Opinion ID: 440186
Heading Depth: 3
Heading Rank: 3

Heading: Findings Concerning Midol

Text: 66 The complaint charged Sterling with failing to disclose Midol's aspirin content. The Commission held that a mere failure to disclose the presence of aspirin in advertising for aspirin-based analgesics was not misleading. It concluded, however, that it was a deceptive practice to disseminate advertising that implied aspirin-based products did not contain aspirin. It found that certain Midol advertisements did create that impression, and it illustrated its finding with this radio advertisement: 67 Midol starts to work fast with an exclusive formula that helps stop periodic pain ... and its medically approved ingredients give effective relief from headache and low backache. All in all, Midol's unique formula gets you through those days in comfort. 68 The Commission concluded that the term exclusive formula conveyed the message that Midol's analgesic ingredient was not aspirin. It also criticized an advertisement that claimed Midol was made from an exclusive formula with medication ordinary pain relievers don't give you. 69 The failure to disclose material information may cause an advertisement to be deceptive, even if it does not state false facts. Simeon Management, 579 F.2d at 1145; see also Bristol-Myers Co. v. F.T.C., 738 F.2d 554, at 563 (2d Cir.1984). We must reject Sterling's contention that these advertisements were not intended to suggest that Midol's analgesic ingredient was unique. The illustrative advertisements specifically state that the unique ingredient relieves pain. We agree with the Commission that consumers could easily infer the unique pain reliever was something other than ordinary aspirin. III Validity of the Order A. Standard of Review 70 Under the Federal Trade Commission Act, the Commission has the primary responsibility for determining the remedy for deceptive advertising. See F.T.C. v. National Lead Co., 352 U.S. 419, 429, 77 S.Ct. 502, 509, 1 L.Ed.2d 438 (1957). Because of the Commission's expertise in determining what remedy is required to eliminate an unfair or deceptive practice, the Commission is granted wide latitude in deciding the scope of its orders. Jacob Siegel Co. v. F.T.C., 327 U.S. 608, 612-13, 66 S.Ct. 758, 760-61, 90 L.Ed. 888 (1946). In drafting the Act, Congress recognized that there is no limit to human inventiveness in [the advertising] field. F.T.C. v. Sperry & Hutchinson Co., 405 U.S. 233, 240, 92 S.Ct. 898, 903, 31 L.Ed.2d 170 (1972) (quoting H.R.Conf.Rep. No. 1142, 63d Cong., 2d Sess., 19 (1914)). Accordingly, it authorized the Commission to draft orders encompassing all of an advertiser's products or all products in a broad product category in order to fence in known violators of the Act. See National Lead, 352 U.S. at 431, 77 S.Ct. at 510; Litton, 676 F.2d at 370. Fencing-in provisions serve to 'close all roads to the prohibited goal, so that [the FTC's] order may not be by-passed with impunity.'  Id. (quoting F.T.C. v. Ruberoid Co., 343 U.S. 470, 473, 72 S.Ct. 800, 803, 96 L.Ed. 1081 (1952)). 71 In reviewing the Commission's order, we must bear in mind its broad powers and its expertise in protecting consumers. We may not lightly modify the Commission's orders. Colgate-Palmolive, 380 U.S. at 392, 85 S.Ct. at 1046; F.T.C. v. Cement Institute, 333 U.S. 683, 726, 68 S.Ct. 793, 815, 92 L.Ed. 1010 (1948). Our inquiry is limited to the determinations that the order is sufficiently clear and precise to give notice to the advertiser and that its scope bears a reasonable relation to the advertiser's violations of the Act. Colgate-Palmolive, 380 U.S. at 392, 394-95, 85 S.Ct. at 1046, 1047-48; Litton, 676 F.2d at 369, 370. 72 In Sears, Roebuck and Co. v. F.T.C., 676 F.2d 385 (9th Cir.1982), we explored in depth the factors that indicate whether there is a reasonable relationship between the violation and the scope of the order. We observed that the ultimate question is the likelihood of the petitioner committing the sort of unfair practices [the order] prohibit[s]. Id. at 391 (quoting Litton, 676 F.2d at 370). We outlined the elements on which a forecast of future violations may be based: (1) the deliberateness of the violation; (2) the violator's past record with respect to advertising practices; and (3) the adaptability or transferability of the unfair practice to other products. Id. at 392. We concluded that no single factor was determinative, but that the more egregious the facts with respect to a particular element, the less important it is that another negative factor be present. Id. 73 In reviewing the Commission's order in the American Home case, the Third Circuit applied our analysis in Sears, Roebuck. Because of the nature of the products involved, the court believed it should also consider the seriousness of potential violations of the order. American Home, 695 F.2d at 706. It concluded that the health risks and potential adverse side effects associated with aspirin made this a unique product category. Id. at 698. The court also considered the fact that it is difficult for consumers to compare analgesic products effectively, so they are more likely to give credence to advertising claims. Id. We agree with the Third Circuit's conclusion that [w]hen drug advertising is at issue, the potential health hazards may well justify a more sweeping order than would be proper were the Commission dealing with a less consequential area. Id. at 706. We therefore add the seriousness of potential violations to our analysis under Sears, Roebuck. B. Discussion 1. Paragraph I of the Order 74 Paragraph I outlines the means by which Sterling must substantiate a claim that the therapeutic superiority of any of its nonprescription internal analgesic products is established. The order requires that such claims be supported by two well-controlled clinical studies, and it sets out the procedures under which such studies must be conducted. Section D of the paragraph authorizes an alternate method of establishing a claim of therapeutic superiority, permitting Sterling to disseminate a claim that cannot be verified by two well-controlled clinical studies, but which is supported by a test or investigation that is generally accepted by the relevant scientific community as sufficient to establish the claim. 75 Sterling contends this paragraph is impermissibly broad. It argues that, at the least, the order should apply only to the two products, Bayer and Cope, as to which Sterling advertised established therapeutic superiority. We agree with the Commission that the scope of the paragraph is appropriate. 