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UNITED STATES OF AMERICA

BEFORE THE FEDERAL TRADE COMMISSION

COMMISSIONERS: Lina Khan, Chair

Noah Joshua Phillips

Rohit Chopra

Rebecca Kelly Slaughter

Christine S. Wilson

In the Matter of

Health Research Laboratories, LLC, 

 a limited liability company, 

Whole Body Supplements, LLC,

 a limited liability company, and 

Kramer Duhon, 

 Individually and as an officer of 

 Health Research Laboratories, LLC,

 and Whole Body Supplements, LLC.

DOCKET NO. 9397 

ORDER DIRECTING PARTIES TO SUBMIT PROPOSED FINDINGS OF 

FACT AND CONCLUSIONS OF LAW AND PROVIDING FOR SUMMARY DECISION 

PROCEEDING

On April 20, 2021, the Chief Administrative Law Judge (“ALJ”) transferred this matter 

to the Commission for further proceedings pursuant to Commission Rule 3.12(b)(2), 16 C.F.R. 

§ 3.12(b)(2). Order Granting In Part and Denying In Part Respondents’ Motion to Enter New

Scheduling Order or, in the Alternative, to Transfer Case to the Commission (Apr. 20, 2021). To

determine the appropriate next step, the Commission sought clarification concerning whether any

factual issues remained and whether additional discovery and fact-finding was needed. On May

14, 2021, the Commission issued an order directing the parties to submit filings identifying any

additional material facts that they intend to assert, listing the decisional issues to which each

asserted additional fact relates, stating whether they dispute the facts identified by the other

party, and explaining the basis for any such dispute. Order for Further Proceedings Before the

Commission (May 14, 2021) (“Order for Further Proceedings”). The Commission also asked

Respondents to clarify their position on the items in the Notice of Contemplated Relief attached

to the Complaint that initiated this proceeding.

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 On May 25, 2021, Complaint Counsel submitted their Statement of Additional Material 

Facts. All of the additional facts citing documents other than the Complaint and its exhibits were

identified as relating to the scope of relief. See Complaint Counsel’s Statement of Additional 

Material Facts, Att. A (May 25, 2021). On June 1, 2021, Respondents submitted their response. 

Respondents’ Response to Complaint Counsel’s Statement of Additional Material Facts (June 1, 

2021) (“Respondents’ Response”). In that submission, Respondents advanced a number of 

objections and arguments in opposition to allowing Complaint Counsel to introduce their 

additional material facts. Respondents, however, did not specifically dispute any of the 

individual asserted facts, nor did they identify additional material facts of their own. On June 21, 

2021, Complaint Counsel submitted a reply responding to Respondents’ various arguments. 

Reply to Respondents’ Response to Complaint Counsel’s Statement of Additional Material Facts 

(June 21, 2021). 

Although Respondents have not disputed the veracity of any of Complaint Counsel’s 

additional material facts, they object to including those facts in the record for a variety of 

reasons. We address these in turn.

First, Respondents argue that Complaint Counsel have not provided enough information 

regarding the decisional issues to which their additional facts relate. Respondents’ Response at 

10-12. Complaint Counsel, however, indicated that these additional facts are relevant to the 

scope of relief.1

 In most cases, Complaint Counsel went further by identifying the particular 

factor used in remedy selection to which the asserted fact relates. See Complaint Counsel’s 

Statement of Additional Material Facts, Att. A; see also Telebrands Corp. v. F.T.C., 457 F.3d 

354, 358 (4th Cir. 2006) (“The FTC considers three factors in determining whether order 

coverage bears a reasonable relationship to the violation it is intended to remedy: ‘(1) the 

seriousness and deliberateness of the violation; (2) the ease with which the violative claim may 

be transferred to other products; and (3) whether the respondent has a history of prior 

violations.’”) (quoting Stouffer Foods Corp., 118 F.T.C. 746, 811 (1994)). This is sufficient to 

comply with the requirements in our Order for Further Proceedings. 

