Complaint Counsel's Post Trial Brief - Federal Trade Commission

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I. COMPLAINT COUNSEL'S PROPOSED FIDINGS OF FACT A. Daniel Chapter One an~ the Feijos 1. Respondent Danel Chapter One ("DCO") is a corporation sole organzed in 2002 under the laws ofthe state of Washington. (Respondents' Answer to FTC's Compl., dated Oct. 14, 2008 (hereinafter referred to as the Answer) ~ 1; Complaint Counsel's Trial Exhbit (hereinafter refered to as CX -- 35; J. Feijo, Hearg on Jursdiction Transcrpt, April 21,2009, (hereinafter refered to as HOJ Tr. -- at 84). 2. According to its Aricles ofInco~oration, Respondent DCO's mailing and pricipal location is 21916 Southeast 392D Street, Enumclaw, Washington, but neither Respondent DCO nor Respondent James Feijo maintains a building at that address. (CX 31; J. Feijo, HOJ Tr. 93-94). business is located at 1028 East Main Road, Portsmouth, Rhode Island 02871. (Answer~ 1; Deposition of James D. 3. According to Respondents, their pricipal offce and place of Feijo, Januar 13, 2009, (hereinafter refered to as R15 (J. Feijo, Dep. --) at 99). Respondent DCO as its Overseer. (Answer ~ 2; J. Feijo, HOJ Tr. 70; J. Feijo, Trial Trancrpt (hereinafter 4. Respondent James Feijo is responsible for the activities of refered to as Tr. -- at 416). 5. Patrcia Feijo, Respondent James Feijo's wife, is the secretar for DCO. (Deposition of Patrcia Feijo, Januar 14, 2009, (hereinafter refered to as (R16 (P. Feijo, Dep. at -- at 10, 52; P. Feijo, HOJ Tr. 276). 6. Respondent James Feijo and his wife, Patrcia, origially stared DCO as a health food store in 1986. (R16 (P. Feijo, Dep. at 39-40); J. Feijo, Tr. 418). 7. Respondent James Feijo sold DCO products prior to registerng as a corporation sole. (R15 (J. Feijo, Dep. at 224)). 8. Respondents offer 150 to 200 products today, including Bio*Shark, 7 Herb Formula, GDU, and BioMixx (collectively, the "DCO Products"). (R15 (J. Feijo, Dep. at 37); P. Feijo, Tr. 392; Maro, HOJ Tr. 54; J. Feijo, HOJ Tr. 314-15). 9. DCO has two buildings in Rhode Island - one is the Order Center and the other is the warehouse. (J. Feijo, HOJ Tr. 110). 10. Messiah Y'Shua Shalom, a Washington corporation sole, owns the proper that Respondents use in Rhode Island. (R15 (J. Feijo, Dep. at 72-73); CX 35). 11. Respondent James Feijo is the overseer for Messiah Y'Shua Shalom. (R15 (J. Feijo, Dep. at 72-73); CX 35). 12. Respondents practice a science they call BioMolecular Nutrtion. (CX 21). 13. According to Respondents, "(t)here are two aspects of spiritual and the physicaL." (CX 21). 1 BioMolecular Nutrtion, the
14. "The priciples of BioMolecular Nutrtion were those missing principles needed to bind together those ofthe nutrtionists and the biochemsts." (CX 21). 15. According to Respondents, "(b)ecause of BioMolecular nutrtional products developed at that time, we've been able to support other natuopathc disciplines - chiropractic, acupunctue, herbology, and homeopathy - and using the principles of BioMolecular Nutrtion has allowed many natual health practitioners to be complete." (CX 21). B. The FTC Has Jurisdiction Over Respondent DCO. which is a Corporation within the Meanie of Section 4 of the FTC Act. and Respondent James Feijo 16. Respondent DCO was previously incorporated as "Danel Chapter One, Inc.," a Rhode Island for-profit corporation, on October 30, 1990. (CX 50; J. Feijo, HOJ Tr. 101). 17. Respondent DCO's Aricles of Incorporation from 1990 state that the puroses for which Danel Chapter One, Inc. was organzed were: "To engage in the sale, retail, wholesale and distrbution of health products, including but not limted to health foods and supplements, namely those with special nutrtive qualities and values." (CX 50; J. Feijo, HOJ Tr. 101-02). 