Nate Jones says he was almost ashamed to see a 2020 study from the University of Tennessee that showed nasal sprays made with xylitol — a sugar alcohol found in plants — block the virus that causes COVID-19 from attaching to cells.
The study’s finding that xylitol showed “antiviral activity” was proof, Jones thought, that such nasal sprays could prevent and help treat COVID-19. Jones, founder and CEO of the Utah-based company Xlear, had been selling sprays with xylitol to soothe dry or irritated noses for 20 years. He was confident in his product’s antibacterial abilities.
“Shame on me and the company,” he said, “for never having thought to look at viruses.”
Another study, co-authored by a researcher at Utah State University, found the ingredients in Xlear significantly reduced the viral load of the coronavirus. Both studies made Jones feel confident that Xlear could help fight COVID-19.
So the company started saying so in social media posts, online videos and other ads.
The problem — at least in the eyes of the federal government — was that the studies did not conclusively prove what Xlear claimed they proved. The Tennessee study was conducted on monkey cells, not on people. The second study was not peer-reviewed and studied cells in lab glassware, not in humans.
The studies did not substantiate Xlear’s claims, the government contended in a lawsuit filed in 2021, arguing that meant Xlear was deceptively marketing its products and and misleading consumers about having evidence to support its claims.
The Federal Trade Commission, working with attorneys from the Department of Justice and the U.S. Attorney’s Office for Utah, and the company fought vigorously in court for nearly four years. But the government abruptly asked last month to dismiss the case with prejudice, meaning it cannot be refiled.
For Xlear, it was a victory and a sign that truth prevailed. “It’s been like an anvil hanging over the company’s head for four years,” said Rob Housman, Xlear’s lead attorney in the case.
Financial burden aside, Housman said, “we had a position throughout the whole thing that what we said was always justified. And to [Jones’] credit, he never swayed. He always believed that the things that the company said, that we were accused of making as false and misleading statements, were neither false or misleading.”
(Bethany Baker | The Salt Lake Tribune) Xlear CEO Nate Jones poses for a portrait at Xlear, Inc. in American Fork on Wednesday, April 16, 2025.
The Department of Justice declined to comment and instead directed The Salt Lake Tribune to its motion to dismiss, which does not explain why the government dropped the case.
But in asking to dismiss a similar case in New York about a week later — against a company that claimed its herbal tea was “more effective” at preventing COVID-19 than vaccines and could get consumers out of quarantine “within twenty-four hours” — federal attorneys cited “the government’s interest in redirecting its resources to more current priorities.”
The Trump administration has halted or dropped federal investigations and lawsuits against 89 corporations, the consumer rights organization Public Citizen said in a report in early March. Its tally has since topped 120, including Xlear and the herbal tea company.
To Sam Levine, who directed the FTC’s Consumer Protection Bureau when the case against Xlear was filed four years ago, the Utah dismissal “should be a warning.”
“It gives me concern that this administration is going to stop policing deceptive ads in claims,” Levine said. “If that happens, if we have a world where people can say anything they want and not be held accountable, that’s a very worrying development for the marketplace. It’s a worrying development for consumer protection.”
A “bet the ranch” case
(Bethany Baker | The Salt Lake Tribune) Product container components run through machinery on the production line at Xlear, Inc. in American Fork on Wednesday, April 16, 2025.
A central question in the case was whether the Federal Trade Commission Act requires advertisers to “substantiate” claims about their products with concrete, scientific evidence.
For Xlear, the answer is clear: No. The FTC Act does not contain precise language about substantiation; nowhere does it require companies “to possess in this precise form — or any form — of substantiation in support of its statements,” Xlear said in court documents.
But such a reading of the FTC Act would render the law and decades of precedent essentially useless, the government argued back.
“I find that argument quite puzzling,” Levine said. “The FTC Act says you can’t engage in deceptive or unfair conduct. And what constitutes deceptive conduct … is deliberately broad, because Congress wanted the FTC to be able to challenge emerging forms of fraud and deception.”
It has always been the case — or at least since the Reagan administration — that when companies make claims, they “need to have a reasonable basis for them,” Levine said.
The standard for medical claims is even higher. Claiming a product could prevent, treat or cure a potentially deadly illness like COVID–19 without “competent, reliable evidence” has the potential to harm consumers, Levine said — and is precisely the kind of conduct the FTC Act is meant to regulate.
