Emails surface in Berkeley fraud case

In the latest string of developments surrounding a class action lawsuit against Berkeley Premium Nutraceuticals, the company is being accused of fraud and money laundering.

The company has already faced numerous settlements for falsely advertising the sexual dysfunction effects of its dietary supplements. Now, according to the Cincinatti Examiner, federal prosecutors investigating the case have revealed documents in which owner Steve Warshak appears to have encouraged or supported the idea that his employees would squeeze money from customers.

The case has been a high profile one for the dietary supplement industry and brings to light the issue of false advertising that has marred the credibility of the industry as a whole.

Smiling Bob" national ad campaign which featured a man whose life improves after he uses the product Berkeley's website claimed supports "firmer, fuller-feeling, better quality erections".

In March 2006, the herbal supplement company reached a $2.5m settlement with the attorney generals of Ohio and five other states.

Then in November of that year, an Ohio judge granted a $4.7m settlement in a class-action suit representing 1.5 million customers. These customers were then entitled to refunds.

As part of the present case, federal prosecutors have filed the documents, which the Enquirer reports are primarily e-mails and interviews with former employees.

Warshak's lawyers have allegedly moved in court to keep this evidence out of the trial, citing it was obtained illegally without a search warrant.

A decision from the judge is awaited.

The company's owner, Steve Warshak, is awaiting trial on federal charges after thousands of customers, as well as merchant banks, were allegedly defrauded of $100m by Berkeley.

One of Warshak's lawyers has described the email correspondence in question as distortion of the truth in how the company was run.

Berkeley later used that information to bill consumers for shipments which they sent automatically, without their consent, or without disclosing the terms and conditions of the plan.

Berkeley is also alleged to have made it difficult for customers to cancel shipments as they faced a wall of busy phone lines and web sites that did not work.

Some employees claim to have been encouraged by Warshak to deny customers their refunds, or to delay them, as well as to charge customers' credit cards even if they only asked for a sample of the merchandise.

The company's other supplement products include Avlimil and Rogisen.

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