May 31 2012
“POM Wonderful” is a brand of pomegranate juice. It is manufactured by a company owned by Linda and Stewart Resnick, California billionaires who pretty much single-handedly created a multi-million dollar market for pomegranate juice where none existed before. Or, as LA Times columnist Michael Hilzik wrote,
It has long been clear that the most wonderful thing about Pom Wonderful pomegranate juice is the spectacular marketing skill that persuades consumers to fork over their hard-earned cash for a liquid that sells for five to six times the price of, oh, cranberry juice.
He’s right about the expense: a daily 8 oz. dose of POM Wonderful juice costs about $780 annually according to a recent Federal Trade Commission case, which we’ll get to soon.
The Resnicks parlayed their success selling pomegranate juice into two additional products, both dietary supplements, in the form of POMx pills and POMx liquid. The Resnicks and their companies have shelled out $35 million in sponsored research to determine what health benefits might arise from ingesting pomegranate juice or its components, research they have not been shy about using in touting their products. The couple apparently has a flair for taking the mundane and making it appear, well, wonderful to the consumer – they also own Fiji Water and the Franklin Mint, among other business interests.
In 2010, the Federal Trade Commission (FTC) filed a complaint against Resnicks, one of their business partners, and two of their companies (which I’ll refer to collectively as “POM”), alleging unfair and deceptive trade practices. POM, according to the FTC complaint, made false and misleading claims that its POM products treat, prevent, and reduce the risk of heart disease, prostate cancer and erectile dysfunction.
An Administrative Law Judge (ALJ) agreed with the FTC and on May 17, 2012, issued a 335-page decision and cease and desist order, ruling POM lacked competent and reliable scientific evidence that drinking 8 ounces of POM Wonderful Juice daily, or taking one POMx pill, or one teaspoon of POMx liquid, treats, prevents or reduces the risk of heart disease, prostate cancer, or erectile dysfunction. In the Matter of POM Wonderful, LLC, et al., F.T.C. No. 9344 (May 17, 2012).
Battle of the Experts No. 1: What Consumers Think
POM denies it ever made such claims, but the FTC argued otherwise and the ALJ agreed with the FTC. In fact, it is undisputed that none of the ads under scrutiny expressly makes the contested claims. But the only legally relevant question is whether “consumers, acting reasonably under the circumstances, would interpret the advertisement to contain that message.”
Because a finding of deceptive trade practices necessarily looks at whether the advertisements are likely to affect consumers’ conduct or decision to purchase, consumer surveys, with accompanying expert testimony, were presented by both sides. These surveys show just how impressed consumers were by POM Wonderful’s claims. In a survey of POM juice drinkers, 91% said it “contains naturally occurring antioxidants,” 57% said it “promotes heart health,” 47% of men said it “helps protect against prostate cancer,” 45% said it “provides immunity from colds and flu,” and 43% said it “helps protect against other cancers (besides prostate).” These supposed benefits are important to consumers. In another survey of pomegranate juice drinkers, consumers ranked cardiovascular health as the first or second most important health benefit. The number two choice for men was “prostate.”
As noted, POM’s ads did not come out and flatly state that POM could prevent, treat or reduce the risk of disease. Rather POM implied this by giving the consumer information which would lead at least some consumers to come to that conclusion on their own. For example, the ALJ found that POM made claims about the effectiveness of POM products in treating, preventing or reducing the risk of heart disease
indirectly and obliquely, typically by presenting, through words and images, a logical syllogism that: free radicals cause or contribute to heart disease; the POM Products contain antioxidants that neutralize free radicals; and, therefore, the POM Products are effective for heart disease.
The ALJ found POM used a similar approach in its prostate cancer claims:
These advertisements typically communicate the claim by juxtaposing statements and representations that prostate cancer is a leading cause of death in men; antioxidants, such as those provided by the POM Products, may help prevent cancer; that PSA is an indicator of prostate cancer; that PSA doubling time is an indicator of prostate cancer progression; and that the POM Products have been shown in clinical testing to slow PSA doubling time.
