Wednesday, September 14, 2005

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Attorney General Abbott Stops Improper Sales Of Therapeutic Massage Devices

AUSTIN - Texas Attorney General Greg Abbott today announced he has halted the unlawful marketing and sales of thermal massage beds sold in Texas that a company and its franchises deceptively claimed would treat or cure cancer and a range of other serious ailments and diseases.

The settlement ends an investigation against Ceragem International Inc. of California, which operates franchises and company-owned stores in several Texas cities, including Houston, the Dallas/Fort Worth area, El Paso, San Antonio, Corpus Christi and McAllen. Most of the distributors sold the beds to Spanish-speaking consumers. Texas is the first state to take legal action against the company for its deceptive marketing practices.

Media links
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Video of News Conference
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Under cover video - Houston
Video transcript (Spanish/English)
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Under cover video - San Antonio
Video transcript (Spanish/English)
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Under cover video - Dallas
Video transcript (Spanish/English)
Attorney General's settlement with Ceragem & its retail outlets

“This company made inflated and unsubstantiated claims about the benefits of its products, which were intended to exploit consumers who may have actually needed professional medical services,” said Attorney General Abbott. “This really amounted to orchestrated consumer health fraud, all without physician involvement, and I am pleased the company will cease these deceptive practices.”

The investigation alleged consumers were falsely led to believe the devices were approved by the U.S. Food and Drug Administration for a range of ailments such as cancer, epilepsy, heart disease, ovarian cysts and other maladies. The company’s Web site also featured the deceptive use of an FDA seal and, when viewed as a whole, suggested the devices utilized methods of acupressure and acupuncture to accomplish the therapy.

Dr. Eduardo J. Sanchez, commissioner of the Texas Department of State Health Services, which referred this case to the Attorney General, concurred with Abbott: “Our investigators documented an alarming incidence of false health claims associated with Ceragem’s beds. Consumers should not rely on these claims. These beds are not substitutes for prescribed medicines and treatments.”

The equipment is manufactured by Ceragem Co. Ltd., of South Korea, which provides machines to Ceragem International and independent franchises. According to the investigation, distributors host up to 14 live presentations per day for up to 50 consumers each.

The Attorney General’s undercover investigation and video revealed speakers repeatedly claiming the $2,400 “Ceragem-C Thermal Massager” was instrumental in the treatment of a range of medical conditions, including diabetes and obesity. “Testimonials” about cures by previous customers were encouraged.

Although the FDA has approved the device for the temporary relief of minor muscle and joint pain, and pain associated with arthritis, the agency has not approved the device for most of the uses described by the distributors during presentations in Spanish about the product. Representations regarding the treatment and cure of diseases was evidence the company misled consumers and marketed what amounted to an illegal device.

According to the investigation, the defendants transformed retail locations into the equivalent of large therapy clinics without physicians involved at any point. The practice increased the risk to consumers who may have had serious ailments because they were led to believe the devices could take care of health problems, and as a result, they might not have sought the medical attention they actually needed.

The settlement also provides for restitution to compensate consumers for losses based on false claims about the health benefits of Ceragem’s beds.

Ceragem Co. of South Korea sells the thermal massage beds in 22 countries and supports more than 500 independent retail distributors worldwide. California-based Ceragem International, which authorizes distributorships for North America, reported sales of $18 million a year, according to a 2004 Dunn & Bradstreet report.

Consumers who purchased Ceragem thermal massage beds and have questions may call the Consumer Protection Hotline at (800) 252-8011.

Company's retail outlets in Texas:

Dallas -- 11181 Denton Dr. #108 & 2498 W. Illinois Ave.
Garland -- 3160 Saturn Rd., #240
Lewisville -- 1130 W. Main St.
Houston -- 5805 S. Gessner Dr. & 1503 Little York Rd.
Pasadena -- 1100 Pasadena Blvd.
San Antonio -- 910 Bandera Rd., #100
Corpus Christi -- 4244 Ayers St.
El Paso -- 1323 Lee Trevino Drive, #405 & 7930 North Mesa
McAllen -- 2216-2218 Nolana, Suite I-J