In essence, the government argued: If Xlear’s advertising didn’t violate the FTC Act, what does? What is the act for?
If the case had continued, U.S. District Court Judge Robert J. Shelby might have ruled on that question. His ruling might have agreed with decades of precedent, in the eyes of federal regulators. Or it might have “radically altered the landscape of FTC law,” Housman said.
And that, Housman said, might help explain the government’s decision to drop the case.
In court, Xlear also argued that under Loper — an influential 2024 U.S. Supreme Court decision — the government’s interpretation of the FTC Act amounted to federal overreach. The Supreme Court’s ruling had overturned what’s called the Chevron deference doctrine, a change that gave judges the authority to overrule a federal agency’s interpretation of an ambiguous or broad statue.
Had the judge agreed that the case against Xlear was fatally flawed, the implications for the FTC could have been sweeping, Housman said.
“This was a ‘bet the ranch’ case,” Housman said. “And they decided not to bet the ranch.”
While nothing in the docket or filings explained why the government walked away, Levine said that for him, it’s hard not to consider the goals of the new president.
President Donald Trump’s administration has done some good things for consumer protection, Levine said. Last month, Trump signed an executive order to “combat unfair practices” in ticket sales for live entertainment. In his first term, Trump’s administration required hospitals to advertise the actual price of services.
But this administration has also moved to cut funding and hobble some federal agencies charged with oversight and regulation, Levine said.
Trump’s health secretary, Robert F. Kennedy, has shared misleading information about health and vaccines. He has celebrated Utah becoming the first state to ban fluoride from drinking water — a move dentists largely oppose. When Kennedy addressed a crowd of Utahns earlier this month, Jones was among them.
“I think… at least parts of this administration do understand the importance of transparency and honest advertising,” Levine said. “I think the question’s going to be: Which part of the administration prevails?
“The part of the administration that dismissed this important case about ensuring health claims are backed up? Or the part of the administration that actually wants transparency and honesty in the marketplace?”
What’s the risk?
(Bethany Baker | The Salt Lake Tribune) Product container components run through machinery on the production line at Xlear, Inc. in American Fork on Wednesday, April 16, 2025.
Xlear maintained all along that it did, in fact, have proof of its claims. Science was on its side — even if it wasn’t good enough for the government, the company argued.
“What [the DOJ] said is: You don’t have substantiation for it,” Housman said. “It’s not that you didn’t have any study. We just didn’t have the specific studies that they wanted.”
The government responded that claiming those studies supported Xlear’s marketing claims was, in fact, a deception itself, and that they did not prove anything about Xlear’s ability to fight COVID-19 in humans.
To Housman and Jones, the government was asking Xlear to adhere to a standard of perfection that the government itself could not maintain. What was known about COVID-19 was changing daily early in the pandemic, Housman said, and so, too, was messaging about what to do. In Xlear’s view, the lawsuit was an example of unhelpful scientific “dogma” and market censorship.
At least with Xlear, Housman said, “there was no risk” to using a nasal spray. “It’s as low-risk as you can possibly get,” he said. “Worst case: you would breathe a little better.”
Levine counters with a different worst-case scenario, for Xlear and products more broadly: People buying products that harm them “or lead them to believe they don’t need treatments that have a more scientific basis.”
Consumers are free to choose how to take care of themselves and with what products — that’s what a free marketplace is for, Levine said. But a free marketplace only works safely if consumers have truthful information, he said, and the job of regulators is to even the playing field.
“If we move into a world where people can say whatever they want as long as they believe it, that’s not good for markets,” Levine said. “That’s not good for capitalism. That’s not good for peoples’ health. And it’s not good for advertising.”
In the early days of COVID, “I don’t think there’s any question that the government, and public health authorities, made mistakes,” Levine continued. “But I don’t think the right response to that is to open the floodgates for all sorts of scientific claims that are baseless in the marketplace.”
But Housman and Jones said they don’t trust that government regulators actually have consumers’ best interests at heart.
“I would think that usually, your consumer good producers are going to have your best interest in mind,” Jones said. “You need to have a good product or you’re not going to get a repeat customer. And if your product is damaging to somebody, they can sue us.”
Shannon Sollitt is a Report for America corps member covering business accountability and sustainability for The Salt Lake Tribune. Your donation to match our RFA grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by clicking here.
