The Justice Department, through a referral by the Federal Trade Commission, filed an amended complaint on Friday that takes aim at Cerebral co-founder Kyle Robertson’s latest telehealth venture.
The DOJ initially filed a complaint and announced a settlement with Cerebral, a digital mental health company, in April. The complaint alleged Cerebral and former CEO Robertson disclosed consumers' sensitive personal health information, which violates the FTC Act. It also alleged Cerebral and Robertson failed to honor their promise of an easy cancellation process for its subscription membership, which violates the Restore Online Shoppers' Confidence Act.
Related: Feds fine Cerebral over data sharing allegations
Cerebral agreed to pay a fine of more than $7 million pending approval from the U.S. District Court for the Southern District of Florida, where the complaint was filed.
Robertson’s latest venture, since he was pushed out of Cerebral in May 2022, is targeted in the amended complaint. Since he left Cerebral, Robertson has not announced any new roles publicly and has an unknown, stealth startup listed in his LinkedIn profile.
The DOJ alleges that Robertson started another telehealth subscription company called Zealthy in December 2022. The complaint alleges Robertson changed the new company’s formal name to Gronk in January, although it continued to do business publicly as Zealthy.
In addition, the department alleges that Robertson and Zealthy, along with affiliated medical corporation Bruno Health, violated ROSCA by failing to clearly disclose terms of online telehealth subscriptions before obtaining consumers’ billing information.
Similar to the charges levied against Cerebral, the amended complaint also alleges that Zealthy does not provide consumers with an easy cancellation process. It also claims Zealthy does not get their informed consent before receiving credit card information. The complaint also states that Zealthy does not disclose how much consumers will pay for medications and what their insurance covers. Dr. German Echeverry, the senior medical director at Zealthy, was also named in the suit.
On its website, Zealthy says it offers consumers access to popular weight loss drugs that contain glucagon-like peptide-1 agonists. The complaint alleges Zealthy claims it only charges consumers $25 for these medications with insurance and $150 without insurance, but consumers end up paying “multiples more” of that amount.
The amended complaint also names Alex Martelli, who was Cerebral’s director of product, as a defendant. It alleges that Martelli and Robertson posted fake positive reviews of Cerebral.
“This settlement is not impacted by the Department Of Justice’s amended complaint stating new allegations against former employees," a Cerebral spokesman said in an emailed statement. The DOJ declined to comment.
A lawyer for Robertson did not respond to a request for comment. Representatives for Zealthy and the FTC did not respond to a request for comment. Echeverry and Martelli did not respond to LinkedIn messages requesting comment.
The FTC initiated its investigation of Cerebral in June 2022.
