Wain'S Laboratory, Inc

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IN THE MATIER OF W ..\IN'S LABORATORY, INC.

CO)IPL.\INT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLA1'10N UF SEl', ;; OF AN ACT OF CONGRESS APPROVED SEPT. 26, lHH Docket 4203. Compla-int, July 30, 1940-Dccision, Oct. 18, 19.~0 Where a corporation engaged in sale and distribution of its "Ama-Gon" or, as subsequently designated, "\Vain's Compound," drug-containing preparation for bronchial asthma and coughs; in advertisements that·eof which it disseminated and caused to be diss~·minated through the mails, newspapers, circulars, and other adn>rtlsing matter, and in commerce and otherwise, and which were int~:>nded or likely to induce purchase of its said product- (a) Represented, dir~:>ctly and by implication, in its \'at·ious stntemcnts and representations thus made, and which purported to be descriptive of the remedial, curative, and thera})('Utic properties of said preparation, that it wns an !'fl'ecti>e and competent treatment for bronchial asthma and coughs, and that its use gu>e imm!'dinte or prompt relief ft·om the paroxysm:,~ of asthma, and that it was entirely sufe and hat·mless and might be w~erl without dan~"£>r of ill effects upon healtlt of user;

Facts bt>lng such revresPntatious w~:>re grossly exu~gemte(l, false UtHl misleading, it was not an effecti>e or competent treatment for bronchial asthmb. or coughs, and had no therapeutic value ill treatment of such condition~> In excess of furnishing temporary symptomatic relief from pnroxysms of aslbmn and bronchial irritations, and, by yittue of potassium Iodide cont~:>ut in quantity pr~:>sent, was not in all cases safe or harmless, but might, ill some instancf's, cause injury to health if tak~:>n under conditions prescribt:>d in said advertis.ements or under such conditions as are customa1·y or usual, and, thus used, might be harmful to those having healed lesions of arrested tuberculosis or goitre; and (b) Failed to reveal, in its said advertisements (Jis,;eminated as aforesaid, facts material in the light of its rept·esentations and that use thereof, undt>r the conditions prescribed in such advertisements or under such conditions as are cu><tomary or usual, might result in injury to ht>alth; With effect of misleading substantial portion of purchasing public into erroneous and mistaken be~lef that all of such false statements and representations were true, and of inducing substantial portion of such public to purc•hase its said preparation b~:>cause of such erroneous and mistaken b£>lief engendered as above set forth:

Held, That such acts and practices, nuder the circumstances set f01'th, were all to the pt·ejndice and injury of the public and constituted unfair and decepti>e acts and pmctices in commerce.

lllr. John 111. Russell for the Commission. Co"tPLAINT Pursuant to the provisions of the Federal Trade Commission Act, and by virtue o£ the authority vested in it by said act, the Federal Trade Commission having reason to believe tha.t ·wain's Laboratory, WAIN'S LABORATORY, INC. 1143 1142 Complaint Inc., a corporation, hereinafter referred to as respondent, has violated the provisions of said act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint, stating its charges in that respect as follows:

