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Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 1 of 12
Ul'i'lTED STATES DISTRICT COURT DISTRICT OF RHODE ISLAND
FEDERAL TRADE COMMISSION,
Plaintiff,
v.
CVS PHARMACY, INC., also dJb/a/ CVSIPHARMACY,
Defendant.
CA09- 420 COMPLAINT FOR INJUNCTIVE AND OTHER EQUITABLE RELIEF
Plaintiff, the Federal Trade Commission ("FTC''), through its undersigned attorneys,
alleges as follows:
1. Plaintiff FTC brings this action under Section 13(b) of the Federal Trade
Commission Act ("FTC Act''), 15 U.S.C. § 53(b), to secure a pennanent injunction,
rescission or reformation of contracts, restitution, the refund of monies paid, disgorgement of
ill-gotten monies, and other equitable relief against Defendant for engaging in deceptive acts
or practices in connection with the advertising, marketing, and sale of the CVS AirShield
line of products ("AirShieJd"), which are purported to prevent or reduce the risk of colds, in
violation of Sections 5(a) and 12 of the FTC Act, 15 U.S.C. §§ 45(a) and 52.
JURISDICTION AND VENUE
2. This Court has jurisdiction over this matter pursuant to 15 U.S.C. §§ 45(a),
52, and 53(b), and 28 U.S.C. §§ 133 I , 1337(a) and 1345.
3. Venu!! in this District is proper under 15 U.S.C. § 53(b) and 28 U.S.C.
§§ 1391 (b) and (c).
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 2 of 12
THE PARTIES
4. Plaintiff, the Federal Trade Commission, is an independent agency of the
United States Government created by statute. See 15 U.S.C. §§ 41-58. The FTC enforces
Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), which prohibits unfair or deceptive acts or
practices in or affecting commerce. The FTC also enforces Section 12 of the FTC Act, 15
U.S.C. § 52, which prohibits false advertisements for foods, drugs, devices, services, or
cosmetics in or affecting commerce. The FTC, through its own 'attorneys, may initiate
federal district court proceedings to enjoin violations of the FTC Act and to secure such other
equitable relief, including rescission or reformation of contracts, restitution, the refund of
monies paid, and disgorgement of ill-gotten monies, a,s may be appropriate in each, case. 15
U.S.c. § 53(b).
5. Defendant CVS Pharmacy, Inc., also d/b/a CVS/pharrnacy ("CVS"), is a
Delaware corporation with its principal place of business at 1 CVS Drive, Woonsocket,
Rhode Island, 02895. CVS retail stores are located throughout the United States and the
District of Rhode Island. Sinc.e July 2005, acting alone or in concert with others, CVS has
marketed, distributed, and sold its AirShield products to consumers throughout the United
States. CVStransacts or bas transacted business in the District of Rhode Island.
COMMERCE
6. The acts and practices of Defendant, as alleged herein, have been in or
affecting commerce, as "commerce" is defiried i.Ji Section 4 of the FTC Act, 15 U.S.C. § 44.
2
Case 1 :09-cv"00420-S-DLM Document 1 Filed 09/09/09 Page 3 of 12
DEFENDANT'S COURSE OF BUSINESS
7. Since July 2005 and continuing thereafter, Defendant CVS has advertised,
promoted, offered for sale, sold, and distributed AirShield to the public. Sales of AirShield,
at CVS stores and on the CVS website at www.cvs.com. from July 2005 through October
2008, exceeded $14 million.
8. AirShield comes in an effervescent tablet form and a non-effervescent powder
form. According to the product label, AirShield contains, Vitamins A, C, and E; miherals,
iIfcluding zinc; electrolytes; amino acids; and a "proprietary" Blend of herbal' extracts,
including echinacea. The formula of ingredients used in AirShield products purportedly
replicates the formula originated by and used in AirBorne products manufactured and sold by
Airborne Health, Inc. Product directions indicate that AirShield ~an be used by both adults
and children.
9. CVS created, prepared, disseminated, or caused to be disseminated
advertisements, product packages and labels, information for pharmacists and pharmacy
technicians to convey to CVS customers, and other promotional material, including, but not
limited to, the attached Exhibits A through H; containing, among other things, the following
stat.ements and depictions:
a. CVS AirShield Package (Exhibit A)
[Graphic: cartoon depiction of multicolored germs, and cartoon illustration of several people standing in a line in front of a theater. A man dispensing tickets coughs or sneezes on a woman in front of him as she recoils in horror. Also in line are a man and woman looking in disgust at another man who is spreading germs as he blows his nose.]
