On January 16, 2013, the Federal Trade Commission in a 5-0 vote upheld a May 2012 Administrative Law Judge’s (“ALJ”) decision that POM Wonderful LLC (“POM”) and its owners had falsely advertised its POM Wonderful 100% Pomegranate Juice, and POMx liquid and pill supplements, by claiming that its products treat, prevent or reduce the risk of heart disease, prostate cancer, and erectile dysfunction, and that they were proven to work.

In upholding the previous decision, the Commission’s Opinion actually went further than the ALJ decision by finding that 34 out of 43 ads contained false or deceptive claims, whereas the ALJ decision found that only 19 contained false or deceptive claims.

In addition, the Opinion found that POM needed a more robust level of substantiation for its claims than what was determined by the ALJ decision. The Commission’s Final Order requires that any disease-related establishment or efficacy claims made about the challenged POM products, or in connection with the POM’s sale of any food, drug, or dietary supplement, must be supported by at least two well-designed, well-controlled, double-blind, randomized, controlled clinical trials.

Although POM allegedly has more than $35 million-worth of scientific testing on its products, including more than 10 clinical studies, many of the studies were found by experts to have flaws.

In its appeal to the Commission, POM argued that finding liability would violate its First Amendment right to free speech and its Fifth Amendment right to due process. The Commission rejected these arguments.

Although the outcome of the Opinion is a blow to POM, the Opinion was not a complete victory for the FTC, as it denied the FTC’s request that POM be required to obtain FDA approval for future claims.

POM Wonderful may appeal the decision to a Federal Appeals Court within 60 days of receiving the Final Order.

Why this matters: This case will likely have a significant impact on advertisers making disease-related claims moving forward as it sets forth a very specific level and number of required clinical studies to meet the “competent and reliable scientific evidence” standard. If POM appeals, this will be an interesting test case as to whether the FTC is indeed overstepping its bounds.