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Capsule Pill and Dots
Capsule Pill and Dots

Justice Department accuses telehealth Zealthy of fraud, says remedy may bankrupt it

The feds say they don’t think Zealthy has the liquidity to pay what it owes customers.

The Department of Justice is seeking an immediate asset freeze and receivership against telehealth startup Zealthy and its CEO, Kyle Robertson, to halt what it calls a “runaway campaign of lawbreaking.”

The DOJ says Zealthy — a privately held telehealth site that sells compounded GLP-1s, erectile dysfunction medications, and antidepressants — used the names and licenses of doctors who didn’t work there to fill thousands of prescriptions without the physicians’ knowledge or clinical supervision. Prosecutors said “it is plausible that Zealthy’s available liquidity will fall short of its exposure in this litigation.”

“Put bluntly, the consumer redress and FTC rule violation penalty amounts that Plaintiff seeks in this action may bankrupt Zealthy, rendering preservation of assets essential for consumer redress,” prosecutors said in a Monday filing.

Neither Robertson nor Zealthy immediately responded to a request for comment.

The DOJ says Zealthy also misused customer information and charged people without their consent. Customer support representatives were strictly banned from canceling accounts or even mentioning the word “cancel” unless it was brought up by the customer first, according to prosecutors.

Zealthy lost its LegitScript medical merchant certification in January 2025 after it failed to disclose the DOJ lawsuit to the standard bearer, after which major advertising platforms and payment processors dropped it. Prosecutors say the company got around this by creating shell companies to process payments.

Many customers also initiated credit card charge-backs, and the DOJ alleges that Zealthy executives used company credit cards to buy their own subscriptions, artificially diluting their transaction dispute rates to hide the problem from financial institutions.

Perhaps the most egregious allegations are that Zealthy stole doctors’ identities to fulfill prescriptions. In on example, the company allegedly ordered more than 8,000 prescriptions using the name of one doctor after he had stopped working there.

Dr. Steven McDonald, the former medical director of Zealthy, wrote in a declaration that he discovered his name was being used to prescribe medications only when a former colleague told him the office received “stacks” of insurance letters for Zealthy patients he had never treated.

The DOJ’s lawsuit was initially filed in April 2024, accusing Robertson’s previous venture, Cerebral, of making it too hard to cancel a subscription and of severe privacy breaches. Cerebral was one of several telehealth startups that began prescribing Adderall online during the pandemic, taking advantage of relaxed telehealth prescribing rules intended to help patients access prescriptions during the COVID-19 pandemic.

Robertson was ousted from Cerebral in 2022 and the company eventually paid a $2.9 million fine for unauthorized distribution of Adderall and other controlled substances. The litigation against Robertson continued and eventually extended to his new venture, Zealthy.

“Robertson’s lawbreaking is only becoming more brazen, and dangerous,” prosecutors wrote in an April 10 amended complaint.

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Tom Jones

Prime Day is here again and Amazon’s subscription service has never been more popular

Well, it’s that time of year again: many have made their wish lists, people are scraping together the money they’ve saved to pick out a perfect gift, some are presumably leaving out refreshments for the weary delivery drivers and, more and more, drones.

It’s Amazon Prime Day — meaning that it’s the second day of the four-day promotional event that Amazon still calls Prime Day — of course, and it’s even come early this year, with the company bringing the period into late June from July, when it’s been traditionally held for the last five years.

The Prime Age

Alongside the eyes and endless clicks that the arbitrary stream of listicles on “The Best Prime Day Deals” that almost every media outlet pours into, Amazon will also be cheering the fact that there’s now more Prime users than ever before to devour the retailer and its sellers’ sometimes-contested “discounts.” Indeed, according to the latest annual estimates from Consumer Intelligence Research Partners (CIRP), there were just over 200 million American shoppers using Amazon’s massive subscription service at the end of 2025.

business

Electronic Arts launches a platform to put more ads in its games

Video game publishing giant EA launched a new platform on Monday designed to make the process of selling immersive ad space in its popular games easier.

The company says the platform, called EA Advertising, allows brands to “integrate directly into gameplay through dynamic, real-time placements, from stadium signage to custom in-game content.”