3
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 4 of 12
Compare to Airbome®
• Antioxidants • Electrolytes • Amino Acids • 1000 mg of Vitamin C • Six Herbal Extracts
FOR USE IN: • SCHOOLS • AIRPLANES • OFFICES • HEALTH CLUBS • THEATERS • RESTAURANTS
ORANGE FLAVOR
CVS pharmacy
AIRSHIELD
IMMUNE BOOSTING FORMULA' EFFERVESCENT FORMULA' DIETARY SUPPLEMENT 10 TABLETS
" This statement has not been evaluated by the Food and Drug Administration, This product is not intended to diagnose, treat, cure or prevent any disease.
b. CVS AirShield l'ackage (Exhibit B)
[Graphic: cartoon depiction of multicolored germs, and cartoon illustration of several people standing in a line in front of a theater. A man dispensing tickets coughs or sneezes on a woman in front of him as she recoils in horror. Also in line are a man and woman looking.in disgust at another man who is spreading germs as he blows his nose.]
. Compare to Airbome®
• Antioxidants • Electrolytes
4
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 5 of 12
• Amino Acids • 1000 mg of Vitamin C • Seven Herbal Extracts
TAKE ANYWHERE SINGLE SERVE POWDER PACKETS
SUGARFREE·P~LEMONADEFLAVOR
CVS pharmacy
AIRSHIELD
IMMUNE BOOSTIN"G D~ MIX* SUGARFREE·NOFUZFORMULA DIETARY SUPPLEMENT Add to bottled water! 8 SINGLE SERVE POWDER PACKETS
* This statement has not been evaluated by the Food and Drug i\dministration. This product is not intended to diagnose, treat, cure or prevent any disease.
c. CVS Circular in Newspapers Nationwide, Nov. 26, 2006 (Exhibit C)
[picture shows two packages ofCVS AirShield, together with other CVS brand products for coughs and cold and flu .lJI7IIptoms]
Compare to Airborne and Save Over 30%
499 with CARD CVS/pharmacy NrShield
[picture shows package of Airborne]
d. CVS Website Advertisement (Exhibit D)
Medicine Cabinet . ..
[picture of AirShield package 1
5
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 6 of 12
CVS Air8hield Effervescent Tablets Lemon-Lime Flavor . ..
Description Immune boosting formula. * Antioxidants, electrolytes, amino acids, 1000 mg of Vitamin C, seven herbal extt:;l.cts. For use in: schools, airplanes, offices, health clubs, theaters, restaurants.
'T.his product is not intended to diagnose, treat, cure or prevent any disease.
e. CVS Website Advertisement (Exhibit E)
Vitamins & Supplements , . .
[picture of AirShield p ackage)
C-V8 AirShield Drink Mix Single Serve Packets Pink Lemonade . . .
Description Immune boosting drink mix.' Take anywhere. Single serve powder packets. Antioxidants, electrolytes, amino aCids, 1000 mg.of vitamin C, seven herbal extracts. Sugar free . . No fizz fonnula. Add to bottled water.
'This product is not intended to diagnose, treat, cure or prevent any disease.
f. CVS/pbarinacy Capsule - August 26, 2005 (Exhibit F)
A WEEKLY OPERATIONAL uPDATE FOR CVS PHARMACISTS AND TECHNIQIANS
CVS BRAND MERCHANDISING ... NEW IN CVSIPHARMACY BRAND
Just in time for back-to-school and cold season, we are launching
6
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 7 of 12
CVS/pharmacy Brand Airshield, our own version of the immuneboosting dietary supplement Airborne. 1bis supplement has become so popular that last season retailers everywhere were often out of stock. 1bis year, we will be able to meet your patients' demand with CVS/pharmacy Brand Airshield, available in Orange ... and LemonLime .. ,.
Unlike other store brand versions of Airborne, CVS/pharmacy brand Airshield is tested to be 100% equivalent to the national brand, from taste to ingredients.
CVS Airshield can be found in your store's Cold aisle, and on this season's Cold Endcap.
g. CVS/pharmacy Express Magazine - January/February 2006 (Exhibit G)
Remind customers that CVS/pharmacy Brand products are 100% satisfaction Guaranteed.
[picture shows a box of Airborne and a box ofCVS AirShieldJ
Stay Ahead of Coughs and Colds
Preventing a cold is often easier than getting rid of one. Frequent handwashing or use of a liquid hand sauitizer are among the best ways to fend off a winter bug. Another increasingly common approach to staying healthy is to take immune-system boosting supplements, such as CVS/pharmacy Brand AirShield.
