[Federal Register Volume 62, Number 43 (Wednesday, March 5, 1997)]
[Notices]
[Pages 10059-10062]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-5344]


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FEDERAL TRADE COMMISSION
[File No. 942-3341]


Schering-Plough Healthcare Products, Inc.; Analysis To Aid Public 
Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: In settlement of alleged violations of federal law prohibiting 
unfair or deceptive acts or practices and unfair methods of 
competition, this consent agreement, accepted subject to final 
Commission approval, would prohibit, among other things, the marketer 
of Coppertone Kids sunscreens for children from making deceptive claims 
about the effectiveness of sunscreens marketed for use on children. The 
agreement will also require that the company produce and distribute 
150,000 consumer education brochures to alert parents to the importance 
of sunscreen protection for children and the need to reapply sunscreens 
after toweling or sustained vigorous activity. The complaint 
accompanying the consent agreement alleges that Schering's ads for 
Coppertone Kids 6-Hour Waterproof Sunblock make unsubstantiated claims 
that one application of Coppertone Kids provides six hours of 
protection from the sun for children engaged in sustained vigorous 
activity in and out of the water.

DATES: Comments must be received on or before May 5, 1997.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary, 
Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT:
Joel Winston, Federal Trade Commission, S-4002, 6th St. and Pa. Ave., 
N.W., Washington, D.C. 20580. (202) 326-3153; Toby Milgrom Levin, 
Federal Trade Commission, S-4002, 6th St. and Pa. Ave., N.W., 
Washington, D.C. 20580. (202) 326-3156.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46, and Section 2.34 of 
the Commission's Rules of Practice (16 CFR 2.34), notice is hereby 
given that the above-captioned consent agreement containing a consent 
order to cease and desist, having been filed with and accepted, subject 
to final approval, by the Commission, has been placed on the public 
record for a period of sixty (60) days. The following Analysis to Aid 
Public Comment describes the terms of the consent agreement, and the 
allegations in the accompanying complaint. An electronic copy of the 
full text of the consent agreement package can be obtained from the 
Commission Actions section of the FTC Home Page (for February 18, 
1997), on the World Wide Web, at ``http://www.ftc.gov/os/actions/htm.'' 
A paper copy can be obtained from the FTC Public Reference Room, Room 
H-130, Sixth Street and Pennsylvania Avenue, N.W., Washington, D.C. 
20580, either in person or by calling (202) 326-3627. Public comment is 
invited. Such comments or views will be considered by the Commission 
and will be available for inspection and copying at its principal 
office in accordance with Section 4.9(b)(6)(ii) of the Commission's 
Rules of Practice (16 CFR 4.9(b)(6)(ii)).

Analysis of Proposed Consent Order to Aid Public Comment

    The Federal Trade Commission has accepted an agreement to a 
proposed consent order from Schering-Plough Healthcare Products, Inc. 
(``Schering-Plough Healthcare''). Schering-Plough Healthcare, a wholly-
owned subsidiary of the Schering-Plough Corporation, is a manufacturer 
and distributor of health care products, including sunscreens.
    The proposed consent order has been placed on the public record for 
sixty (60) days for receipt of comments by interested persons. Comments 
received

[[Page 10060]]

