Interstate Bakeries Corporation

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IN THE MATTER OF INTERSTATE BAKERIES CORPORATION CONSENT ORDER, ETC., IN REGARD TO ALLEGED VIOLATIONS OF SEC. 5 AND SEC. 12 OF THE FEDERAL TRADE COMMISSION ACT Docket C-4042; File No. 0123182 Complaint, April 16, 2002--Decision, April 16, 2002 This consent order addresses allegedly unsubstantiated representations made by Respondent Interstate Bakeries Corporation – on television and in Internet advertising – about the effects of the calcium in W onder Bread on children’s memory and brain function. The order, among other things, prohibits the respondent from representing that – as a good source of calcium – Wonder Bread helps children’s minds work better, or helps children remember things, without possessing competent and reliable scientific evidence that substantiates the claim. The order also requires the respondent to possess competent and reliable scientific evidence for any claim that any of its breads, bread products, rolls or muffins – or any of their ingredients – helps brain function or memory, or can treat, cure or prevent any disease or related health condition. In addition, the order provides that a mere statement that a product contains a particular vitamin or mineral will not, without more, be considered for purposes of this order a representation that the product can treat, cure or prevent any disease or related health condition.

Participants For the Commission: Richard F. Kelly, Kial S. Young, Mary K. Engle, and Joseph P. Mulholland.

For the Respondent: Michael L. Sibarium, Winston & Strawn. COMPLAINT The Federal Trade Commission, having reason to believe that Interstate Bakeries Corporation, a corporation (“respondent”), has violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that this proceeding is in the public interest, alleges:

VOLUME 133 Complaint 1. Respondent Interstate Bakeries Corporation (“IBC”) is a Delaware corporation with its principal office or place of business at 12 East Armour Boulevard, Kansas City, Missouri, 64111. IBC operates bakeries throughout the United States, distributing baked goods marketed under national and regional brands, including Wonder, Home Pride, Beefsteak, and Sunbeam. IBC produces and disseminates advertising in the form of television programming that is disseminated through cable channels, broadcast stations, and via the Internet. 2. Respondent has manufactured, advertised, labeled, offered for sale, sold, and distributed products to the public, including Wonder Bread. Wonder Bread is a "food," within the meaning of Sections 12 and 15 of the Federal Trade Commission Act. 3. The acts and practices of respondent alleged in this complaint have been in or affecting commerce, as “commerce” is defined in Section 4 of the Federal Trade Commission Act. 4. Respondent has disseminated or has caused to be disseminated advertisements and other promotional material for Wonder Bread, including but not limited to the attached Exhibits A and B. According to the product labels, Wonder Bread contains, among other ingredients, calcium. The attached advertisements and promotional material for Wonder Bread contain the following statements:

A. “PROFESSOR WONDER: Moms know calcium helps build strong bones. But did you know it helps build strong minds, too? * Neurons in your brain need calcium to transmit signals. Without it, they can be, well, a little slow. [Inside Missy’s brain, Professor Wonder sees tired neurons that have obviously not gotten enough calcium] Let’s see what happens when you give them soft, delicious Wonder Bread. [Professor Wonder, with the help of Mom, constructs a demonstration that will allow Missy to get her calcium.] A good source of calcium with vitamins and minerals.

VOLUME 133 Complaint WOMAN: [After Missy takes a bite of her sandwich, Mom directs Missy to do her homework in order to show how well the calcium worked. Professor Wonder looks into her brain again.] Missy, go do your homework. [Inside Missy’s brain we see lively, active neurons.] NEURON: Let’s go, guys, time to do homework. PROFESSOR WONDER: Wow! I’ve never seen anything like it! Calcium helps you remember things, too. So remember, Wonder helps build strong bodies and minds.” * The following superscript appears in small, white type, on varying backgrounds, at the bottom of the screen, for approximately three (3) seconds: “With regular exercise and a balanced diet.”

