FEDERAL TRADE COMMISSION | OFFICE OF THE SECRETARY | FILED 1/25/2021 | OSCAR NO. 600547 | PUBLIC

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UNITED STATES OF AMERICA 

BEFORE THE FEDERAL TRADE COMMISSION 

OFFICE OF ADMINISTRATIVE LAW JUDGES 

In the Matter of 

HEALTH RESEARCH LABORATORIES, LLC, 

a limited liability company, 

WHOLE BODY SUPPLEMENTS, LLC, 

a limited liability company, and DOCKET NO. 9397 

KRAMER DUHON, 

individually and as an officer of 

HEALTH RESEARCH LABORATORIES, LLC 

and WHOLE BODY SUPPLEMENTS, LLC. 

COMPLAINT COUNSEL’S OPPOSITION TO 

RESPONDENTS’ MOTION FOR SELF-IMPOSED CEASE-AND-DESIST ORDER 

Respondents’ unusual request asks the Court to order them to discontinue apparently 

ongoing unlawful activity. However, for several reasons, the Court cannot enter the proposed 

voluntary, unilateral cease-and-desist order. As the Court is aware, it has only the authority the 

Commission has delegated. Although the Commission has delegated considerable power, it has 

not delegated the authority to issue cease-and desist orders. See 16 C.F.R. § 0.14. In fact, the 

FTC Act, 15 U.S.C. § 45(b), prohibits the Commission from delegating that function. 

Furthermore, even assuming the Court has authority to enter cease-and-desist orders generally, 

neither the Court nor the Commission could enter this particular proposed order because it lacks 

the factual findings that 15 U.S.C. § 45(a) requires. Indeed, those necessary findings include 

jurisdictional facts, which Respondents’ Answer deny. 

To the extent Respondents’ real audience is at least partly the Commission, or the Court 

of Appeals, there are two additional reasons why neither the Court nor the Commission should 

enter the proposed unilateral cease-and-desist order. First, the proposal’s apparent purpose is to 

support a forthcoming mootness motion, but Respondents’ voluntary decision to cease their 

unlawful activity will not deprive this Court (or the Commission) of the ability to resolve this 
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matter. See, e.g., United States v. W.T. Grant Co., 345 U.S. 629, 632 (1953). Put simply, 

Respondents’ proposal will not moot this case and the Court should not enter a pointless order 

(of course, nothing prevents Respondents from halting their illegal activity anyway). 

Second, as explained below, a voluntary, unilateral cease-and-desist order likely cannot 

support future monetary redress under Section 19, 15 U.S.C. § 57b—which Congress authorized 

the Commission to seek if the facts otherwise warrant such relief. In fact, even if the proposed 

order could support a future Section 19 action, it would still deprive the Commission of its 

statutory right to issue factual findings entitled to deference. See 15 U.S.C. § 57b(c)(1). 

Because neither the Court nor the Commission should permit Respondents to negate deference to 

Commission factual findings and the ultimate right to bring a Section 19 action, Respondents’ 

motion must be denied. 

Background 

Nearly a decade ago, Respondents began pitching supplements they claimed would 

“reverse memory loss” (advertised with phony references to medical journals) or cause 

consumers to lose weight (advertised with bogus testimonials from people who “lost 20lbs by 

doing nothing”).1

 Rather than attempt to defend the indefensible when the FTC and Maine 

authorities sued, Respondents agreed to refund $800,000 to consumers.2 Through a stipulated 

order (“Final Order”), Respondents also agreed not to make certain claims without adequate 

substantiation.3 

Rather than comply, Respondents resumed making unsubstantiated claims to sick and 

vulnerable consumers. Specifically, Respondents pushed pills that supposedly prevent or treat 

heart disease (“say goodbye to your heart surgeon and avoid an angioplasty”), and diabetic 

1

 Complaint, FTC v. Health Research Labs., LLC, No. 17-cv-467 (D. Me. Nov. 30, 2017)

at 8, 10. 

2

 Stipulated Order, FTC v. Health Research, No. 17-cv-467 (D. Me. Jan. 16, 2018) (ECF 

No. 25) at 21. 

3 See id. at 7-11. 

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neuropathy (“100% effective . . . [and] shown to help reverse damaged nerves”).4 Respondents 

have apparently sold more than $2 million5 worth of these snake oil supplements including, 

almost certainly, to consumers whose diabetic or cardiovascular conditions have irreparably 

deteriorated in the absence of legitimate treatment. 