Modeled after Airborne - the immune-system booster that was so popular last winter most retailers struggled to keep it in stock -CVS/pharmacy Brand AirShield was just introduced last fall. The effervescent tablets contain the same combination of antioxidants, electrolytes, amino acids and vitamins as the national brand, and are identical in taste and strength. AirShield comes in orange and lemonlime flavors and costs 27% less than its brand-name counterpart. CVS/pharmacy colleagues, of course, get an additional 30% off of that that [sic) price, and on all CVS/pharmacy Brand products.
7
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 8 of 12
Our customers tell us that they're more likely to try a CVS/pharmacy Brand item when a friend or pharmacist recommends it. You cart help our customers get a great value and a terrific product when you encourage them to try our brand. lf you're not yet familiar with CVS/pharmacy Brand, take a few moments to familiarize yourself with the. products we offer. Read the labels, look at the packaging, and try them out (remember, you receive 30 percent of( CVS/pharmacy Brand products). That way, you'll feel confident in recommending any CVS/pharmacy Brand product to your customers.
Use these coupons below and see for yourself ...
h. CVS/pharmacy Express Magazine - Fall 2006 (Exhibit H)
Remind customers that CVS/pharmacy Brand products are 100% satisfaction Guaranteed.
An Ounc.e ofPreveution (and Treatment)
Old and new products will bring relief during cough and cold season
Of course, the best way to avoid treating a cold is to prevent it. And two innovative new CVS/pharmacy Brand products can help your customers stay healthier this season. CVS is the first to offer these products - there ·are no national brand equivalents available. This helps us stay ahead of the competition, and gives our customers a great value on a unique product
Taking a cue from the popular "on the go" inaividually packaged drink mixes, our immune-system boosting CVS/pharmacy Brand AirShield line is now available in powdered form in pre-measured sleeves that you can mix with bottled water. An equivalent to Airborne, CVS AirShield has become one of our most popular cough and cold products. It contains the same combination of antioxidants, electrolytes, amino acids and vitamins as the national brand, ...
Our customers tell us they' re more likely to try a CVS/pharmacy
8
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 9 of 12
Brand item when a friend or pharmacist recommends it. If you're not yet familiar with CVS/pharmacy Brand, take a few moments to familiarize yourself with the products we offer. Read the labels, look at the packaging, and try them out (remember, CVS colleagues receive 30% off all CVS/pharmacy Store Brand products).
[picture shows a box of CVS AirShield]
DEFENDANT'S VIOLATIONS OF THE FTC ACT
10. Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), prohibits unfair or deceptive
acts or practices in or affecting commerce. Section 12(a) of the FTC Act, 15 U.S.c. § 52(a),
prohibits the dissemination of any false advertisement in or affecting commerce for the
purpose of inducing, or which is likely to induce, the purchase of food, drugs, devices,
services, or cosmetics. For the purposes of Section 12 of the FTC Act, 15 U.S.C. § 52, the
AirShield products are ''foods'' or "drugs" pursuant to Section 15(b) and (c) of the FTC Act,
15 U.S.C. § 55(b) and (c). As set forth below, Defendant has ~ngaged in such unlawful
practices in connection with the marketing and sale of the AirShield products.
11. Through the means described in Paragraph 9, inciuding the statements and
depictions contained in the advertisements attached as Exhibits A through H, among others,
Defendant CVS has represented, expressly or by implication, that the AirShield products:
a. Reduce the risk of or prevent colds;
b. Protect against or help fight germs;
c. Protect against colds in crowded places, such as schools, airplanes,
offices, health clubs, theaters, and restaurants; and
d. Boost the body's immune system thereby providing protection against
9
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 10 of 12
colds.
12. The representations set forth in Paragraph II were not substantiated at the
time the representations were made. Therefore, the representations set forth in Paragraph II
constitute deceptive acts or practices, and the dissemination offalse advertisements, in or
affecting commerce, in violation of Sections 5(a) and 12 of the FTC Act, 15 U.S.C. §§ 45(a)
and 52.
CONSUMER INJURY
13. Consumers throughout the United States have suffered substantial monetary
loss as a result of Defendant's unlawful acts and practices. In addition, Defendant has been
unjustly enriched as a result of its unlawful practices. Absent relief by this Court, Defendant
is likely to continue to injure consumers, reap unjust enrichment, and harm the public
interest.
THlS COURT'S POWER TO GRANT RELIEF
14. Section 13(b) or the FTC Act, 'IS U.S.C. § 53(b), empowers this Court to
grant injunctive and such other relief as the Court may deem appropriate to halt and redress
violations of the FTC Act. The Court, in the exercise of its equitable jurisdiction, may award
other ancillary relief, including, but not limited to, rescission or reformation of contracts,
restitution, the refund of monies paid, and the disgorgement of ill-gotten monies caused by
Defendant's law violations.
