Wednesday, August 20, 2008

Weight Loss Guru Banned from Producing Infomercials, Ordered to Disgorge Profits

This posting was written by William Zale, Editor of CCH Advertising Law Guide.

Infomercial producer and weight loss book author Kevin Trudeau—held in contempt for intentionally violating a 2004 injunction by making an infomercial that misrepresented his book’s content—was ordered by the federal district court in Chicago to disgorge infomercial royalties conservatively estimated at more than $5.1 million and was banned for three years from participating in the production or publication of any infomercials for products in which he had any interest. The ban specifically included books and informational publications.

Confirming its previous contempt finding (CCH Advertising Law Guide ¶62,754), the court held that the infomercial falsely and intentionally led thousands (probably hundreds of thousands) to believe that the weight loss book would describe an “easy” and “simple” protocol that, once “finished,” would allow a consumer to “eat anything” he or she wanted.

Appropriateness of Ban

The three-year ban was appropriate remedy because Mr. Trudeau had made abundantly clear that nothing short of a complete ban, for a reasonable period of time, would achieve compliance with the previous directives to limit the content of his infomercials to non-misleading claims about his books, according to the court.

While commercial speech generally benefits from limited protection under the First Amendment, untruthful or misleading commercial speech “finds no refuge under the Constitution,” the court held, citing the Supreme Court decision in Central Hudson Gas Co. v. Public Service Commission, 447 U.S. 557 (1980).

To the extent that the First Amendment arguably protected any non-misleading portions of Trudeau’s infomercials, it did not trump the public’s interest in obtaining compliance with federal court judgments, according to the court.

The August 7 decision is Federal Trade Commission v. Trudeau, which appears at 2008-2 Trade Cases ¶76,255 and CCH Advertising Law Guide ¶63,048.

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