Consumer Protection Div. Office of Atty. Gen. v. Consumer Pub. Co., Inc.

CourtCourt of Appeals of Maryland
Citation304 Md. 731,501 A.2d 48
Decision Date01 September 1984

Diana G. Motz, Asst. Atty. Gen. (Stephen H. Sachs, Atty. Gen., William Leibovici, Cathy Cobbs, Asst. Attys. Gen., on brief), Baltimore, for appellant & cross appellee.

Henry R. Lord and Cynthia J. Morris, Baltimore, for appellee & cross appellant.

Argued before MURPHY, C.J., and SMITH, ELDRIDGE, COLE, RODOWSKY and COUCH, JJ., and W. ALBERT MENCHINE, Associate Judge of the Court of Special Appeals (retired), Specially Assigned.


We granted certiorari in this case to resolve several issues under the Maryland Consumer Protection Act, Maryland Code (1975, 1983 Repl.Vol.), Title 13 of the Commercial Law Article.

Consumer Publishing Company is an Ohio corporation which, under various names, sells "diet" pill plans through the mails. The active ingredient in the pills sold by the Company is phenylpropanolamine hydrochloride (PPA). The Company has promoted its products with full-page advertisements in Maryland newspapers and has made sales to consumers in Maryland. On May 20, 1981, the Consumer Protection Division of the Office of the Attorney General filed charges against the Company alleging that its advertisements offering pills for sale in Maryland contained false and misleading statements in violation of the Maryland Consumer Protection Act.

At the administrative hearing on these charges, the Division presented two witnesses: (1) Dr. Thaddeus E. Prout, Chief of Medicine at the Greater Baltimore Medical Center, Associate Professor of Medicine at the Johns Hopkins University School of Medicine and former Chairman of a Food and Drug Administration advisory committee on anti-obesity drugs; and (2) Dr. Thomas Pozefsky, Assistant Professor of Medicine at the Johns Hopkins University School of Medicine and a private practitioner specializing in the treatment of patients with weight problems. Both Dr. Prout and Dr. Pozefsky explained that the major components of a successful weight loss program are consumption of less calories than are burned in normal activities, continued motivation, and behavior modification. Dr. Prout testified that the successful treatment of obesity occurs in an extremely small number of cases. Both doctors agreed that permanent weight loss is comparatively rare because of the underlying psychological need to eat.

Dr. Prout testified that PPA has been available for 20 years and is primarily a nasal decongestant. He further stated that there is no evidence that it significantly affects hunger and that its effect on weight loss is trivial. In his opinion, PPA is "not an effective agent in weight loss," and he cited clinical studies which indicated that weight loss due to taking PPA is approximately six ounces per week. Dr. Pozefsky testified that a weight loss of about one half pound per week for four weeks is the maximum which can be expected from taking PPA. He also testified that in his opinion excessive appetite is probably not a significant cause of obesity.

The Division introduced as exhibits the following: four advertisements which had run between January 7, 1979, and March 22, 1981; examples of the pills and accompanying materials sent to consumers; an OTC Miscellaneous Internal Drug Product Panel Study of weight control products; and portions of a publication entitled AMA Drug Evaluations.

The Company called Dr. Bartley G. Hoebel, Assistant Professor of Psychology at Princeton University and an expert in obesity. Dr. Hoebel testified that PPA is an effective appetite suppressant and that it is statistically effective in helping people lose weight, although he stated that he was not testifying as to clinical effectiveness and he could not say that PPA would work for everyone. He acknowledged that there is no data regarding the effects of PPA over long periods of time. Dr. Hoebel also admitted that typical weight loss in his studies of PPA was less drastic than the weight loss described in the Company's advertisements. The Company also submitted studies which Dr. Hoebel had relied on, at least some of which were financed by a manufacturer of PPA.

