Federal Trade Commission v. Trudeau (Trudeau I)
United States Court of Appeals for the Seventh Circuit
579 F.3d 754 (2009)
Kevin Trudeau (defendant) sold purported cures for ailments such as cancer, AIDS, severe pain, hair loss, and obesity. Trudeau claimed that the government and corporations were hiding the truth about the cures. Trudeau promoted the cures through infomercials. The Federal Trade Commission (FTC) (plaintiff) pursued Trudeau on various accusations of deceiving and misleading consumers to induce them to purchase his products. In 2004, a consent order (Consent Order) banned Trudeau from appearing in infomercials for any products except for books, provided he did not “misrepresent the content of the book.” Subsequently, Trudeau appeared on infomercials to promote his book, The Weight Loss Cure “They” Don’t Want You To Know About (Weight Loss Cure). The program prescribed in Weight Loss Cure involved eating only 500 calories per day, eating only organic food, receiving injections of a prescription hormone not approved for weight loss, walking an hour per day, taking supplements, and following numerous other dietary and lifestyle restrictions. However, in his infomercial, Trudeau described the program in Weight Loss Cure as “easy,” “simple,” and allowing participants to eat “anything you want,” as well as not involving diet, exercise, calorie counting, or taking pills. The FTC brought suit, alleging that Trudeau misrepresented his book in the infomercial in violation of the Consent Order. The FTC sought reimbursement from Trudeau for consumers who had purchased the book. The federal district court concluded that Trudeau had misrepresented his book, holding him in contempt of court and fining him $37.6 million to be paid to the FTC. Trudeau appealed, arguing (1) that his infomercials did not misrepresent anything, as they were merely quoting or paraphrasing the book and therefore did not violate the Consent Order, and (2) that the sanction imposed was neither coercive nor compensatory and thus was not civil.
Rule of Law
Holding and Reasoning (Tinder, J.)
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