Beiersdorf, Inc.

Text (OCR of the scan at left; may contain errors)

IN THE MATTER OF BEIERSDORF, INC.

CONSENT ORDER, ETC. IN REGARD TO ALLEGED VIOLATIONS OF SECS. 5(A) AND 12 OF THE FEDERAL TRADE COMMISSION ACT Docket No. C-4333; File No. 092 3194 Filed, August 17, 2011 — Decision, August 17, 2011 This consent order addresses allegations that Beiersdorf, Inc.’s (“Respondent”) advertising, marketing, and sale of its “Nivea My Silhouette! Redefining Gel-Cream” skin cream (“My Silhouette”) violates the FTC Act. According to the complaint, Respondent advertised that regular use of My Silhouette results in significant reductions in body size. The complaint alleged this claim was false and violated the FTC Act. The order prohibits Respondent from claiming that My Silhouette or any other topically applied product causes substantial weight loss, fat loss, or reduction in body size. The order further prohibits Respondent from making any representations that a drug, dietary supplement, or cosmetic causes weight or fat loss or a reduction in body size without competent and reliable scientific evidence substantiating the representation. The order further requires Respondent to pay $900,000 to the Commission to be distributed as equitable relief, including restitution, to consumers. Participants For the Commission: Matthew D. Gold and Evan Rose. For the Respondent: John Fleder, Paul Hyman, and Susan J. Matthees, Hyman, Phelps & McNamara PC.

COMPLAINT The Federal Trade Commission, having reason to believe that Beiersdorf, Inc., a corporation (“respondent”), has violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that this proceeding is in the public interest, alleges:

1. Respondent Beiersdorf, Inc., is a Delaware corporation with its principal office or place of business at Wilton Corporate Center, 187 Danbury Road, Wilton, Connecticut 06897. BEIERSDORF, INC. 415 Complaint 2. Respondent has manufactured, advertised, labeled, offered for sale, sold, and distributed products to the public, including Nivea My Silhouette! Redefining Gel-Cream (“My Silhouette”). My Silhouette is a “drug” and/or “cosmetic” within the meaning of Sections 12 and 15 of the Federal Trade Commission Act. 3. The acts and practices of respondent alleged in this complaint have been in or affecting commerce, as “commerce” is defined in Section 4 of the Federal Trade Commission Act. 4. My Silhouette is a skin cream that contains “Bio-slim Complex,” a combination of ingredients that includes white tea and anise. Respondent promoted My Silhouette as able to slim and reshape the body.

5. Respondent has disseminated or has caused to be disseminated advertisements for My Silhouette, including but not necessarily limited to the attached Exhibits A to C. These advertisements contained the following statements and depictions: A. TV advertisement (Exhibit A, transcript, and Exhibit B, DVD containing ad) “[Narrator]: New Nivea My Silhouette! with Bio-Slim Complex helps redefine the appearance of your silhouette and noticeably firm skin in just four weeks. [Depicts woman getting jeans out of rear of closet, and trying them on to discover that they fit.] So you can rediscover your favorite jeans. And how they still get his attention. New Nivea My Silhouette! with Bio-Slim Complex. Touch and be touched.”

B. Sponsored Search Engine Keywords (Exhibit C) Respondents also entered into agreements with Google, an Internet search engine, to preferentially identify a webpage marketing My Silhouette in response to consumer searches for information relating to body size. As a result, if a consumer entered the terms “stomach fat,” “nivea slim silhouette,” or “thin waist” into Google, a link to VOLUME 152 Complaint this My Silhouette webpage would appear as a sponsored result at the top of the search results, such as follows:

Excerpts from Google sponsored search results [User search term: “stomach fat”] Want a Toned Stomach? Sponsored Link [URL] NIVEA My Silhouette Can Redefine The Appearance of Your Curves! [User search term: “nivea slim silhouette”] Want to Slim Down? Sponsored Link [URL] NIVEA My Silhouette Redefines the Appearance of the Body’s Contours! [User search term: “thin waist”] Thin Waist Sponsored Link [URL] Try NIVEA My Silhouette Body Gel-Cream and Redefine Your Curves! 6. Through the means described in Paragraph 5, respondent represented, expressly or by implication, that regular use of My Silhouette results in significant reductions in body size. 7. In truth and in fact, regular use of My Silhouette does not result in significant reductions in body size. Therefore, the representation set forth in Paragraph 6 was, and is, false or misleading.

8. The acts and practices of respondent as alleged in this complaint constitute unfair or deceptive acts or practices, and the making of false advertisements, in or affecting commerce in violation of Sections 5(a) and 12 of the Federal Trade Commission Act.