The hearing officer, Professor Charles Shafer of the University of Baltimore School of Law, was specially appointed for the administrative hearing. He submitted proposed findings of fact, conclusions of law and a proposed order based on the evidence. The Company then filed exceptions to the proposed findings and order, and a hearing on the exceptions was held before H. Robert Erwin, then Chief of the Consumer Protection Division. Following that hearing, both parties filed additional factual and legal material for Mr. Erwin's consideration. After some delay, Mr. Erwin issued his ruling on the exceptions and a final order on April 13, 1983.

The final order adopted most of the findings of fact and conclusions of law proposed by the hearing officer. Based on these findings it ordered the Company to cease and desist from representing 1) that its diet plan consists primarily of taking any pill or tablet when, in fact, the plan also includes a low-calorie diet program, 2) that use of the pill or plan will cause a reduction in weight without the need to exercise individual will power, 3) that the use of any appetite suppressant, the primary ingredient of which is PPA, will prevent hunger, or end the cause of hunger, or prevent excessive consumption of food, 4) that pills, the primary ingredient of which is PPA, are recent medical discoveries or have only recently been used in diet programs, 5) that pills, whose primary ingredient is PPA, will increase the body's metabolic rate or will otherwise increase the rate at which the body converts fat cells to energy, 6) that use of the pills or plan will result in a significant weight loss for substantially all users when in fact it will not for at least 50% of the users, 7) that users of the pills or plan may expect to experience certain amounts of weight or inches lost without indicating weight or inches lost by the typical prospective purchaser with the kind of supervision typically received, and 8) that the pill or plan has been the subject of scientific, academic, or clinical testing which proves its value as a weight loss program unless such tests are generally accepted in the medical community as demonstrating the value of the pill or plan in the treatment of obesity.

The final order required affirmative disclosures in future advertising, including disclosure of the active ingredients of the pills and a bold-faced notice stating that "DIETING IS REQUIRED." The order also required the Company to restore "the initial purchase price, including postage, of such products (excluding reorders)" to all residents of Maryland who had purchased the products between May 19, 1978, and December 31, 1981. Finally, the order required the Company to make available to the Division business records which identify Maryland consumers entitled to such restitution.

The Company sought review of the order in the Circuit Court for Baltimore City. Hearings were held before the court on February 7, 8 and 9, 1984, and additional evidence was received. In a judgment entered on February 21, 1984, the circuit court vacated the Division's final order and substituted a new order allowing the Division to enforce the terms of an agreement which had been entered between the Company and the United States Postal Service. The trial judge found that the Company's constitutional rights under the First Amendment and the Fourteenth Amendment had been violated and that "the record is insufficient to support a factual basis for the rejection of the [Company's] exceptions." The Division filed an order of appeal from that judgment on March 14, 1984.

On March 21, 1984, the Company filed a motion for revision of the judgment under former Maryland Rule 625(a), 1 requesting costs and reasonable expenses, including attorney's fees. The Company contended that the proceeding against it was initiated in bad faith and without substantial justification, entitling it to costs and reasonable expenses in accordance with former Maryland Rule 604b. 2 The circuit court denied the motion on the ground that the court was without jurisdiction to revise an order from which an appeal had been taken. The Company filed an order of appeal from this denial.

Before any proceedings in the Court of Special Appeals, we granted a petition for a writ of certiorari, bringing both appeals before this Court. In its appeal, the Division argues that the circuit court exceeded its authority by substituting its own remedy for the Division's order and erred by improperly admitting additional evidence at the trial. The Division also argues that the Company's constitutional rights were not violated and that the Division's findings and final order are supported by the record. The Company responds by defending the circuit court's action and by asserting that the administrative order was subject to reversal on various grounds. In addition, the Company has filed a motion to dismiss the Division's appeal.


