Court upholds Q-Ray decision; company to pay FTC $16 million-plus

CHICAGO The U.S. Court of Appeals for the Seventh Circuit earlier this month upheld a lower court decision against marketers of the Q-Ray Ionized Bracelet which mandated that Q-Ray forfeit $16 million plus interest to the Federal Trade Commission to be distributed to consumers who bought into Q-Ray claims that its bracelets offered therapeutic pain relief.

WIRED Magazine recently put the Q-Ray Ionized Bracelet on its list of the top ten Snake-Oil Gadgets,” stated Chief Judge Frank Easterbrook in his opening remarks. “The Federal Trade Commission has an even less honorable title for the bracelet’s promotional campaign: fraud.”

Judge Easterbrook used strong language in criticizing Q-Ray’s pain-relief claims. “For the Q-Ray Ionized Bracelet … all statements about how the product works—Q-Rays, ionization, enhancing the flow of bio-energy, and the like—are blather,” he wrote. “Defendants might as well have said: ‘Beneficent creatures from the 17th Dimension use this bracelet as a beacon to locate people who need pain relief, and whisk them off to their homeworld every night to provide help in ways unknown to our science.’”

According to Easterbrook’s opinion, Q-Ray appealed the lower court ruling because the $16 million judgement—based on estimated company profits provided by FTC—was excessively large. Easterbrook countered that Q-Ray company officials had an opportunity to set the record straight with regard to their profits, but chose not to do so. “Defendants’ business was a profitable one; that much, at least, they concede,” he wrote. “It is so profitable that they continue to carry it on despite the injunction that requires them to stop making most of their old claims for its efficacy. Today it is sold with testimonials and vaporous statements.”

The FTC filed the case in May 2003, alleging that the Illinois-based defendants deceptively advertised their refund policy and made false claims that their bracelet “provided immediate and significant pain relief” in violation of the FTC Act. The federal district court in Chicago ruled in the FTC’s favor September 2006.

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