False establishment claims not actionable under consumer protection law

Aloudi v. Intramedic Research Group, LLC, 2015 WL 4148381,
No. 15-cv-00882 (N.D. Cal. Jul. 9, 2015)
Aloudi brought the usual California/warranty claims against
IRG for its claims about its JavaSLIM product, a “green coffee bean extract
weight loss formula.” The label says that JavaSLIM is “Clinically Proven” to
cause “significant reduction in actual body mass index (BMI).” Aloudi alleged
that the only “active” ingredients in the Product “are chlorogenic acids and
caffeine, neither of which are effective treatments for weight loss,” but that
IRG advertised that the product “helps consumers achieve ‘safe, effective,
RAPID weight loss,” and “also cited and continues to cite a ‘clinical trial’
purportedly proving that [the Product’s] ingredients provide a ‘significant
reduction in both body weight and all important Body Mass Index (BMI) in just a
few short weeks.’”
Aloudi alleged that “there are no clinical trials or
scientific studies showing that the Product or its ingredients are safe and
effective for weight loss or that the Product or its ingredients cause a
significant reduction in body weight and BMI.”  IRG’s failure to provide “adequate
‘substantiation’ that these statements are truthful and not misleading” allegedly
violated the Dietary Supplement Health Education Act of 1994 (“DSHEA”) and
therefore was unlawful under the UCL. Plus, Aloudi alleged falsity under the
UCL because “chlorogenic acids have never been shown to be an effective
treatment for weight control.”  Further,
he alleged, the FDA determined that “there is ‘inadequate data to establish the
general recognition of the safety and effectiveness’ of caffeine for the specified
use of ‘weight control,’” and “there is a scientific consensus that ‘magic
pills’ containing caffeine and green coffee extract, such as [the Product], do
not and cannot provide significant reductions in weight loss alone.”
The court kicked out the lack of substantiation allegations
because “[i]t is well settled that private litigants may not bring claims on
the basis of a lack of substantiation.” Aloudi argued that IRG’s claims were
establishment claims, which could thus be falsified by showing that the
evidence didn’t support them.
First, the court ruled, that didn’t support the UCL “unlawful”
claim, based entirely on IRG’s lack of substantiation as required by
DSHEA.  RT: But that seems mistaken.  True, the UCL in general doesn’t allow
consumers to bring lack of substantiation claims as falsity claims—but if the underlying
law does require substantiation, the UCL is designed to create private
plaintiff authority to act under the “unlawful” prong.  There might be preemption issues, but there’s
a lot of law on how to manage that.
Second, Aloudi’s argument relied on Lanham Act precedent,
and California law didn’t make that “establishment claim” distinction.  (It’s notable that courts usually analyze the
Lanham Act and state law in pari materia when competitors are suing; why they
should do that when consumers are suing, especially after Lexmark, is less clear. 
Compare also the 4th Circuit’s In re GNC case, which imports explicit/implicit falsity with
absolutely no analysis or argument.  This
is the court’s best reason, it seems to me, but weakened by its reliance on the
idea that there’s just no precedent out there supporting Aloudi’s argument.  It would be better to think about the purposes
of state consumer protection laws and whether they’re well served by some kind
of establishment claim doctrine.)
The court concluded that “[t]he California legislature
delegated the authority to demand substantiation for advertising claims to
prosecuting authorities alone.” Thus, “as a matter of law, Plaintiffs cannot
bring consumer protection claims solely on the basis of a lack of
substantiation.” The court therefore disagreed with McCrary v. Elations Co.,
No. 13–cv–00242, 2013 WL 6403073 (C.D.Cal. July 12, 2013) (“Since Defendant’s
advertising expressly states that it has clinical proof to support [its
product’s] effectiveness, Plaintiff plausibly alleges falsity when he contends
that there is an absence of such proof.”).
RT: McCrary was
right.  “Substantiation” is when the
regulator says, “you say your product causes weight loss. Please prove it.”  But the advertiser here didn’t make that
claim.  It made a different, stronger
claim: that it’s clinically proven to cause weight loss.  If you show that the product is not clinically proven to cause weight
loss, you’ve falsified—proved false—the claim the advertiser actually made,
even if you’ve also incidentally shown that a different claim (this product
causes weight loss) is unsubstantiated.  The
instant ruling is a license to deceive, especially in the supplement space
where there’s too much going on for regulators to go after everyone and too
many competitors for a Lanham Act suit to be worthwhile for any given
competitor.  This result is particularly
bad because claims to have empirical proof are more powerful than straight-up
claims.  Nor would a ruling the other way
eviscerate the no-substantiation rule: it would still bar a consumer plaintiff
from prevailing when the advertising claim does not invoke empirical proof and
the plaintiff only attacks the reliability of the studies allegedly behind the
claim.  (Note the separate issue: there
are two ways to attack the studies. 
Either they’re just not reliable to prove the claim made, which is a
substantiation argument, or they actually show the opposite (that the product
doesn’t work), which is a falsity argument. Aloudi’s first set of allegations
goes to the first line of attack, but there might be the second lurking in
Then the court made short work of the falsity allegations.  The allegation that there was a “scientific
consensus that ‘magic pills’ containing caffeine and green coffee extract, such
as [the Product], do not and cannot provide significant reductions in weight
loss alone” was purely conclusory, and the remaining facts alleged were
insufficient to show falsity, based on general statements by politicians and
the FDA that weren’t tied to this particular product or these specific representations.
Nor was Aloudi’s anecdotal experience that JavaSLIM didn’t work sufficient.
Finally, Aloudi failed to identify specific actionable
The warranty claims failed for the same reasons.

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