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  "documentTitle": "Herbalife, Ltd. (HLF)",
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  "authorName": "William Ackman",
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  "presentationDate": "2012-12-20 00:00:00",
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  "notes": "The slide highlights the company's admission of regulatory risk regarding their marketing practices.",
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      "text": "Herbalife acknowledges that, under the 2009 FTC Guides, its and its distributors' use of income opportunity testimonials may be \"significantly impacted and therefore might negatively impact our sales.\"",
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      "text": "Herbalife acknowledges that, under the 2009 FTC Guides, its and its distributors’ use of income opportunity testimonials may be “significantly impacted and therefore might negatively impact our sales.”",
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      "text": "From Herbalife's 2009-2011 10Ks (emphasis added):",
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      "text": "The FTC has approved revisions to its Guides Concerning the Use of Endorsements and Testimonials in Advertising, or Guides, which became effective on December 1, 2009. Although the Guides are not binding, they explain how the FTC interprets Section 5 of the FTC Act's prohibition on unfair or deceptive acts or practices. Consequently, the FTC could bring a Section 5 enforcement action based on practices that are inconsistent with the Guides. Under the revised Guides, advertisements that feature a consumer and convey his or her atypical experience with a product or service are required to clearly disclose the results that consumers can generally expect. In contrast to the 1980 version of the Guides, which allowed advertisers to describe atypical results in a testimonial as long as they included a disclaimer such as \"results not typical\", the revised Guides no longer contain such a safe harbor. The revised Guides also add new examples to illustrate the long-standing principle that \"material connections\" between advertisers and endorsers (such as payments or free products), connections that consumers might not expect, must be disclosed. Herbalife has adapted its practices and rules regarding the practices of its independent distributors to comply with the revised Guides. However, it is possible that our use, and that of our independent distributors, of testimonials in the advertising and promotion of our products, including but not limited to our weight management products and of our income opportunity[,] will be significantly impacted and therefore might negatively impact our sales.",
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      "text": "The FTC has approved revisions to its Guides Concerning the Use of Endorsements and Testimonials in Advertising, or Guides, which became effective on December 1, 2009. Although the Guides are not binding, they explain how the FTC interprets Section 5 of the FTC Act’s prohibition on unfair or deceptive acts or practices. — Herbalife 2009-2011 10Ks",
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