Cellulite Suit Causes Loss

A Florida company that promised its dietary supplement could erase cellulite agreed Tuesday to repay customers up to $12 million to settle federal charges of deceptive advertising.

The Federal Trade Commission had accused Rexall Sundown Inc. of Boca Raton of making false and unproven claims in national advertising to market Cellasene, a pill containing ginkgo biloba, grape seed extract and other herbal ingredients.

The FTC said sales of Cellasene exceeded $40 million in the United States and a typical eight-week regimen cost about $200.

"Hundreds of thousands of consumers were misled," said Howard Beales, director of the FTC's Bureau of Consumer Protection. "This case should alert advertisers to the fact that their chances of getting away with making unsubstantiated claims are slim to none."

Carol Walters, a Rexall spokeswoman, said the company stopped selling Cellasene in 2000 and settled the FTC charges to avoid more litigation.

"We are committed to fair and accurate advertising, and we feel we met all the applicable standards," she said. By settling, the company does not admit breaking any law.

The FTC will administer a fund to repay consumers, who can call 1-202-326-3793 for information.

The settlement will become final after it is approved by a federal court in Miami and related class action lawsuits in California and Florida are completed, the FTC said.

Cellasene was advertised - in major newspapers, in fashion magazines and on television, radio and the Internet - as a product that could get rid of the fatty deposits known as cellulite.

The FTC said ads for the product claimed, "You'll notice smoother-feeling legs and a firmer-looking appearance of your skin after just eight weeks." The company also claimed, "Unlike massages and creams, Cellasene works from within, nutritionally, to help eliminate cellulite at its source."

The government sued Rexall in July 2000, accusing the company of making false claims that it had scientific evidence to back up its Cellasene promotions.

The settlement also bans the company from making unproven claims about cellulite-removal or weight-loss products and dietary supplements.

By David Ho