Nutraquest Plan for Exiting Ephedra-Related Bankruptcy Approved

By William Murphy

Published on November 10, 2006

Nutraquest sold the popular ephedra-containing diet pill Xenadrine RFA-1 and other supplements until 2003. Ephedra was linked to health risks and banned by the U.S. Food and Drug Administration in April 2004. The herbal stimulant has been associated with heart palpitations, strokes, seizures, high blood pressure, and heart attacks.

One of the most important components of Nutraquest’s emergence from Chapter 11 protection, filed in Oct. 2003, is the resolution of almost 140 wrongful death and personal injury lawsuits. Under the plan approved by Judge Brown, plaintiffs will receive $34.4 million, with Nutraquest paying no more than $4.35 million of the total. Nutraquest owner Robert Chinery and related companies will contribute $11.1 million, and the balance will be paid by retailers that sold the company's ephedra-containing products.

As part of the bankruptcy plan, Brown also approved the settlement of two class-action suits involving deceptive advertising. Plaintiffs and their attorneys in one class will receive $12.5 million. Class members of the other suit will receive $8 million.

Comment on this article →