Respondents’ second argument is that Complaint Counsel’s factual assertions are 

irrelevant and must be excluded because only legal issues remain in the case. Respondents’ 

Response at 12-13. Respondents have admitted all of the Complaint’s factual allegations and 

have “agree[d] and accept[ed]” the remedies in the Notice of Contemplated Relief, subject only 

to two purely legal objections regarding constitutionality and the FTC’s remedial authority under 

Section 5(b) of the Federal Trade Commission Act. Id. at 7-10, 12. Complaint Counsel, 

however, indicated in briefing before the ALJ that, although it was not expressly requested in the 

Notice of Contemplated Relief, they also intend to seek to ban Respondents from the 

supplements industry. See Complaint Counsel’s Opposition to Motion to Amend Answer and 

Cross Motion to Amend Complaint at 8 n.3 (Feb. 24, 2021). Respondents have not conceded the 

appropriateness of an industry ban, so the question of the proper remedy remains a potentially 

contested issue. Complaint Counsel’s additional facts are therefore not irrelevant. 

 

1 In one instance, Complaint Counsel indicated that facts drawn from Complaint Exhibits (referenced and quoted in 

the Complaint allegations) are related to the materiality of Respondents’ claims. Complaint Counsel’s Statement of 

Additional Material Facts, Att. A, Item 3.

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Third, Respondents argue that allowing Complaint Counsel to rely on facts outside the 

Complaint would be inconsistent with Rule 3.12(b)(2) and the Commission’s explanatory 

statement in the Federal Register and contrary to Respondents’ right to expedited proceedings 

under Rule 3.12(b)(2). Respondents’ Response at 13-15. We disagree. Nothing in Rule 

3.12(b)(2) prohibits the Commission from considering facts outside the pleadings but established 

in the record where appropriate, in rendering a final decision. The Rule states that the complaint 

and answer “provide a record basis on which the Commission shall issue a final decision,” but it 

does not state that these pleadings provide the sole record basis for a final decision. Further, the 

Rule provides that an answer admitting the facts in the complaint waives hearings “as to the facts 

alleged in the complaint,” not all hearings as to all pertinent facts. That the Rule allows the 

parties to file proposed findings of fact further suggests that the Commission may deal with 

matters that arise outside the pleadings; otherwise, such proposed findings would simply 

duplicate the complaint and answer.

Nor does the Commission’s statement in the Federal Register discussing a 2009 

amendment to Rule 3.12(b) bar consideration of facts outside the Complaint. The 2009 

amendment eliminated the intermediate step of requiring an administrative law judge to issue an 

initial decision when the answer admits all of the material allegations in the complaint. The 

Commission reasoned that, since the only issues remaining at that point are legal and policy 

ones, for expediency it makes sense to bypass the administrative law judge and have the

Commission issue a final decision on the basis of the facts alleged in the complaint. See Rules of 

Practice, 74 Fed. Reg. 1804, 1808-09 (Jan. 13, 2009) (interim final rules with request for 

comment). This explanation, however, was not meant to limit the Commission’s authority or to 

address every circumstance that may arise. Where, as here, issues regarding the choice of 

remedy remain in the case despite the admissions in the answer, it is appropriate to look to 

established evidence outside the pleadings to resolve the dispute. As to Respondents’ claim that 

considering outside evidence violates their “right” to expedited proceedings, Rule 3.12(b)(2) in 

fact expedites the process by avoiding litigation of issues that have been admitted, but gives 

Respondents no “right” to terminate the proceeding without consideration of evidence relevant to 

the choice of remedy or to other unresolved issues such as affirmative defenses. 

 

Respondents’ final argument is that the Commission’s issuance of a decision and order 

based on facts not in the Complaint would violate Respondents’ due process rights under the 

Fifth Amendment. Respondents’ Response at 15-16. Respondents do not object to Commission 

action based on the Complaint alone, but take issue with the Commission or the ALJ “deciding 

any additional facts beyond those alleged in the Complaint” because “[t]he FTC’s combined role 

of prosecutor, trial judge, jury, and appellate court in the administrative proceedings” allegedly 

deprives Respondents of a neutral decision maker. Id. at 15. But the Supreme Court rejected 

this same argument in Withrow v. Larkin, 421 U.S. 35 (1975), holding that “the combination of 

investigative and adjudicative functions does not, without more, constitute a due process 

violation[.]” Id. at 58; see also Gibson v. F.T.C., 682 F.2d 554, 560 (5th Cir. 1982) (“The 

combination of investigative and judicial functions within an agency has been upheld against due 