BEIERSDORF, INC. 417 Complaint THEREFORE, the Federal Trade Commission this seventeenth day of August, 2011, has issued this complaint against respondent.

By the Commission.

VOLUME 152 Complaint EXHIBIT A BEIERSDORF, INC. 419 Complaint EXHIBIT B DVD OF NIVEA MY SILHOUETTE! “MIRROR” TV COMMERCIAL VOLUME 152 Complaint EXHIBIT C-1 Z-9 WaNUXa BEIERSDORF, INC.

Complaint EXHIBIT C-2 Google Search Web Imagss Maps News Video Gmail mos ¥ Goc gle ives slim sithoustte (Seacq ] jeusasauce Web Shopping Want to Slim Down? NiveaUSA cony/SkinnyJeaneChallonge NIVEA My Silhouette Redefines the Appearance ofthe Body's Contours! Nivea Silhouette gstore comin Slim Silhouette Find Stim Siihouewte BarRate cor ea See Reviews on Nivea Skin Care Free Shipping with Minimum Purchase cs Hives Slimming & mshaeing gel-cieam (200 ml} $18.70 - Sasa com Slim-Sithouente My jouette! - NIVEA review at Kaboodle Gel-Cream alims and reshapes your body for you to discover your ow feel good silhouette NIVEA research has developed the natural Sio-Slim Complex that kadcodle com/reviews!my-silhouette-nivea - 3k - Ca hoo onitne Nivea My Silh Redefining Gel Cream with Natural .». New Nivea My Silhouette! Gel-Cream with naturel Bio-Slim Complax for a toned and redefined sithouette INGREDIENTS. Water, Glycenn. Alechol Denat. .. My Silhouette! - NIVEA Slimming & Reshaping GelCream NIVEA My Silhouette! . rratural Bio-Slim Complex that combines the high-perforra NIVEA research has developed the active Nivea My Silhouette Redefining Gel Cream with Natural Bio Slim ... ‘We have additional Nivea My Silhouette Redefining Gel Cream with Natural Bo Slim Complex = 7 Oz supplies in our onine store supportiing garden tools, Companson Shopping Made Easy hopping results f st ” results for nivea slim silhouette sates; Eind Slim Sithouette now Niven My Sithouette Redefining Gel Cream wih __ 3 - America J Looking for cheap Slim Silhouette? Nives My Sithouette Redefining Gel Cream wth _ $12 13 - Linderbid Check 6 $00 shops for grest prices! VOLUME 152 Complaint EXHIBIT C-3 BEIERSDORF, INC. 423 Decision and Order DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft of complaint which the Western Region-San Francisco proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violation of the Federal Trade Commission Act; and The respondent, its attorneys, and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondent of all the jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, or that the facts as alleged in such complaint, other than jurisdictional facts, are true and waivers and other provisions as required by the Commission’s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondents have violated the said Act, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of thirty (30) days, now in further conformity with the procedure prescribed in § 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings and enters the following order:

1. Respondent Beiersdorf, Inc., is a Delaware corporation with its principal office or place of business at Wilton Corporate Center, 187 Danbury Road, Wilton, Connecticut 06897.

2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest. VOLUME 152 Decision and Order ORDER DEFINITIONS For purposes of this order, the following definitions shall apply:

1. Unless otherwise specified, “respondent” shall mean Beiersdorf, Inc., a corporation, its successors and assigns and its officers, agents, representatives, and employees.

2. “Commerce” shall mean as defined in Section 4 of the Federal Trade Commission Act, 15 U.S.C. § 44. 3. “Covered Product” means any drug, dietary supplement, or cosmetic.

4. “Drug” and “cosmetic” mean as defined in Section 15 of the FTC Act, 15 U.S.C. § 55.

5. “Adequate and well-controlled human clinical study” means a human clinical study that is randomized, double-blind, placebo-controlled, and conducted by persons qualified by training and experience to conduct such study.

6. “Dietary supplement” means:

A. any product labeled as a dietary supplement or otherwise represented as a dietary supplement; or B. any pill, tablet, capsule, powder, softgel, gelcap, liquid, or other similar form containing one or more ingredients that are a vitamin, mineral, herb or other botanical, amino acid, probiotic, or other dietary substance for use by humans to supplement the diet by increasing the total dietary intake, or a concentrate, metabolite, constituent, extract, or combination of any ingredient described above, BEIERSDORF, INC. 425 Decision and Order that is intended to be ingested, and is not represented to be used as a conventional food or as a sole item of a meal or the diet.

