Reebok International Ltd. has agreed to pay $25 million as part of a settlement of a Federal Trade Commission complaint that the company made unsubstantiated, deceptive benefits claims about its EasyTone and RunTone shoes in its advertising.
According to the FTC complaint, Reebok made unsupported claims that walking in its EasyTone shoes and running in its RunTone running shoes strengthens and tones key leg and buttock (gluteus maximus) muscles more than regular shoes. The FTC's complaint also alleges that Reebok falsely claimed that walking in EasyTone footwear had been proven to lead to 28% more strength and tone in the buttock muscles, 11% more strength and tone in the hamstring muscles, and 11% more strength and tone in the calf muscles than regular walking shoes.
The settlement payment will be used to reimburse consumers who purchased Reebok toning apparel, as well as the shoes. The refunds will be made available either directly from the FTC or through a court-approved class-action lawsuit.
Consumers who bought the shoes "expected to get a workout, not get worked over," quipped FTC director of consumer protection David Vladeck during a press conference this morning, adding that there are "no shortcuts to fitness."
The FTC does not know how many refund applications it will receive from consumers (applications are being taken online at FTC.gov/ Reebok), how many refunds will be issued, or what the amount of individual refunds will be, said Vladeck.
Under the settlement, Reebok also is barred from making claims that toning shoes and other toning apparel are effective in strengthening muscles, or that using the footwear will result in a specific percentage or amount of muscle toning or strengthening, unless the claims are true and backed by scientific evidence; from making any health or fitness-related efficacy claims for toning shoes and other toning apparel unless the claims are true and backed by scientific evidence; and from misrepresenting any tests, studies or research results regarding toning shoes and other toning apparel.
Vladeck said that to Reebok's credit, it pulled the advertising with the unsubstantiated claims during the course of the FTC's investigation, has stopped making boxes and promotional materials bearing the claims, and has instructed retailers to sticker over such claims on shoe boxes and take down promotions bearing the claims.
The FTC launched the Reebok investigation as a result of "multiple sources," including consumer complaints, according to Vladeck. Noting that the FTC does not comment on its investigations, he declined to respond to questions concerning whether the advertising claims of other toning shoe manufacturers are under investigation.
According to the complaint, filed simultaneously with the settlement, Reebok's print, television and Internet ads have included the disputed claims since EasyTone's launch in early 2009. Marketing Daily reported that Reebok launched a major TV ad campaign (its first since 2007) that also had print elements, created by DDB/Chicago, for EasyTone footwear in late October 2009.
This spring, Reebok ramped up advertising for both EasyTone and ZigTech, a line launched last year that is said to conserve and return energy to the wearer via its zigzag sole design. A worldwide EasyTone campaign from DDB Berlin featured "Reetoners," an international cast of inspirational women.
Reebok has said that EasyTone and the ZigTech are considered key in driving sales and the company's financial performance going forward.
Canton, Mass.-based Reebok was acquired by German sportswear company Adidas in 2006. According to The Stillman Exchange, 2010 marked the first year since the acquisition that Reebok posted revenue increases. Reebok's worldwide sales rose 15%, and the brand's U.S. sales rose 24%, last year. In this year's first half, Reebok's worldwide sales grew by 14%, and Adidas's overall net income increased 19%. Management said the company "is on its way to record sales and earnings" in 2011.
A Reebok statement addressing the FTC settlement said, in part: "The allegations suggested that the testing we conducted did not substantiate certain claims used in the advertising of our EasyTone line of products. In order to avoid a protracted legal battle, Reebok has chosen to settle with the FTC. Settling does not mean we agreed with the FTC's allegations; we do not."
Reebok added that it has had "overwhelmingly enthusiastic" feedback from EasyTone customers, and that it remains committed to the continued development of the EasyTone line.
Early this year, the National Advertising Division of the Council of Better Business Bureaus also recommended that Reebock cease certain claims about EasyTone shoes, and the company said it would take that recommendation into account in future advertising, noted Advertising Age.