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Misleading Claims Formula for a Lawsuit Against Gerber
Federal regulators announced Thursday they were suing Gerber for claiming that its Good Start Gentle formula can prevent or reduce allergies in children, the Associated Press reports. The false claim misled consumers by suggesting that the Gerber product was the first to meet government approval for reducing the risk of allergies, the Federal Trade Commission alleged in the complaint. The FTC wants Gerber to pull its claim from formula labels and advertisements. In its statement released Thursday, Gerber reiterated the claim that its formula can help prevent baby eczema, and said the company had been authorized by the FDA to feature that claim, the AP states. Earlier this week, the FTC sued AT&T for limiting its promised unlimited data
Consumer Spending Drops
For the first time in eight months, U.S. consumer spending fell in September, the Commerce Department said Friday. Spending declined 0.2 percent in September as demands for goods and services were stagnant. In August, spending was up 0.5 percent. Economists had expected consumer spending to go up by 0.1 percent in September. When adjusted for inflation, consumer spending fell 0.2 percent. The consumer spending data was included in the Gross Domestic Product report Thursday that say the economy expanding at a 3.5 percent annual rate.
Wal-Mart Playing Match Game with Holiday Shoppers
Bentonville, Arkansas-based Wal-Mart Stores Inc. is considering matching online prices from competitors such as Amazon.com, the Wall Street Journal reported Thursday. The world’s No. 1 retailer has not followed other retailers including Best Buy and Target in matching prices of online rivals, but last month, it began to test the strategy in five markets: Atlanta; Charlotte, North Carolina; Dallas; Phoenix; and northwest Arkansas. Wal-Mart's flagship stores in the U.S. account for 60 percent of its total business and have not reported growth in a key sales measure in six straight quarters due to competition from e-tailers, dollar stores and drugstores.
Citigroup Slashes Third-Quarter Earnings
Recent investigations by regulators have forced Citigroup to revise its previously-reported third quarter earnings by $600 million, USA TODAY reports. The New York-based bank, slashed its quarterly net income to $2.8 billion from a previously reported $3.4 billion, citing legal expenses.
FTC Bites Online Dating Site
The Federal Trade Commission filed a lawsuit this week against the online date company JDI Dating for using fake messages and profiles to get people to pay for upgraded memberships. JDI Dating is a British company that operates 18 dating websites, where customers create free profiles. The FTC says the company would send non-paying customers messages from other clients who could only be “met’’ with a paid membership. “Adding insult to injury, users were charged automatically to renew their subscriptions often without their consent," said Jessica Rich, director of the FTC's Bureau of Consumer Protection. JDI Dating has agreed to pay more than $600,000 back to customers and will change its business practices.
Exxon Top Projections
ExxonMobil’s third-quarter report showed a 3 percent increase in profit on improved results in its refining and chemical businesses. The company posted third-quarter earnings of $1.89 per share, up from $1.79 per share one year ago and above the $1.71 share price expected by Wall Street analysts. Revenue was at $1.07.49 billion, down from $112.37 billion one year ago but above the analysts’ projection of $105.51 billion in revenue.