemental amino acids, such as the arginine and ornithine in Dream Away. The premise in this special weight loss formula is to provide the necessary amino acids, which, in scientific theory and practice, aid muscle growth in place of fat. Growth Hormone can cause one to add muscle and potentially burn fat. (JX-F, p. 2)
17. As alleged in Complaint 14 (i), Respondents represent that obese people are likely to have a deficiency of the human growth hormone:
It [growth hormone] is often found deficient in people who are obese . (JX-F, p. 2)
18. As alleged in Complaint 14 (l), Respondents' pamphlet and reorder letter represents that human growth hormone burns fat (Respondents' Brief, p. 31).
19. As alleged in Complaint 14 (m) and (n), Respondents represent that use of Dream Away makes a significant contribution to a loss of weight when used in conjunction with diet and exercise:
a. With Dream Away, you can eat normally. However, common sense would dictate reducing the intake of carbohydrates and fats. . . For absolute maximum weight loss benefits, consider a light to moderate exercise program (especially brisk daily walks) and our suggested Dream Away Menu Plan. (JX-D-1)
b. Following the program carefully will maximize your results. For additional weight loss benefits, we recommend a light to moderate exercise program (especially brisk daily walks) in conjunction with the Dream Away Menu Plan. (JX-D-2)
20. Complainant's expert witness, Ernst J. Drenick, M.D., has been board certified in internal medicine since 1951. He is the Chief of the General Medicine Section at the Veterans Administration Hospital in Los Angeles. He is Professor in Residence at the University of California at Los Angeles (UCLA) Medical School. Since approximately 1962, Dr. Drenick has conducted research at the VA Hospital on treatment of obesity and nutritional disorders. He treats several hundred patients a year for obesity at clinics at the VA Hospital and UCLA (Tr. 8). He belongs to a number of professional societies whose membership is based upon medical or scientific accomplishments. He has presented his research at meetings of these societies and has published about 40 abstracts that summarize these oral presentations. He has published about 80 scientific and medical papers recording his research in peer-reviewed journals. He is an editorial reviewer of articles on obesity for a number of peer-reviewed scientific and medical publications. He keeps current with developments in the field of obesity by attending meetings of various professional societies and international and national conferences and by regularly reading professional journals and publications (Tr. 6-13, CX-1).
Dr. Drenick also has specific knowledge and experience concerning the ingredients of the weight-loss product at issue in these proceedings. Dream Away is an amino acid formulation which Respondent claims causes weight loss due to the release of growth hormones. Dr. Drenick has published several articles on amino acids and has conducted experiments in which they were fed, measured, and analyzed (Tr. 21; CX-1). Also, he has conducted an experiment regarding the injection of growth hormone (Tr. 36). He has also researched the effects of thyroid hormone under various experimental conditions, studied the effects of exercise on hormones during fasting, and contributed book chapters on obesity to two text books of endocrinology (CX-1).
Accordingly, Dr. Drenick is exceptionally well-qualified to testify in this matter.
21. Respondents'