Two of the four people behind the purported diet pill CortiSlim have agreed to pay a total of $4.5 million to settle a deceptive-advertising lawsuit brought by the federal government, officials said Wednesday.
The agreement comes nearly a year after the Federal Trade Commission sued a trio of Orange County companies and a Utah chemist for falsely claiming the capsules spurred weight loss.
CortiSlim, which was promoted heavily via nationwide TV and radio, is still on the market, but the ads have been rewritten to avoid claiming the product reduces weight.
Under the settlement, chemist Shawn Talbott of Utah and marketer Thomas Cheng of Fullerton are banned from making claims about any future pills and potions that aren't supported by reputable scientific studies.
Cheng and his Brea-based Pinnacle Marketing Concepts agreed to give the FTC $700,000 cash, a $215,000 boat, a $40,000 Ford truck, $450,000 from real estate and $2 million from a charitable foundation and investment partnership funded by CortiSlim profits.
Cheng, who served time in federal prison in the 1990s for bootlegging CDs, didn't return a call seeking comment.
Talbott, a former University of Utah instructor who lost his job after the lawsuit, agreed to pay the FTC $225,000 cash, plus $350,000 from a home in Cape Cod, Mass., $39,000 from the sale of a timeshare in Hawaii and $500,000 from property in Lisbon, Ohio. He didn't return calls seeking comment.
In agreeing to the settlement, none of the defendants admitted legal liability in the case.
Negotiations with four other parties in the lawsuit broke off earlier this year, according to FTC attorney Heather Hippsley, who said a trial is scheduled to begin in the spring.
One of the remaining defendants is Cheng's younger brother, Stephen, who also served time for bootlegging CDs and now runs Window Rock Enterprises of Brea, the main company behind CortiSlim and CortiStress.
CortiStress, which purported to cure cancer and Alzheimer's disease, is part of the lawsuit. It has been pulled from the market.
Also named in the lawsuit is former CortiSlim spokesman Greg Cynaumon of Anaheim Hills and his Yorba Linda company, Infinity Advertising.
Cynaumon, a former Buena Park police officer who was fired in 1987 after being accused of falsifying information in an arrest report, was recently fined by two state boards for falsely claiming to be a psychologist.
Hippsley said the $4.5-million settlement could be used to reimburse CortiSlim customers.
More than a million people have paid $50 for a month's supply of the pill, which has grossed more than $200 million since its introduction two years ago, making it one of the most successful infomercial products of the decade.
CortiSlim claimed to shrink waistlines by controlling a stress hormone called cortisol, which has been linked to weight gain. However, no studies back up the product's effectiveness, and it has been ridiculed by scientists.
Also, doctors and customers have complained to the Food and Drug Administration that CortiSlim has led to heart palpitations, nausea, depression and other adverse health effects.
Window Rock issued a statement saying the reports were "merely anecdotal and do not prove any causal relationship between the product and the adverse event.... With millions of bottles of CortiSlim having been sold, the adverse event reports are extremely rare."