Federal Trade Commission v. Quincy Bioscience Holding Company, Inc.
- Louis Stanton
- 1:17-cv-00124
- U.S. District Court · Southern District of New York
- 5
In Federal Trade Commission v. Quincy Bioscience, Judge Stanton denied reconsideration and defendants’ request for judgment notwithstanding the verdict concerning Prevagen advertising.
The ruling affected the Quincy Bioscience entities and Mark Underwood, whose requests for reconsideration and for judgment notwithstanding the verdict were denied. It also concerned the Federal Trade Commission and the People of the State of New York, whose enforcement action and jury verdict were not altered by this order.
What happened
The Federal Trade Commission and the New York Attorney General sued Quincy Bioscience entities and Mark Underwood over statements about Prevagen’s ability to improve memory. A jury found two statements materially misleading and found that all eight statements could deceive under the laws at issue.
The defendants asked the court to reconsider earlier rulings, including its denial of summary judgment, based on a later Second Circuit decision involving “All Natural” snack-food advertising. They argued that the decision required evidence of what reasonable consumers expected after seeing the challenged advertisements.
Judge Stanton denied the defendants’ requests. He said the two cases involved different facts and legal questions: the earlier case concerned the unclear meaning of “All Natural,” while this case concerned whether Prevagen’s statements had scientific support and were misleading or deceptive. He also denied entry of judgment for the defendants notwithstanding the verdict.
The detailed version
- Federal Trade Commission v. Quincy Bioscience Holding Company, Inc. · No. 1:17-cv-00124
- Louis Stanton
- July 10, 2024
Background
The Federal Trade Commission and the People of the State of New York, acting through the New York Attorney General, brought this enforcement action against Quincy Bioscience Holding Company, Inc.; Quincy Bioscience, LLC; Prevagen, Inc., doing business as Sugar River Supplements; Quincy Bioscience Manufacturing, LLC; and Mark Underwood. The case concerned advertising statements about Prevagen and its claimed ability to improve memory, particularly for aging people.
A jury found that two of eight statements were materially misleading and that none of the statements was supported by the reliable scientific evidence the court said was required under New York General Business Law §§ 349 and 350. The jury also found that all eight statements had the capacity or tendency to deceive in violation of New York Executive Law § 63(12).
Defendants’ reconsideration request
The defendants moved for reconsideration of earlier proceedings, including the trial and verdict. They relied on the Second Circuit’s decision in a prior related proceeding involving “All Natural” snack-food labeling. The defendants argued that the decision was controlling law and an intervening change in law requiring the plaintiffs to present admissible evidence of what consumers expected after viewing the challenged advertising.
The court rejected that reading of the Second Circuit decision. In the earlier related proceeding, the plaintiffs’ experts had been disqualified, and the plaintiffs lacked admissible evidence showing what a reasonable consumer would understand “All Natural” to mean. The Second Circuit affirmed summary judgment for the snack-food company because the plaintiffs had not produced admissible evidence of a reasonable consumer’s expectations.
The court distinguished this case. It said there was no dispute about the meanings of the statements in the Quincy case. This was also a government enforcement action, rather than a case brought by disappointed consumers seeking relief based on their own purchasing experience. The court explained that the issues for the jury included whether the statements were supported by accepted scientific authority, whether they were materially misleading, and whether they tended to deceive. The jury was not asked to evaluate consumer reactions.
Ruling
Judge Stanton denied the defendants’ applications for a retroactive alteration of the court’s denial of summary judgment and for entry of judgment notwithstanding the verdict for the defendants. The court stated that the two cases involved different facts and that the jury’s verdict was based on the lack of substantial scientific support for the challenged statements and their tendency to deceive under the applicable New York laws.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.