Hi-Tech and Dynamic Sports Nutrition clash over trademark, marketing issues

Sometimes FDA and FTC root out and take on the questionable marketing and products in the dietary supplement world, and sometimes competitors do the dirty work. Such is the case in the recent spate of competitor-to-competitor lawsuits in the sports nutrition segment.  One of the most recent examples is the legal sparring between Georgia-based Hi-Tech Pharmaceuticals and its owner Jared Wheat, and Texas-based Dynamic Sports Nutrition (DSN, d/b/a Anabolic Research) and its owner Brian Clapp.

According to various court filings, the trouble started when Wheat and Clapp exchanged a series of emails. Clapp said he reached out to Wheat to band together against the bad actors in the sports nutrition segment, specifically in the muscle development area. One of the issues discussed by the pair was trademark infringement. However, their communications went sour, and Wheat threatened legal action alleging Clapp was also infringing upon Hi-Tech’s trademark.  In the end, both parties sued each other in September 2015, and the allegations have been flying around ever since.

Wheat sent Clapp a cease-and-desist letter on or about Sept. 11, 2015, claiming DSN’s D-ANABOL 25 supplement infringes on Hi-Tech’s registered trademark DIANABOL—both supplements are sold and marketed for muscle building. Clapp reported Wheat gave DSN 10 days to stop selling D-ANABOL 25 and requested US$100,000. The next day, Clapp and DSN preemptively filed a complaint in the U.S. District Court in Southern Texas, Houston, requesting a declaration of non-infringement, based on DSN’s claimed first use of the brand name and Hi-Tech’s abandonment of the DIANABOL mark. In its original complaint, DSN also sought legal and court fees; in its amended complaint, filed Oct. 2, DSN also asked for US$75,000 in damages.

On Sept. 28, Wheat and Hi-Tech filed a lawsuit in the U.S. District Court for the Northern District of Georgia, Atlanta, over the infringement situation but ramped it up a notch by also alleging deception and fraud. In a late-October reply brief filed in the Georgia case, Hi-Tech and Wheat stated Clapp’s “illegal and harmful marketing practices deceive and defraud the consuming public precisely as they intend." The smoking gun offered by Hi-Tech was an internal DSN document on developing one of the company’s websites; the document detailed how the bottles and labels will intentionally “trick the viewer into thinking that our bottles and labels are the REAL stuff. … It will make them think our bottles are real steroids."

In its complaint, Hi-Tech requested a temporary restraining order and relief under the federal Lanham Act and Georgia law protecting against trademark infringement, false advertising and deceptive trade practices, as well as mail and wire fraud covered under the state’s Racketeering Influenced and Corrupt Organization (RICO) law. In its filing for restraint and relief, Hi-Tech argued it is likely to win its case based on evidence that DSN is defrauding consumers who think their products are steroids and human growth hormone; further, it claims Hi-Tech has lost sales and profits due to DSN’s alleged practices.

Hi-Tech is alleging Clapp and his companies have engaged in deceptive advertising via its various websites—in addition to Anabolics.com, Clapp owns Steroid.com, Dianabol.com, BuySteroids.com, RoidStore.com and Dynamicsportsnutrition.com.

DSN sells sports supplements called TEST-600x, D-ANABOL 25, CLEN, TREN 75, DECA 200 and Pituitary Growth Hormone via its Anabolics.com site. Hi-Tech noted these product names conjure up controlled substances such as testosterone, the steroids dianabol (a trade name for methandrostenolone), clenbuterol, trenbolone and nandrolone decanoate, as well as human growth hormone (HGH), respectively. Some of the products contain ingredients that are banned by the World Anti-Doping Association (WADA), including octopamine and DHEA (when administered exogenously). However, as stated in the court filings, DSN is upfront about this and said it even warns users they could fail a doping test.

Clapp’s websites called RoidStore and BuySteroids redirect to Anabolics.com, where the supplements are sold. On his Dianabol.com site, the steroid dianabol is discussed at length, including info on what to expect when taking the steroid and possible side effects. Clicking on the “Buy Dianabol" link takes the visitor to info on buying the steroid, including: “There are countless steroids at our disposal, numerous choices in fact, but of all the anabolic steroids we can choose from, we should buy Dianabol above the rest.. One of the oldest steroids on the market, in-fact it's the second steroid ever made and the first oral steroid, this little pill exemplifies performance enhancement."

Then under the subhead “Buy Dianabol - High Quality Dianabol" it says, “If you decide to buy Dianabol, you'll always be best served by sticking with tried and true brands like Anabol and Naposim, but you can find some high quality underground brands if you put your nose to the ground." Right next to this is an ad for DSN’s D-ANABOL 25 that is linked to BuySteroids.com, which is redirected to Anabolics.com. Only at the bottom of the page does the article say purchasing dianabol is illegal in the United States as is purchasing it abroad and bringing it into the country.

Further, on the Steroids.com page on buying steroids, there is a header near the bottom of the page that reads: “Buy these powerful legal steroids online," which is followed by tabs bearing the names of DSN products including D-ANABOL 25, TREN 75, Pituitary Growth Hormone etc. All over the site, there are ads linking to DSN supplements; one features a physician-looking fellow who says, "We ship without a prescription."

In the section labeled “Steroid Suppliers" there is info on how to find good suppliers. Near the bottom it reads: “The reality is very simple; there are steroid suppliers that have existed for twenty years, even thirty years and longer and in many cases they haven't been busted yet and guess what, some of them are based right here in the United States. These suppliers are very careful in who deal with; they remain low profile and in many cases keep close relationships with their customers. They protect one another and that is something you will not find in any true drug circle and it is something law enforcement and the congress of the United States cannot understand."