during this period will become part of the public record. After sixty 
(60) days, the Commission will again review the agreement and the 
comments received and will decide whether it should withdraw from the 
agreement or make final the agreement's proposed order.
    This matter involves alleged deceptive representations made in 
advertising for Coppertone Kids, a sunscreen product promoted for use 
on children. According to the FTC complaint, Schering-Plough Healthcare 
represented, without adequate substantiation, that a single application 
of Coppertone Kids provides six hours of protection from the sun, at 
the advertised SPF level, for children engaged in sustained vigorous 
activity in and out of the water. The complaint also alleges that 
Schering-Plough Healthcare falsely represented that it had conducted 
tests demonstrating that the product provides such protection. 
According to the complaint, among other things, the company's tests did 
not evaluate a single application of the product under the advertised 
conditions of use (sustained vigorous activity).
    The consent order contains provisions designed to remedy the 
violations charged and to prevent Schering-Plough Healthcare from 
engaging in similar acts and practices in the future.
    Part I of the proposed order prohibits Schering-Plough Healthcare 
from representing: (a) the length of time that Coppertone Kids or any 
other children's sun protection product will provide protection from 
the sun for persons engaged in sustained vigorous activity in and out 
of the water; or (b) the efficacy of any children's sun protection 
product in providing protection against any harmful effect of sun 
exposure or ultraviolet radiation, unless the company has scientific 
substantiation for the representation.
    The order defines a ``children's sun protection product'' as any 
sun protection product that uses the word ``babies,'' ``children,'' 
``kids,'' or other similar words in the name or promotion of the 
product, or that is advertised or promoted for use primarily on 
children under the age of twelve.
    Part II of the proposed order prohibits Schering-Plough Healthcare 
from misrepresenting the existence, contents, validity, or conclusions 
of any test or study concerning any sun protection product.
    Part III of the order allows Schering-Plough Healthcare to make any 
representation for a sun protection product that is specifically 
permitted in labeling for that product under any tentative final or 
final Food and Drug Administration standard or under any new drug 
application approved by the Food and Drug Administration.
    Part IV of the proposed order requires Schering-Plough Healthcare 
to produce and disseminate a consumer brochure addressing the 
importance of sunscreen usage to children and the health benefits 
associated with it, and promoting the proper use and application of 
sunscreens on children. The brochure, which is subject to FTC approval, 
will be disseminated by Schering-Plough Healthcare to organizations 
with direct access to parents or organizations with access to parents 
or others who work with or care for children under the age of 12.
    Parts V, VII, IX, and X of the proposed order require Schering-
Plough Healthcare to keep copies of all materials relied upon in making 
any representations covered by Parts I and II of the order; to provide 
copies of the order to certain of the company's personnel; to notify 
the Commission of any change in corporate structure; and to file 
compliance reports with the Commission. Part VI permits respondent to 
use existing labeling for 100 days after the date of service of the 
order. Part VIII provides that the order will terminate after twenty 
(20) years under certain circumstances.
    The purpose of this analysis is to facilitate public comment on the 
proposed order, and it is not intended to constitute an official 
interpretation of the agreement and proposed order or to modify in any 
way their terms.
Donald S. Clark,
Secretary.

Separate Statement of Commissioner Mary L. Azcuenaga Concurring in Part 
and Dissenting in Part in Schering-Plough Healthcare, File No. 942 3341

    Today, the Commission accepts for public comment a proposed consent 
agreement resolving allegations about certain claims in the advertising 
of Coppertone Kids 6-Hour Waterproof Sunblock. I concur except with 
respect to Part IV of the proposed order, which requires the respondent 
to develop and disseminate a consumer education brochure addressing the 
dangers of unprotected exposure to the sun. Consumer education 
brochures are an integral part of the Commission's consumer protection 
program, but they are not necessarily defensible adjuncts to Commission 
orders.
    A fencing-in provision will be sustained by the courts as long as 
it is ``reasonably related'' to the violation found.\1\ Fencing-in 
relief properly may include requirements beyond simply prohibiting the 
challenged conduct that are designed to ``close all roads to the 
prohibited goal, so that [the Commission's] order may not be by-passed 
with impunity.'' \2\ The allegedly deceptive claim is that the 
respondent's sunblock for children would remain effective for six hours 
even if the children engaged in ``sustained vigorous activities in and 
out of the water,'' such as playing in sand, taking off and putting on 
clothes and toweling off after swimming. Complaint para.5. The proposed 
order expressly enjoins the respondents from making the challenged 
claim, either directly or indirectly, for the product at issue as well 
as for ``any other children's sun protection product.'' Order para.I.
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    \1\ FTC v. Colgate-Palmolive Co., 380 U.S. 374, 394-95 (1965); 
FTC v. National Lead Co., 352 U.S. 419, 428 (1957).
    \2\ FTC v. Ruberoid Co., 343 U.S. 470, 473 (1952).
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    In addition, the proposed order requires the respondent to develop 
and distribute 150,000 copies of a color brochure concerning the 
importance of sunscreen usage by children. The order requires that the 
brochure contain six messages or themes only one of which addresses the 
issue in this case, the need to reapply so-called water-proof or water-
resistant sunblock after vigorous activity or after toweling off. Order 
para. IV-E.
    The brochure requirement, even the message that relates most 
closely to the challenged claim, is not focused on preventing the 
respondent from making the challenged claim or otherwise from avoiding 
compliance with the order. The brochure would help educate consumers 
regarding an important health issue, and, presumably, make them less 
likely to be misled by the kind of implied claims challenged in this 
action.\3\ There is no reason to think that it would enhance the 
deterrent effect of the order on Schering.
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    \3\ The product label already contains the statement, ``Reapply 
after toweling.''
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    Presumably, the brochure requirement will not be unduly burdensome 
or costly for Schering because it will promote the use of its product, 
and the brochure is undoubtedly commendable as a public health 
initiative. Nevertheless, under the circumstances, it is an overly 
broad order requirement as measured against the current standard for 
ordering relief.\4\ There is a

