WASHINGTON — In its latest law enforcement action to halt deceptive health and efficacy claims in the growing cannabidiol (CBD) market, the Federal Trade Commission (FTC) alleges that Kushly Industries LLC made false or unsubstantiated claims about the effectiveness of its products in treating a host of conditions.
Scottsdale, Ariz.-based Kushly and the company’s sole officer, Cody Alt, have agreed not to make false or unsupported claims or falsely claim that scientific evidence exists to back them up. They also will pay the FTC more than $30,500 in consumer redress, the amount consumers paid Kushly for products sold using deceptive marketing.
This is the first law enforcement action since the FTC announced a crackdown on such false claims in December.
The conditions Kushly claimed its products could treat ranged from common ailments like acne and psoriasis to more serious diseases including cancer and multiple sclerosis. In addition, the complaint alleges the respondents falsely told consumers that scientific studies or research prove that CBD effectively treats, mitigates or cures the diseases, including hypertension, Parkinson’s disease and Alzheimer’s disease.
“This is the seventh case we’ve brought against CBD sellers who should know better than to make unsupported health claims for their products,” said Daniel Kaufman, acting director of the FTC’s Bureau of Consumer Protection. “There may be some benefits of CBD, but there’s no proof that it can treat the serious health conditions in Kushly’s advertising, such as Parkinson’s, multiple sclerosis or cancer.”
The respondents have used these false or unsubstantiated claims to market or sell a range of products containing CBD, including gummies, softgel capsules and topical ointments, according to the FTC’s complaint. Kushly promoted its products on its website and social media. The complaint alleges that Alt participated directly in promoting and advertising Kushly’s CBD products and has been featured and quoted in articles about the company, its products and the CBD industry in general.
The proposed administrative order settling the FTC’s charges covers any dietary supplement, drug or food product the respondents sell or market, including CBD products. It prohibits Kushly and Alt from making any representations about the health benefits, efficacy, safety or side effect about any covered product, including CBD products, unless the representations are true at the time they are made, are not misleading, and they have and rely upon competent and reliable scientific evidence to support the claims. It also requires them to secure and preserve any human clinical tests or studies they use to substantiate these health claims.
The order also prohibits Kushly and Alt from misrepresenting that any covered product is clinically proven to treat, alleviate or cure or that scientific evidence exists to back up such claims regarding chronic pain, multiple sclerosis, anxiety, depression, cancer, sleep disorders, hypertension, Parkinson’s disease, Alzheimer’s disease, acne, psoriasis and eczema.