PARAGRAPH 1. Respondent, 'Vain's Laboratory, Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of California, having its office and principal place of business at 4687 Hollywood Boulevard, Hollywood, Calif. PAR. 2. Respondent is now and has been for more than 2 years last past enga.ged in the business of selling and distributing a certain preparation containing drugs, formerly designated Ama-Gon and now offered for sale and sold tmder the name "'Vain's Compound," recommended for use in the treatment of bronchial asthmtt and bronchial coughs. Respondent sells its said product to members of the purchasing public situated in various States of the United States and in the District of Columbia, and causes said product when sold by it, to be transported from its place of busine.<;s in the Stat~ of Califomia to the purchasers thereof located in various other States of the United States and in the District of Columbia. Re!'ipondent maintains, and at all times mentioned herein has maintained, a course of trade in its said product in commerce among and between the Yarious States of the United States and in the District of Columbia. PAR. 3. In the course and conduct of its aforesaid business, the respondent has disseminated, and is now disseminating, and has caused, and is now causing, the dissemination of false advertisements concerning its said product by the United States mails, and by various other means in commerce, as commerce is defined in the Federal Trade Commission Act, for the purpose of inducing, and which are likely to induce, directly or indirectly, the purchase of its said product; and respondent has also disseminated and is now disseminating, and has caused, and is now causing, the dissemination of false advertisements concerning its said product, by various means, for the purpose of inducing, and which are likely to induce, directly or indirectly, the purchase of its said product in commerce, as commerce is defined in the Federal Trade Commission Act. Among and typical of tho false, misleading, and deceptive statements and representations contained in said false advertisements, disseminated and caused to be disseminated, as hereinbefore set forth, by the United States mails, by ad\'ertisements in newspapers, and by circulars and other advertising literature, are the following:

TO PALLIATE ATTACKS OF BRO:"CHIAL ASTHMA And Bronchial Coughs 296516'"-41-vol. 31-7:> Complaint 31 F. T. C. The active ingredient in Wain's Compound works rapidly. In a few minutes 1t is taken into the blood stream and starts its work. No matter how long you have suffered from torturing attacks of Bronchial Asthma and Bronchial Coughs, we want you to prove the value of Wain's Compound to yourself today. Accept this generous trial offer. You must be entirely satisfied. Wain's Compound helps YOU, or your MONEY BACK is GUARANTEED.

Sold at all OWL DRUG STORES PAR. 4. Thj;ough the use of the statements and representations hereinabove set forth, and other similar statements and representations not specifically set out herein, all of which purport to be descriptive of the remedial, curative, and therapeutic properties of respondent's said preparation, respondent directly and by implication represents that said preparation is an effective and competent treatment for bronchial asthma and bronchial coughs; that its use gives immediate or prompt relief from the paroxysms of asthma; that said preparation is entirely safe and harmless and may be used without danger of ill effects upon the health of the user.

