The Federal Trade Commission won a court order against F & G International Group Holdings, LLC, FG International, LLC, (FGI) and their principal J. Glenn Davis after suing the company and its CEO for deceptively claiming their paint insulates, when it does not. The order from the U.S. Court for the Southern District of Georgia permanently bans FGI from making deceptive claims and prohibits them from supporting similar deception from other companies.
“At a time of high energy prices and deep concern about inflation, today’s ruling shows the impact FTC cases are having on issues of vital economic importance to American consumers,” said Sam Levine, Director of the FTC’s Bureau of Consumer Protection.
Georgia-based FGI sells paint products for buildings and other structures. In advertising its insulating paint, FGI played to consumers’ concerns about rising energy costs, stating that their product “provides excellent insulation” at an “extreme insulation value.” In reality, FGI’s insulating paint provided far less protection than the company claimed and end users of the product received none of the insulation FGI promised.
In issuing the opinion and order the court found that the FGI defendants harmed consumers, including small businesses, by:
- Making False Claims. FGI baselessly claimed that their insulation coating was more than thirty times more effective than its actual value;
- Misrepresenting Data. FGI claimed that testing supported the insulation value of their paints when it did not; and
- Inducing Customers with False Insulation Claims. FGI made these false claims and misrepresentations in a way that was important in buying decisions and induced purchases by customers.
The order prohibits the defendants behind FGI from helping anyone else make misleading claims about insulation ratings or the energy efficiency that any product will provide.
The U.S. District Court for the Southern District of Georgia, Statesboro Division, entered the opinion and permanent injunction.