Preliminarily, the Company argues in its motion to dismiss that the Consumer Protection Division of the Office of the Attorney General has no authority to seek review of the circuit court's decision. The Company relies on a line of cases, beginning with Zoning Appeals Board v. McKinney, 174 Md. 551, 199 A. 540 (1938), in which this Court has taken the position that certain administrative agencies acting in a "quasi-judicial" capacity cannot appeal the reversal of their decisions by a circuit court, unless the authority to appeal is specifically provided by statute. See, e.g., County Comm'rs of Carroll Co. v. Gross, 301 Md. 473, 483 A.2d 755 (1984); Maryland Board v. Armacost, 286 Md. 353, 355, 407...

To continue reading

Request your trial
101 cases
  • Lussier v. Maryland Racing Com'n, 96
    • United States
    • Court of Appeals of Maryland
    • September 1, 1994
    ......Easton Publishing Co., 272 Md. 563, 325 A.2d 740 (1974), cert. denied, ...Consumer Protection, 338 Md. 188, 196-198, 657 A.2d 788, ...Consumer Pub., 304 Md. 731, 756-759, 501 A.2d 48, 61-63 ... 6 Opp. Att'y Gen. at 480. In concluding that licensing of jockeys ...Classified Employees Asso., Inc. v. Governor, 325 Md. 19, 33, 599 A.2d 91, 98 508, 620 A.2d at 893. See also Office & Professional Employees Int'l Union, Local 2 v. ......
  • Erb v. Maryland Dept. of Environment, 1245
    • United States
    • Court of Special Appeals of Maryland
    • September 1, 1995
    ...Parcel, supra, 336 Md. at 577, 650 A.2d 226; Consumer Protection Div. Office of the Attorney Gen. v. Consumer Page 267 Publishing Co., 304 Md. 731, 749, 501 A.2d 48 (1985); Warner v. Town of Ocean City, 81 Md.App. 176, 193-94, 567 A.2d 160 (1989). The presentation of new evidence to the cir......
  • State v. Cottman Transmissions Systems, Inc., 943
    • United States
    • Court of Special Appeals of Maryland
    • April 4, 1991
    ...... Page 717 . William D. Gruhn, Asst. Atty. Gen. (J. Joseph Curran, Jr., Atty. Gen., ... In 1988, the Attorney General's Office of the State of Maryland ("State") filed a four ...through 3, citing the Maryland Consumer Protection Act ("CPA"), Md.Com.Law Code Ann. § ...         In Lone v. Montgomery Co., 85 Md.App. 477, 503-04, 584 A.2d 142 (1991), ... had lived in it); 17 Consumer Protection Div. v. Consumer Publishing Co., 304 Md. 731, 780-81, ......
    • United States
    • Court of Special Appeals of Maryland
    • December 1, 1999
    ...of Md. v. Baltimore Gas & Elec. Co., 273 Md. 357, 362, 329 A.2d 691 (1974). See also Consumer Protection Div. v. Consumer Publishing Co., 304 Md. 731, 749, 501 A.2d 48 (1985) ("Generally, in reviewing agency action... a court may only consider the record made before the administrative agenc......
  • Request a trial to view additional results
2 books & journal articles
  • Business torts and actions
    • United States
    • James Publishing Practical Law Books California Causes of Action
    • March 31, 2022
    ...of defendant may be considered in imposing penalty)). • Restitution (Cal. Bus. & Prof. Code §17535; Consumer Protection v. Consumer Pub , 304 Md. 731 (Md. 1986) (“[t]he court may … order restitution without individualized proof of deception, reliance, and injury if it ‘determines that such ......
    • United States
    • Washington University Law Review Vol. 99 No. 3, February 2022
    • February 1, 2022
    ...Ct. 1938) (misrepresenting quality of pearl necklace). (129.) E.g., Consumer Prot. Div. Off. of Atty. Gen. v. Consumer Publ. Co., Inc., 501 A.2d 48 (Md. 1985) (cease and desist order for false claims about mail order diet pills); In re Physicians Weight Loss Ctrs. of Am., 116 F.T.C. 1484 (F......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT