Cognitive Dissonance: State and Federal Enforcers’ Case Against Brain Health Dietary Supplement Due For Oral Arguments at the Second Circuit

The manufacturers and retailers of Prevagen, a dietary supplement that purportedly improves memory, made eight statements about the supplement in their advertising that caught the attention of the Federal Trade Commission (FTC) and the New York Attorney General (NYAG):

• Prevagen improves memory,
• Prevagen is clinically shown to improve memory,
• Prevagen improves memory within 90 days,
• Prevagen is clinically shown to improve memory within 90 days,
• Prevagen reduces memory problems associated with aging,
• Prevagen is clinically shown to reduce memory problems associated with aging,
• Prevagen provides other cognitive benefits, including but not limited to healthy brain function, a sharper mind, and clearer thinking,
• Prevagen is clinically shown to provide other cognitive benefits, including but not limited to healthy brain function, a sharper mind, and clearer thinking.

After a 12-day jury trial presented by the NYAG in the Quincy Bioscience case,[1] a jury found that all of the statements lacked scientific support, but that only two were materially misleading – a crucial distinction under NY law. Nonetheless, the Court ordered an injunction prohibiting the company from making all eight statements nationwide. Is that possibly correct? The Federal Court of Appeals for the Second Circuit is about to tell us.

Background

In January 2017, the FTC and NYAG filed a joint complaint[2] against Quincy Bioscience, related entities, and two officers individually.[3] 

The FTC brought claims under Section 13(b), seeking to enjoin marketing of Prevagen purportedly in violation of FTC Act Sections 5(a) and 12, which prohibit unfair methods of competition and false advertising. The NYAG brought the action under New York Executive Law (NYEL) Section 63(12) for alleged violations of Sections 349 and 350 of the New York General Business Law (NY GBL). NYEL Section 63(12) allows the NYAG to seek an injunction “whenever any person [engages] in repeated fraudulent or illegal acts or otherwise demonstrate[s] persistent fraud or illegality in the carrying on, conducting or transaction of business.” NY GBL Sections 349 and 350 prohibit deceptive acts or practices and false advertising, in the conduct of any business. 

The Complaint sought a permanent injunction; consumer redress (including but not limited to restitution, refunds, and disgorgement); civil penalties in an amount up to $5,000 per violation of NY GBL 349 and 350; and costs. 

A 12-day jury trial on liability was held in February and March of 2024, and the jury found that all eight statements (i) were made repeatedly or persistently, (ii) were not supported by competent and reliable scientific evidence, and (iii) had the capacity or tendency to deceive, findings which rendered all eight statements violations of the NYEL.[4] Only two of the statements, however, were found by the jury to be “materially misleading”[5] – meaning only two of the eight statements, as a matter of law, constitute a violation of NY GBL Sections 349 and 350. [6] 

Of the interesting issues that have come up during the near-decade of litigation, two key questions are currently on appeal before the Second Circuit: the scope of the injunction and the reach of the NYEL. 

A Nationwide Injunction – After A Trial Brought by the NYAG Under NY State Statutes

Despite the Complaint alleging claims by both the FTC and the NYAG, the 12-day jury trial was presented by the NYAG. In fact, while the Court allowed the FTC to participate and question witnesses, the FTC was expressly prohibited from disclosing its participation to the jury.[7] Under the law, the FTC is not entitled to a jury trial.[8] Defendants had previously argued that the FTC’s participation would prejudice Defendants. Without elaborating on its reasoning, the Court prohibited the FTC from disclosing its participation to the jury.[9] 

Following the jury verdict, per the FTC’s request, the Court applied the jury’s factual findings to the FTC Act Sections 5 and 12. Reasoning that NY GBL Sections 349 and 350 are modeled off the FTC Act and “the statutes share essentially the same legal elements,” the Court held that the jury’s factual findings “are binding on this Court’s determination of the Quincy defendants’ liability under Sections 5 and 12 of the FTC Act.”[10] 

A Factual Finding Precluding Liability under GBL 349 and 350 – Yet the Same Remedies Applied under NYEL Section 63(12)

NYEL Section 63(12) allows the NYAG to seek equitable relief, including an injunction. Following the jury verdict, the NYAG sought to permanently enjoin defendants from making “in or affecting the State of New York or any New York consumer” all eight statements at issue, including the six found not to violate the NY GBL.[11]

