Pom Wonderful, LLC v. Federal Trade Commission
414 U.S. App. D.C. 111
| D.C. Cir. | 2015Background
- POM Wonderful (and related entities/individuals) marketed pomegranate juice and supplements claiming they treat, prevent, or reduce risk of heart disease, prostate cancer, and erectile dysfunction, often citing clinical studies.
- POM funded many studies (including small/nonrandomized and larger randomized trials) but selectively emphasized favorable results and omitted contrary findings in advertisements and promotional materials.
- FTC administrative proceedings found numerous advertisements deceptive or unsubstantiated; the ALJ found liability on 19 ads and the full Commission found liability on more and issued a cease-and-desist order.
- The FTC order (Part I) barred disease-treatment/prevention claims unless supported by at least two randomized, controlled, human clinical trials (RCTs) yielding statistically significant results (double-blinded when feasible); Parts II–III imposed additional substantiation and non-misleading-reporting requirements.
- Petitioners sought judicial review in the D.C. Circuit, challenging the liability findings, the remedial two-RCT requirement, notice-and-comment rulemaking and First Amendment protections for their speech.
Issues
| Issue | Plaintiff's Argument (POM) | Defendant's Argument (FTC) | Held |
|---|---|---|---|
| Whether POM’s ads conveyed efficacy/establishment claims (i.e., claims that products treat/prevent disease or are "clinically proven") | Ads merely referenced studies and did not necessarily imply clinical proof; Commission overbroadly interpreted ads | Reasonable consumers would draw a causal/establishment impression from the ads given wording, symbols, journal citations, and statements about extensive research | Commission’s factual findings that many ads conveyed efficacy and establishment claims are supported by substantial evidence; affirmed |
| Whether the challenged claims were unsubstantiated and therefore deceptive under the FTC Act | Non-RCT studies, subgroup analyses, or validated vs. non-validated measures sufficed; RCTs not always required for foods/nutrients | Experts and FTC precedent show RCTs (well-controlled, randomized, placebo-controlled, double-blinded when feasible) are required to substantiate causal disease claims | Substantial evidence supports FTC finding that RCTs are required to substantiate disease-related causal claims; affirmed |
| Whether FTC violated APA notice-and-comment by imposing an RCT substantiation rule in adjudication | FTC adopted a new substantive rule requiring RCTs without notice-and-comment | Agency may announce new principles in adjudication; precedent supports adjudicative path here | FTC properly proceeded by adjudication; no APA rulemaking violation |
| Whether the remedial two-RCT categorical requirement for any disease claim violates the First Amendment (Central Hudson) | Two-RCT floor is overly rigid, unjustified, and burdens truthful speech; First Amendment requires narrower tailoring | Protecting consumers from deceptive claims is substantial; RCT requirement directly advances that interest and is tethered to liability findings | Order upheld to require at least one RCT for disease claims, but the across-the-board two-RCT categorical requirement is not adequately justified and is invalid; modified to one RCT requirement |
Key Cases Cited
- Cent. Hudson Gas & Elec. Corp. v. Public Serv. Comm'n, 447 U.S. 557 (commercial-speech intermediate scrutiny test)
- FTC v. Colgate-Palmolive Co., 380 U.S. 374 (FTC expertise on deceptive advertising)
- Thompson Med. Co. v. FTC, 791 F.2d 189 (D.C. Cir. 1986) (distinguishing efficacy vs. establishment claims and historical two-study contexts)
- Removatron Int'l Corp. v. FTC, 884 F.2d 1489 (1st Cir. 1989) (standards for establishment claims and substantiation review)
- Novartis Corp. v. FTC, 223 F.3d 783 (D.C. Cir. 2000) (standard of review for FTC factual findings even in First Amendment context)
- Board of Trustees v. Fox, 492 U.S. 469 (government must show reasonable fit between restriction and interest)
- Edenfield v. Fane, 507 U.S. 761 (governmental interest in accuracy of commercial information is substantial)