Weight Loss Supplement Class Gains $4.6M Settlement

Advertising Law

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A challenge to the claims about effectiveness of weight loss pills has settled for $4.6 million.

Fred Duran and other, later-joined plaintiffs filed suit against Obesity Research Institute, Continuity Products and related individuals in 2013 alleging that the defendants falsely advertised Lipozene weight loss pills as a “weight-loss breakthrough” that would “get rid of pounds of body fat.”

In reality, the supplements are neither safe nor an effective treatment for weight loss, the plaintiffs said, because their main ingredient—glucomannan—is not absorbed by the human body.

The class action complaint cited violations of California’s False Advertising Law, Unfair Competition Law and Consumers Legal Remedies Act.

After several years of litigation, the parties reached a deal that will provide class members (purchasers of the pills between August 10, 2012, and October 28, 2019) with $15 per bottle for up to four units with proof of purchase; those without a receipt can claim $7 for one unit.

The settlement fund will also cover administrative costs, attorneys’ fees and costs not to exceed $1.4 million, and incentive payments of $7,500 each for Duran and the other two named plaintiffs.

In addition to monetary relief, the defendants also agreed to change their marketing by removing the following statements from commercials and other advertising materials: “Lipozene is so powerful …” and “Lipozene is specifically designed to target fat.”

To read the settlement agreement in Fernandez v. Obesity Research Institute, click here.

Why it matters: Although the defendants continue to deny all allegations of wrongdoing and to disclaim all liability, they will, pursuant to the settlement terms, pay out a total of $4.6 million and tweak their marketing for the weight loss product.