The Court granted the requested injunction, finding that since there was no evidence that the statements caused harm or economic injury, no claim or evidence of damages, and no evidence to support the “occasionally discussed but unarticulated, unmade claims for disgorgement . . . the full, fair, and proper determination…is that the defendant must immediately remove all of the [challenged] statements…from use in connection with any and all forms of promotion of Prevagen.”[12] 

Quincy Biosciences filed a request for clarification on the scope of the injunction, which the Court held applied nationally wherever Prevagen is marketed. Because the jury held Quincy Bioscience liable under NY GBL Sections 349 and 350 and the Court held Quincy Bioscience liable under the FTC Act, the Court found that it is undisputed that a Court may issue a permanent, nationwide injunction.[13] 

The Court recognized the severity of enjoining the use of all eight statements, stating that:

“[This] is not a trivial event. It involves years of accumulated goodwill, whose loss must be replaced with costs and effort. That relief aligns with the purpose of both the FTC Act and the New York Statutes, and it should be administered in proportion to the damage caused by each statement's tendency to deceive, as found by the jury, whose verdict was discriminating and perceptive.” [14]

The NYAG sought to amend the judgment to pursue statutory penalties, disgorgement, and statutory costs under the NY GBL and NYEL; the motion was denied. The Court held that the jury’s “careful denials” that six of the statements were materially misleading precluded the pursuit of monetary penalties, especially since the evidence showed that the defendants intended no harm.[15]

Issues on Appeal at the Second Circuit

Each of the NYAG, the FTC, and the Defendants have appealed to the Second Circuit. The NYAG asks the Second Circuit to affirm that because each of the eight statements violate NYEL, they each constitute a cause of action for fraud. Additionally, the NYAG requests that the Second Circuit overturn the Court below’s denial of monetary relief and its ruling that six statements did not violate NY GBL 349 and 350.[16] 

The FTC seeks an affirmation that it may sue for a permanent injunction under Section 13(b) of the FTC Act without an administrative proceeding and also asks the Second Circuit to affirm that the evidence presented to the jury was sufficient to establish liability under the FTC Act.[17] 

Quincy Bioscience asks the Second Circuit to narrow the scope of the injunction, arguing that it is impermissible for a New York statute to apply nationwide.[18] Quincy Bioscience specifically argues that the injunction fails to meet the specificity requirements of Federal Rule of Civil Procedure 65(d), which requires that orders granting injunctions state the reason, specific terms, and acts restrained in reasonable detail. Because the injunction prohibits the eight statements and “similar” ones, Quincy Bioscience argues that it is impermissibly vague.[19] Additionally, because the FTC is permitted only to seek preliminary injunctions pending an administrative complaint or final order, Quincy Bioscience argues that the issuance of a nationwide injunction under Section 13(b) of the FTC Act on the basis of a verdict coming out of the NYAG’s jury verdict is procedurally improper.[20] The Second Circuit is expected to weigh in on whether commencing an administrative proceeding or seeking a preliminary injunction are necessary prerequisites to a permanent injunction, as Quincy Bioscience maintains.

Quincy Bioscience also asks that the Second Circuit hold that the NYEL does not create an independent cause of action for fraud, which would absolve six of the statements from liability, since predicate liability under the NY GBL was only found on the two materially misleading statements.[21] Furthermore, Quincy Bioscience argues that the NYAG failed to present evidence to establish that the statements were unsubstantiated or deceptive under NY GBL, so the materially misleading finding was erroneous.[22]

The issues on appeal are nine years in the making – and the Second Circuit has never opined on a joint FTC/NYAG action implicating these highly visible New York consumer protection laws. The Second Circuit will hear oral arguments on February 26, 2026. More on their decision in our next installment.

Mintz continues to closely monitor this case and will provide updates following the Second Circuit’s opinion on the parties’ briefs and oral arguments. If you have questions about Federal Trade Commission, Department of Justice, or State Attorneys General consumer protection investigations and enforcement actions, contact your regular Mintz attorney or one of the attorneys named above.

[1]FTC v. Quincy Bioscience Holding Co., Inc., No. 1:17cv124, (S.D.N.Y. 2024) appeal docketed, No. 20-16 (2d Cir. Dec. 20, 2024). 

