FTC Continues Crackdown on Fake Claims About CBD

  • The Federal Trade Commission (“FTC”) reached a settlement with cannabidiol (“CBD”) products retailer Kushly Industries LLC and its sole officer (collectively, “Kushly”) to resolve allegations that Kushly made unsubstantiated marketing claims and falsely claimed that scientific evidence supported the efficacy of its products in violation of the FTC Act.
  • The complaint alleged that Kushly falsely advertised a range of CBD-containing products such as gummies and topical ointments as effective in treating or curing a number of medical conditions, including cancer and multiple sclerosis, and that it falsely claimed that there is scientific evidence that CBD can treat serious conditions like Parkinson’s disease, Alzheimer’s disease, and hypertension.
  • Under the terms of the proposed consent order, Kushly must pay over $30,000 to the FTC for consumer redress, is prohibited from making any misleading and unsubstantiated health claims about its products, including misrepresenting any product as being clinically proven to be medically effective against a number of conditions such as chronic pain, cancer, multiple sclerosis, acne, psoriasis, and eczema, among others.
  • As reported previously, Cozen O’Connor State AG Group Members Meghan Stoppel and Mira Baylson recently penned a timely article for Cannabis Business Executive on the real threat of regulatory scrutiny and the importance of a carefully crafted marketing campaign for companies manufacturing and selling CBD.