Skechers USA to Pay $40 Million for Deceptive Marketing Practices

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The Federal Trade Commission (FTC) is advising the public to be wary of ads claiming that by simply wearing Skechers shoes, you’ll soon be rocking a body like Kim Kardashian or Brooke Burke. According to the FTC, Skechers USA has been fined a whopping $40 million to settle charges that the company made unfounded advertising claims that its shoes would help people lose weight and tone their bodies. Consumers who purchased Skechers will reportedly be eligible for refunds, although it’s still not clear as to how much money they will get.

What’s the problem?

May 16, 2012 – Today’s settlement involves Skecher’s Shape-ups, Resistance Runner, Toners, and Tone-ups shoes. According to the FTC, the company made deceptive claims about all of these products.

The number of consumer refunds will depend on how many claims are received in the eight-month filing period. The FTC has stated that most of the $40 million will be returned to consumers. A small portion of the settlement will be used to facilitate the payouts.

“The FTC’s message, for Skechers and other national advertisers, is to shape up your substantiation or tone down your claims,” said David Vladeck, director of the commission’s consumer protection bureau. For millions of consumers, he said, “the only thing that got a workout was their wallet.”

Last year, the FTC settled similar deceptive marketing charges with Reebok over its EasyTone walking shoes and RunTone running shoes. That agreement, which was settled for $25 million, also provided consumer refunds.

Skechers marketed Shape-ups as a revolutionary fitness concept that effectively promoted weight loss and increased muscle tone with a curved ‘rocker’ or rolling bottom that supposedly forces wearers to “use more energy with every step.” Shape-ups are sold at popular shoe retailers around the country, and cost about $100 per pair.

Additionally, the FTC said Skechers USA made claims that its Resistance Runner could increase ‘muscle activation’ in users by up to 50% for posture-related muscles, and more than 70% for muscles in the buttocks. The commission ultimately determined that Skechers falsely represented clinical studies about the Resistance Runner. The company is now barred from making any unsubstantiated claims based on tests, studies, or research on its products in the future.

Today’s settlement is part of a larger agreement intended to resolve a nationwide investigation involving more than 40 states. Skechers USA, which is based in Manhattan Beach, Ca., will be fined $40 million for customer refunds in the federal case and an additional $5 million to the states.

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