(Exhibit A) (Exhibit A is a storyboard of a thirty-second television advertisement) (See also Exhibit C, a videotape version of the advertisement) B. “Parents know calcium helps build strong bones, but did you know that with regular exercise and a balanced diet, calcium helps build strong minds too? Calcium can help you to remember things, which is good to know when you ... ah, er, um, oh yeah, ... lost your train of thought. * * * The neurons in the brain need calcium to help transmit their signals. Without calcium, neurons can become a little slow. * * * So, help your kids (and keep the whole family thinking sharply) by making sure they get enough calcium with a balanced diet and help from Wonder Bread. * * * [D]id you know that Wonder Bread is calcium fortified and now has 200% more calcium than regular white bread? So, when you’re looking for a good source of calcium, go for the dough.”

VOLUME 133 Complaint (Exhibit B) (Exhibit B is a printout from the Internet web site for Wonder Bread, www.wonderbread.com/calcium.html)(printed 2/21/01) 5. Through the means described in Paragraph 4, including but not necessarily limited to the advertisements attached as Exhibits A and B, respondent has represented, expressly or by implication, that:

A. As a good source of calcium, Wonder Bread helps children’s minds work better, and B. As a good source of calcium, Wonder Bread helps children remember things.

6. Through the means described in Paragraph 4, respondent has represented, expressly or by implication, that it possessed and relied upon a reasonable basis that substantiated the representations set forth in Paragraph 5, at the time the representations were made.

7. In truth and in fact, respondent did not possess and rely upon a reasonable basis that substantiated the representations set forth in Paragraph 5, at the time the representations were made. Therefore, the representation set forth in Paragraph 6 was, and is, false or misleading.

8. The acts and practices of respondent as alleged in this complaint constitute unfair or deceptive acts or practices, and the making of false advertisements, in or affecting commerce in violation of Sections 5(a) and 12 of the Federal Trade Commission Act.

THEREFORE, the Federal Trade Commission this sixteenth day of April, 2002, has issued this complaint against respondent. By the Commission, Commissioner Anthony recused. New :30 Wonder Television Commercial “Neurons”

t. (Open on an frame of a heroic Professor Wonder holding a package af Wonder Bread.} SUPER: PROFESSOR WONDER » (fan attempt to further explain this new news, Professor Wonder uses a souped-up magnifying glass to look into Missy's brain.) PW: Neurons in your brain need calcium to transmit signals 7. (A visual demonstration of the 200% mare calcium enrichment in Wonder Bread.} PW: A good source of calcium with vitamins and ininerats.

10. (Professor Wonder is amazed by what he just saw.) PW: Wow! I've never seen anything ‘ike it! 2. (Professor Wonder confirics what moms kiow, that calcium, most frequently identified with milk, helps build strong boney.;

PW: Mom's know caicium helps build strong bones, 5. (Inside Missy's brain, Professor Wonder sees Hired neurons that have obviously not gotten enough calctumn.) PW: With out it they can be, well, a little slow. . (After Missy takes a bite of her sandwich, mom directs Mixsy to do her homework in order ta show how well the calcium worked. Professor Wonder looks into her brain again.) MOM: Missy, go do your homework.

I}. {As we see the active neurons, Professor Wonder restates ihe new news we've just learned about calcium.) PW: Calcium helps ycu remember things too. . (With the help ofa brain prop, Professor Wonder shares new news with mom: that caiciton helps build strong minds.) PW: But did you know it helps build strong avinds too.

SUPER: WITH REGULAR EXERCISE AND A BALANCED DIET.

an . (Professor Wonder, with the help of mom, constructs a demonstration that will allow Missy ta get her calciwon.;} PW: Let's see witat happens when you give them soft delicious Wonder Bread.

. Unside Missy's brain we see lively, active neurons. } NELRON: Let’s go guys, time to do homewark,.

e@ el WONDER . Helps build strong bodies”

(Closing scene, ugain with Professor Wonder and the Wonder Bread iogo.} PW: So -remember, Wonder nelps build strong bodies, and minds! Exhibit A Caicium Ups WwWwwowonderoread.cum Caius HISTORY no Calcium Folic Acid Other Nutrients Did you know that bones and teeth make up 99% of the body's calcium content? As the glue that holds the body's entire framework together, calcium is an important nutrient for building strong bodies and minds.

