The Federal Trade Commission announced the first law enforcement crackdown on deceptive claims in the growing market for cannabidiol (CBD) products. The FTC said in a press release that it was taking action against six sellers of CBD-containing products for allegedly making a wide range of scientifically unsupported claims about their ability to treat serious health conditions, including cancer, heart disease, hypertension, Alzheimerâs disease, and others.
The companies include Bionatrol Health, Epichouse, CBDMeds, HempmeCBD, Reef Industries, and Steve’s Distributing.
The FTC is requiring the companies to stop making such unsupported health claims immediately and pay fines to the agency in the thousands of dollars. The orders settling the FTCâs complaints also bar the respondents from similar deceptive advertising in the future and require that they have scientific evidence to support any health claims they make for CBD and other products.
âThe six settlements announced today send a clear message to the burgeoning CBD industry: Donât make spurious health claims that are unsupported by medical science,â said Andrew Smith, Director of the FTCâs Bureau of Consumer Protection. âOtherwise, donât be surprised if you hear from the FTC.â
Each case the FTC is described below:
Bionatrol Health, LLC
According to the FTCâs complaint against Utah-based companies Bionatrol Health, LLC and Isle Revive, LLC, and two former managers and owners, since at least December 2019 the respondents sold a CBD oil to consumers on two websites. Among other things, the respondents allegedly claimed without substantiation that their CBD product is safe for all users, treats pain better than prescription medications like OxyContin, and prevents and treats age-related cognitive decline and chronic pain. The respondents also claimed, without scientific evidence, that CBD oil is âmedically provenâ to improve a variety of conditions, according to the FTCâs complaint. In addition, the FTC alleges the respondents deceived consumers who ordered one bottle of their CBD oil by changing the order to five bottles without consumersâ consent.
The proposed administrative order settling the FTCâs charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs without human clinical testing to substantiate the claims. It also requires competent and reliable scientific evidence for other health-related product claims, and prohibits the respondents from misrepresenting the cost of any good or service and from charging consumers without their express, informed consent. Finally, it requires the corporate respondents and individual respondent Marcello Torre to pay $20,000 to the FTC and to notify consumers of the Commissionâs order.
Epichouse LLC (First Class Herbalist CBD)
According to the FTCâs complaint against Utah corporation Epichouse, LLC, which operated under several names, including First Class Herbalist, and the companyâs founder and owner, John Le, since at least September 2019 the respondents sold several CBD products on their website, including oils, a pain-relief cream, coffee, and gummies.
Among other alleged unsupported claims, Epichouse and Le promoted CBD as safe for all users, able to treat pain better than prescription medications such as OxyContin, and able to prevent a wide range of serious conditions, including cancer, diabetes, and heart disease. In their advertising, they also falsely claimed that CBD is scientifically proven to improve many serious health conditionsâincluding chronic pain and hypertensionâand provide neurological benefitâsuch as preventing age-related cognitive declineâaccording to the FTCâs complaint.
The proposed administrative order settling the FTCâs charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. It requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, the order requires the respondents to pay $30,000 to the FTC and notify consumers of the Commissionâs order.
CBD Meds, Inc.
According to the FTCâs complaint against CBD Meds, Inc.; G2 Hemp, Inc.; and Lawrence Moses, a/k/a Lawrence D. Moses, Jr., individually and as an officer of the corporate entities, the two companies advertised CBD oil on their website and on YouTube. In their ads, the FTC contends, the Winchester, California-based firms made a number of false or unsubstantiated claims, including that CBD effectively treats, prevents, or mitigates serious diseases and conditions like artery blockage, cancer, glaucoma, autism, and schizophrenia, among many others. The respondents also falsely represented that some of the efficacy claims were scientifically proven or that the U.S. government has confirmed the health benefits of CBD.
The proposed administrative order settling the FTCâs charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. More broadly, it requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, the order requires the respondents to notify consumers of the Commissionâs order.
HempmeCBD
According to the FTCâs complaint against EasyButter, LLC, also d/b/a HempmeCBD, and its owner and officer Michael Solomon, since at least January 2018, the respondents have sold CBD products on their website, including CBD-infused shea butter, gummies, lozenges, honey sticks, vape pens, and oils. The complaint alleges that HempmeCBD claimed its CBD products could treat or cure serious ailments like cancer-related symptoms, substance abuse, and AIDS. The complaint alleges HempmeCBD lacked the scientific substantiation for such health claims and falsely claimed to have studies showing CBD is effective at treating autism.
The proposed administrative order settling the FTCâs charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. It also requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, it requires the respondents to pay the FTC $36,254 and to notify consumers of the Commissionâs order.
Reef Industries, Inc.
According to the FTCâs complaint against California-based Reef Industries, Inc.; Cannatera, Inc.; AndHemp, Ltd., and the companiesâ three principals, the respondents have sold a variety of CBD products directly to consumers on their website and Twitter accounts since at least January 2019 and misrepresented the health benefits of CBD. The FTC alleges that the respondents made unsubstantiated claims that CBD can prevent, cure, mitigate, or treat diseases and serious health conditions, including Alzheimerâs disease, arthritis, autoimmune disease, and irritable bowel syndrome. The complaint also alleges the respondents falsely claimed that studies or scientific research prove that CBD is effective at treating, curing, or mitigating these diseases and conditions.
The proposed administrative order settling the FTCâs charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. More broadly, it requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, it requires them to pay the FTC $85,000 and notify consumers of the Commissionâs order.
Steves Distributing, LLC
According to the FTCâs complaint against Steves Distributing, LLC, d/b/a Steveâs Goods; and the companyâs CEO Steven Taylor Schultheis, since beginning operations in 2018, the respondents have sold a variety of products containing both CBD and cannabigerol (CBG), which, like CBD, is a non-psychoactive compound derived from hemp. The company advertises its CBD and CBG products, including tinctures, gummies, capsules, topical balms, suppositories, bath balms, and coffee, on its website and through social media companies like Twitter.
The FTC alleges that the respondents claimed, without adequate substantiation, that their CBD and CBG products are effective alternatives to prescription medications and treat a wide range of diseases and serious health conditions, including Alzheimerâs disease, cancer, and diabetes. The complaint also alleges the respondents falsely claimed that their CBD and CBG products have antibacterial properties, prevent or reduce the risk of heart attacks, strokes, and other diseases, and that certain of these claims were supported by scientific evidence.
The proposed administrative order settling the FTCâs charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. More broadly, it requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, it requires the respondents to pay the FTC $75,000 and notify consumers of the Commissionâs order.
2 comments
Leland Radovanovic
December 18, 2020 at 11:35 am
Jesus – it’s one thing to say that this could help improve your health and wellness and then share research on CBD use and individual illnesses, but it’s another to say your product treats that stuff. Good riddance.
Tim
December 18, 2020 at 5:10 pm
If I remember correctly, The FDA cracked down on several companies for the same thing and warned the industry not to make health claims they could not prove. Where is the FDA now?
If they can fine them I think they should.