PAR. !5. The foregoing representations are grossly exaggerated, false and misleading. In truth and in fact, respondent's preparation is not an effective or competent treatment for bronchial asthma or bronchial coughs, and has no therapeutic value in the treatment of such conditions in excess of furnishing temporary symptomatic relief from the paroxysms of asthma and bronchial irritations. Said preparation is not in all cases safe or harmless as it contains potassium iodide in quantities sufficient to cause in same instances injury to health if taken under the conditions prescribed in said advertisements or under such conditions as are customary or usual. The use of said preparation as aforesaid may be harmful to those .having healed lesions of arrested tuberculosis or goitre. In arrested cases of tuberculosis the tendency of potassium iodide is to resolve the fibrous tissues about the healed lesions and thereby to reactivate the tuberculous process. The hazard in cases of goitre is the tendency to convert a benign adenoma to a toxic adenoma. PAR. 6. In addition to the representations hereinabove set forth, the respondent has also engaged in the dissemination of false advertisements in the manner above set forth, in that said advertisements so dis· seminated fail to reveal facts material in the light of such representations and fail to reveal that the use of said preparation under the conditions prescribed in said advertisements or under such conditions as are customary or usual, may result in injury to health. PAR. 7. The use by the respondent of the foregoing false, deceptive and misleading statements and representations disseminated as aforesaid, has had, and now has, the tendency and capacity to, and does, WAIN'S LABORATORY, INC. 1145 1142 Findings mislead a substantial portion of the purchasing public into the erroneous and mistaken belief that all of such false statements and representations are true and to induce a substantial portion of the purchasing public to purchase respondent's said preparation because of such erroneous and mistaken belief engendered as above set forth. PAR. 8. The aforesaid acts and practices of respondent, as herein alleged, are all to the prejudice and injury of the public and constitute unfair and dec{'ptive acts an.d practices in commerce within the intent and meaning of the Federal Trade Commission Act. REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission, on July 30, 1940, issued, and on August 3, 1940, served, its complaint in this proe{'€ding upon the respondent, \Vain's Laboratory, Inc., a corporation, charging it with the use of unfair and deceptive acts and practices in commerce in violation of the provisions of said act. On September 11, 1940, respondent filed its answer, in which answer it admitted all the material allegations of :fact set :forth in said complaint and waived all intervening procedure and further hearings as to said facts. Thereafter, the proceecling regularly came on for final hearing before the Commission on the said complaint and answer thereto, an.d the Commission, having duly considered the matter and being now fully advised in the premises, finds that this proceeding is in the interest of the public and makes this its findings as to the facts and its conclusion drawn therefrom. FINDINGS AS TO THE FACTS PARACR..\PH 1. Respondent, \Vain's Laboratory, Inc., is a corporation organized, existing, an,d doing business under and by virtue of the laws of the State of California, having its office and principal place of business at 4687 Hollywood Boulevard, Hollywood, Calif. PAn. 2. Respondent is now and has been for more than two years last past engaged in the business of selling and distributing a certain preparation containing drugs, formerly designated Ama-Gon and now offered for sale and sold under the name "'Vain's Compmmd,'t recommended for use in the treatment of bronchial asthma and bronchial coughs. Respondent sells its said product to members of the purchasing public situated in Yarious States of the United States and in the District of Columbia, and causes said product when sold by it, to be transported from its place of business in the State of California to the purchasers thereof located in various other States of the United States and in the District of Columbia. Respondent main- Findings 31 F. T. C. tains, and at all times mentioned herein has maintained, a cou~ of trade in its said product in commerce among and between the various States of the United States and in the District of Columbia. PAR. 3. In the course and conduct of its aforesaid business, the respondent has disseminated, and is now disseminating, and has caused, and is now causing, the dissemination of false advertisemei1ts concerning its said product by the United States mails, and by various other means in commerce, as commerce is defined in the Federal Trade Commission Act, for the purpose of inducing, and which are likely to induce, directly or indirectly, the purchase of its said product; and respondent has also disseminated and is now disseminating, and has caused, and is now causing, the dissemination of false advertisements concerning its said product, by various means, for the purpose of inducing, and which are likely to induce, directly or indirectly, the purchase of its said product in commerce, as commerce is defined in the Federal Trade Commission Act. Among and typical of the false, misleading and deceptive statements and representations contained in said false advertisements, disseminated and caused to be disseminated, as hereinbefore set forth, by the United States mails, by advertisements in newspapers, and by circulars and other advertising literature, are the following:

TO PALLIATE ATTACKS OF BRONCHIAL ASTHMA And Bronchial Coughs The acti-ve ingredient in \Vain's Compound works rapidly. In a few minutes it is taken into the blood stream and starts its work. No matter how long you have suffered from torturing attacks of Bronchial Asthma and Bronchial Coughs, we want you to prove the value of 'Vain's Compound to yourself today. Accept this generous trial offer. You must be enth·ely satisfied. Wain's Compound helps you, or your MONEY BACK is GUARAN'rEED. Sold at all OWL DRUG STORES.

