FDA/FTC Warning Letters
Although discovering a cure for COVID-19 would certainly be welcome news, any current mention of a cure or vaccine is more likely to be fake news. Furthermore, with economic ramifications and health concerns affecting the entire global population, anyone making false claims about their product’s ability to treat or cure this deadly disease may face both civil and criminal charges.
Unfortunately, there are always people looking to capitalize on the misfortune of others. Dozens of products fraudulently claim to effectively treat or cure coronavirus, all without approval from the U.S. Food and Drug Administration (FDA) to make such claims. Since May 18th, the FDA and the Federal Trade Commission (FTC) have issued 57 Warning Letters to companies claiming to offer a COVID-19 treatment or cure.
Subject of Warning Letters
The FDA sent dozens of Warning Letters to pharmaceutical and marketing companies with the subject of: Unapproved and Misbranded Products Related to Coronavirus Disease 2019 (COVID-19). But what exactly did these companies do wrong? Have they all been guilty of intentionally duping a buyer, or did some unintentionally use misleading wording in their marketing/labeling for products that genuinely treat or mitigate some of the virus’s symptoms?
Companies need to be aware of what they can and cannot say to avoid government or civil enforcement. If product labels, advertisements, or any marketing campaigns claim to treat, reduce, or prevent COVID-19, they are likely in violation of FDA and FTC guidelines.
The Legal Bases for FDA and FTC Actions
In plain English, companies cannot say (without FDA approval) that the product can treat, cure, mitigate, or prevent a disease condition. And in this case, the product will prevent, treat, or cure coronavirus or COVID-19 sickness. More formally, the FDA and FTC will say that it is illegal to cause the introduction or delivery for introduction of these products into interstate commerce as being prohibited under sections 301(a) and (d) of the FD&C Act, 21 U.S.C. § 331(a) and (d). Further, it is “unlawful under the FTC Act, 15 U.S.C. 41 et seq., to advertise that a product can prevent, treat, or cure human disease unless you possess competent and reliable scientific evidence, including, when appropriate, well-controlled human clinical studies, substantiating that the claims are true at the time they are made. For COVID-19, no such study is currently known to exist for the product identified above. Thus, any coronavirus-related prevention or treatment claims regarding such products are not supported by competent and reliable scientific evidence.”
Reckless Disregard Can Lead to Court Actions Immediately
In some cases, false or misleading claims may be considered reckless enough to warrant immediate legal action. Case in point, a Utah-based manufacturer of colloidal silver products claimed that its silver products could destroy the virus, “usher” it out of the body, and that Alkaline Structured Silver has been proven to destroy viruses in the body. The FDA skipped sending a warning letter in this case, and went straight to issuing a restraining order and other legal ramifications. The company effectively got hammered with court enforcement actions at the outset.
Retailer Liability For Helping Sales of Problematic Products
Online shopping during the pandemic has exploded and similar the problematic products are being sold online. The online sales can be from the company’s website or through third-party resellers, who either resell the product or facilitate the sale. For example, can Amazon.com be liable for sales of problematic products sold through its Amazon Associates program? FDA and FTC have sent Warning Letters to online companies who sell through Amazon.com. Normally a third party retailer may not have liability. But these FDA/FTC letters specifically cc:’ed the Amazon Associates program, which has several implications. Did they copy Amazon hoping Amazon would take action against by delisting the product ads? Or is the cc: designed to put Amazon on notice that it too could be liable? At least 3 combined FDA/FTC Warning Letters were sent on May 26th, 2020 to various online retailers with cc: to Amazon Associate program for product advertisements that said: (i) “Find the best CBD Oil to help fight Coronavirus” or (ii) “NATURAL REMEDIES FOR CORONAVIRUS…There are plenty of things you can do to boost your immune system and fight off any virus including coronavirus” or (iii) “4 Proven Ways To Protect Yourself Against Coronavirus.” In July 2019, the 3rd Circuit Court of Appeals held that Amazon.com may be potentially liable for strict liability claims for products its sells because it determined that Amazon may be a “seller” within the meaning of the law.
Warning letters are typically the first line of defense against deceptive marketing tactics related to COVID-19 treatment products. If claims are particularly reckless, however, or the company does not cease after the initial warning, the FTC may seek a federal injunction and an order to refund consumers.
Contact Upadhye Cwik LLP Today
At Upadhye Cwik LLP, we know that fear and uncertainty are making even routine aspects of business challenging these days. But when competitors gain an unfair advantage through the use of deceptive marketing tactics and false advertising, you may need to take immediate legal action.
At Upadhye Cwik LLP we counsel companies and defend against FDA/FTC enforcement actions. If another company’s sales tactics damage your company, we also pursue companies who are utilizing deceptive advertising or marketing tactics. Contact Shashank Upadhye at 312-327-3326 or [email protected] to discuss Warning Letter resolution or other enforcement issues.