Brain Food Parents know calcium helps build strong bones, but did you know that with regular exercise and a balanced diet, calcium helps build strong minds too? Calcium can help CON TACT you to remember things, which is good to know when you . us .. ah, er, um, oh yeah, .. . lose your train of thought. ~ as Speaking of thinking. Everyone knows that your brain helps Calcium you think. But have you ever thought about your brain? As the main control center, the brain instructs the body on what to do, how to react as well as other basic functions. To communicate the different commands with your muscles, organs and nerves, the brain uses a vast network called the nervous system. In addition to the brain and spinal cord, the nervous system includes more than 100 billion nerves. Although nerves are very small, they perform some very big, complex functions. When you need energy, your brain sends a message to your stomach to let you know that you're hungry and need nutrients to sustain your body. This messenger is known as a neuron. Also known as nerve cells, neurons electronically transmit these messages between the brain, spinal column and other nerves. The neurons in the brain require calcium to help transmit their signals. Without calcium, neurons can become a little slow. So, help your kids (and keep the whole family thinking sharply).by making sure they get enough calcium with a balanced diet and help from Wonder Bread. Osteoporosis Osteoporosis, which means porous5 1 13 1 2 5 1820 2024 122 36 79.865440 bones, is a disease in which bones become fragile. If not prevented, osteoporosis can lead to bone breaks, usually in the hip, spine, and wrist. Although there is no cure for osteoporosis, you can help prevent the disease by incorporating a balanced diet rich in ~ calcium, which helps to build strong bones, during childhood and adolescence. According to government studies, more than 70% of American women don't get enough calcium in their diet. That's why it's so important to eat foods containing calcium like Wonder Bread. Starting Young Calcium also is needed for the heart, muscles and nerves to function properly and for blood to clot. Nutrition experts stress the importance of consuming enough calcium early in life, but unfortunately, national nutrition surveys show that many young girls consume less than half the amount of calcium recommended to grow and maintain healthy bones. In fact, 7 out of 10 kids do not get enough calcium. That's a problem. When the calcium intake doesn't meet the daily requirement, your body pulls what it needs from your bones, weakening them in the process. So getting the recommended daily amount of calcium is critical to helping your kids build strong bodies.

Exhibit B rf 2 2°21 2001 2-29 P\I Jalerum Hip. Www Ss ONUGCT OP aU COT Cdic la: Your Skeletal Account To visualize the importance of calcium, think of your body as a savings account. We deposit most of our bone and build bone mass during the first 30 years of our life. In fact, *75 to 85% of the skeleton's 206 bones are formed during adolescence. By about age 20, the average woman has acquired 98% of her skeletal mass. At age 30, bone mass starts to break down faster than it forms. If adequate amounts of calcium have not been stored, she is at nsk for a number of diseases. In fact, deficiency of calcium has been linked to:

e high blood pressure e stroke e kidney stones e and colon cancer Parents already know that milk is a good source of calcium. But did you know that Wonder Bread is calcium fortified and now has 200% more calcium than regular white bread? So, when you're looking for a good source of calcium, go for the dough.

fouc aad > Home History Nutrition Fun About Us Contact Us Corporate Info Planet Twinkie of 2 2212001 2:20 PM VOLUME 133 Decision and Order DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft of complaint which the Bureau of Consumer Protection proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge the respondent with violation of the Federal Trade Commission Act; and The respondent, its attorney, and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondent of all the jurisdictional facts set forth in the aforesaid draft complaint, a statement that the signing of the agreement is for settlement purposes only and does not constitute an admission by the respondent that the law has been violated as alleged in such complaint, or that the facts as alleged in such complaint, other than jurisdictional facts, are true, and waivers and other provisions as required by the Commission's Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondent has violated the Act, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of thirty (30) days, now in further conformity with the procedure prescribed in § 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Interstate Bakeries Corporation is a Delaware corporation with its principal office or place of business at 12 East Armour Boulevard, Kansas City, Missouri, 64111. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

