{"id":3722,"date":"2022-11-11T08:00:00","date_gmt":"2022-11-11T13:00:00","guid":{"rendered":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/?p=3722"},"modified":"2024-09-27T18:57:21","modified_gmt":"2024-09-27T18:57:21","slug":"the-ftc-sticks-their-foot-in-the-first-amendment","status":"publish","type":"post","link":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/the-ftc-sticks-their-foot-in-the-first-amendment\/","title":{"rendered":"The FTC Sticks Their Foot in the First Amendment"},"content":{"rendered":"\n<figure class=\"wp-block-image aligncenter size-large\"><img loading=\"lazy\" width=\"500\" height=\"751\" src=\"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-content\/uploads\/sites\/8\/2022\/11\/truth-is-sticky.jpg?w=500\" alt=\"An image of a dress shoe stepping in gum with pink text overlaid saying: \nTruth Might Be Sticky: get into it anyway. \" class=\"wp-image-3724\" srcset=\"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-content\/uploads\/sites\/8\/2022\/11\/truth-is-sticky.jpg 500w, https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-content\/uploads\/sites\/8\/2022\/11\/truth-is-sticky-200x300.jpg 200w\" sizes=\"(max-width: 500px) 100vw, 500px\" \/><\/figure>\n\n\n\n<p><a href=\"https:\/\/www.linkedin.com\/in\/kendall-smith-8b0623229\/\">By: Kendall Smith<\/a>, Vol. 21 Staff Writer<\/p>\n\n\n\n<p><strong>My Neck, My Back, and My Knee?<\/strong><\/p>\n\n\n\n<p>In May 2022, the U.S. Federal Trade Commission (FTC)<a href=\"https:\/\/www.ftc.gov\/system\/files\/ftc_gov\/pdf\/1923114GravityDefyerComplaintrev.pdf\" target=\"_blank\" rel=\"noreferrer noopener\"> filed a lawsuit<\/a> against a California footwear company, Gravity Defyer Medical Technology Corporation, and its owner, Alexander Elnekaveh, for false and deceptive advertising. <a href=\"https:\/\/www.gravitydefyer.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Gravity Defyer<\/a> markets and sells \u201cpain defying\u201d footwear made with \u201chybrid VeroShock technology\u201d that claims to relieve knee, back, ankle or foot pain associated with certain medical conditions. In response to the lawsuit, Gravity Defyer invoked their First Amendment right to free speech and criticized the government agency for having a history of overreaching.<\/p>\n\n\n\n<p><strong>Walk, Before you Run<\/strong><\/p>\n\n\n\n<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Supreme Court in <a href=\"https:\/\/supreme.justia.com\/cases\/federal\/us\/447\/557\/#:~:text=Central%20Hudson%20Gas%20%26%20Elec.%20v.%20Public%20Svc.,Fourteenth%20Amendments.%20Pp.%20447%20U.%20S.%20561%20-572.\" target=\"_blank\" rel=\"noreferrer noopener\"><em>Central Hudson Gas &amp; Electric Corp. v. Public Service Commission<\/em><\/a> made it clear that commercial speech is a less-protected category of speech. The Court defined commercial speech as \u201cexpression related solely to the economic interest of the speaker and its audience.\u201d While commercial speech is a less protected category, this does not mean it is not protected at all. Under the First Amendment commercial speech doctrine, the U.S. government may not prohibit advertising unless it is provably, and thus, inherently misleading. If speech is only potentially misleading, the remedy applied is more disclosure, not prohibition.<\/p>\n\n\n\n<p>The FTC is an independent agency of the U.S. Government created by and tasked with enforcing <a href=\"https:\/\/www.ftc.gov\/legal-library\/browse\/statutes\/federal-trade-commission-act\">the Fair Trade Commission Act<\/a>. Congress passed the act to protect consumers against methods of deception in advertisement and compelling businesses to be upfront and truthful about items being sold online. The FTC alleges Gravity Defyer violated several sections of the Act which prohibit:<\/p>\n\n\n\n<ul>\n<li>Unfair or deceptive acts or practices in or affecting commerce;<\/li>\n\n\n\n<li>Misrepresentations or deceptive omissions of material facts that constitute deceptive acts or practices; and<\/li>\n\n\n\n<li>Dissemination of any false advertisement in or affecting commerce for the purpose of inducing, or which is likely to induce, the purchase of food, drugs, devices, services, or cosmetics.<\/li>\n<\/ul>\n\n\n\n<p><strong>Tied Up with the FTC<\/strong><\/p>\n\n\n\n<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; This is not Alexander Elnekaveh\u2019s first rodeo with the FTC. In 2001, Elnekaveh was an officer of Gadget Universe. Gadget Universe advertised, sold, and distributed <a href=\"https:\/\/strikeengine.com\/fuel-magnets-do-they-work\/\" target=\"_blank\" rel=\"noreferrer noopener\">Super FuelMax, a device<\/a> installed on a vehicles fuel line to help the consumer save gas. &nbsp;Elnekaveh claimed that this device was tested at a certified EPA laboratory and was determined to increase mileage and reduce harmful emissions or pollutants. The FTC discovered that the tests performed did not in fact prove these findings and, therefore, any advertisements about the test results were false or misleading. To avoid litigation, Elnekaveh settled with the FTC. <a href=\"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/cases\/2001\/12\/evshdo.pdf\">This settlement<\/a> included an order which barred Elnekaveh from using deceptive advertising that makes unsupported scientific claims and using misleading consumer testimonials to sell products. The order terminated on December, 17, 2021, meaning Elnekaveh is no longer bound by any restrictions set out in the order.