The FTC and Maine moved to hold Respondents in contempt of Section II(H) of the 

Final Order, which, in the Plaintiffs’ view, imposed substantiation requirements for all diseaserelated claims Respondents might make. Respondents contended II(H) covered only claims 

related to certain specific diseases (conveniently, not heart disease or diabetic neuropathy).6 The 

court found the government’s position “supported by the plain text and purpose of the 

Judgment.”7 However, the court noted that the section heading appearing before section II 

mentioned only certain specific diseases.8 According to the court, this drafting error rendered 

Respondents’ interpretation “also reasonable,” and thus a technical defense to contempt under 

Section II(H).9 In fact, the court confirmed that the FTC’s position was “substantially justified,” 

and that it based its decision “solely on Section II’s heading.”10 The Court ultimately permitted 

the FTC to seek leave to file an amended contempt motion if it sought to proceed under another 

Final Order provision;11 instead, the Commission issued the pending administrative Complaint. 

Significantly, Respondents have used—and apparently continue using—so-called 

“continuity” programs.12 In particular, once their deceptive ads lure consumers, Respondents 

4

 Complaint ¶¶ 11, 13. 

5

 Motion, FTC v. Health Research, No. 17-cv-467 (D. Me. Dec. 17, 2019) (ECF No. 21) 

at 21 n.17 (citing PX2). 

6

 Opposition, Health Research, No. 17-cv-467 (D. Me. Dec. 31, 2020) (ECF No. 30) at

10. 

7 FTC v. Health Research Labs, LLC, No. 17-cv-467, 2020 WL 4431497, *7 (D. Me. July

31, 2020). 

8 Id. at *6. 

9 Id. at *7. 

10 Order, Health Research, No. 17-cv-467 (D. Me. Jan. 20, 2020) (ECF No. 58) at 6-7. 

11 Health Research, No. 17-cv-467 (Aug. 12, 2020) (ECF No. 52) at 1. 

12 As the Court is aware, discovery commenced only a few weeks ago. 

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continue billing some of them automatically for additional shipments (sometimes without 

informed consent or even knowledge) until they cancel (which Respondents make difficult).13 

After Respondents learned that the FTC had started investigating their ongoing 

misrepresentations, they stopped advertising the products at issue to new customers—although 

they continued auto-billing consumers that their deceptive marketing had already ensnared. In 

fact, this billing based on false claims has apparently continued through the present. 

Respondents now volunteer to stop ongoing sales through a cease-and-desist order they 

have asked the Court to impose. Importantly, this represents only a portion of the relief 

potentially available, and necessary to protect the public. Among other things, given the 

substantial danger associated with selling fake treatments to consumers with diabetes or 

cardiovascular problems, Complaint Counsel seeks notice to consumers informing them 

Respondents deceptively advertised their products and strongly recommending that they seek 

legitimate treatment.14 In these proceedings, Complaint Counsel also seeks findings entitled to 

deference in a probable future action seeking refunds for injured consumers pursuant to Section 

19 of the FTC Act.15 

Argument 

I. The Court Lacks Authority to Issue the Proposed Cease-And-Desist Order. 

A. The Court Lacks Authority to Issue Cease-and-Desist Orders. 

Pursuant to 16 C.F.R § 0.14, the Commission must form this Court through the Office of 

Administrative Law Judges and delegate to it “the initial performance of statutory fact-finding 

functions and initial rulings on conclusions of law[.]” The Commission has not delegated 

authority to issue cease-and-desist orders, nor could it do so. See 15 U.S.C. § 45(b) (providing 

only that “the Commission” may order a party “to cease and desist”) (emphasis added); In the 

13 See Complaint, FTC v. Health Research, No. 17-cv-467 (D. Me. Nov. 30, 2017) (ECF

No. 1) ¶¶ 24-25, 28, 54, 64, 66, 72 (allegations concerning pills sold before the Final Order). 

14 See Complaint, Notice of Contemplated Relief ((e) and (m)). 

15 See 15 U.S.C. § 57b(c)(1). 

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Matter of Axon Enter., Inc., No. 9389, 2020 WL 5406806, *4 (F.T.C. Sept. 3, 2020) (explaining 

that “[t]he Commission” is “responsible for all final agency decisions”) (citation omitted). 