[[Page 10061]]

value to the Commission in maintaining the integrity of the standard 
for imposing a fencing-in remedy.
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    \4\ It would be even more difficult to justify Part IV of the 
order as corrective advertising, because it is unlikely that the 
implied claim challenged in the complaint would linger in the minds 
of consumers long after it ceased being made. See Warner-Lambert Co. 
v. FTC, 562 F.2d 749, 762 (D.C. Cir. 1977), cert. denied, 435 U.S. 
950 (1978).
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    I respectfully dissent from Part IV of the order.

Separate Statement of Commissioner Roscoe B. Starek, III Concurring in 
Part and Dissenting in Part in Schering-Plough Healthcare, File No. 
9423341

    I have voted to accept for public comment the consent agreement 
with Schering-Plough Healthcare Products, Inc. (``Schering''), because 
I have reason to believe that the challenged advertisements are 
deceptive and I find that the proposed order, for the most part, 
provides appropriate relief. I do not, however, support the requirement 
that Schering produce and distribute a consumer education brochure that 
includes numerous specified ``messages or themes.'' As set forth in the 
proposed order, this consumer education remedy is overbroad and in any 
event is unlikely to assist in the prevention of the violations alleged 
in the complaint. Although I am an advocate of a strong Commission 
consumer education program, and we can be proud of the valuable work 
done by the Bureau of Consumer Protection's Office of Consumer and 
Business Education, this remedy is a well-meaning but not legally 
justifiable effort to fund a general consumer education campaign.
    The Commission enjoys extensive authority to fashion fencing-in 
relief for deceptive practices so long as the remedy has a reasonable 
relation to the violations alleged in the complaint. See, e.g., FTC 
versus Colgate-Palmolive Co., 380 U.S. 374, 394-95 (1965); FTC versus 
National Lead Co., 352 U.S. 419, 428-29 (1957). With such authority, 
however, comes the responsibility to exercise it judiciously. In my 
view, the consumer education remedy mandated by this proposed order 
bears no reasonable relationship to the violations alleged in the 
complaint.
    The proposed complaint alleges that Schering lacked a reasonable 
basis for the claim that a single application of Coppertone Kids 
provides six hours of protection from the sun for children engaged in 
sustained vigorous activity in and out of the water.\1\ The order 
addresses this allegation by requiring scientific substantiation for 
claims about the efficacy of any children's sun protection product in 
providing protection against any harmful effect of sun exposure or 
ultraviolet radiation, or about the length of time that any such 
product will provide sun protection for individuals engaged in 
sustained vigorous activity in and out of the water.
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    \1\ The proposed complaint challenges as false the claim that 
Schering has conducted tests demonstrating that a single application 
of Coppertone Kids provides six hours of protection from the sun for 
children engaged in sustained vigorous activity in and out of the 
water. The proposed order broadly prohibits false establishment 
claims for any sun protection product.
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    In addition, however, the order would require Schering to design, 
produce and print a brochure--subject to the approval of the Associate 
Director of the Division of Advertising Practices (``DAP'') in the 
Commission's Bureau of Consumer Protection--about the importance of 
sunscreen usage by children. The order mandates that the brochure 
include all of the following ``messages or themes'':
    (A) The importance of sunscreens in preventing skin damage, 
including skin cancer, sunburn, and premature skin aging;
    (B) Regular use of a high SPF sunscreen during childhood can 
significantly reduce the risk of certain types of skin cancers later in 
life;
    (C) A single bad sunburn during childhood can significantly 
increase a child's risk of developing skin cancer later in life;
    (D) The importance of proper application of sunscreens;
    (E) The need to reapply sunscreens after toweling or sustained 
vigorous activity; and
    (F) The need to use sunscreens during outdoor activities--not only 
in connection with water activities.

