Advertising Litigation

Abstract

In Federal Trade Commission v. HCG Diet Direct, LLC and Clint Ethington, the FTC sued HCG Direct and its principal Clint Ethington in January 2014 for making false and deceptive claims regarding the weight loss efficacy of liquid homeopathic HCG drops (a hormone) that the company sold. Importantly, however, the settlement contained an "Avalanche" provision that allowed the FTC to remove the suspension if upon motion to the court it was determined that a defendant had failed to disclose a material asset, materially misstated the value of any asset, or made any other material misrepresentation in the financial disclosures provided to the FTC.