With no explanation, Respondents cite three provisions as purportedly giving the Court 

“the power to . . . enter the requested Cease-and-Desist Order.” Mtn. at 3 n.4. None, however, 

do. First, Respondents reference 16 C.F.R. § 3.42(c)(6), which affords authority “[t]o regulate 

the course of hearings[.]” Accordingly, § 3.42(c)(6) is inapplicable to Respondents’ voluntary, 

unilateral cease-and-desist order request. Second, Respondents cite § 3.42(c)(7), which governs 

“conferences for settlement” or other purposes, but this motion does not seek a “conference.” 

Finally, Respondents mention § 3.42(c)(12), which permits the Court to take actions “authorized 

by the rules in this part [16 C.F.R. part 3]” or the Administrative Procedure Act (“APA”). 

However, Respondents identify no APA provision authorizing the Court to issue a cease-anddesist order—and there is none. Furthermore, as discussed above, nothing in the Part 3 Rules 

provides such authority. In fact, both Part 3 and the FTC Act (“FTCA”) prevent such an order. 

See 15 U.S.C. § 45(a); 16 C.F.R § 0.14. Because the Commission has not delegated to the Court 

authority to issue cease-and-desist orders, nor could it, the Court must deny Respondents’ 

motion.16 

B. Respondents Fail To Include Required Factual Findings. 

Even if the Commission had delegated its authority to issue cease-and-desist orders to 

this Court—and it has not—the Court still cannot enter the proposed unilateral cease-and-desist 

16 Likely recognizing that the Court cannot enter cease-and-desist orders, Respondents 

include a footnote asking the Court, in the alternative, to “refer the Motion to the Commission[.]” 

Motion at 3 n.4. However, the Court only refers matters to the Commission if the Part 3 Rules 

provide for such a referral. See, e.g., 16 C.F.R. § 3.22(a) (“[M]otions for summary decision shall 

be directly referred to the Commission[.]”). Notably, if the motion proposed a consent 

agreement, the Court could certify it to the Commission “upon a written determination that there 

is a reasonable possibility of settlement.” See id. at § 3.25(c). This provision is inapplicable

because Respondents concede that their proposal “is not a settlement agreement,” Motion at 2, 

and settlement is not reasonably possible for many reasons (and Respondents do not argue 

otherwise). Because there is no applicable rule, the correct procedure is not to simply request 

that the Court refer the motion to the Commission. Rather, the correct procedure is to move the 

Court, as Respondents have done, and then attempt to pursue an interlocutory appeal to the 

Commission if they disagree with this Court’s determination. See 16 C.F.R. § 3.23. 

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order because it contains no findings of fact. Specifically, the FTCA provides that the 

Commission “shall state its findings as to the facts” with respect to any cease-and-desist order. 

See 15 U.S.C. § 45(a); FTC v. Raladam Co., 316 U.S. 149, 150 (1942) (explaining that the 

FTCA “authorizes the Commission after hearings and findings of fact to issue orders requiring 

violators to cease and desist”) (emphasis added); cf. 16 C.F.R. § 2.32 (requiring that all proposed 

consent orders contain either proposed findings from Complaint Counsel or an “admission of all 

jurisdictional facts and an express waiver of the requirement that the Commission’s decision 

contain a statement of findings of fact and conclusions of law”).17 

Significantly, however, Respondents’ order neither proposes findings of fact nor waives 

such findings. Indeed, through their Answer, Respondents affirmatively deny the conduct they 

propose to cease, rendering any possible factual findings that would support their proposal 

inconsistent with their position. See Answer (Dec. 4, 2020) at 1-3 (denying numerous factual 

allegations and asserting, incorrectly that “all alleged conduct . . . ceased more than a year 

[ago]”).18 Additionally, Respondents deny the jurisdictional facts upon which any cease-anddesist order would rest. See id. at 4 (denying that “the contemplated relief is in the public 

interest as required by 15 U.S.C. § 45”); id. at 2 (denying that the acts at issue “have been in or 

affecting commerce”). Put simply, jurisdictional and substantive factual findings are mandatory, 

but Respondents propose none, nor could they without abandoning their defenses. Even if the 

Commission delegated cease-and-desist authority to this Court—which it did not—no statute or 

regulation permits a cease-and-desist order without factual findings. 

17 The proposed voluntary, unilateral cease-and-desist order is also deficient because it 

contains no conclusions of law. 

18 Respondents incorrectly assert that the only alleged conduct is “marketing and 

advertising,” rather than ongoing sales based on earlier wrongful marketing and advertising. See 

Answer at 3. In any event, the proposed voluntary, unilateral cease-and-desist order prohibits 

“advertising” that Respondents’ Answer denies they are currently conducting. See id. at 2-3. 

