Motor Up Corporation, Inc., et al.; Analysis To Aid Public Comment

AGENCY:

Federal Trade Commission.

ACTION:

Proposed Consent Agreement.

SUMMARY:

The consent agreement in this matter settles alleged violations of federal law prohibiting unfair or deceptive acts or practices or unfair methods of competition. The attached Analysis to Aid Public Comment describes both the allegations in the complaint that the Commission issued in April 1999 and the terms of the consent order—embodied in the consent agreement—that would settle these allegations.

DATES:

Comments must be received on or before April 28, 2000.

ADDRESSES:

Comments should be directed to: FTC/Office of the Secretary, Room 159, 600 Pennsylvania Ave., NW, Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT:

Elaine Kolish or Heather Hippsley, FTC/S-4302, 600 Pennsylvania Ave., NW, Washington, DC 20580. (202) 326-3042 or 326-3285.

SUPPLEMENTARY INFORMATION:

Pursuant to Section 6(f) of the Federal Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Section 3.25(f) of the Commission's Rules of Practice, 16 CFR 3.25(f), notice is hereby given that the above-captioned consent agreement containing a consent order to cease and desist, having been filed with and accepted, subject to final approval, by the Commission, has been placed on the public record for a period of thirty (30) days. The following Analysis to Aid Public Comment describes the terms of the consent agreement, and the allegations in the complaint. An electronic copy of the full text of the consent agreement package can be obtained from the FTC Home Page (for March 29, 2000), on the World Wide Web, at “http://www.ftc.gov/ftc/formal.htm.” A paper copy can be obtained from the FTC Public Reference Room, Room H-130, 600 Pennsylvania Avenue, NW, Washington, DC 20580, either in person or by calling (202) 326-3627.

Public comment is invited. Comments should be directed to: FTC/Office of the Secretary, Room 159, 600 Pennsylvania Ave., NW, Washington, DC 20580. Two paper copies of each comment should be filed, and should be accompanied, if possible, by a 31/2 inch diskette containing an electronic copy of the comment. Such comments or views will be considered by the Commission and will be available for inspection and copying at its principal office in accordance with Section 4.9(b)(6)(ii) of the Commission's Rules of Practice (16 CFR 4.9(b)(6)(ii)).

Analysis of Proposed Consent Order to Aid Public Comment

The Federal Trade Commission has accepted, subject to final approval, an agreement to a proposed consent order from Motor Up Corporation, Inc., Motor Up America, Inc., and Kyle Burns, the principal who controls these corporations (referred to collectively as “Motor Up”). The agreement would settle a complaint by the Federal Trade Commission that Motor Up engaged in unfair or deceptive acts or practices in violation of Section 5(a) of the Federal Trade Commission Act.

The proposed consent order has been placed on the public record for thirty (30) days for reception of comments by interested persons. Comments received during this period will become part of the public record. After thirty (30) days, the Commission will again review the agreement and the comments received and will decide whether it should withdraw from the agreement or make final the agreement's proposed order.

This matter concerns representations made about Motor Up No Oil Change Engine Treatment Concentrate, an engine oil additive, in advertising. The administrative complaint alleged that Motor Up violated the FTC Act by disseminating ads that made unsubstantiated performance claims about the oil additive. The Complaint alleged that the respondents represented that, compared to motor oil alone, Motor Up: (1) Reduces engine wear; (2) reduces engine wear by up to 50 percent; (3) reduces adhesive engine wear by up to 90.17 percent; (4) reduces engine wear during cold starts; (5) provides more protection against engine wear in cold temperatures; (6) extends the duration of engine life; and (7) helps prevent engine breakdowns. The Complaint also alleged that respondents represented that Motor Up: (1) Prevents corrosion in engines; (2) will not drain out from the engine even when the oil is changed; (3) protects engines for up to 50,000 miles; and (4) protects against engine wear even without motor oil. The Complaint alleged that respondents represented that they had a reasonable basis for making these claims, but in fact did not possess competent evidence supporting the claims. The Complaint alleged that respondents claimed that tests prove that, compared to motor oil alone, Motor Up reduces engine wear by up to 50 percent without possessing tests that prove the claim. The Complaint also alleged that respondents represented that product demonstrations in their advertising proved, demonstrated, or confirmed that Motor UP prevents corrosion in engines and that, compared to motor oil alone, Motor Up helps prevent breakdowns and reduces engine wear, when in fact the demonstrations do not prove, demonstrate, or confirm these product attributes.

The proposed consent order contains provisions designed to prevent Motor UP from engaging in similar acts and practices in the future. Part I of the proposed consent order prohibits Motor Up from making any claims about any engine treatment, fuel treatment, motor oil, grease, transmission fluid, or brake fluid, and any additive intended for use with or as a substitute for these products, unless Motor Up can support the claims with competent and reliable evidence. Part I specifies certain specific claims and states that these and all other claims must be supported by evidence. It also states that the evidence required to support claims may be competent and reliable scientific evidence.

Parts II prohibits Motor Up from misrepresenting in advertising the existence, contents, validity, results, conclusions, or interpretations of any test or study dealing with the Motor Up engine oil additive or any other motor vehicle product.

Part III prohibits Motor Up from using false demonstrations. It prohibits Motor Up from representing that any demonstration, picture, experiment, illustration or test of the Motor Up engine oil additive or any other motor vehicle product proves, demonstrates or confirms the product's attributes unless the demonstration, picture, experiment, illustration or tests does in fact prove, demonstrate, or confirm the attributes. This provision applies to all demonstrations of product attributes, including comparisons with other products.

The proposed order also contains provisions regarding distribution of the order, recordkeeping, notification of changes in corporate status, termination of the order, and the filing of a compliance report.

The purpose of this analysis is to facilitate public comment on the proposed order, and it is not intended to constitute an official interpretation of the agreement and the proposed order or to modify their terms in any way.