NEWARK
- N.V.E., Inc., a.k.a. N.V.E. Pharmaceuticals,
and Robert Occhifinto, the president of
N.V.E., have settled a lawsuit that alleged
the Sussex County manufacturer of dietary
supplements misled consumers by making false
and misleading claims about the safety and
efficacy of its products, Consumer Affairs
Acting Director Stephen B. Nolan announced
today.
“This case makes clear that there
are no quick fixes when it comes to weight
loss and if it sounds too good to be true,
it probably is,” said Acting Director
Nolan. “This company exploited human
nature to make money.”
The state’s complaint, filed in August,
2004, alleged that Newton-based N.V.E. violated
New Jersey’s Consumer Fraud Act (CFA)
through advertisements that exaggerated
the benefits and minimized the risks of
its “Stacker-2" and other ephedra-based
dietary supplements.
Ephedra is a stimulant derived from the
Chinese herb ma huang that has been proven
to cause headaches, irritability and heart
palpitations, and has been associated with
strokes, seizures, high blood pressure and
heart attacks. The dangers of using ephedra
and other ephedrine alkaloids as a diet
supplement for weight loss are, especially
when used with caffeine, widely documented
in medical literature. N.V.E. represented
that its products were safe when taken in
the recommended dosages and that most people
who used them lost two to three pounds per
week, despite hundreds of complaints that
refuted these statements.
The settlement requires N.V.E. and Occhifinto
to pay the State $260,000 as follows: a
$60,000 payment from Occhifinto and four
$50,000 payments from N.V.E. N.V.E. filed
for Chapter 11 Bankruptcy protection on
August 10, 2005. On August 9, 2006 and as
a pre-condition of the settlement, the Bankruptcy
Court approved the State’s settlement
with N.V.E., thereby protecting the $200,000
N.V.E. payment from bankruptcy proceedings.
N.V.E. and Occhifinto entered into the settlement
without any admission of liability or any
violation of the CFA.
Under
the terms of the settlement, N.V.E. and
Occhifinto are prohibited from engaging
in acts and practices in violation of the
CFA, which include:
-
misrepresenting that a weight-loss product
causes rapid and substantial weight
loss without the need to diet or exercise;
- representing
that a weight-loss product, when used
by itself or with diet and exercise,
causes the loss of weight or fat within
a specific period, if not based upon
competent and reliable scientific evidence;
- using
an endorsement for a weight-loss product
that identifies atypical results, yet
fails to clearly and conspicuously disclose
that the results are not typical; and
-
representing that a weight-loss product
is “clinically proven” to
be safe or effective, unless the representation
is based upon competent and reliable
scientific evidence.
As
part of this settlement, N.V.E. has also
agreed to make the following documents available
to the state for the next four years:
- all
advertisements and promotional materials
for each weight-loss product it sells
in New Jersey;
- all
materials it relies upon to confirm
the accuracy of the advertisements and
promotional materials; and
-
all tests, reports, studies, surveys,
demonstrations or other evidence that
contradict the representations made
in its advertisements or promotional
materials, including complaints or other
communications with consumers, governmental
entities or consumer protection agencies.
This
is the State’s third settlement of
a lawsuit against a New Jersey company that
manufactured or distributed ephedra-based
dietary supplements for alleged violations
of the CFA. The State previously settled
with Cytodyne Technologies (a.k.a. Nutraquest)
in April 2005, and with Goen Technologies
in August 2005.
Deputy Attorney General Joshua T. Rabinowitz
represented the State in each lawsuit.
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