Order para. IV. The respondent must disseminate 150,000 copies of this 
brochure to parents or to organizations with access to parents or 
others who work with or care for children under age twelve.\2\
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    \2\ Like the brochure, the dissemination plan is subject to the 
approval of the Associate Director in charge of DAP.
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    Of the six required messages, only statement (E) seems likely to 
assist in the prevention of future deception like or related to that 
alleged in the complaint. Yet by including this key reapplication 
information in an extensive list of other facts about sunscreen, the 
order makes it less likely that consumers will see the reapplication 
information. In my view, it is highly unlikely that a parent who 
receives and reviews whatever brochure is approved will recall the one 
piece of information related to the complaint allegation when the 
parent makes a sunscreen purchase. Because the scope of the information 
to be included in the brochure is so broad, the consumer education 
remedy is not reasonably related to the violations alleged in the 
proposed complaint.\3\
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    \3\ The consumer education remedy here stands in contrast to a 
fencing-in provision contained in a consent order issued by the 
Commission last year. See Blenheim Expositions, Inc., Docket No. C-
3633 (Jan. 18, 1996) (requiring a franchise show promoter to 
undertake a limited distribution of an FTC consumer education 
brochure to customers attending its franchise shows). The respondent 
in Blenheim allegedly made unsubstantiated claims regarding the 
earnings and success of franchise owners and false claims regarding 
a poll of franchise owners. The brochure specifically identified FTC 
requirements with which franchisors must comply, including 
consumers' right to receive an earnings claims document, and it 
provided instructions on how to evaluate earnings claims. It thus 
contained information likely to assist the respondent's customers to 
detect and protect themselves from possible future 
misrepresentations of earnings like those alleged in the complaint. 
Although the brochure also addressed other issues related to the 
purchase of a franchise, all of the advice in the brochure at least 
arguably would help prospective franchisees avoid becoming victims 
of future violations by the respondent.
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    It is also troubling that if the Commission issues this order, it 
essentially will be ordering the respondent to advertise that persons 
should buy and use more of the respondent's products. Schering already 
has every incentive to communicate the required messages to consumers. 
In fact, the consumer education remedy is advertising (``use more 
sunscreen'') that the company might wish to do in any event since the 
conduct provisions of the order may prevent it from continuing to 
distinguish its children's sun protection product from others by 
claiming that it requires fewer applications. The deterrence value of 
this remedy is minimal at best.
    Finally, if this relief were sought in litigation, rather than 
obtained through a consent agreement, it would not withstand scrutiny 
under the First Amendment. For purposes of First Amendment analysis, 
there is no difference between compelled speech and restrictions on 
speech. Riley v. National Fed'n of the Blind, 487 U.S. 781, 796-97 
(1988). A valid restriction on commercial speech must be no more 
extensive than necessary to serve the substantial governmental interest 
directly advanced by the restriction. Rubin v. Coors Brewing Co., 115 
S. Ct. 1585, 1591 (1995) (discussing Central Hudson Gas & Elec. Corp. 
v. Public Serv. Comm'n of N.Y., 447 U.S. 557, 566 (1980)). Thus, 
disclosures compelled by the FTC can be no broader than necessary to 
prevent future deception or to correct the effects of past deception. 
See, e.g., National Comm'n on Egg Nutrition v. FTC, 570 F.2d 157, 164 
(7th Cir. 1977), cert. denied, 439 U.S. 821 (1978). Additionally, the 
government bears the burden of showing that a speech restriction will 
advance its

[[Page 10062]]

interest ``to a material degree.'' 44 Liquormart, Inc. v. Rhode Island, 
116 S. Ct. 1495, 1509 (1996) (plurality opinion of Justice Stevens) 
(citing Edenfield v. Fane, 507 U.S. 761, 771 (1993)). A commercial 
speech restriction that ``provides only ineffective or remote support 
for the government's purpose'' does not pass this test. 44 Liquormart, 
116 S. Ct. at 1509 (citing Central Hudson, 447 U.S. at 564).
    The dubious efficacy of the proposed consumer education remedy 
makes it unlikely that it will directly advance the asserted 
governmental interest in preventing future deception by the respondent. 
In addition, I doubt that a credible argument can be made that the 
information that the order specifically requires be included in the 
brochure is no more extensive than necessary to prevent future 
violations by Schering. Certainly Schering has waived any First 
Amendment objections to this relief by entering into the consent 
agreement. Nonetheless, when a remedy implicates First Amendment 
rights, the Commission should be particularly reluctant to obtain 
through negotiations relief that it lacks at least a colorable chance 
to obtain in litigation.
    In my view, it would be better to have no consumer information 
remedy in the consent order if the only alternative is an overbroad 
remedy of doubtful efficacy that raises First Amendment concerns.

[FR Doc. 97-5344 Filed 3-4-97; 8:45 am]
BILLING CODE 6750-01-M