More so than other studios, EA has incorporated advertising into its most popular titles. As Kotaku points out, the company’s ad efforts stretch as far back as 2006. Several of its sports franchises already feature partnerships with brands like Visa, Lowe’s, Red Bull, and PepsiCo.

In-game advertising hasn’t exactly been embraced by fans, but industry experts expect it to ramp up as companies seek more revenue to offset higher games budgets and surging memory costs. EA rival Take-Two has taken a different approach, with CEO Strauss Zelnick recently saying the company was “not at risk of doing brand partnerships” in the forthcoming “Grand Theft Auto VI,” and that ads in full-price games seems “unfair.”

The $55 billion deal to take EA private, led by Saudi Arabia’s Public Investment Fund, is set to close at the end of this month. Being the largest leveraged buyout in history, EA will likely look for more ways to boost revenue to cover interest payments.

More so than other studios, EA has incorporated advertising into its most popular titles. As Kotaku points out, the company’s ad efforts stretch as far back as 2006. Several of its sports franchises already feature partnerships with brands like Visa, Lowe’s, Red Bull, and PepsiCo.

In-game advertising hasn’t exactly been embraced by fans, but industry experts expect it to ramp up as companies seek more revenue to offset higher games budgets and surging memory costs. EA rival Take-Two has taken a different approach, with CEO Strauss Zelnick recently saying the company was “not at risk of doing brand partnerships” in the forthcoming “Grand Theft Auto VI,” and that ads in full-price games seems “unfair.”

The $55 billion deal to take EA private, led by Saudi Arabia’s Public Investment Fund, is set to close at the end of this month. Being the largest leveraged buyout in history, EA will likely look for more ways to boost revenue to cover interest payments.

business

JM Smucker says it sold $1 billion worth of Uncrustables in FY2026

After years of booming sandwich sales, JM Smucker has finally earned a billion-dollar crust.

On Tuesday, the company reported results for fiscal year 2026, highlighting better-than-expected profits driven by higher prices for coffee and sweet baked goods. However, at another point on the earnings call, CEO Mark Smucker pointed to one particularly jammy figure: in line with previous forecasts, the company sold $1 billion worth of its (almost always) crustless sandwiches, Uncrustables, in the last year alone.

business

Paramount reportedly offers concessions to resolve multistate antitrust investigation

Paramount has reportedly offered up some concessions in an effort to prevent an antitrust lawsuit by California and about 10 other states, according to Bloomberg reporting on Monday.

Reuters first reported on the potential suit from a group of unnamed states last week, which could throw a wrench in Paramount’s plans to buy rival Warner Bros. Discovery in a Hollywood megamerger.

The list of concessions is unknown, though Bloomberg previously reported that Paramount is open to divesting some of its kids TV assets to appease EU regulators.

Late last month, reports said US regulators appeared likely to approve the $110 billion merger, following a meeting between Paramount CEO David Ellison and DOJ antitrust staffers.

The list of concessions is unknown, though Bloomberg previously reported that Paramount is open to divesting some of its kids TV assets to appease EU regulators.

Late last month, reports said US regulators appeared likely to approve the $110 billion merger, following a meeting between Paramount CEO David Ellison and DOJ antitrust staffers.

$98B ⛽

The IATA released its latest financial outlook for the airline industry over the weekend, forecasting a $98 billion jump in the sector’s collective fuel bill. The world’s largest trade group representing airlines expects the oil spike to halve profits by 49% from last year to $23 billion.

The group also expects profit margins to halve year over year, falling from 2025’s 4.2% to 2%. Still, revenue is expected to climb to $1.17 trillion from $1.07 trillion.

A surge in the cost of jet fuel has rocked US and global airlines this year, leading Delta Air Lines, United Airlines, American Airlines, Southwest Airlines, JetBlue, and others to raise fares and ancillary charges like bag fees. Low-cost carriers, which operate on smaller margins, have been squeezed the hardest, resulting in Spirit’s shutdown.

“It’s a tough year for all airlines, especially those whose balance sheets had not yet recovered from COVID. And, of course, for those operating in the Gulf,” said IATA Director General Willie Walsh, who added that demand is holding up and about half of passengers expect to spend more on travel this year. “That bodes well for a strong northern summer peak season. The big unknown is how long travelers and shippers can tolerate the higher costs of connectivity.”

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