Federal Trade Commission v. Garvey

Enforma Natural Products, Inc. (Enforma) hired retired baseball player Steven Garvey (defendant) to star in infomercials for the dietary supplements Fat Trapper and Exercise in a Bottle, collectively known as the Enforma System (the system). Before filming the infomercials, Garvey read two Enforma-provided informational booklets, met with people who had experienced positive results from the system, and learned about a scientific study on a system ingredient. Garvey and his wife also used the system; Garvey lost eight pounds in three weeks, and Garvey’s wife lost roughly 27 pounds between the filming and airing of the first infomercial. While filming the infomercials, Garvey used Enforma-prepared scripts and made statements including that the system worked, was amazing, and was the greatest weight-loss program in history. Garvey also promoted the system in other television and radio appearances and made claims about the system based on Enforma-prepared guidelines and script points. In one television appearance, Garvey said that he filmed the Enforma infomercials because the system had worked for him and his wife. In August of 2000, the Federal Trade Commission (FTC) sued Garvey, alleging that Garvey had violated the FTC Act as a participant and an endorser in making false-advertising claims about the system. During a bench trial, the evidence included conflicting expert testimony about whether Garvey should be considered an endorser. The district court ultimately entered judgment in Garvey’s favor, holding that Garvey was not liable as a participant because Garvey did not actually know that he was making material misrepresentations about the system, was not recklessly indifferent to the truth or falsity of his representations, and was neither aware of a high probability that he was making fraudulent representations nor intentionally avoiding the truth about the system. The court further held that Garvey was not liable as an endorser because there was no evidence that Garvey’s statements did not reflect his good-faith belief and opinions about the system. The FTC appealed.