"federal trade commission" news and stories

Remember those Rice Krispies cereal boxes from 2009 that claimed the "Snap, Crackle, Pop" breakfast would "support your child's immunity?" This was right around the time parents were vaccine-crazy over the bird flu? As you might have guessed, that claim wasn't true. Neither was the company's claim that their Frosted Mini Wheats were "clinically shown to improve children's attentiveness by nearly 20%." And for that, Kellogg's is paying.

Last week, the Federal Trade Commission (FTC) -- which regulates U.S. advertising -- announced a class-action settlement brought to the century-old, $13 billion company in the U.S. District Court of California, thanks to the laws of advertising that ban misleading and inaccurate marketing claims (or what we like to call the "That just ain't right!" ruling).

If you believe the ads, the probiotic-lined straw in Boost Kid Essentials drink would "prevent upper respiratory infections, strengthen the immune system and reduce absences from school." Wow, does it do windows, too? Making wild claims is nothing new in the food industry, but it looks like the government is starting to crack down. The Federal Trade Commission went after Nestle, the maker of the drink, claiming the ads went too far.

The company agreed to stop making the claims. The straws contained a dose of L. Reuteri Protectis, a probiotic culture marketed by a company called BioGaia. The popularity of probiotics has skyrocketed in the past few years, with consumers finding doses of the "good" bacteria in yogurts, juices, and powders. Manufacturers claim the products help regulate internal flora, improving health and digestive function.

Evidently, though, the government wasn't impressed with Nestle's ads, and sent them a warning letter late last year.

Why would a company CEO go on a financial web site and post about his company under a pseudonym?

That's what the Federal Trade Commission is investigating. Whole Foods CEO John Mackey has admitted that it was he who posted under the name "Rahodeb" (an anagram of his wife's name) on Yahoo's financial boards. In fact, he didn't just post about finances and stocks in general, he specifically posted about rumors that Whole Foods might buy Wild Oats. This was in January of 2005. Whole Foods bought Wild Oats a few months ago for $565 million.

Or should I say, "might buy them." The FTC is trying to block the agreement and is using this new info for their case. Mackey insists he did nothing wrong since all of the stuff he talked about was public knowledge and harmless.

[via Boing Boing]

Whole Foods' plan to merge with Wild Oats Markets has just hit a snag.

The Federal Trade Commission is trying to stop the proposed merger, saying that if the two organic foods giants get together it would lead to higher prices and be bad for consumers. But Whole Foods chairman John P. Mackey says in a statement:

"The F.T.C. has failed to recognize the robust competition in the supermarket industry, which has grown more intense as competitors increase their offerings of natural, organic and fresh products; renovate their stores; and open stores with new banners and formats resembling Whole Foods Market."

Whole Foods had announced in February that they were going to buy Wild Oats Markets for $565 million.