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process challenges, both in the context of the FTC and other agencies.”). Thus, the combined 

roles of the FTC do not render the Commission’s decisions and orders due process violations.2 

Consequently, Respondents’ objections are not persuasive, and we will not bar Complaint 

Counsel from presenting facts beyond those alleged in the Complaint. As the Commission

explained in Zale Corp., 77 F.T.C. 1635 (1970), “The selection of an appropriate remedy, and 

the admissibility of evidence with regard thereto, are governed by the unlawful practices actually 

found to exist, and not by the allegations of the complaint.” Id. at 1636. The additional material 

facts identified by Complaint Counsel are appropriate for Commission consideration. 

Indeed, in a similar setting, the Federal Rules of Civil Procedure contemplate and provide 

for consideration of such facts beyond those in the complaint.3 Specifically, Rule 12(d) states, 

“If, on a motion under Rule 12(b)(6) or 12(c) [providing for judgment on the pleadings], matters 

outside the pleadings are presented to and not excluded by the court, the motion must be treated 

as one for summary judgment under Rule 56.” Fed. R. Civ. P. 12(d). Thus, where, as here, 

judgment is sought based on the facts of the complaint and the answer, courts have discretion to 

consider additional facts by treating the matter as one for summary judgment. We exercise 

analogous discretion here. Respondents’ Response does not identify a factual dispute with any 

of the additional facts that Complaint Counsel have identified as material, see Respondents’ 

Response at 10-16, so summary decision procedures are appropriate. The Federal Rules, 

however, caution that when a motion for judgment on the pleadings is converted to one for 

summary decision, “[a]ll parties must be given a reasonable opportunity to present all the 

material that is pertinent to the motion.” Fed. R. Civ. P. 12(d). By drawing upon the summary 

decision procedures of Commission Rule 3.24, 16 C.F.R. § 3.24, we afford the parties that 

opportunity. 

Accordingly, 

IT IS HEREBY ORDERED that on August 20, 2021, Complaint Counsel and 

Respondents shall file with the Commission proposed findings of fact and conclusions of law, 

along with a proposed order and briefs addressing liability, remedy, and defenses, in the form 

required by Commission Rule 3.46; if any party chooses to rely on facts outside the allegations 

of the Complaint, it shall state whether summary decision or partial summary decision is 

warranted and shall include, either within its proposed findings of fact or in a separate document, 

a concise statement of the material facts as to which it contends there is no genuine issue for 

trial, as specified in Commission Rule 3.24(a)(1); 

 

2 Respondents also argue that provisions within the FTC Act that make the Commission’s findings of fact, if 

supported by evidence, “conclusive” for purposes of subsequent review by a court of appeals under 15 U.S.C. 

§ 45(c) or that make the Commission’s findings of fact “conclusive” in later enforcement actions under 15 U.S.C. 

§ 57b are unconstitutional because the Commissioners and ALJs who decide the facts are not neutral decision

makers. Respondents’ Response at 15-16. We need not address the constitutionality of provisions about possible 

future review or enforcement actions because it is not raised by the issues presently before us. 

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 The Commission may look to the Federal Rules of Civil Procedure for guidance when its own rules do not 

mandate a result. See, e.g., LabMd, Inc., 2014-1 Trade Cas. (CCH) ¶ 78784, 2014 WL 253518, at *2 n.3 (F.T.C. 

Jan. 16, 2014).

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IT IS FURTHER ORDERED that on September 10, 2021, Complaint Counsel and 

Respondents shall file with the Commission reply findings of fact, conclusions of law, and 

briefs; also on September 10, 2021, any party against whom summary decision or partial 

summary decision has been sought may file opposition papers as specified in Commission Rule 

3.24(a)(2), either as part of or separate from its reply findings, conclusions, and briefs; and 

IT IS FURTHER ORDERED that any party that requests summary decision or partial 

summary decision may file a reply in support of that request within five days after service of the 

filings specified in the second ordering paragraph. 

 By the Commission. 

 April J. Tabor

Secretary

SEAL:

ISSUED: July 30, 2021 

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