19 tf

The FTC has held that if an automobile is advertised to get 35 miles per gallon in highway driving, that must be the average mileage that ordinary drivers will get in ordinary driving, otherwise it is deceptive advertising.

False

The FTC is required by law to sue all advertisers that publish deceptive ads.

False

The FTC may not bring an action against a company for an unfair act; the act must be unfair and deceptive.

False

The FTC may not prosecute companies that sell investment scams; that responsibility falls with the Securities and Exchange Commission.

False

The FTC may not regulate products sold by telemarketing; those are controlled by the Federal Communications Commission.

False

The FTC's advertising substantiation program requires media ads to be registered with the FTC for review before being used to prevent deception.

False

The Food Quality Protection Act of 1996 states that food should have a "de minimus" chance of harming consumers.

False

The Food, Drug and Cosmetic Act of 1938 allowed the FD to impose pure food standards for the first time.

False

The Kefauver amendment of 1962 requires the FD to approve drugs based on their proven safety .

False

To the FDA "low fat" means less than 10 grams of fat per serving.

False

Under the FTC's advertising substantiation program, if an consumers will be misled by an advertisement, it must be modified.

False

Under the Lanham Act, Ford was able to sue General Motors for false advertising that hurt Ford pickup sales, and collected over $100 million in damages.

False

Under the Lanham Act, the FTC may sue advertisers for damages for deceptive ads.

False

The FDA requires nutrition labels only on canned or bottled foods sold to the public.

False

The FDA uses a food purity standard that says that an additive should have no more than a one- in-a-million chance of causing cancer.

False

The FDA was created in 1914.

False

The FTC deception policy is applied equally to all products regardless of the sex, age, race or financial condition of the consumers in the relevant market.

False

The FTC deception policy is the same, in effect, as common law fraud.

False

The FTC deception policy states that an deceptive practice likely to mislead an consumer will be challenged b Congress.

False

The FTC determines the legal meaning of terms like "light" and "low fat" when used to advertise food products.

False

The FTC's advertising substantiation program allows the FTC to ensure that retailers have a reasonable basis for claims made about products the are selling.

True

The Food Quality Protection act states that food should ha e a "reasonable certainty of no harm."

True

The Food, Drug and Cosmetic Act of 1938 gave the FD broad powers to regulate food production and prohibit false advertising of drugs.

True

The Kefauver amendment of 1962 requires the FD to approve drugs based on proven effectiveness, not Just safety .

True

The Mail Order Rule attempts to reduce the incidence of deceptive practices in the first-class postal business.

True

The Mail Order Rule requires goods to be delivered by mail to arrive within clearly set time or allow the customer out of the deal.

True

The Used-Car rule issued b the FTC has increased the price of used cars about five percent.

True

The Used-Car rule issued b the FTC requires used car sellers to give consumers clear warrant information.

True

Trade regulation rules tend to be issued in areas where the FTC thinks there are particular problems with deception.

True

Under the FTC's advertising substantiation program, if the FTC attacks an ad the usual result is that the advertiser agrees to stop running the ad.

True

Under the Lanham Act, U-Haul was able to sue a competitor for false advertising and was awarded $40 million in damages

True

Under the Lanham Act, a private part injured by the false ads of a competitor may sue the competitor for double value of lost profits.

True

When the FTC proposes a trade regulation rule, it must be published in the Federal Register for public inspection before it becomes effective.

True

The Department of agriculture has primary responsibility for sanitation of foods; the FD focuses on food additives.

False

The FDA does not regulate health claims made on food products.

False

Advertising controls are extremely strict in Europe compared to the US

False

Dietary supplements, unlike drugs, are not regulated.

False

If a product is labeled "fresh" it may either be raw, unprocessed food or frozen food, so long as it was frozen fresh.

False

In Schuchmann v. Air Services Heating and Air Conditioning, where a company refused to provide air conditioning service after five years on a product with a "lifetime warranty", the court held that lifetime does not mean that; it is commonly understood to mean a "reasonable" length of time

False

In Schuchmann v. Air Services Heating and Air Conditioning, where a company refused to provide air conditioning service after five years on a product with a "lifetime warranty", the court held that the warranty was not part of the purchase contract, so was not enforceable.