VOLUME 133 Decision and Order ORDER DEFINITIONS For purposes of this order, the following definitions shall apply:

1. "Competent and reliable scientific evidence" shall mean tests, analyses, research, studies, or other evidence based on the expertise of professionals in the relevant area, that has been conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results. 2. Unless otherwise specified, “respondent” shall mean Interstate Bakeries Corporation, its successors and assigns, and its officers, agents, representatives, and employees. 3. “Commerce” shall mean as defined in Section 4 of the Federal Trade Commission Act, 15 U.S.C. § 44. I.

IT IS ORDERED that respondent, directly or through any corporation, subsidiary, division, or other device, in connection with the labeling, advertising, promotion, offering for sale, sale, or distribution of Wonder Bread, in or affecting commerce, shall not make any representation, in any manner, expressly or by implication that:

A. As a good source of calcium, Wonder Bread helps children’s minds work better, or B. As a good source of calcium, Wonder Bread helps children remember things, VOLUME 133 Decision and Order unless, at the time the representation is made, respondent possesses and relies upon competent and reliable scientific evidence that substantiates the representation. II.

IT IS FURTHER ORDERED that respondent, directly or through any corporation, subsidiary, division, or other device, in connection with the labeling, advertising, promotion, offering for sale, sale, or distribution of any bread, bread product, rolls, or muffins, in or affecting commerce, shall not make any representation, in any manner, expressly or by implication, that such product or any of its ingredients, helps brain function or memory, or can treat, cure or prevent any disease or related health condition, unless, at the time the representation is made, respondent possesses and relies upon competent and reliable scientific evidence that substantiates the representation; provided, however, that a mere statement that the product contains a particular vitamin or mineral shall not, without more, be considered for purposes of this order a representation that the product can treat, cure or prevent any disease or related health condition.

III.

Nothing in this order shall prohibit respondent from making any representation for any product that is specifically permitted in labeling for such product by regulations promulgated by the Food and Drug Administration pursuant to the Nutrition Labeling and Education Act of 1990, and any such representation shall not be covered by this order.

IV.

IT IS FURTHER ORDERED that the provisions of this order shall not apply to any label or labeling printed prior to the date of service of this order and shipped by respondent’s bakeries to distributors or retailers prior to January 16, 2003 . VOLUME 133 Decision and Order V.

IT IS FURTHER ORDERED that respondent Interstate Bakeries Corporation, and its successors and assigns, shall, for five (5) years after the last date of dissemination of any representation covered by this order, maintain and upon request make available to the Federal Trade Commission for inspection and copying:

A. All advertisements and promotional materials containing the representation including videotape recordings of all such broadcast advertisements;

B. All materials that were relied upon in disseminating the representation; and C. All tests, reports, studies, surveys, demonstrations, or other evidence in their possession or control that contradict, qualify, or call into question the representation, or the basis relied upon for the representation, including complaints and other communications with consumers or with governmental or consumer protection organizations. VI.

IT IS FURTHER ORDERED that respondent Interstate Bakeries Corporation, and its successors and assigns, shall, within thirty (30) days after service upon it of this order, deliver a copy of this order to all executive officers, managing employees, agents, and representatives having responsibilities with respect to the subject matter of this order. Respondent shall secure from each such person a signed and dated statement acknowledging receipt of the order pursuant to this paragraph. Respondent shall deliver this order to current personnel within thirty (30) days after the date of service of this order, and, for a period of three (3) years, to future personnel within thirty (30) days after the person assumes such position or responsibilities. VOLUME 133 Decision and Order VII.

