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Feds Prosecute Skin Patch Weight-Loss Promoters

December 15, 2004
The Federal Trade Commission continues its attack on bogus weight-loss claims by suing a diet patch manufacturer and a retailer that marketed the patch directly to Spanish-speaking consumers.

In two separate federal court actions, the FTC charged that the patch manufacturer, Transdermal Products International Marketing Corporation, and the retailer, SG Institute of Health & Education, Inc., falsely claimed that the skin patch causes substantial weight loss.

The FTC complaints in both cases also challenge false claims that the patch or its main ingredient, sea kelp, has been approved by the Food and Drug Administration (FDA). The FTC further alleged that Transdermal Products provided retailers with deceptive marketing materials that could be used to mislead consumers.

“We’re determined to pursue deception to its source,” said Lydia B. Parnes, Acting Director of the FTC’s Bureau of Consumer Protection. “Today’s action targets a company that manufactured both an ineffective product and the misleading claims to sell it. These defendants are doubly responsible for the deception.”

The FTC’s case against Transdermal Products and its president, William Newbauer, will proceed to litigation in U.S. District Court for the Eastern District of Pennsylvania. SG Institute and its principals settled with the FTC and agreed to stop making the deceptive claims.

Transdermal Products

Transdermal Products International Marketing Corporation, based in Bristol, Pennsylvania, advertised on the Internet to recruit distributors who would purchase patches from Transdermal and sell them at retail. Transdermal sold the purported weight-loss patches to distributors under several brand names, including LePatch, Revo Patch, Svelt Patch, and Z Patch.

Transdermal also sold unmarked patches, which retailers could sell under their own brand names. Transdermal allegedly provided its distributors with advertising copy and purported substantiation materials, including a document claiming to be a scientific weight loss study demonstrating the patch’s efficacy. Transdermal’s ads contain statements such as, “Amazing Skin Patch Melts Away Body Fat.”

According to the complaint, Transdermal has sold approximately 381,000 “units” of 30 patches to distributors, for which distributors paid approximately $1.75 million.

The FTC’s complaint alleges that the Transdermal defendants made false claims that the patch causes substantial weight loss, safely enables users to lose more than three pounds per week for more than four weeks, and causes permanent weight loss. In addition, the complaint alleges that the defendants falsely claimed that scientific research demonstrates that the patch causes substantial weight loss and that the FDA approved the product’s main ingredient – Fucus vesiculosus (sea kelp) – for weight loss.

The complaint also alleges that the defendants made unsubstantiated claims that the product causes weight loss and “melts away” body fat. Finally, the complaint alleges that by providing their distributors with deceptive advertising and substantiation materials, the defendants provided them with the means and instrumentalities to deceive consumers.

SG Institute

SG Institute of Health & Education, Inc., based in Tamarac, Florida, and its owners, Pedro Salas and Vanessa Salas (SGI), settled charges that they made false and unsubstantiated claims in marketing Revopatch Plus, a purported weight-loss and cellulite-reduction skin patch.

Revopatch Plus was manufactured by Transdermal (the subject of a separate FTC lawsuit, described above). The FTC’s complaint alleges that SGI falsely claimed that Revopatch Plus causes substantial weight loss in a short time, for example, 15 pounds in four weeks and 20 pounds in six weeks, and has been approved by the FDA.

The complaint also alleges that SGI claimed without substantiation that Revopatch Plus causes weight loss, eliminates fat, reduces appetite, regulates metabolism, and reduces or dissolves cellulite. The defendants’ ads claimed, for example, that Revopatch Plus “takes away the urge to eat and the accumulated fat in the body: and best of all, it is 2 products in 1, because it helps you to lose weight and it helps you dissolve cellulite.”

According to the FTC, the SGI defendants advertised their product in major, national Spanish-language magazines, on local radio stations in California and New York City, and on Telemundo in Florida. Consumers purchased the patch by calling a toll-free telephone number listed in the ads. SGI sold the patch in units of 30, 60, and 90 for prices ranging from $60 to $200. It is estimated that SGI sold more than $1 million in patches since September 2001.

To settle the FTC charges, the proposed stipulated final order prohibits the defendants from falsely claiming that Revopatch Plus or any other product applied to the skin causes substantial weight loss in a short period of time or that the FDA has approved sea kelp for controlling weight. The order also prohibits the defendants from misrepresenting that any health-related product, service, or program has been approved by the FDA.

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