In the erectile dysfunction ads, the claims are more direct. For example, POM ads claimed
- Powerful antioxidants in the POM products enhance the actions of nitric oxide in vascular endothelial cells, showing potential for management of erectile dysfunction.
- A preliminary study of “erectile function” showed that men who consumed POM Juice reported “a 50% greater likelihood of improved erections,” as compared to a placebo.
- A pilot study involving 61 male subjects showed that men drinking 8 ounces of POM Juice daily for 4 weeks were “50% more likely to experience improved erections.”
In the dry language which often accompanies legal reasoning, the ALJ notes that as “Dr. Butters [one of POM’s expert witnesses on ad interpretation] acknowledged, contemporary speakers of American English could interpret the phrase ‘erectile function’ to relate to the ability of men to achieve and maintain erections. Erectile function and the absence of erectile dysfunction are closely related.” I suppose that in the field of expert witnesses, as in so much of modern life, areas of expertise are becoming more and more specialized. But I digress.
Battle of the Experts No. 2: Level of Substantiation Required
In determining whether POM’s ads were misleading or deceptive, a key issue was the level of substantiation required for a particular health claim, a decision controlled by five factors: the product involved, the type of claim, the benefits of a truthful claim, the ease of developing substantiation for the claim and – a big issue in this case – the amount of substantiation experts in the field would agree is reasonable. Needless to say, the experts in this case did not agree except in the most general sense: that “competent and reliable scientific evidence” was the appropriate standard for substantiation. Exactly what constituted “competent and reliable scientific evidence” was hotly disputed.
The ALJ decided that double-blind, placebo controlled randomized clinical trials were not required in this particular instance to substantiate POM’s claims that its products treated, prevented, or reduced the risk of serious diseases like heart disease and prostate cancer. In this, the ALJ accepted the testimony of POM’s experts, including Dr. Dean Ornish, that RCTs were not required. However, for each of the three diseases in question in this case – heart disease, prostate cancer and erectile dysfunction – the ALJ determined that clinical trials, even if not RCTs, were required for each of POM’s claims.
Battle of the Experts No. 3: Evidence (vel non) of Effectiveness
The case then boiled down to another battle of the experts over whether POM’s disease claims indeed met the competent and reliable scientific evidence test. This included conflicting testimony over underpowered trials, endpoints chosen, valid surrogates for improvement in condition, and other matters which I am incompetent to evaluate and discuss. ( You should feel free, however.) In each case, POM fell short of the mark. Even Dr. Dean Ornish himself couldn’t overcome the lack of “competent and reliable scientific evidence” for ability of fruit juice to treat, prevent or reduce the risk of cardiovascular disease.
On the other hand, the ALJ ruled claims that POM Wonderful can “support prostate health” and “support erectile health” (whatever the heck those terms mean) were supported by competent, reliable scientific evidence.
“Cease and Desist” Order
Because of the seriousness and deliberateness of POM’s violations, the ALJ’s cease and desist order, based on his findings of fact and conclusions of law, covers not only the three pomegranate juice products, but “any food, drug, or dietary supplement” made by the manufacturer of POM products and several related companies for the next twenty years.
In the future, POM and the related companies must have competent and reliable scientific evidence to support both treatment, prevention or risk reduction claims, as well as general claims about the health benefits, performance, and efficacy of their products. This evidence must meet generally accepted standards in the relevant scientific field AND must be viewed in light of the entire body of relevant and reliable scientific evidence. (In other words, no cherry-picking allowed.) POM and related companies, as well as the Resnicks and a business partner [“Respondents”],
shall not make any representation in any manner, expressly or by implication, . . . that such product is effective in the diagnosis ,cure, mitigation, treatment, or prevention of any disease; . . . unless, at the time it is made, the representation is non-misleading and Respondents possessed and relied 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.
“Competent and reliable scientific evidence” means
tests, analyses, research, or studies, conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results.
