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AG reaches settlement with 5-Hour Energy makers

AG reaches settlement with 5-Hour Energy makers
Posted at 12:43 PM, Jan 08, 2016
and last updated 2016-01-08 14:58:53-05

A lawsuit filed through the state of Idaho against the companies that produce 5-Hour Energy has reached a settlement, according to Attorney General Lawrence Wasden.

Originally filed in 4th District Court in May of 2015, the lawsuit argued that the company violated Idaho’s Consumer Protection Act and Consumer Protection Rules because of “false, deceptive or misleading practices in advertising and promoting their products.”

The settlement, which was approved by District Judge Richard Greenwood this week, resolves the lawsuit against the energy supplement owners Living Essentials LLC and Innovation Ventures LLC after alleged misrepresentations on the label, including whether consumers experience a “crash” after consumption and claims that the product has been recommended by doctors.

Both Living Essentials and Innovation Ventures denied any violations of Idaho law.

Under the terms of the agreement, the companies that represent 5-Hour Energy will not be able to claim sponsorships, benefits or ingredients about the product they don't have in the state of Idaho.

“Ensuring companies make accurate statements about their products is important to consumers and the marketplace,” Attorney General Wasden said. “I’m pleased that we were able to reach a resolution of this case.”

As part of the settlement, the companies will have to adhere to the following for their products sold in Idaho:

·        Ensure that any new marketing materials for 5-hour Energy products that use the word “crash” shall use the words “no sugar crash” instead;

·        Provide on labels warnings for women who are pregnant or nursing, and that their products are not recommended for children;

·        In any advertising campaign, only use survey data if it was created, conducted and evaluated in an objective manner by qualified people who used methods generally accepted in the profession to produce accurate and reliable results;

·        Continue to list the amount of caffeine in products and disclose that amount as a separately listed ingredient; and

·        Not use testimonials or endorsements that do not comply with Federal Trade Commission rules.

The settlement also clarified how the companies will be able to market their products to minors, according to Wasden.

Until mid-2019, the companies will be prohibited from using or hiring anyone under the age of 18 to promote the products or appear in ads.

The logo, name or any company sponsored mascot will be prohibited from being used in any elementary, middle or high school promotional materials. In addition, the company will be unable to promote the product at school events or use any child oriented animated character to market the product.

A $9,000 fine will be paid from the companies to the Attorney General for fees and costs associated with the investigation and litigation.