So just what does happen when the Federal Trade Commission puts a cannabis producer in its cross hairs for unsubstantiated health claims? It’s not pretty, and it starts with having to make a very public mea culpa for those consumers who may have been deceived.
This month, Longmont, Colorado company Steve’s Goods learned its fate for having made allegedly dubious claims about its products for many years. They were ordered to immediately implement a customer notification program — reaching back to every purchaser since 2018 —with an email letter admitting:
- Unless we have scientific proof, we will not say that our CBD and CBG products can effectively treat or ease serious diseases and health conditions, such as Alzheimer’s disease, cancer, Crohn’s disease, diabetes, and irritable bowel syndrome (IBS).
- Unless we have scientific proof, we will not say that we have studies or scientific research that prove that our CBD or CBG products have antibacterial properties, stimulate bone formation or healing, have neuroprotective effects, or cure, mitigate, or treat anxiety, cancer, depression, glaucoma, inflammation, inflammatory bowel conditions, IBS, neurological disorders, ocular diseases, overactive bladder pain, or psoriasis.
The letter also provides consumers with a link to read the full settlement order, and underscores the importance of talking to your doctor. The same notices were also required to be sent to affiliates and resellers.
Steve’s Goods also was ordered to post notices of the FTC order on all their social media accounts, and on the home page of all their websites — including a link to the full order. Compliance recordkeeping, activity monitoring, and record preservation provisions were also mandated in the order, and specific guidance was provided on what scientific data would be allowable if the company were to make any health claim in the future. What’s more, the FTC imposed a $75,000 fine on the company. Five other companies were also punished in this initial round of “Operation CBDeceit” crackdowns: New York City-based Bionatrol Health, West Valley, California-based CBD Meds, Utah-based First Class Herbalist, Temecula, Boca Raton, Florida-based HempmeCBD, and Costa Mesa, California-based Reef Industries. All had made such prohibited claims as CBD would “leave you pain-free”, “cure thousands of ailments” or “take the place of expensive prescription drugs.”