GNC 2008 Annual Report Download - page 35

Table of Contents
thereafter on or about December 20, 2002, alleged claims for false and deceptive marketing and omissions and violations of the New Jersey
Consumer Fraud Act. On November 18, 2003, the court signed an order dismissing plaintiff's claims for affirmative misrepresentation and
sponsorship with prejudice. The claim for knowing omissions remains pending.
• Shawn Brown, Ozan Cirak, Thomas Hannon, and Luke Smith v. General Nutrition Companies, Inc. (previously pending in the 15th
Judicial Circuit Court, Palm Beach County, Florida, Index. No. CA-02-14221AB and currently styled Shawn Brown, Ozan Cirak, Thomas
Hannon and Luke Smith, each individually and on behalf of all others similarly situated v. General Nutrition Companies, Inc., Case No. 1:07-
cv-06356-UA, In the United States District Court for the Southern District of New York). Plaintiffs filed this putative class action on or about
July 25, 2002. The Second Amended Complaint, filed thereafter on or about November 27, 2002, alleged claims for violations of the Florida
Deceptive and Unfair Trade Practices Act, unjust enrichment, and violation of Florida Civil Remedies for Criminal Practices Act. These claims
remain pending.
• Andrew Toth v. General Nutrition Companies, Inc., et al. (previously pending in the Common Pleas Court of Philadelphia County,
Philadelphia, Class Action No. 02-703886 and currently styled Andrew Toth and Richard Zatta, each individually and on behalf of all others
similarly situated v. Bodyonics, LTD, d/b/a Pinnacle and General Nutrition Companies, Inc., Case No. 1:06-cv-02721-JSR, In the United States
District Court for the Southern District of New York). Plaintiffs filed this putative class action on or about July 25, 2002. The Amended
Complaint, filed thereafter on or about April 8, 2003, alleged claims for violations of the Unfair Trade Practices and Consumer Protection Law,
and unjust enrichment. The court denied the plaintiffs' motion for class certification, and that order has been affirmed on appeal. Plaintiffs
thereafter filed a petition in the Pennsylvania Supreme Court asking that the court consider an appeal of the order denying class certification.
The Pennsylvania Supreme Court denied the petition after the case against GNC was removed as described above. The claims for violations of
the Unfair Trade Practices and Consumer Protection Law and unjust enrichment remain pending.
• Santiago Guzman, individually, on behalf of all others similarly situated, and on behalf of the general public v. General Nutrition
Companies, Inc. (pending on the California Judicial Counsel Coordination Proceeding No. 4363, Los Angeles County Superior Court). Plaintiffs
filed this putative class action on or about February 17, 2004. The Second Amended Complaint, filed on or about November 27, 2006, alleged
claims for violations of the Consumers Legal Remedies Act, violation of the Unfair Competition Act, and unjust enrichment. These claims
remain pending.
On January 25, 2008, a mediation was held for the Andro Actions and no resolution was reached. Based upon the information available
to us at the present time, we believe that these matters will not have a material adverse effect upon our business or financial condition. As any
liabilities that may arise from these cases are not probable or reasonably estimable at this time, no liability has been accrued in the
accompanying financial statements.
Class Action Settlement. Five class action lawsuits were filed against us in the state courts of Alabama, California, Illinois, and Texas with
respect to claims that the labeling, packaging, and advertising with respect to a third-party product sold by us were misleading and deceptive.
We denied any wrongdoing and are pursuing indemnification claims against the manufacturer. As a result of mediation, the parties agreed to a
national settlement of the lawsuits, which has been approved by the court. Notice to the class has been published in mass advertising media
publications. In addition, notice has been mailed to approximately 2.4 million GNC Gold Card members. Each person who purchased the third-
party product and who is part of the class and who presented a cash register receipt or original product packaging will receive a cash
reimbursement equal to the retail price paid, net of sales tax. Class members who purchased the product, but who do not have a cash register
receipt or original product packaging, were given an opportunity to submit a signed affidavit that would then entitle them to receive one or more
coupons. The deadline for submission of register receipts, original product packaging, or signed affidavits, was January 5, 2007. The number of
coupons will be based on the total amount of purchases of the product subject to a maximum of five coupons per purchaser. Each coupon will
have a 31