(CN) – Infomercial pitchman Kevin Trudeau, known for hawking “cures” for everything from baldness to obesity, successfully appealed a $37.6 million judgment and ban against him over promotions for his book, “The Weight Loss Cure ‘They’ Don’t Want You to Know About.”
The 7th Circuit vacated and remanded the fine and ban, saying it was “troubled” by the nature of both.
For more than a decade, Trudeau has pushed “cures” for nearly everything: cancer, AIDS, slow reading, poor memory, debt and obesity, to name a few.
“And the infomercial is his medium of choice,” Judge Tinder wrote. “He has appeared in dozens of them, usually in the form of a staged, scripted interview where Trudeau raves about the astounding benefits of the miracle product he’s pitching.
“But Trudeau’s tactics have long drawn the ire of the Federal Trade Commission,” Tinder continued. “By promoting his cures, Trudeau claims he is merely exposing corporate and government conspiracies to keep Americans fat and unhealthy. But the FTC accuses Trudeau of being nothing more than a huckster who preys on unwitting consumers – a 21st century snake-oil salesman.”
His latest duel with the FTC involved his book, “Weight Loss Cure.” The FTC claimed that he misrepresented the weight-loss program as “easy,” “simple” and able to complete at home, when it was actually expensive, restrictive and cumbersome.
By the time Trudeau began promoting “Weight Loss Cure,” a court had banned him from appearing in infomercials for anything but books, so long as he didn’t “misrepresent the content of the book.”
The FTC said Trudeau’s “Weight Loss Cure” infomercial violated this court order.
The district court agreed that the infomercial was misleading and held Trudeau in contempt. It fined him $37.6 million and banned him from all infomercials – even for books – for three years.
The Chicago-based federal appeals court upheld the contempt finding, saying Trudeau “clearly misrepresented the book,” but it rejected the fine and ban.
The court explained that the sanctions were civil and not criminal. Civil sanctions can either be compensatory or coercive, meaning they’re meant to make someone comply with a court order. If they’re coercive, they must give the sanctioned party the opportunity to “purge,” or avoid punishment by complying with the order.
But the lower court failed to explain how the fine compensated the FTC for its losses, Judge Tinder ruled. And the infomercial ban can’t be coercive, the court added, because it lacks a “purge” option.
“The trouble with the infomercial ban is that it lasts for three years no matter what Trudeau does,” Tinder explained.
The circuit court remanded, instructing the district court to explain how it arrived at $37.6 million and to rework its coercive sanction.