Interestingly, Clapp also owns SteroidAbuse.com, the home of the Association Against Steroid Abuse whose stated mission is to “to educate and safeguard against the abuse of anabolic steroids. We are committed to providing crucial information and statistics on the dangers and issues surrounding anabolic steroid abuse to not only potential abusers, but to Parents, Educators, Sporting Organizations, and all others who can help make a difference in this wide spread problem."

In a declaration filed with the Georgia court, Clapp wrote: “D-ANABOL 25 is a performance-enhancing supplement that is an alternative to the androgenic anabolic steroid methandrosenolone [sic], which is made and sold by prescription under the trade name Dianabol. … Anabolics.com accurately explains that D-ANABOL 25 consists of a proprietary formula that DSN calls Metandesenolone [sic] to underscore that it is an alternative to the well-known substance methandrosenolone [sic]."

There is some history of FDA action against dietary supplements marketed as alternatives to specific drugs. In a May 2013 warning letter to Alternative Health Supplements, the agency stated the company’s touting its Regenerect™ dietary supplement as “an alternative solution to prescription products like Viagra" cause the product to be a drug. It warned the same in a September 2013 letter to Pure Energy Products.

FDA has also warned supplement owners that product names can be implied drug claims; the March 2015 warning letter calling out the product name Forged Joint Repair may be a glaring example of this scenario, but the agency may well also take issue with a supplement product name using a variation of a drug or controlled substance.

INSIDER asked FDA to clarify its position on implied claims in cases where product names are the same as or similar to drug names and when the products are marketed as alternatives to drugs or steroids. The agency would not comment on specific products or even steroid-related products in general, but it said: “Product names certainly play into the totality of evidence that FDA evaluates. Generally the product name alone will not constitute a disease claim."

This hasn’t stopped Hi-Tech from asking the court to “stop this massive fraud." Consumers aren’t waiting for the government either, as a class action was filed against Clapp and DSN  last month in federal court in Florida over similar allegation of fraud by marketing supplements to make consumers think they are buying steroids.

As for the RICO relief, Hi-Tech alleged in its relief filing that Clapp used the mail system to execute his fraudulent scheme, including “discreet shipping" of internet orders from its supplement sales sites. In addition, Hi-Tech said DSN’s use of the internet to advertise and sell the products constitutes wire fraud. As evidence of intention to defraud Hi-Tech specifically, the relief filing noted Clapp reached out to Wheat to befriend him and “purposefully withhold information, demonstrating … fraudulent intent."

Things get more interesting in the infringement part of the lawsuit, where Hi-Tech has taken the position that Clapp and DSN’s use of D-ANABOL 25 infringes upon Hi-Tech’s “incontestable registration" for DIANABOL® (USPTO Registration No. 3,378,354)—Hi Tech sells a dietary supplement formula named DIANABOL that contains herbs, 7-keto, DHEA and other dietary ingredients, and it calls the product a “Natural Steroidal Anabolic and Anti-Proteolytic Formulation."

In its original complaint, Hi-Tech told the court DSN tried to register its D-ANNABOL with the USPTO (U.S. Patent and Trademark Office), despite knowing of DIANABOL’s prior registration, but DSN was denied by USPTO. Hi-Tech further told the court its trademarked DIANABOL and DSN’s product name D-ANABOL not only sound the same but the products are sold in the same or similar channels for the same intention of building muscle mass and strength. DSN’s website Dianabol.com furthers this confusion, according to the court filing. Hi-Tech further noted while evidence of actual confusion of the two products is important to the case, it is not necessary to support a finding of a likelihood of confusion.

Also in the complaint, Hi-Tech detailed a story about how Clapp reached out to Wheat after the USPTO denied DSN’s registration request for D-ANABOL. According to the filing, Clapp said he wanted to help Wheat protect his DIANABOL trademark, but he never told Wheat his own sites were also infringing nor that he owned any other website besides ProBodyBulding.com, which did not sell or market DSN’s alleged offending products. When Wheat learned Clapp owned Anabolics.com and other sites that redirected to Anabolics.com, he sent Clapp a letter of Hi-Tech’s intention to protect its trademark against infringement by D-ANABOL. According to Hi-Tech’s filing, Clapp responded by telling Wheat DSN’s first use of the term preceded Hi-Tech’s first use.

In his declaration to the Georgia court, Clapp said he reached out to Wheat with a suggestion the two execs and companies work together “to clean-up the performance-enhancing and mass- and muscle-building supplement marketplace, which is and was rife with trademark infringers and deceptive, fly-by-night sellers who defraud consumers and give everyone in the industry a bad name." Clapp further stated Wheat allowed at least seven other companies to use product names that potentially infringed on the DIANABOL trademark for at least a decade, and DSN did not receive a cease and desist letter until September 2015. Clapp also noted Hi-Tech’s website was down during all or part of the time Wheat was incarcerated in federal prison for mail and wire fraud.

As of Nov. 18, the Georgia court granted DSN’s motion to transfer the case to the Southern District of Texas, agreeing with DSN’s assertion it was first to file, and the cases involve the same parties and similar allegations. In that case, Hi-Tech filed a motion to dismiss, but the judge ruled on Nov. 19 to deny the motion.

Interestingly, according to exhibits filed by Hi-Tech in its motion to dismiss, emails exchanged between Wheat and Clapp show the two bickering over the infringement, including whose product was sold first; in one email provided by Wheat, Clapp seems to move for a compromise: if Wheat will give Clapp one year, he will promise to change his labeling and line names. “Neither one of us will really win anything from this," said the email attributed to Clapp, “and I can use this to motivate me to make changes I’ve been wanting to do anyway."