Operator of Diet Pill Business Must Pay $81,412 in Fraud Case

A judge has ordered a Newport Beach man and his Van Nuys mail-order diet pill business to pay civil penalties of $81,412 for false advertising and unlawful business practices.

Ventura County Superior Court Judge Jerome Berenson filed a tentative ruling Monday ordering Leo Daboub and his company, Health Energetic Inc., to pay the penalties to Ventura County and to give refunds to 27 customers who filed complaints, Deputy Dist. Atty. Barry B. Klopfer said.

The tentative ruling is the basis for a final judgment that the judge will file later, Klopfer said.

The Ventura County district attorney’s office brought the case after customers complained that the product, “Fast-Trim,” didn’t work and they could not get refunds.

Klopfer said Health Energetic sold diet pills by mail and at retail outlets called the Diet Stores in Tarzana, Granada Hills, Van Nuys, Burbank and Los Angeles.

Klopfer said Daboub sharply reduced the business and closed many of the stores after a court injunction in February, 1985, forced him to stop his advertising campaign, which included full-page advertisements in two newspapers.

Daboub admitted that he violated the Business and Professions Code by advertising his diet pills as an “amazing new discovery” and promising specific weight losses “even if you cheat,” Klopfer said.

The pills were made from standard pharmaceutical products and were effective only in conjunction with a diet and exercise program, Klopfer said.

Klopfer argued for penalties of $220,000, but Berenson set the lower figure based on testimony that Daboub had lost more than $1 million and fallen into debt after he stopped advertising.