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Oregon Sues LA Weight Loss and Franchisee

July 16, 2007

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Oregon Attorney General Hardy Myers has filed suit against LA Weight Loss and an Oregon franchisee, accusing them of making false and misleading representations about the costs, fees, products, and benefits associated with the program.

The lawsuit contends that LA Weight Loss and its franchisee violated Oregon’s Unlawful Trade Practices Act (UTPA) by advertising that the program could be purchased for only $9 a week when, in fact, consumers were required to pay hundreds of dollars for the entire program at the time of enrollment.

In addition, the lawsuit alleges that customers were presented with the actual cost of "LA Lites", so-called nutritional bars that are in reality similar to candy bars, three to four days after enrollment.

Customers were then told that to take advantage of the "guarantee" and "rebate' of half the program costs, they must eat these bars throughout the program.

A box of seven bars costs $16 or, if purchased in bulk at the beginning of the plan, $10.50. The LA Weight Loss program includes eating two bars a day for the initial "weight-loss weeks" plus during an additional six weeks of "stabilization". Consumers also must eat one bar per day for the following "maintenance" year.

The lawsuit also claims that advertised one-on-one counseling with an "individualized" menu plan was, in fact, one of eight menu plans based on general factors such as amount of weight to lose, age and gender.

The lawsuit further states that LA Weight Loss and its franchisee have no competent and reliable scientific evidence to substantiate effectiveness claims about their "dietary supplements" such as asserting that one of their supplements "FB 500" normalizes blood pressure.

Advertising

During the investigation of consumer complaints, the state found the company's advertising to be misleading in many aspects, including use of the word "guarantee".

The so-called "guarantee" had nothing to do with guaranteeing weight loss but was instead a "guarantee" that customers can stay on the weight loss program until they reach their target weight. In order to maintain the "guarantee", customers must strictly adhere to the plan and use the required amount of "LA Lites".

Investigators also found that so-called "counselors" available for one-on-one counseling were in reality staff (many of them former customers) who had no health or nutritional training or experience; however, they wore white lab coats and took customers' medical history and blood pressure.

In addition, the "counselors" pushed customers to buy the "LA Lites", supplements and other products to meet weekly sales quotas.

"Although the LA Weight Loss franchisee was quick to give refunds to Oregonians who complained to our office, the misleading marketing continued," Myers said. "It's always good to offer disgruntled consumers their money back but if the company continues to operate in the same misleading manner, the refunds are just 'smoke screens' devised to hide the intentional violation of law."

The state began its investigation into LA Weight Loss in September 2005 and attempted to negotiate a settlement agreement with the companies at the beginning of 2006. After months of stalling by the companies, the government issued a deadline for agreement and filed suit when the deadline was not met.

The lawsuit seeks restitution for Oregon consumers covering most costs and fees connected with joining the weight loss program, including payments for "LA Lites" and any "dietary supplement". The lawsuit also asks for civil penalties of $25,000 for each UTPA violation and for attorney fees and investigative costs.

In addition, the lawsuit seeks permanent changes in the way the companies market their products and to require that they only use competent and reliable scientific evidence to substantiate their claims.

"Oregonians of all ages should be generally cautious when choosing the right weight loss program," Myers explained. "Consumers should first consult with their doctor or nutritionist before obligating themselves to an expensive program that may or may not work for them."

Named in a complaint filed in Marion County Circuit Court is LA Weight Loss Franchise Company, a Delaware corporation operating out of Horsham, Pennsylvania, and an Oregon franchisee, NWM, Inc., of Lake Oswego. NWM, Inc., currently has locations in Clackamas, Corvallis, Eugene, Gresham, Lloyd (Portland), McMinnville, South Salem, Sherwood, Tanasbourne (Portland), Washington Square (Tigard), and Wilsonville. It also operated locations in Bend and North Salem.

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