7. “Essentially Equivalent Product” means a product that contains the identical ingredients, except for inactive ingredients (e.g., binders, colors, fillers, excipients), in the same form and dosage, and with the same route of administration (e.g., orally, sublingually), as the Covered Product; provided that, with regard to Paragraph II of this Order, the Covered Product may contain additional ingredients if reliable scientific evidence generally accepted by experts in the field demonstrates that the amount and combination of additional ingredients is unlikely to impede or inhibit the effectiveness of the ingredients in the Essentially Equivalent Product.

II.

IT IS ORDERED that respondent, directly or through any corporation, subsidiary, division, or other device, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of NIVEA My Silhouette! Redefining Gel-Cream, or any other topically applied product, in or affecting commerce, shall not represent, in any manner, expressly or by implication, including through the use of a product name, endorsement, depiction, or illustration, that use of such product causes substantial weight or fat loss or a substantial reduction in body size.

III.

IT IS FURTHER ORDERED that, subject to the provisions of Part I of this order, respondent, directly or through any corporation, subsidiary, division, or other device, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of any Covered Product, in or affecting commerce, shall not represent, in any manner, expressly or by implication, including through the use of a product name, endorsement, depiction, or illustration, that use of such product VOLUME 152 Decision and Order causes weight or fat loss or a reduction in body size, unless the representation is non-misleading, and, at the time it is made, respondent possesses and relies upon competent and reliable scientific evidence that substantiates that the representation is true. For purposes of this Part, competent and reliable scientific evidence shall consist of at least two adequate and well-controlled human clinical studies of the Covered Product, or of an Essentially Equivalent Product, conducted by different researchers, independently of each other, that conform to acceptable designs and protocols and whose results, when considered in light of the entire body of relevant and reliable scientific evidence, are sufficient to substantiate that the representation is true. Respondent shall have the burden of proving that a product satisfies the definition of Essentially Equivalent Product.

IV.

IT IS FURTHER ORDERED that respondent, directly or through any corporation, subsidiary, division, or other device, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of any Covered Product in or affecting commerce, shall not make any representation, in any manner, expressly or by implication, including through the use of a product name, endorsement, depiction, or illustration, other than representations covered under Parts I and II of this order, about the health benefits of such product, unless the representation is non-misleading, and, at the time of making such representation, the respondent possesses and relies upon competent and reliable scientific evidence that is sufficient in quality and quantity based on standards generally accepted in the relevant scientific fields, when considered in light of the entire body of relevant and reliable scientific evidence, to substantiate that the representation is true. For purposes of this Part, competent and reliable scientific evidence means tests, analyses, research, or studies that have been conducted and evaluated in an objective manner by qualified persons, and that are generally accepted in the profession to yield accurate and reliable results.

BEIERSDORF, INC. 427 Decision and Order V.

IT IS FURTHER ORDERED that nothing in this order shall prohibit respondent from making any representation for: A. Any drug that is permitted in the labeling for such drug under any tentative final or final standard promulgated by the Food and Drug Administration, or under any new drug application approved by the Food and Drug Administration; and B. Any product that is specifically permitted in labeling for such product by regulations promulgated by the Food and Drug Administration pursuant to the Nutrition Labeling and Education Act of 1990. VI.

IT IS FURTHER ORDERED that respondent shall pay to the Federal Trade Commission the sum of nine hundred thousand dollars ($900,000). This payment shall be made in the following manner:

A. The payment shall be made by wire transfer made payable to the Federal Trade Commission, the payment to be made no later than five (5) days after the date that this order becomes final.

B. In the event of default on any obligation to make payment under this order, interest, computed pursuant to 28 U.S.C. § 1961(a), shall accrue from the date of default to the date of payment. In the event such default continues for ten (10) calendar days beyond the date that payment is due, the entire amount shall immediately become due and payable.

C. All funds paid to the Commission pursuant to this order shall be deposited into an account administered by the Commission or its agents to be used for equitable relief, including restitution, and any attendant expenses for the administration of such VOLUME 152 Decision and Order equitable relief. In the event that direct redress to consumers is wholly or partially impracticable or funds remain after the redress to consumers (which shall be the first priority for dispensing the funds set forth above) is completed, the Commission may apply any remaining funds for such other equitable relief (including consumer information remedies) as it determines to be reasonably related to respondent’s practices alleged in the complaint. Any funds not used for such equitable relief shall be deposited in the United States Treasury as disgorgement. Respondent shall be notified as to how the funds are distributed, but shall have no right to challenge the Commission’s choice of remedies under this Part. Respondent shall have no right to contest the manner of distribution chosen by the Commission. No portion of any payment under this Part shall be deemed a payment of any fine, penalty, or punitive assessment. D. Respondent relinquishes all dominion, control, and title to the funds paid to the fullest extent permitted by law. Respondent shall make no claim to or demand for return of the funds, directly or indirectly, through counsel or otherwise.