[2] Notably, this joint effort predates the 2021 AMGv. FTC decision (593 U.S. 67) in which the Supreme Court held that the FTC is not entitled to equitable monetary relief, such as restitution or disgorgement, under Section 13(b). Following that decision, there has been a rise in consumer protection litigations brought jointly by the FTC and various state attorneys general (AGs), as the FTC can generally no longer seek monetary relief, but many states can. See e.g., FTC et al. v. Roomster Corp. et. al., Case No. 1:22-cv-7389 (S.D.N.Y., filed Aug. 30, 2022); FTC et al. v. Harris Original of NY, Inc. et al., Case No. 22-cv-4260 (E.D.N.Y., filed Jul. 20, 2022); FTC and State of Florida v. Treashonna P. Graham et al., Case No. 3:22-cv-655 (M.D. Fla., filed June 13, 2022); In the Matter of Google LLC and iHeartMedia, Inc., FTC Dkt. No. C-4784; FTC and State of Arkansas v. BINT Operations LLC et al., Case No. 4:21-cv-00518-KGB (E.D. Ark., filed June 16, 2021).

[3] Compl. 2, Jan. 9, 2017, ECF No. 1.

[4] Jury Verdict 7-9, Mar. 11, 2024, ECF No. 421.

[5] “Prevagen reduces memory problems associated with aging” and “Prevagen is clinically shown to reduce memory problems associated with aging.” Id. at 2, 5.

[6]Himmelstein, McConnell, Gribben, Donoghue & Joseph, LLP v. Matthew Bender & Co., 37 N.Y.3d 169, 176 (N.Y. 2021) (quoting Plavin v. Group Health Inc., 35 NY3d 1, 10 (N.Y. 2020), “[t]he requisite elements of the cause of action are well established. A plaintiff must allege that: (1) the defendant's conduct was consumer-oriented; (2) the defendant's act or practice was deceptive or misleading in a material way; and (3) the plaintiff suffered an injury as a result of the deception.”).

[7] Ct. Order 1, Jan. 3, 2024, ECF No. 377. 

[8]Chevron Corp. v. Donziger, No. 1:11-cv-00691, 2013 WL 5526287, at *2 (S.D.N.Y. Oct. 7, 2013) (“Cases seeking only injunctions are purely equitable and carry no right to trial by jury.”).

[9] Ct. Order 1, Jan. 3, 2024, ECF No. 377. 

[10] Ct. Order 2-3, Aug. 29, 2024, ECF No. 493. 

[11] Pl.’s Mot. Permanent Inj. Proposed Order 2, Sept. 26, 2024, ECF No. 502-1. The NYAG also sought to compel the company to maintain records related to “any evidence on which they rely to substantiate any claim covered by the Court’s injunction,” as well as all records that would be relevant to a NYAG inquiry regarding any advertising claims covered by the Court’s injunction. Id. at 7. Additionally, the government requested that the defendants “be compelled to submit reports documenting their compliance with the Court’s injunction on a quarterly basis for three years.” Id. at 8.

[12] Ct. Order 2, Nov. 18, 2024, ECF No. 513.

[13] Ct. Order 2-3, 4, Dec. 6, 2024, ECF No. 524.

[14] Id. at 4.

[15]Id. In November 2025, the NYAG sought to enjoin the use of an advertising tagline that was not named in the Complaint nor among those listed in the injunction. Pl.’s Mot. Enforce J. 1-2, Nov. 17, 2025, ECF No. 536. The parties fought over whether the prior injunctions covered the tagline “For Your Brian,” which was the subject of the motion by the NYAG. The parties engaged in discovery on the tagline and a newly produced expert report presented by the NYAG. The Court rejected the NYAG’s attempt to apply injunctive relief as broadly as possible, extending it to advertising speech that was not the subject of the initial judgment. The Court called the motion “not a motion to enforce this Court's Judgment, rather . . . an attack on the new For Your Brain Statements.” The Court found that “the NYAG cannot shoehorn an entirely new set of facts into an existing Judgment,” and as such the NYAG could not bring in the “For Your Brain” statements. Ct. Order 4, Jan. 8, 2026, ECF No. 549.

[16] Appellee People of N.Y. Br. 64, Nov. 7, 2025, ECF No. 138.1.

[17] Appellee FTC Br. 22, 53, Nov. 13, 2025, ECF No. 140.1. 

[18] Appellant Quincy Bioscience Br. 25, Nov. 3, 2025, ECF 132.1. 

[19] Id. at 28.

[20]Id. at 47.

[21]Id. at 32.

[22] Id. at 50.

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