18. Consistent with its status as a for-profit corporation incorporated in Rhode Island, Respondent DCO filed anual reports from 1991 though 1997, durg which time the stated character of the business remained substantially simlar, namely "To engage in the sale, retail, wholesale and distrbution of health products, including health foods and supplements." (CX 50; J. Feijo, HOJ Tr. 102-08). 19. Each of these for-profit corporation anual reports bears the signatue of Respondent James Feijo. (J. Feijo, HOJ Tr. 102-08). 20. DCO is not registered with the Interal Revenue Serice as a charty. (R15 (J. Feijo, Dep. at 45); J. Feijo, HOJ Tr. 209). 1. Respondents Are Eneaeed in Commerce 21. Respondents distrbute the DCO Products in commerce. (Answer~ 4; R15 (J. Feijo, Dep. at 102); Maro, HOJ Tr. 53-55; Harson, Tr. 295-96). 22. Anyone can buy and use DCO products, including people who do not believe in God. (Maro, HOJ Tr. 55; P. Feijo, Tr. 410-11). 23. Respondent DCO has an 800 number and a call center for consumers to purchase the DCO Products. (R16 (P. Feijo, Dep. at 67); J. Feijo, HOJ Tr. 212; P. Feijo, HOJ Tr. 273 74; J. Feijo, HOJ Tr. 168,204,211-12). 24. Respondent James Feijo created, managed, and maitained the toll-free telephone number, designed so that consumers can order the DCO Products. (CX 39). 2
Page 1 and 2: UNITED STATES OF AMERICA BEFORE THE
Page 3 and 4: TABt
Page 5: TABLE OF CONTENTS i. Complaint Coun
Page 9 and 10: 38. Respondents have generated appr
Page 11 and 12: Respondent DCO "is the ONLY nutrtio
Page 13 and 14: priced with most other brands but w
Page 15 and 16: Florida, which Respondent DCO owns.
Page 17 and 18: C. Respondents Claim That Their Pro
Page 19 and 20: and the tuor behind my hear has shr
Page 21 and 22: BioMixx TM. . . GDU Caps TM. . . (d
Page 23 and 24: east examnation by mamography. On 1
Page 25 and 26: 185. The DCO radio program and the
Page 27 and 28: 211. Universal Nutrtion has not con
Page 29 and 30: 233. Nevertheless, Dr. Miler cautio
Page 31 and 32: 262. When enterng in the MA an acti
Page 33 and 34: 292. Duke made no effort to see whe
Page 35 and 36: nutrtional supplements and botancal
Page 37 and 38: 352. LaMont acknowledged that there
Page 39 and 40: 383. Dews never has heard of James
Page 41 and 42: 412. Dews is not famliar with any s
Page 43 and 44: 442. There are no indications in Du
Page 45 and 46: 472. LaMont does not know whether B
Page 47 and 48: 114 F.T.C. at 322; Thompson Medical
Page 49 and 50: it was not blinded or placebo-contr
Page 51 and 52: Tech., Inc., 128 F.T.C. 299 (1999)
Page 53 and 54: In the Matter of ) ) DANIEL CHAER O
Page 55 and 56: a. The Adverisements in Question Ma
Page 57 and 58:
In the Matter of ) ) DANIEL CHAER O
Page 59 and 60:
CCPF ~ 16-18. In 2002, James Feijo
Page 61 and 62:
the ter "BioMolecular Nutrtion" to
Page 63 and 64:
1. Claims That the DCO Products Are
Page 65 and 66:
above the brain stem. . . has compl
Page 67 and 68:
direct statements. Id. at 318 and 3
Page 69 and 70:
12-12A; CCPF ~ 35. Respondents make
Page 71 and 72:
c. Respondents Represented that GDU
Page 73 and 74:
CCPF ~ 140 (emphasis in bold added)
Page 75 and 76:
consistent with the FTC's approach.
Page 77 and 78:
not cure the fact that the claims a
Page 79 and 80:
fudamental requirements for scienti
Page 81 and 82:
competent and reliable scientific e
Page 83 and 84:
humans with cancer. CCPF ~ 228. il.
Page 85 and 86:
lines of evidence." CCPF ~ 280. LaM
Page 87 and 88:
effectiveness ofGDU, BioMixx, Bio*S
Page 89 and 90:
adverisements and promotional mater
Page 91 and 92:
canot, however, make deceptive stat
Page 93 and 94:
dosages ofthe DCO Products. CCPF ~~
Page 95 and 96:
VI. CONCLUSION The evidence at tral
Page 97 and 98:
In the Matter of DANIEL CHAPTER ONE
Page 99 and 100:
CX 14 Attachment C to Administrativ
Page 101 and 102:
CX33 Emails from DCO relating to FT
Page 103 and 104:
2. James Feijo Owner and President,
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