Rawlings Sporting Goods Company, Inc. has agreed to pay up to $220,000 to settle claims that it misled consumers by claiming its Power Balance products used magnetic frequencies to enhance energy, flexibility, strength and other athletic attributes.
The settlement sets aside up to $130,000 to reimburse consumers who bought a mylar bracelet and other products bearing the Rawlings and Power Balance trademarks. Rawlings also agree to pay up to $90,000 in legal fees charged by the plaintiff’s law firm, according to Dahl Administration, LLC.
The settlement, which must be approved by the U.S. District Court for the District of New Jersey at a hearing in January, was reached on behalf of consumers that purchased the bracelet and other Rawlings-Power Balance products between March 1, 2010 and Oct. 11, 2013. In addition to the bracelet, the settlement covers necklaces, batting gloves, catcher's equipment, and other apparel that contain the brand name “Rawlings” and a “Power Balance” logo, emblem or hologram.
Shortly after “final” court approval of the settlement, Rawlings will distribute refunds to consumers who, depending on the product, return their products or provide proof of purchase. Consumers who filed valid claims will be reimbursed for the full retail price of the bracelet and up to $10 for every other Power Balance product they purchased.
The plaintiffs claim that Rawlings violated consumer protection laws and was unjustly enriched by making false and misleading claims to consumers about the Rawlings Power Balance products. Rawlings denies these claims. The Court did not decide in favor of plaintiffs or Rawlings. Instead, both sides agreed to a settlement.
Rawlings will fund a Settlement Fund of at least $50,000 and, if the valid claims exceed $50,000, up to a maximum of $130,000. If the total value of valid claims submitted exceeds $130,000, then the amount of reimbursement per product will be adjusted downward on a pro rata basis. If the total value of the valid claims does not exceed the guaranteed amount of $50,000, the unclaimed portion of the guaranteed amount will be distributed to charities.
Although Rawlings previously discontinued making statements regarding the ability of Rawlings Power Balance products to provide certain benefits, it has also agreed to not to recommence making such claims again in the future in the marketing and advertising of Rawlings Power Balance products.
The May, 2012 lawsuit alleges Rawlings made false and misleading claims when it advertised: “Power Balance holograms are embedded with frequencies that react positively with your body’s natural energy fields. When the hologram comes in contact with your body’s energy field, it allows your body to interact with the natural, beneficial frequency stored with the hologram. This results in improved energy flow throughout your body.”
“In reality,” reads the lawsuit, “the Rawlings Rubber Bracelet is nothing more than a piece of rubber (actually, mylar) wrapped, not around a magical, energy producing hologram, but rather a simple piece of ordinary photography film. Indeed, there truly is no legitimate dispute about that, as the manufacturer and supplier of the bracelets (a now bankrupt company called Power Balance LLC) publically admitted over 15 months ago that any performance enhancing advertising claims about the rubber bracelets are false, the lawsuit alleged.”