PAR. 4. Through the use of the statements and representations hereinabove set forth, and other similar statements and representations not specifically set out herein, all of which purport to be descriptive of the remedial, curative, and therapeutic properties of respondent's said preparation, respondent directly and by implication represents that said preparation is an effective and competent treatment for bronchial asthma and bronchial coughs; that its use gives immediate or prompt relief from the paroxysms of asthma; that said preparation is entirely safe and harmless and may be used without danger of ill effects upon the health of the user. PAR. 5. The foregoing representations are grossly exaggerated, fttlse and misleading. In truth and in fact, respondent's preparation js not an effective or competent treatment for bronchial asthma or WAIN'S LABORATORY, INC. 1147 1142 Order bronchial coughs, and has no therapeutic value in the treatment of such conditions in excess of furnishing temporary symptomatic relief from the paroxysms of asthma and bronchial irritations. Said preparation is not in all cases safe or harmless as it contains potassium iodide in quantities sufficient to cause in some instances injury to health if taken under the conditions prescribed in said advertisements or under such condit-ions as are customary or usual. The use of said preparation as aforesaid may be harmful to those having healed lesions of arrested tuberculosis or goitre. In arrested cases of tuberculosis the tendency of potassium iodide is to resolve the fibrous tissues about the healed lesions and thereby to reactivate. the tuberculous process. The hazard in cases of goitre is the tendency to convert a benign adenoma to a toxic adenoma. PAR. 6. In additior to the representations hereinabove set forth, the respondent has also engaged in the dissemination of false advertisements in the manner above set forth, in that said advertisements so disseminated fail to reveal facts material in the light of such representations and fail to reveal that the use of said preparation under the conditions prescribed in said advertisements or under such conditions as are customary or usual, may result in injury to health. PAR. 7. The use by the respondent of the foregoing false, deceptive, and misleading statements and representations disseminated as aforesaid has had, and now has, the tendency and capacity to, and does, mislead a substantial portion of the purchasing public into the erroneous and mistaken belief that all of such false statements and representations are true and to induce a substantial portion of the purchasing public to purchase respondent's said preparation because of such erroneous and mistaken belief engendered as above set forth. CONCLUSION The aforesaid acts and practices of the respondent as herein found are all to the prejudice and injury of the public and constitute unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission and the answer of the respondent, in which answer respondent admits all the m~terial allegatit>ns of fact set forth in said complaint and states that it waives all intervening procedure and further hearing as to said facts, and the Commission having made it findings as to the facts and its conclusion 1148 FEDERAL TRADE COMMISSION DECISIOXS Order 31F.T.C.

that said respondent has violated the provisions of the Federal Trade Commission Act.

It is ordered, That the respondent, 'Vain's Laboratory, Inc., a corporation, its officers, representatives, agents, and employees, directly or through any corporate or other device, in connection with the offering for sale, sale, or distribution of its medicinal preparation designated "'Vain's Compound," or any other medicinal preparation, composed of substantially similar ingredients, or possessing substantially similar therapeutic properties, whether sold under the same name or under any other name, do forthwith cease and desist from directly or indirect! y :

1. Disseminating or causing to be disseminated any advertisement (a) by means of the United States mails or (b) by any means in commerce, as "commerce" is defined in the Federal Trade Commission Act, which advertisement represents directly or through inference that said preparation has any therapeutic value in the treatment of bronchial asthma or bronchial coughs, in excess of relief from the paroxysms of asthma and bronchial irritations; that said preparation is in all cases safe or harmless; or which advertisement fails to reveal that said preparation should not be used by those having tuberculosis or goitre {provided, however, that such advertisement need contain only a statement that said preparation should be used only as directed on the label thereof when such label contains a warning to the effect that the preparation should not be used by those having tuberculosis or goitre).

2. Disseminating or causing to be disseminated any advertisement by any means for the purpose of inducing, or which is likely to induce, directly or indirectly, the purchase in commerce, as "commerce" is defined in the Federal Trade Commission Act, of said preparation, which advertisement contains any of the representations prohibited in paragraph 1 hereof, or which advertisement fails to reveal that said preparation should not be used by those having tuberculosis or goitre (provided, however, that such advertisement need contain only a statement that said preparation should be used only as directed on the label thereof when such label contains a warning to the effect that the preparation should not be used by those having tuberculosis or goitre). It is further orde·red, That the respondent shall within 10 days after service upon it of this order file with the Commission an interim report in writing stating whether it intends to comply with this order and, if so, the manner and form in which it intends to comply; and that within 60 days after service upon it of this order, said respondent shall file with the Commission a report in writing, setting forth in detail the manner and form in which it has complied with this order.

TRADING SALES CO. 1149 Syllabus