E. Respondent agrees that the facts as alleged in the complaint filed in this action shall be taken as true without further proof in any bankruptcy case or subsequent civil litigation pursued by the Commission to enforce its rights to any payment or money judgment pursuant to this order, including but not limited to a nondischargeability complaint in any bankruptcy case. Respondent further agrees that the facts alleged in the complaint establish all elements necessary to sustain an action by the Commission pursuant to Section 523(a)(2)(A) of the Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), and that this order shall have collateral estoppel effect for such purposes. F. In accordance with 31 U.S.C. § 7701, respondent is hereby required, unless it has done so already, to BEIERSDORF, INC. 429 Decision and Order furnish to the Commission its taxpayer identifying number, which shall be used for the purposes of collecting and reporting on any delinquent amount arising out of respondent’s relationship with the government.

G. Proceedings instituted under this Part are in addition to, and not in lieu of, any other civil or criminal remedies that may be provided by law, including any other proceedings the Commission may initiate to enforce this order.

VII.

IT IS FURTHER ORDERED that respondent Beiersdorf, Inc., and its successors and assigns shall, for five (5) years after the last date of dissemination of any representation covered by this order, maintain and, upon reasonable notice and request, make available to the Federal Trade Commission for inspection and copying:

A. All advertisements and promotional materials containing the representation;

B. All materials that were relied upon in disseminating the representation; and C. All tests, reports, studies, surveys, demonstrations, or other evidence in its possession or control that contradict, qualify, or call into question the representation, or the basis relied upon for the representation, including complaints and other communications with consumers or with governmental or consumer protection organizations.

VIII.

IT IS FURTHER ORDERED that respondent Beiersdorf, Inc., and its successors and assigns shall deliver a copy of this order to all current and, for the next five (5) years, all future principals, officers, directors, and other employees having VOLUME 152 Decision and Order primary responsibilities with respect to the subject matter of this order, and shall secure from each such person a signed and dated statement acknowledging receipt of the order. Respondent Beiersdorf, Inc., and its successors and assigns shall deliver this order to current personnel within thirty (30) days after the date of service of this order, and to future personnel within thirty (30) days after the person assumes such position or responsibilities. IX.

IT IS FURTHER ORDERED that respondent Beiersdorf, Inc., and its successors and assigns shall notify the Commission at least thirty (30) days prior to any change in the corporation(s) that may affect compliance obligations arising under this order, including but not limited to a dissolution, assignment, sale, merger, or other action that would result in the emergence of a successor corporation; the creation or dissolution of a subsidiary, parent, or affiliate that engages in any acts or practices subject to this order; the proposed filing of a bankruptcy petition; or a change in the corporate name or address. Provided, however, that, with respect to any proposed change in the corporation about which respondent learns less than thirty (30) days prior to the date such action is to take place, respondent shall notify the Commission as soon as is practicable after obtaining such knowledge. Unless otherwise directed by a representative of the Commission, all notices required by this Part shall be sent by overnight courier (not the U.S. Postal Service) to the Associate Director of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580, with the subject line: In the Matter of Beiersdorf, Inc., FTC File Number 092-3194. Provided, however, that, in lieu of overnight courier, notices may be sent by first-class mail, but only if an electronic version of such notices is contemporaneously sent to the Commission at [email protected]. X.

IT IS FURTHER ORDERED that respondent Beiersdorf, Inc., and its successors and assigns shall, within sixty (60) days after the date of service of this order, file with the Commission a true and accurate report, in writing, setting forth in detail the BEIERSDORF, INC. 431 Decision and Order manner and form of its own compliance with this order. Within ten (10) days of receipt of written notice from a representative of the Commission, they shall submit additional true and accurate written reports.

XI.

This order will terminate on August 17, 2031, or twenty (20) years from the most recent date that the United States or the Federal Trade Commission files a complaint (with or without an accompanying consent decree) in federal court alleging any violation of the order, whichever comes later; provided, however, that the filing of such a complaint will not affect the duration of: A. Any Part in this order that terminates in less than twenty (20) years;

B. This order’s application to any respondent that is not named as a defendant in such complaint; and C. This order if such complaint is filed after the order has terminated pursuant to this Part.

