FOR IMMEDIATE RELEASE
December 16, 2008
Makers of Airborne Enter into Multi-State Settlement for Deceptive Advertising
Attorney General Steve Carter announces largest multi-state settlement to date with dietary supplement maker
(INDIANAPOLIS, IN) – Indiana Attorney General Steve Carter, in coordination with 32 attorneys general in other states, has announced the largest multi-state settlement to date with any dietary supplement producer when Airborne and its founders, Victoria and Thomas McDowell, agreed to settle charges of deceptive advertising.
Airborne and its owners agreed to pay $7 million to settle allegations made by the attorneys general concerning unsubstantiated and unlawful claims made in the marketing of their products, which include Airborne and all associated items such as Airborne Power Pixies, Airborne Soothing Throat Gummis, and other variations of the product. The settlement prevents Airborne, which is the largest selling dietary product of its kind, from engaging in specific misleading advertising in Indiana and marketing Airborne products as a cold or flu preventative or cure.
State refunds are being distributed on a sliding scale with Indiana receiving $460,000. Indiana’s portion of the settlement will be deposited into the state’s consumer protection fund.
“Today’s settlement with Airborne is a victory for Indiana consumers,” Carter said. “Advertising claims need to be substantiated by facts. Companies must market their products in compliance with the law to insure that consumers are not misled.”
The settlement arose after allegations by the attorneys general in the various states that the McDowells on behalf of Airborne explicitly made advertising claims that the product could cure colds and flu, fight allergies and germs, and prevent illness thereby violating laws that require any company making such claims must first obtain approval from the Food and Drug Administration to sell the product as a drug instead of a dietary supplement. The allegations also included the defendants’ failure to warn consumers of potential health risks to specific groups of people, including pregnant women.
The multi-state settlement with the attorneys general was signed after the defendants reached an agreement with the Federal Trade Commission and a separate private class action lawsuit was settled. Consumers were able to apply to join the private class action lawsuit up until September of this year. Under the terms of these lawsuits, individual consumers could receive restitution of over $29.5 million once all claims are settled.
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