76 The violation was deliberate. The deceptive advertisements incorporated text, tone, and visual aspects intended to subtly persuade consumers that Bayer and Cope's therapeutic superiority had been scientifically established. These advertisements were widely disseminated for a period of several years. 77 The Commission found that Sterling did have a past history of violations, including an order litigated in 1950 regarding false claims that Bayer had been endorsed by a pharmacists' group. Sterling's record with the Commission also included four consent decrees involving non-analgesic products. 78 Applying the third Sears, Roebuck factor, the Commission found this practice to be readily transferable. It reasoned that if the order were limited to Bayer and Cope, Sterling could easily use the same subtle advertising devices to suggest that another internal analgesic had proven therapeutic superiority. Sterling would be free to change the name of one of its products and thereby avoid the order's restrictions. 79 We believe any future violation of this nature would be serious and should therefore be prevented. These advertisements convey a strong message to consumers--that doctors and scientists endorse the product--and do so in a manner so intentionally subtle that consumers are unlikely to analyze the message they receive. 80 We reject Sterling's contention that the requirement of two well-controlled clinical tests is unduly burdensome. The order sets out precisely the procedures to be followed; there is no question of adequate notice to Sterling. The Commission responded to Sterling's argument that the scientific community would not demand such studies by permitting an alternate means of supporting its claims. Furthermore, Sterling's argument that these requirements are burdensome ignores the obvious. If it prefers not to undertake the burden of establishing the truth of its claims, it need only refrain from claiming its products have been proven to be superior. 2. Paragraph II of the Order 81 Paragraph II regulates establishment claims as to the pharmaceutical quality of any of Sterling's nonprescription internal analgesic products. It is specifically limited to claims that any such product has superior purity, freshness, stability, or speed of disintegration. The level of support required for these claims is more lenient than that imposed in Paragraph I. Sterling is required to possess and rely on scientific evidence that would satisfy relevant experts as reliable. 82 Sterling believes this paragraph must be vacated because its establishment claims as to pharmaceutical attributes were made only about Bayer and there is no evidence it will make such claims about Bayer or any other internal analgesic in the future. We disagree. The violation was deliberate; the advertisements made explicit factual statements that consumers were likely to view as verified. See Sears, Roebuck, 676 F.2d at 393; American Home, 695 F.2d at 697. Although the challenged claims were made only as to Bayer, it is clear that these claims are easily adaptable for use in other Sterling advertisements. This paragraph is narrowly drawn, referring only to four specific attributes, and is reasonably related to the violation. It will therefore be enforced. 3. Paragraph III of the Order 83 Paragraph III requires Sterling to have a reasonable basis to support therapeutic performance claims for any of its nonprescription internal analgesic products. Reasonable basis is defined in the order as competent and reliable scientific evidence. 84 Sterling asks us to vacate this paragraph as too vague. It relies upon American Home, in which the court held that an identical reasonable basis requirement was too vague and imprecise to give the advertiser sufficient notice of the standard. American Home, 695 F.2d at 710-11. The Commission's decision in American Home had acknowledged that the requirement of competent and reliable scientific evidence was intended to be flexible. The Commission refused to equate the requirement with the well-controlled clinical tests standard, stating instead it would determine the standard on a case-by-case basis. Id. at 710. The reviewing court found that the imprecision of this standard was exacerbated by the order's overbreadth. The advertiser had made only one comparative efficacy claim, but was subjected to an order covering all of its nonprescription drug products. The court concluded the combination of overbreadth and imprecision required it to deny enforcement of that section of the order. Id. at 711. 85 The Commission again applied the competent and reliable scientific evidence standard in this case and in Bristol-Myers. In the explanation of its order, however, it attempted to make the standard more precise. It described the standard as requiring more support than the usual reasonable basis test, but less than that required for establishment claims. It recognized that this left some ambiguity regarding the minimum acceptable level of support, but observed that submission of two clinical studies would always be sufficient. It concluded that the flexibility inherent in the standard set an appropriate balance between the need for clear standards and the need to prevent repeated violations. 86 We agree with the Second Circuit's conclusion that American Home should be distinguished. See Bristol-Myers, at 560-61. As in Bristol-Myers, the order here is not overbroad, but is limited to the product category in which a violation occurred. Sterling does not contest the Commission's determination that it made therapeutic efficacy claims as to Cope, Vanquish, and Midol. The Commission also found such claims were made as to Bayer. Sterling's pattern of transferring this deceptive practice from one product to another is therefore clear. 87 With the Commission's explanation of its intent, this section of the order is probably as specific as the circumstances will permit. Colgate-Palmolive, 380 U.S. at 393, 85 S.Ct. at 1047. In view of the extent of Sterling's violations and of the fact that violations were transferred from one product to another, it is appropriate that Sterling bear any risk that results from the standard's imprecision. Id. If Sterling prefers to continue to advance claims of therapeutic efficacy, it can reduce its risk of violating the order in one of several ways. First, it can support its therapeutic efficacy claims with two well-controlled clinical studies. Second, it can secure from the Commission an advisory opinion as to the propriety of proposed advertising. See id. at 394, 85 S.Ct. at 1047. Third, it can advise consumers that its claims of therapeutic efficacy are not clearly established. See American Home, 695 F.2d at 695. 88 We conclude that this portion of the order is sufficiently clear and precise, and it will be enforced.