Living Essentials, maker of 5-hour Energy, and its venture capital arm Innovation Ventures were ordered to pay nearly $4.3 million in penalties and legal costs following a trial in Washington in which a judge found the company in violation of the state’s Consumer Protection Act.
Washington Attorney General Bob Ferguson filed a lawsuit in King County Superior Court in 2014, alleging Living Essentials made “deceptive and/or unfair representations” in its marketing that 5-hour Energy claimed to provide energy and alertness, was superior to coffee, was recommended by doctors, and does not cause a crash in consumers. A trial was held in August 2016.
“The makers of 5-hour ENERGY broke the law in pursuit of profit, and now they are paying for it,” Ferguson said in a press release.
On Tuesday, Judge Beth Andrus ruled that Living Essentials and Innovation Ventures had “scant evidence” behind the science the company cites in its marketing of 5-hour Energy.
“Defendants spent more time trying to justify the science behind their ads after-the-fact than they did before marketing the products in Washington,” Andrus wrote in the ruling. “The Court was struck by the fact that Defendants presented no testimony from a single scientist actually involved in developing the contents of this product.”
The companies were ordered to pay roughly $2.2 million in civil penalties, $2.1 million legal costs and fees to the Attorney General’s office, and were instructed not to make claims about the physiological effects of 5-hour Energy and other products without proper scientific evidence to back up the claims.
The Washington lawsuit was filed alongside similar deceptive marketing complaints by attorneys general in Oregon and Vermont. Living Essentials won its case in those two states.
In an email sent to BevNET on Friday, Living Essentials spokesperson Melissa Skabich denounced the ruling.
“Unlike the two other courts that found in our favor, this court did not follow the law,” Skabich said. “We intend to vigorously pursue our right to appeal, and correct the trial court’s incorrect application of the law.”