Continuing its trend of scrutinizing claims touting improved cognitive function, the Federal Trade Commission recently announced a settlement with LearningRx Franchise Corp. (“LFC”), the developer and franchisor of a chain of “LearningRx centers” providing one-on-one cognitive training to consumers. The FTC’s settlement with LFC comes in the wake of several other high-profile FTC actions involving cognition claims, including a $2 million settlement with Lumos Labs, Inc. (brain training app and video games), a $1.4 million settlement with Brain Research Labs, Inc. (dietary supplement), and a stipulated final order with WordSmart Corporation (program to improve test performance). The LFC settlement demonstrates that the FTC continues to prioritize consumer protection actions against companies claiming that the use of their products yields brain-boosting benefits, particularly where those claims suggest that the products are effective to treat or slow the onset of brain-related disorders.
According to the FTC’s complaint, LFC promoted the LearningRx program through a blog, Facebook, Twitter, radio and print ads, brochures, direct mail, and through Google AdWords. The claims about the effects of the program ran the gamut from increased income (based on increased IQ scores) to improved athletic and scholastic performance. In addition, and of particular concern to the FTC, LFC claimed in its ads that its program could delay the onset of dementia, overcome the long-term effects of traumatic brain injury, and help treat Autism, Apserger’s Syndrome, and Attention Deficit Disorder.
The FTC alleged that these claims were false and misleading and/or were not substantiated at the time they were made. The proposed settlement order prohibits LFC from making such claims in the future unless they are not misleading and are substantiated by human clinical testing.
Takeaways for Advertisers
There are several takeaways here for advertisers.
First, if you are claiming that a product improves cognitive function or slows cognitive decline, be very wary. Within the past two years alone, the FTC has brought about half a dozen cases against advertisers making cognition claims, and that trend shows no sign of changing any time soon. You should absolutely make sure that you have sound science to support the claims you are making.
Second, do not assume that AdWord buys will escape the FTC’s attention. To the contrary, the FTC will often require disclosure of AdWords in order to determine what message an advertiser intends consumers to take away from its advertising. Even assuming that its other forms of advertising did not make the connection between a brain disorder and the product, LFC’s purchase of phrases like “Alzheimer’s Cure” and “cure for ADD” (as alleged by the FTC) might suggest that the advertiser intended consumers to make that connection.
Third, and finally, do not assume that the FTC pays no attention to social media. The LFS case, like many before it, shows that the FTC pays close attention to what companies say about their products on Facebook and Twitter.