10
Case 1 :09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 11 of 12
PRAYER FOR RELIEF
WHEREFORE, Plaintiff Federal Trade Commission, pursuant to Section 13(b) of
the FTC Act, 15 V.S.c. § 53(b), and the Court's own equitable powers, requests that the
Court:
I . Enter a permanent injunctio.n to prevent future violations of the FTC Act by
Defendant;
2. Award such relief as the Court finds necessary to redress injury to consumers
resulting from Defendant's violations of the FTC Act, including, but not limited to,
rescission or reformation of contracts, restitution, the refund of monies paid, and the
illsgorgement of ill-go.tten monies from Defendant; and
11
Case 1' 09-cv-00420-S-DLM Document 1 Filed 09/09/09 Page 12 of 12
3. Award Plaintiff the costs of bringing this action, as well as such other and
additional relief as the Court may determine to be just and proper.
Dated: September 8, 2009
12
Respectfully Submitted,
WILLARD K. TOM General Counsel
NJ 035061994; NJ Dis!. Court GF 2244 CAROL 1. JENNINGS DC 236513 Trial Counsel 600 Pennsylvania Avenue NW, NJ-3212 Washington, DC 20580 · Tel: 202-326-3617 (Fortsch), 202-326-3010 (Jennings) Fax: 202-326-3259 [email protected] [email protected]
Attorneys for Plaintiff Federal Trade Commission
• Antioxidants • Electrolytes • Amino Adds .1000 mg of Vif4llml;n C • Six Herb.al Extracts
10 TABLETS
lYfiouality MONE Y BACI( GUARANrEE
Distributed by: CVS Pharmacy, tnc. Woo~socke t , RI 02895 © 2005 CVSlpharmacy
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EXHIBIT F
CVS BRAND MERCHANDISING CoHt4C!: Pbil G1C#. Ext. 5811
NEW IN CVS/PHARMACY BRAND
Just in time for back-ta-school and cold season, we a-re launching CVS/pharmacy Brand Airshield, our own version of the tmmune-b06sti-ng dietary supplement Airborne. This supplement has become 50 popular that last season retai1f?rs everywhere were often out of stock. This year, we will be able to mee~ your patients' demand with CVS/pharmacy Brand Airsfiield, available in Orange (item # "320711), and Lemon-Lim~ (item # 320712).
The effervescent tablets (drop 1-;n 4-6 6z. of w'ater) conta in the same combination of antioxidants, electrolytes, amino ?ocids and vitamins -as the national brand.
However, CVS Airshield costs at least 20% less than the national brand, and comes with our 100% Money Back Guarantee.
Unlike ot.her store brand versions of Airborne, CVS/pharmacy brand Airshield is tested to be 100% equivalent to the national brand, from taste to ingredients.
015 Airshield can be found in your store's Cold aisle, and on this sea_sen's Cold Endcap.
Also Now Available:
CVSl pharmaq Brand Chest Congestion Relief Expectorant (Item # 297885), These easy~to-swallow tablets contain th~ same active ingredient as found in the OTe Humibid " e" , and in Mucinex: 400 mg Guafenesin.
The 400 mg Guafenesin is the maximum allowed In an immediate rele$p. tablet.
Because the unique Mucinex formula is time rele~se, patients can get the same m'aximum dosage by taking CVS/pharmacy Brand tablets. every 4 hours instead of every 12 hours, and still save over 30% vs. Mucinex.
Mucinex 20 ct, has 5 days 01 treatment, and CVS/ pharmacy Chest Congestion Relief 50 ct. has 8:3 days treatment.
CV5 Chest Congestion can be used by adults .and children 6-12 years of age (1 / 2 tablet), but Mucinex labeling does not have dosage for children under 12.
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CVSlpharmacy AirShield
ExpIr8s 4130106 ~ ClWOO~ lor~~"'I'lo)'MSorI\'. (r .. USI ~. fIilOO'l. ~ tpplios n, 10 Itns :llatlll grlll!Wfal $1.00.
CVSlphannacy AlrShield
ElQ!ires.4130108 Jllb WUIIOO good 1~ CVSIp~IIl!C)'CI11l',cyeea~. OM us. per PMWl. OIsalUIII """* nnI}' 1Il1llr]l, IhJt '" ~ilDr 1l1li1 $1.(10
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CVSlpharmaty AlrShield
Expires 4130/06 lIiIIi q)~DOOClfllr ~OII\Pkl)'tUorf\', OrieUlloer _ DImlun! ."-anIjo!O llem h! ar' lI'eI!!el1ll8l'l $1.l'1l:I.