The same prohibition applies to representations regarding the health benefits, performance or efficacy of any product covered by the order. The Respondents are further prohibited from misrepresenting, “in any manner, expressly or by implication, . . . the existence, contents , validity, results, conclusions, or interpretations of any test, study, or research.”
Response to the Order
The supplement industry put a positive spin on the decision. It found comfort in the fact that the ALJ did not require randomized double blind placebo controlled clinical trials in order to make claims for health benefits as well as refusing to require FDA approval of all future health claims, both of which the FTC sought to impose.
Several aspects of the ALJ’s ruling might cause the supplement industry to temper its enthusiasm for this decision. First, the ALJ did not say that double blind, placebo controlled RCTs would never be required for a supplement or food product making a health claim, and, in fact, case law cited in the decision makes it clear that this possibility remains open. What the ALJ did say is that where, as was true of the POM products, there was scientific evidence that these products were very safe and where there was no claim that they were a substitute for medical care, a lesser standard would suffice. In a future case, where safety is not as clear or a suggestion that the product is a substitute for medical care is made, the possibility of requiring a more stringent level of evidence remains.
Second, not requiring an RCT does not mean anything flies. The ALJ decided that claims for treatment, prevention and risk reduction of disease require “a heightened level of substantiation,” which the ALJ determined would be “competent and substantial evidence” based the standards generally accepted in the relevant scientific community. In other words, whether “competent and substantial evidence” supports a claim must be determined case by case and based on what experts in the particular field would regard as such. Again, this leaves open the possibility that in another case expert testimony could support a finding that one or more RTCs would be required to make a particular claim.
And POM’s response?
A random quote from the decision plucked out of context and run in ads like this:
According to the New York Times, a POM spokesman said “the company would run the new ads ‘as long as necessary to inform the public of the truth,’” but “declined to disclose the budget for them.” I know you are as relieved as I am that we consumers will be informed of “the truth.” Interestingly, in 2009 the UK Advertising Standards Authority ruled that a POM Wonderful ad displaying a cut hangman’s noose and the phrase “Cheat Death” was misleading and could not be used again.
Even if POM didn’t literally ‘win’ the case, consumer psychologist Kit Yarrlow calls its ad campaign ‘a sophisticated move.’ ‘Consumers are ready to battle, love to champion underdogs and consider the government to be a big ugly Goliath,’ says Yarrow, a Golden Gate University marketing professor.
We’ll wait and see.
Any of the parties can appeal the decision to the full Federal Trade Commission or the Commission can choose to review the decision on its own. According to the Canadian newspaper, The Star, a POM spokesperson said POM would appeal. No matter what the full Federal Trade Commission decides, that decision may not, and likely won’t, be the end of things. Any party can appeal the full Commission’s decision to a federal appellate court. Because of the stakes, I imagine this case will be around for a few more years.
The complaint in this case was filed in 2010. The administrative hearing began on May 24, 2011 and concluded on November 4, 2011. Twenty four witnesses, including 14 expert witnesses, testified. There were nearly 2000 exhibits and the transcript ran almost 3300 pages. All in all, I imagine this case cost hundreds of thousands of dollars to prosecute and defend. In fact, I wouldn’t be surprised if the total price tag is over $1 million. And it’s still not over.
This cat and mouse game between the food and supplement industry on the one hand, and government regulators on the other, is not in the best interest of anyone, least of all the consumer. Congress could fairly easily enact a law that would provide clear guidelines on the level of evidence which should be required to make a health claim for a product in a manner that is understood by consumers and backed by good science. While regulatory agencies such as the FDA and FTC can issue regulations and guidelines governing health claims, these are subject to challenges as well, ending in more litigation. Unfortunately, Congress is in the thrall of industry, as is evidenced by DSHEA. This means that litigation will continue to define the parameters of permissible claims, case by case. The cat and mouse will continue to play, and the lawyers and experts will continue to profit.
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