IT IS FURTHER ORDERED that respondent Interstate Bakeries Corporation, and its successors and assigns, shall notify the Commission at least thirty (30) days prior to any proposed change in the corporation that may affect compliance obligations arising under this order, such as dissolution, assignment, or sale resulting in the emergence of a successor corporation, the creation or dissolution of a subsidiary or parent, or any other corporate change that may affect compliance obligations. Provided, however, that, with respect to any proposed change in the corporation about which respondent learns less than thirty (30) days prior to the date such action is to take place, respondent shall notify the Commission as soon as is practicable after obtaining such knowledge. All notices required by this Part shall be sent by certified mail to the Associate Director, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, D.C. 20580. VIII.

IT IS FURTHER ORDERED that respondent Interstate Bakeries Corporation, and its successors and assigns shall, within sixty (60) days after the date of service of this order, file with the Commission a report, in writing, setting forth in detail the manner and form in which they have complied with this order. IX.

This order will terminate on April 16, 2022, or twenty (20) years from the most recent date that the United States or the Federal Trade Commission files a complaint (with or without an accompanying consent decree) in federal court alleging any violation of the order, whichever comes later; provided, however, that the filing of such a complaint will not affect the duration of: A. Any Part in this order that terminates in less than twenty (20) years;

VOLUME 133 Decision and Order B. This order's application to any respondent that is not named as a defendant in such complaint; and C. This order if such complaint is filed after the order has terminated pursuant to this Part.

Provided, further, that if such complaint is dismissed or a federal court rules that the respondent did not violate any provision of the order, and the dismissal or ruling is either not appealed or upheld on appeal, then the order will terminate according to this Part as though the complaint had never been filed, except that the order will not terminate between the date such complaint is filed and the later of the deadline for appealing such dismissal or ruling and the date such dismissal or ruling is upheld on appeal. By the Commission, Commissioner Anthony recused. VOLUME 133 Analysis Analysis of Proposed Consent Order to Aid Public Comment The Federal Trade Commission has accepted, subject to final approval, an agreement containing a consent order from Interstate Bakeries Corporation (IBC).

The proposed consent order has been placed on the public record for thirty (30) days for receipt of comments by interested persons. Comments received during this period will become part of the public record. After thirty (30) days, the Commission will again review the agreement and the comments received, and will decide whether it should withdraw from the agreement or make final the agreement's proposed order.

This matter involves allegedly unsubstantiated representations made on television and in Internet advertising about the effects of the calcium in Wonder Bread on children’s memory and brain function. According to the FTC complaint, IBC made unsubstantiated claims that as a good source of calcium, Wonder Bread helps children’s minds work better and helps children remember things.

The proposed consent order contains provisions designed to prevent IBC from engaging in similar acts and practices in the future. Part I of the proposed order prohibits IBC from making any unsubstantiated claim (a claim lacking competent and reliable scientific evidence) that as a good source of calcium, Wonder Bread helps children’s minds work better, or as a good source of calcium, Wonder Bread helps children remember things. Part II of the order requires IBC to have competent and reliable scientific evidence for any claim that any of its breads, bread products, rolls or muffins or any of their ingredients, helps brain function or memory, or can treat, cure or prevent any disease or related health condition. Part II also provides that a mere statement that a product contains a particular vitamin or mineral will not, without more, be considered for purposes of this order a representation that the product can treat, cure or prevent any disease or related health condition.

VOLUME 133 Analysis Part IV of the order states that the order does not apply to any label or labeling printed before the order is served on IBC and shipped by IBC’s bakeries to distributors or retailers within nine months after the order is issued.

Part III of the order notes that this order does not prohibit IBC from making any claim that is specifically permitted in labeling pursuant to the Nutrition Labeling and Education Act of 1990. Parts V through VIII of the order require IBC to keep copies of relevant advertisements and materials substantiating claims made in the advertisements, to provide copies of the order to certain of its personnel, to notify the Commission of changes in corporate structure, and to file a compliance report with the Commission. Part IX provides that the order will terminate after twenty (20) years under certain circumstances.

The purpose of this analysis is to facilitate public comment on the proposed order, and it is not intended to constitute an official interpretation of the agreement and proposed order or to modify in any way their terms.

VOLUME 133 Complaint