Provided, further, that if such complaint is dismissed or a federal court rules that the respondent did not violate any provision of the order, and the dismissal or ruling is either not appealed or upheld on appeal, then the order will terminate according to this Part as though the complaint had never been filed, except that the order will not terminate between the date such complaint is filed and the later of the deadline for appealing such dismissal or ruling and the date such dismissal or ruling is upheld on appeal. By the Commission.

VOLUME 152 Analysis to Aid Public Comment ANALYSIS OF CONSENT ORDER TO AID PUBLIC COMMENT The Federal Trade Commission (“FTC” or “Commission”) has accepted, subject to final approval, an Agreement Containing Consent Order from Beiersdorf, Inc. (“respondent”). The proposed consent order has been placed on the public record for thirty (30) days for receipt of comments by interested persons. Comments received during this period will become part of the public record. After thirty (30) days, the Commission will again review the agreement and the comments received, and will decide whether it should withdraw from the agreement and take appropriate action or make final the agreement’s proposed order. This matter involves the advertising, marketing, and sale of “NIVEA My Silhouette! Redefining Gel-Cream” (“My Silhouette”) by respondent. Respondent has marketed My Silhouette to consumers through third-party retail outlets. My Silhouette is a skin cream that contains “Bio-slim Complex,” a combination of ingredients that includes white tea and anise. According to the FTC complaint, respondent promoted My Silhouette as able to slim and reshape the body. Specifically, the FTC complaint alleges that respondent represented, in various advertisements, that regular use of My Silhouette results in significant reductions in body size. The complaint alleges that this claim is false and thus violates the FTC Act.

The proposed consent order contains provisions designed to prevent respondent from engaging in similar acts or practices in the future. Specifically, Part I prohibits respondent from claiming that My Silhouette or any other topically applied product causes substantial weight or fat loss or a substantial reduction in body size.

Part II covers any representation that a drug, dietary supplement, or cosmetic causes weight or fat loss or a reduction in body size. Part II prohibits respondent from making such representations unless the representation is non-misleading, and, BEIERSDORF, INC. 433 Analysis to Aid Public Comment at the time of making such representation, respondent possesses and relies upon competent and reliable scientific evidence that substantiates that the representation is true. For purposes of Part II, the proposed order defines “competent and reliable scientific evidence” as at least two randomized, double-blind, placebo-controlled human clinical studies that are conducted by independent, qualified researchers and that conform to acceptable designs and protocols, and whose results, when considered in light of the entire body of relevant and reliable scientific evidence, are sufficient to substantiate that the representation is true. Part III of the proposed order prohibits respondent from making representations, other than representations covered under Parts I or II, about the health benefits of any drug, dietary supplement, or cosmetic, unless the representation is non-misleading, and, at the time of making such representation, respondent possesses and relies upon competent and reliable scientific evidence that is sufficient in quality and quantity based on standards generally accepted in the relevant scientific fields, when considered in light of the entire body of relevant and reliable scientific evidence, to substantiate that the representation is true. For purposes of Part III, the proposed order defines “competent and reliable scientific evidence” as “tests, analyses, research, or studies that have been conducted and evaluated in an objective manner by qualified persons, and that are generally accepted in the profession to yield accurate and reliable results.” Part IV of the proposed order states that the order does not prohibit respondent from making representations for any drug that are permitted in labeling for that drug under any tentative or final standard promulgated by the Food and Drug Administration (“FDA”), or under any new drug application approved by the FDA. This part of the proposed order also states that the order does not prohibit respondent from making representations for any product that are specifically permitted in labeling for that product by regulations issued by the FDA under the Nutrition Labeling and Education Act of 1990.

Part V of the proposed order requires respondent to pay nine hundred thousand dollars ($900,000) to the Commission to be used for equitable relief, including restitution, and any attendant VOLUME 152 Analysis to Aid Public Comment expenses for the administration of such equitable relief. Parts VI, VII, VIII, and IX of the proposed order require respondent to keep copies of relevant advertisements and materials substantiating claims made in the advertisements; to provide copies of the order to its personnel; to notify the Commission of changes in corporate structure that might affect compliance obligations under the order; and to file compliance reports with the Commission. Part X provides that the order will terminate after twenty (20) years, with certain exceptions. The purpose of this analysis is to facilitate public comment on the proposed order, and it is not intended to constitute an official interpretation of the agreement and proposed order or to modify their terms in any way.

GOOGLE, INC. 435 Complaint