<\/p>\n\n\n\n<p>Gravity Defyer\u2019s customers are primarily people aged 55 and older. Their <a href=\"\/Users\/Kendall\/OneDrive\/FALR\/1923114GravityDefyerComplaintrev.pdf\">annual footwear sales<\/a> in 2016 were $3.9 million, $13.1 million in 2018, and for the first three quarters of 2019 approximately $11.2 million. Similar to Gadget Universe, Gravity Defyer basis its claims of pain relief on a <a href=\"https:\/\/japmaonline.org\/view\/journals\/apms\/112\/1\/17-224.xml\">UCLA study<\/a> published in the <em><a href=\"https:\/\/japmaonline.org\/\">Journal of American Podiatric Medical Association. <\/a><\/em>Once again, the FTC found these results unsubstantiated.So, in a surprising twist, <a href=\"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-content\/uploads\/sites\/8\/2022\/11\/8cdcf-ftclawsuit.pdf\">Gravity Defyer filed its own lawsuit<\/a> against the FTC in April 2022, a month before the FTC\u2019s lawsuit, claiming the FTC\u2019s concerns as to the UCLA study are \u201cbaseless and amount to unscientific conjecture.\u201d The FTC declared the study has substantial flaws and prohibited the footwear company from using these results in its advertising. In an attempt to come to a resolution, Gravity Defyer offered to amend its advertising to include any reasonable disclosures or qualifications that the FTC desired. Perhaps already annoyed with Elnekaveh\u2019s antics, the FTC flatly rejected these changes.<\/p>\n\n\n\n<p><strong>Whose Report do you Believe?<\/strong><\/p>\n\n\n\n<p><strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <\/strong>The FTC and Gravity Defyer Complaints were filed separately in the District Court for the District of Columbia, but they have since been consolidated and the case is pending trial. In reading Gravity Defyer\u2019s rather animated complaint, it\u2019s easy to see their point of view. They contend they have done everything above board, after all, the UCLA study <em>was<\/em> published in \u201cthe oldest and most frequently cited <a href=\"https:\/\/japmaonline.org\/\">peer-reviewed journal<\/a> in the profession of foot and ankle science.\u201d They also argue that the FTC\u2019s concerns regarding the study are extraordinary and illogical given the facts. On the other hand, there are alarmingly similar motifs in both Elnekaveh\u2019s business ventures.<\/p>\n\n\n\n<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Even if the similarity is more than a coincidence, the FTC\u2019s authority does not give it free reign to infringe upon business\u2019s First Amendment rights to free speech simply because the speech is commercial. Protection for commercial speech is dependent on the nature of the expression and the governmental interests served by its regulation. In <a href=\"https:\/\/casetext.com\/case\/fed-trade-commn-v-agora-fin-llc\" target=\"_blank\" rel=\"noreferrer noopener\"><em>FTC v. Agora Financial<\/em><\/a><em>, <\/em>the District Court for the District of Maryland stated that the limited question within the FTC\u2019s consumer protection purview is \u2013\u201cwhether the advertisements accurately represent the product such that consumers can make an informed decision about whether they want to purchase the item.\u201d In the FTC\u2019s Complaint against Elnekaveh, there are no inferences that the UCLA study is the only reason consumers purchased the footwear nor that the study even made it <em>more likely <\/em>that consumers purchased the footwear. Also, if the findings of the study were the sole (pun intended) issue with the footwear, shouldn\u2019t the proposed amendments be enough? While the jury is still out, Gravity Defyer\u2019s controversial ads are still in rotation, and no changes have been made.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In May 2022, the U.S. Federal Trade Commission (FTC) filed a lawsuit against a California footwear company, Gravity Defyer Medical Technology Corporation, and its owner, Alexander Elnekaveh, for false and deceptive advertising. Gravity Defyer markets and sells \u201cpain defying\u201d footwear made with \u201chybrid VeroShock technology\u201d that claims to relieve knee, back, ankle or foot pain associated with certain medical conditions. In response to the lawsuit, Gravity Defyer invoked their First Amendment right to free speech and criticized the government agency for having a history of overreaching.<\/p>\n","protected":false},"author":10,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":true,"template":"","format":"standard","meta":[],"categories":[396,10],"tags":[68,133,160,170,321],"_links":{"self":[{"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/posts\/3722"}],"collection":[{"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/comments?post=3722"}],"version-history":[{"count":1,"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/posts\/3722\/revisions"}],"predecessor-version":[{"id":5287,"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/posts\/3722\/revisions\/5287"}],"wp:attachment":[{"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/media?parent=3722"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/categories?post=3722"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/journals.law.unc.edu\/firstamendmentlawreview\/wp-json\/wp\/v2\/tags?post=3722"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}