He ran into trouble again in 2003 with the FTC, which alleged that Telebrands, as well as several other marketers, were making false and unsubstantiated claims about electronic muscle-stimulation devices. “This really got me upset,” says Khubani, who opted not to settle this time. “When you go to physical therapy, as I have from skiing accidents, they stick these pads on you and stimulate your muscles to rebuild the tissue,” he says. “So I looked at this ab belt, from a manufacturing and technology standpoint, and I thought, Here’s something that can be made for just a few dollars, and they’re selling it for $120.” The commercial that he produced didn’t make any claims directly, says Khubani, but simply said that the belt offered the same benefits as its more expensive counterparts. The FTC did not agree—it found that the claims were implied in the commercial—and Telebrands agreed not to market the gadget anymore or make similar claims, which wasn’t a hard thing to agree to, because by the time the decision came down in 2005, Telebrands had already sold $19 million of the belts.
Intellectual-property disputes are yet another hazard of the trade. Because big hits are so rare, when one company has a winner, a host of other competitors rush to get spinoffs on the air as fast as possible (hence four imperceptibly different versions of an ab stimulator on the market at once). Last year, Telebrands sued a Hong Kong manufacturer over the Juststick Bulb, an alleged knockoff of the StickUp Bulb. Meanwhile, Cricket Productions, Inc., a rival infomercial firm in Marlboro, Massachusetts, threatened to sue Telebrands over Depend-a-Light, a battery-free shake-and-shine flashlight. Cricket CEO Victor Grillo Jr. claims Telebrands copied his ad frame by frame. Khubani claims his own ad originally ran two years before. “I didn’t steal the idea from them,” says Khubani. “But people are always borrowing in business. The first person that came up with the laptop—how many times were they copied? The first person who came up with the minivan?”
What’s even worse is when an adversary’s product blows his out of the water. A few years ago, Khubani was coasting along on the effortless sales of various abdominal contraptions when the Ab Roller hit the airwaves. Simple, modern, and gym-worthy, the device “annihilated our product overnight,” says Khubani. “In a matter of months, we lost $20 million in unsold inventory, returns from retailers, and so on.” Khubani, also battling a costly patent-infringement claim over his Easy Money coin sorter, filed for Chapter 11 protection in 2000. He followed with a series of hits that included a U.S. map with a slot for each state’s quarter—the company sold 12 million of them.
Things are continuing to go well. This year, he has another triumph on his hands with the StickUp Bulb, which is on track to do $50 million, putting it in blockbuster territory. EarLifts, not so much. In four months, Telebrands has sold 200,000 units, falling far short of the million-piece goal. “I guess there’s a bigger market of people with dark spaces than people who care about their sagging earlobes,” he confesses.
But will anyone care about dust mites? Khubani wasn’t achieving much traction among his Telebrands staff with his bed-spray idea, when along came a proposal for an anti-dust-mite pillow, from a colleague Khubani mysteriously describes only as “a business associate.” It’s hardly a new concept—there are several such pillows already marketed to allergy sufferers and asthmatics. But so far, nobody has had the brilliance to incite a national panic around flesh-eating creatures that feast on human remains—and lurk in the pillow of every man, woman, and child. “The hum you sometimes hear at night?” Khubani asks eerily. “That’s the sound of 2 million dust mites eating your dead skin.” Or perhaps it’s the sound of one man in Fairfield, New Jersey, homing in on your next anxiety.