United States Court of Appeals, District of Columbia Circuit
Argued: May 2, 2014.
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On Petition for Review of an Order of the Federal Trade Commission.
Thomas C. Goldstein argued the cause for petitioners POM Wonderful, LLC, et al. With him on the briefs were John Graubert, Megan L. Rodgers, and Erik S. Jaffe.
Erik S. Jaffe was on the brief for petitioner Matthew Tupper.
Bilal K. Sayyed was on the brief for amici curiae Consumer Healthcare Products Association and Council for Responsible Nutrition in support of petitioners.
Jonathan W. Emord was on the brief for amici curiae Alliance for Natural Health USA and TechFreedom in support of petitioners.
Jonathan E. Nuechterlein, General Counsel, Federal Trade Commission, argued the cause for respondent. With him on the brief were Joel Marcus, Assistant General Counsel, and Imad D. Abyad, Attorney. John F. Daly, Attorney, Federal Trade Commission, entered an appearance.
Julie A. Murray, Scott L. Nelson, Allison M. Zieve, and Stephen Gardner were on the brief for amici curiae Public Citizen, Inc. and Center for Science in the Public Interest in support of respondent.
Before: GARLAND, Chief Judge, SRINIVASAN, Circuit Judge, and GINSBURG, Senior Circuit Judge. OPINION filed by Circuit Judge SRINIVASAN.
Srinivasan, Circuit Judge:
POM Wonderful, LLC produces, markets, and sells a number of pomegranate-based products. In a series of advertisements from 2003 to 2010, POM touted medical studies ostensibly showing that daily consumption of its products could treat, prevent, or reduce the risk of various ailments, including heart disease, prostate cancer, and erectile dysfunction. Many of those ads mischaracterized the scientific evidence concerning the health
benefits of POM's products with regard to those diseases.
In 2010, the Federal Trade Commission filed an administrative complaint charging that POM and related parties had made false, misleading, and unsubstantiated representations in violation of the Federal Trade Commission Act. After extensive administrative proceedings, the full Commission voted to hold POM and the associated parties liable for violating the FTC Act and ordered them to cease and desist from making misleading and inadequately supported claims about the health benefits of POM products. The Commission's order also bars POM and the related parties from running future ads asserting that their products treat or prevent any disease unless armed with at least two randomized, controlled, human clinical trials demonstrating statistically significant results.
POM and the associated parties petition for review of the Commission's order, arguing that the order runs afoul of the FTC Act, the Administrative Procedure Act, and the First Amendment. We deny the bulk of petitioners' challenges. The FTC Act proscribes--and the First Amendment does not protect--deceptive and misleading advertisements. Here, we see no basis for setting aside the Commission's conclusion that many of POM's ads made misleading or false claims about POM products. Contrary to petitioners' contentions, moreover, the Commission had no obligation to adhere to notice-and-comment rulemaking procedures before imposing liability in its adjudicatory proceeding. Additionally, we affirm the Commission's remedial order insofar as it requires POM to gain the support of at least one randomized, controlled, human clinical trial study before claiming a causal relationship between consumption of POM products and the treatment or prevention of any disease. We find inadequate justification, however, for the Commission's blanket requirement of at least two such studies as a precondition to any disease-related claim. In all other respects, we deny the petition for review.
Since 1987, entrepreneurs Stewart and Lynda Resnick have acquired and planted thousands of acres of pomegranate orchards in California. In 1998, they began to collaborate with doctors and scientists to investigate the potential health benefits of pomegranate consumption. They formed POM Wonderful, LLC to make, market, and sell pomegranate-based products. The products include POM Wonderful 100% Pomegranate Juice and two dietary supplements, POMx Pills and POMx Liquid, which contain pomegranate extract in concentrated form. The Resnicks are the sole owners of POM Wonderful and an affiliated company, Roll Global LLC, which provides advertising and other services to POM. Those entities have engaged in a broad array of advertising campaigns promoting POM products through various media including magazine ads, newspaper inserts, billboards, posters, brochures, press releases, and website materials.
POM's promotional materials regularly referenced scientific support for the claimed health benefits of its pomegranate products. By 2010, the Resnicks, POM, and Roll had spent more than $35 million on pomegranate-related medical research, sponsoring more than one hundred studies at forty-four different institutions. This case involves studies examining the efficacy of POM's products with regard to three particular ailments: heart disease, prostate cancer, and erectile dysfunction.
1. POM sponsored a number of studies examining the capacity of its products to
improve cardiovascular health. One such study, led by Dr. Michael Aviram of the Technion-Israel Institute of Technology, examined the effect of pomegranate juice consumption by patients with carotid artery stenosis. Carotid artery stenosis is the narrowing of the arteries that supply oxygenated blood to the brain, usually caused by a buildup of plaque inside the arteries.