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II. If the Court Reaches the Issue, or if the Commission Reviews the Matter, Neither 

the Court Nor the Commission Should Issue the Proposed Order. 

A. Respondents’ Proposal Will Not Affect the Outcome of This Proceeding. 

Even if the Court could do what Respondents ask, it should deny their request because it 

will not affect the outcome of these proceedings.19 Commission authority “holds 

that voluntary discontinuance of practices by respondents—particularly when that occurs only in 

the face of an investigation or lawsuit—does not exonerate respondents or render the 

proceeding moot.” In the Matter of Sw. Sunsites, Inc., 105 F.T.C. 7 (1985); see also United 

States v. W.T. Grant Co., 345 U.S. 629, 632 (1953) (“[V]oluntary cessation of allegedly illegal 

conduct does not deprive the tribunal of power to hear and determine the case, i.e., does not 

make the case moot.”).20 Thus, Respondents’ post-investigation, post-litigation voluntary 

cessation of their unlawful practices does not render this case moot. 

B. Respondents’ Proposal Would Wrongfully Foreclose Section 19 Relief. 

Congress enacted Section 19 of the FTCA partly as means to enable the FTC to recover 

monetary redress following administrative proceedings, see 15 U.S.C. § 57b, and receive 

deference to the factual findings administrative proceedings produce, see id. at § 57b(c)(1). 

Importantly, entering a unilateral, voluntary cease-and-desist order likely would foreclose the 

FTC from using Section 19’s monetary recovery tools. In particular, Section 19 applies only 

when “the Commission has issued a final cease and desist order.” 15 U.S.C. § 57b(a)(1). 

However, the Commission would not issue the proposed order.21 Additionally, even if it is 

possible to file a future Section 19 action based on a voluntary, unilateral cease-and-desist 

19 Nothing prevents Respondents from halting apparently ongoing auto-bill sales without 

a cease-and-desist order. 

20 Respondents may cite various exceptions, none of which apply here. 

21 Notably, even assuming the proposed order qualifies as one issued by “the 

Commission,” it would not become “final” until “the expiration of time allowed for filing a 

petition [the Court of Appeals] for review,” 15 U.S.C. § 45(g)(1). However, there is no such

period because there is no mechanism for Respondents to appeal a cease-and-desist order they 

begged the Court (or the Commission) to enter. This underscores that what Respondents propose 

is not cognizable under the FTC Act. 

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order—which is uncertain at best—the proposed order would deprive the Commission of its 

power to make factual findings entitled to deference. In short, permitting Respondents to choose 

their own remedy unilaterally would effectively nullify Section 19’s applicability in 

administrative proceedings in direction contradiction of the FTCA. For this reason as well, 

Respondents’ request is improper. 

Conclusion 

For all the aforementioned reasons, the Court should deny Respondents’ motion. 

Respectfully submitted, 

s/ Jonathan Cohen 

 Elizabeth J. Averill

 Jonathan Cohen 

 Federal Trade Commission

 600 Pennsylvania Ave, NW, CC-9528 

 Washington, DC 20580 

 (202) 326-2993 (Averill); -2551 (Cohen) 

 Eaverill@ftc.gov; Jcohen2@ftc.gov 

 (202) 326-3197 (facsimile) 

Complaint Counsel 

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CERTIFICATE OF SERVICE 

I certify that I served a copy of Complaint Counsel’s Opposition on counsel for the 

Respondents on January 25, 2021 via electronic mail. 

Joel Reese 

Joshua Russ 

Reese Marketos LLP 

750 N. Saint Paul St., Suite 600 

Dallas, TX 75201 

Joel.reese@rm-firm.com 

Josh.russ@rm-firm.com 

I also served one electronic copy via the Administrative E-Filing System and one electronic 

courtesy copy to the Office of the Secretary via email to ElectronicFilings@ftc.gov. 

I served one electronic courtesy copy via email to the Office of the Administrative Law Judge: 

The Honorable D. Michael Chappell 

Administrative Law Judge 

600 Pennsylvania Ave, N.W., Room H-110 

Washington, DC 20580 

 s/ Jonathan Cohen 

 Jonathan Cohen 

 Federal Trade Commission

 600 Pennsylvania Ave, NW, CC-9528 

 Washington, DC 20580 

 (202) 326-2551; jcohen2@ftc.gov 

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