False

In Wyeth v. Levine, the Supreme Court held that FDA approval of the warning label on a drug set the federal safety standard that preclude a safety claim brought under state law.

False

In Wyveth v. Levine, In the Supreme Court held that FDA approval of the warning label on a drug set the federal standard that was not subject to change without FDA approval.

False

It costs about $25 million and takes an average of 3 years to develop one new drug and clear all FDA rules before marketing the product.

False

It costs an average of about a billion dollars to develop one new drug and clear all FD rules. If a drug is not approved for marketing, the FDA pays the company for the costs of the tests.

False

Maximum judgment in an FTC deception cases is $1 million.

False

Most advanced European nations have substantially stronger regulations of drugs than exist in the U.S.

False

Once the FDA approves a drug for the market, it has no further power to control the sale of that drug except to issue public warnings.

False

Once the FDA has approved a drug for sale there may be no liability imposed on the drug manufacturers for side-effects that were revealed during the testing process.

False

The "R- value Rule" states that refrigerator makers must clearly explain to consumers what kind of insulation is used in their products.

False

Before passage of the 1938 Food, Drug and Cosmetic Act there were no such things as prescription drugs. That is, people could bu an legal drug.

True

Common vitamins-niacin and ribofla in-do not have to be listed on nutrition labels.

True

Drugs must complete three phases of trials before considered b the FDA for release to the public.

True

If a person is injured by a drug because a physician gives an improper dose, the maker may be protected from liability under the "learned intermediary " doctrine.

True

In Wyeth v. Levine, Supreme Court held that FDA approval of the warning label on a drug did not mean the drug maker could not be sued for having an inadequate warning label on the drug.

True

In Wyeth v. Levine, Supreme Court held that FDA approval of the warning label on a drug did not mean the drug maker was not responsible for updating the label to include new relevant safety information.

True

In recent years, the FD has allowed drugs that show some promise for life-threatening diseases such as IDS to be used more quickly than normally .

True

It costs an average of about a billion dollars to develop one new drug and clear all FD rules before marketing the product.

True

It takes about $1 billion for a drug company to develop a new drug to market.

True

Making illegal copies of patented drugs is a serious problem for public health around the world.

True

Many FTC complaints are settled by consent decree rather than a trial.

True

Medical devices approved by the FDA before being sold and then monitored for problems

True

Medical devices are subject to FD regulation.

True

No drug may be marketed for sale until the FDA has approved the drug for sale as safe for intended use.

True

One reason for passage of the Pure Food and Drug Act is the high death rate of soldiers during the Spanish- american War due to impure food.

True

State attorney generals usually have the authority to attack deceptive business practices.

True

States have laws similar to the FTC's powers to attack deceptive business practices.

True

The 1906 Pure Food and Drug ct provided primarily for protection against adulteration and misbranding of food and drugs.

True

The 1906 Pure Food and Drug ct was the first step b the federal government to regulate food safety .

True

The British Office of Fair Trading operates somewhat like the FTC in the US

True

The Delaney Clause (the Food additives amendment) allows the FDA to regulate food additives.

True

The Department of agriculture has primary responsibility for sanitation of meats and poultry ; the FDA has responsibility for most other foods.

True

The FDA decides what drugs may be sold as well as what drugs may be sold over the counter and what drugs may be sold only by prescription.

True

The FDA determines the legal meaning of terms like "light" and "low fat" when used on food products.

True

The FDA issues standards for nutrition labels on food.

True

The FDA may seize shipments of products that are falsely labeled.

True

The FDA seized shipments of orange juice that were not properly labeled.

True

The FTC deception policy holds that failure to reveal certain information may be found to be deceptive.

True

The FTC has the authority to attack deceptive sales practices via the Internet just like any other sale.

True

The FTC investigates a wide range of practices suspected to be unfair and deceptive.

True

The FTC may prosecute companies that solicit investments for things such as phony oil and gas wells.

True

The FTC may sue a company for an unfair act that is not deceptive.

True

The FTC was created by Congress to help enforce antitrust laws and deal with deceptive business practices.

True