In Dr. Aviram's study, ten patients with carotid artery stenosis consumed concentrated pomegranate juice daily for a year, while nine patients with carotid artery stenosis served as a control group and consumed no pomegranate juice. The investigators measured the change in the patients' carotid intima-media thickness (CIMT), an indicator of plaque buildup. They found that patients who consumed pomegranate juice every day experienced a reduction in CIMT of " up to 30%" after one year, while CIMT for patients in the control group increased by 9% after one year. POM Wonderful LLC, No. 9344, Initial Decision of ALJ at 115 ¶ 791 (U.S. Fed. Trade Comm'n May 17, 2012) (ALJ Initial Decision). As one of POM's experts would later testify, the Aviram study, while " suggest[ing] a benefit" from pomegranate juice consumption for patients with carotid artery stenosis, was " not at all conclusive," in part because of the study's small sample size. Id. at 118 ¶ 802 (quoting expert testimony). In 2004, the journal Clinical Nutrition published the study. See M. Aviram et al., Pomegranate Juice Consumption for 3 Years by Patients with Carotid Artery Stenosis Reduces Common Carotid Intima-Media Thickness, Blood Pressure and LDL Oxidation, 23 Clinical Nutrition 423 (2004).
Subsequently, in 2005, a larger study, led by Dr. Dean Ornish of the University of California, San Francisco and the Preventative Medicine Research Institute, followed seventy-three patients with at least one cardiovascular risk factor for one year. The patients were randomly assigned either to drink one cup of pomegranate juice daily or to drink a placebo beverage. At the end of the study, Dr. Ornish and his co-investigators found no statistically significant difference between the treatment group and the placebo group in CIMT change or any other heart-related measure.
In 2006, a third, still larger study, led by Dr. Michael Davidson of the University of Chicago, followed 289 patients with one or more coronary heart disease risk factors. As in the Ornish study, the patients were randomly assigned to drink either pomegranate juice or a placebo beverage each day. At the end of eighteen months, Dr. Davidson and his co-investigators found no statistically significant difference in the rate of carotid intima-media thickening between patients in the treatment group and those in the placebo group. POM initially delayed publication of the adverse findings, but ultimately allowed publication of the study in 2009. See Michael H. Davidson et al., Effects of Consumption of Pomegranate Juice on Carotid Intima-Media Thickness in Men and Women at Moderate Risk for Coronary Heart Disease, 104 Am. J. Cardiology 936 (2009).
In their final report, Dr. Davidson and his co-investigators noted that they had found some evidence of an association between pomegranate juice consumption and decreased CIMT among subgroups of patients with high triglyceride levels and low levels of HDL (" good" ) cholesterol. Dr. Davidson and his co-authors emphasized, however, that the findings for those subgroups were based on " post hoc exploratory analyses" unanticipated in the study protocol. As Dr. Davidson and his co-authors noted, " post hoc exploratory analyses . . . should be interpreted with caution"
because of an increased risk of " type I errors" (i.e., false positives). See id. at 941. Even for patients in the high-risk subgroups, moreover, the reduction in arterial thickness was between 4% and 9% (depending on the measurement), substantially below the 30% decrease reported by Dr. Aviram.
Although Drs. Ornish and Davidson completed their arterial thickness studies in 2005 and 2006, respectively, a consumer reading POM's promotional materials after 2006 would not have known of those studies or that they cast doubt on Dr. Aviram's prior findings. In June 2007, for example, POM distributed a brochure featuring a statement by Dr. Aviram that " POM Wonderful Pomegranate Juice has been proven to promote cardiovascular health," along with a description of his arterial thickness study, but with no mention of Drs. Ornish's and Davidson's contrary findings. POM Wonderful LLC, No. 9344, Opinion of the Commission, App. B fig.10, at 5 (U.S. Fed. Trade Comm'n Jan. 10, 2013) (FTC Op.). That same summer, POM published a newsletter in which it asserted that " NEW RESEARCH OFFERS FURTHER PROOF OF THE HEART-HEALTHY BENEFITS OF POM WONDERFUL JUICE." Id. App. B fig.16, at 3. The newsletter claimed a " 30% DECREASE IN ARTERIAL PLAQUE" on the basis of Dr. Aviram's limited study but again omitted any mention of the Ornish and Davidson findings. Id. And in 2008 and 2009, POM conducted a $1 million promotional campaign, with seventy ads in newspapers and magazines across the country, in which it trumpeted Dr. Aviram's findings--including the 30% figure--without any acknowledgement of the contrary Ornish and Davidson studies. Id. App. B fig.25; see also id. App. B fig.19.
Dr. Ornish also conducted a separate study examining the relationship between pomegranate juice and blood flow. The study followed forty-five patients with coronary heart disease and myocardial ischemia (insufficient blood flow to the heart due to narrowing of the arteries). The patients were randomly assigned to drink either pomegranate juice or a placebo beverage daily. Dr. Ornish later testified that, although his protocol called for a twelve-month study, he terminated the study abruptly after three months because the Resnicks did not follow through on their previous commitment to fund a twelve-month trial.
At the end of three months, patients in the treatment group outperformed patients in the placebo group on one measure of blood flow to the heart, known as the " summed difference score." The study, however, found no statistically significant difference between the treatment and control groups on two other measures of blood flow (the " summed rest score" and the " summed stress score" ), nor did it find any statistically significant differences in blood pressure, cholesterol, or triglycerides. Medical experts later noted a number of shortcomings of the study, including that patients in the placebo group began the study with significantly worse blood flow than patients in the treatment group, potentially skewing the outcomes.
