Stewart and Lynda Resnick, who owned thousands of acres of pomegranate orchards, formed POM Wonderful, LLC, to make and sell pomegranate juice. POM spent more than $35 million on medical research, sponsoring at least 100 studies on the impact of pomegranate juice on heart disease, prostate cancer, and erectile dysfunction.

POM might be wonderful, but, unfortunately, the results of the medical studies were not. Any health benefit was at best slight and obtained only in studies that were scientifically invalid. Despite the absence of scientific support, POM conducted national advertising campaigns trumpeting the benefits of pomegranate juice, such as: “POM Wonderful Pomegranate Juice can help prevent premature aging, heart disease, stroke, Alzheimer’s, even cancer.”

The Federal Trade Commission charged the Resnicks and POM under the FTC Act for making false, misleading, and unsubstantiated statements. It ordered them to stop making health claims without scientific evidence. POM and the Resnicks appealed. 

Questions:

1. Did the Resnicks and POM violate the FTC Act?

2. What did the defendants claim that their POM wonderful juice could do?

3. Did the Defendants have medical proof of these claims?

4. What effect did POM’s reporting of the amount of money spent on medical research have on their liability?

5. Does it matter that defendants qualified their remarks with such phrases as “an initial study,” “hopeful results,” “preliminary study,” and “promising results.” 

6. What statement could the defendants have made in their ads to avoid liability under the FTCA?