5-Hour ENERGY® to pay $4.3 million for deceptive claims

Sunday, February 12, 2017

Attorney General Bob Ferguson announced Wednesday that a King County judge ordered the makers of 5-hour ENERGY® to pay nearly $4.3 million in penalties, attorneys’ fees and costs for multiple violations of the state Consumer Protection Act.

Ferguson filed a lawsuit against the companies in 2014, alleging violations of the state Consumer Protection Act. After a three-week trial last September, Judge Beth Andrus ruled in the state’s favor, finding that claims in the companies’ advertising were deceptive, and therefore violated the Consumer Protection Act. The deceptive claims — that the popular flavored energy shots is superior to coffee, that doctors recommend 5-hour ENERGY®, and that its decaffeinated formula provides energy, alertness and focus that lasts for hours — appeared in press releases, on the internet and in thousands of print and broadcast ads.

“The makers of 5-hour ENERGY® broke the law in pursuit of profit, and now they are paying for it,” Ferguson said.

In a ruling issued late Tuesday, Judge Andrus ordered defendants Living Essentials LLC and Innovation Ventures LLC to pay nearly $2.2 million in civil penalties for violations of the Consumer Protection Act.

“Defendants spent more time trying to justify the science behind their ads after-the-fact than they did before marketing the products in Washington,” Judge Andrus wrote in her Tuesday order. 
“The Court was struck by the fact that Defendants presented no testimony from a single scientist actually involved in developing the contents of this product.
“There was scant evidence as to what science anyone at Living Essentials had ever seen or relied on before it began to sell this product,” she continued.

Judge Andrus also ordered the companies to pay nearly $2.1 million in costs and fees to Ferguson’s office.

The penalties and fees ordered Tuesday include more than $64,000 in sanctions against Living Essentials and Innovation Ventures for “willful” discovery violations in the lead-up to the September trial. Andrus ruled that the defendants improperly “cherry-picked” the documents they produced to the Attorney General’s Office, impeding the ability of the Attorney General’s Office to prepare for trial.

In Tuesday’s decision, Judge Andrus also ordered Living Essentials and Innovation Ventures not to make claims about the biochemical or physiological effects of their products, or their “synergistic” interactions with caffeine or other ingredients, without competent and reliable scientific evidence to support those claims.

The order further bars the companies from using survey data in their marketing or advertising unless the surveys are created, conducted and evaluated in an objective manner by qualified professionals, and the data is not presented in a deceptive manner.

Lisa Erwin and Trisha McArdle, both senior counsel with the Attorney General’s Office, Assistant Attorney General Daniel Davies and former Assistant Attorney General Kimberlee Gunning handled the case.



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