TV pitchman Trudeau has FTC fine, ban thrown out

Thu Aug 27, 2009 3:21pm EDT
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By Jonathan Stempel

NEW YORK (Reuters) - A federal appeals court has thrown out a $37.6 million fine and three-year infomercial ban against Kevin Trudeau, who has long battled regulators over his marketing of "cures" for obesity, disease and financial woe.

Thursday's ruling by the Seventh Circuit Court of Appeals in Chicago sends back to a lower court a case accusing the TV pitchman of misleading marketing that violated his 2004 settlement with the Federal Trade Commission.

Writing for a three-judge panel, Judge John Tinder said a lower court judge properly held Trudeau in contempt for having "outright lied" about the content of a book, "The Weight Loss Cure 'They' Don't Want You to Know About."

Yet the judge was "troubled" by the punishment because it was unclear how the fine was determined, and because the infomercial ban did not consider the possibility that Trudeau could mend his ways.

This despite the FTC's branding Trudeau, in the words of Judge Tinder, as "a 21st century snake oil salesman" and "nothing more than a huckster who preys on unwilling consumers." Trudeau has pitched cures for such things as hair loss, memory loss, excessive debt, cancer and AIDS.

The appeals court ordered the district court judge to craft a new remedy, including a criminal sanction if it so chose.

FTC spokesman Peter Kaplan had no immediate comment. A lawyer for Trudeau did not immediately return a call seeking comment.

In 2004, Trudeau entered a consent order with the FTC that required him to pay $2 million and banned him from advertising products in infomercials.   Continued...