POM touted the results of the second Ornish study in its ads and promotional materials without noting the study's limitations or acknowledging that patients in the treatment group showed no statistically significant improvement in blood flow on two of three measures. In September 2005, for instance, POM issued a press release announcing the study in which it asserted that " blood flow to the heart improved approximately 17% in the pomegranate juice group" and that differences in blood flow between the two groups were " statistically significant." Id. App. B fig.8.
POM continued to make similar statements in its promotional materials through 2009. See id. App. B fig.10, at 5 (June 2007 brochure claiming that " [p]atients who consumed 8oz of POM Wonderful 100% Pomegranate Juice daily for three months experienced a 17% improvement in blood flow" ); id. App. B fig.16, at 3 (summer 2007 newsletter claiming " 17% IMPROVED BLOOD FLOW" ); id. App. B figs.37, 38, 39 (similar claims on POM websites in 2009).
2. In addition to the cardiovascular studies, petitioners sponsored research on the effect of pomegranate juice consumption in prostate cancer patients. One study, led by Dr. Allan Pantuck of the University of California, Los Angeles Medical School, followed forty-six patients who had been diagnosed with prostate cancer. All of the patients had already been treated by radical prostatectomy, radiation therapy, or cryotherapy. The study called for them to drink eight ounces of pomegranate juice daily. There was no control group. The study concluded that the patients' " PSA doubling time," a measure of the rapidity of growth in prostate tumor cells, increased from fifteen months at the beginning of the study to fifty-four months at the end. But as Dr. Pantuck himself noted, patients who have undergone radical prostatectomy or radiation therapy for prostate cancer commonly experience a lengthening in PSA doubling time regardless of whether they consume pomegranate juice.
POM, however, made no mention of the limitations of the Pantuck study in its public statements. In a July 2006 press release, POM claimed that " drinking 8 ounces of POM Wonderful pomegranate juice daily prolonged post-prostate surgery PSA doubling time from 15 to 54 months," without noting that some or all of the increase in the patients' PSA doubling times may have resulted from the radical prostatectomies or radiation treatments undergone by the patients. Id. App. B fig.9, at 2. POM advanced similar claims in a June 2007 brochure and in a fall 2007 newsletter, again with no disclosure of the study's limitations. See id. App. B figs.10, 17. In 2008 and 2009, POM ads in the New York Times Magazine and TIME Magazine asserted that prostate cancer patients who drank eight ounces of POM Wonderful 100% Pomegranate Juice a day for at least two years experienced " significantly slower" PSA doubling times, once again without any acknowledgment that the patients' PSA doubling times may have slowed regardless of whether they consumed pomegranate juice. Id. App. B figs.21, 27; see also id. figs.36, 37, 38, 39 (similar claims on POM websites in 2009).
3. Petitioners additionally sponsored research of the effects of pomegranate juice consumption in men with mild to moderate erectile dysfunction. One study, led by Dr. Harin Padma-Nathan, a urologist in Beverly Hills, California, followed fifty-three patients over eight weeks. The study used a " crossover" design: one group of patients consumed pomegranate juice for the first four weeks and then consumed a placebo beverage for the next four, while a second group consumed the placebo beverage for the first four weeks and pomegranate juice for the next four. Dr. Padma-Nathan and co-investigators evaluated the results using two measures: the International Index of Erectile Function (IIEF), a fifteen-question instrument, and the Global Assessment Questionnaire (GAQ), a one-question test. The IIEF is a " validated" tool, which means that the measure has been shown to have statistical reliability, while the one-question GAQ is not a validated measure for assessing erectile function. See generally R. C. Rosen et al., The International Index of Erectile Function (IIEF): A State-of-the-Science Review,
14 Int'l J. Impotence Res. 226, 226 (2002).
Dr. Padma-Nathan's study showed some evidence that patients scored higher on the GAQ measure after drinking pomegranate juice. But the p -value--the probability of observing at least as strong an association between pomegranate juice consumption and GAQ scores due to random chance--was 0.058, falling just short of statistical significance at the conventional p < 0.05 level. On the scientifically validated IIEF measure, however, the difference between patients' scores after drinking pomegranate juice and after drinking the placebo beverage came nowhere near statistical significance: there was nearly a 3/4 likelihood of observing as strong an association due to random chance ( p =0.72). See C.P. Forest, H. Padma-Nathan & H.R. Liker, Efficacy and Safety of Pomegranate Juice on Improvement of Erectile Dysfunction in Male Patients with Mild to Moderate Erectile Dysfunction: A Randomized, Placebo-Controlled, Double-Blind, Crossover Study, 19 Int'l J. Impotence Res. 564, 566 (2007).
In its public statements about Dr. Padma-Nathan's study, POM made no mention of the negative results with respect to the validated IIEF measure. POM instead touted the study outcomes based exclusively on the non-validated GAQ measure. A 2007 POM ...