Category Archives: Direct Sales

What The FTC Said About Direct Selling In 2018

Earlier this year, the Federal Trade Commission released new business guidance for direct sellers and multilevel marketers describing the legal principles that it will apply when evaluating practices under the FTC Act. Law360 published the article “What The FTC Said About Direct Selling In 2018,” co-authored by partner John Villafranco and senior associate Donnelly McDowell. … Continue Reading

FTC Releases Business Guidance on Multi-Level Marketing, Memorializing Principles from Prior Settlements on Hot Button Issues

By John E. Villafranco and Donnelly L. McDowell on January 4, 2018 Posted in Direct Sales, Federal Trade Commission, Multi-Level Marketing

The FTC released today Business Guidance Concerning Multi-Level Marketing, which offers answers to frequently asked questions to assist multi-level marketers in evaluating their business practices for compliance with the FTC Act. The Guidance begins by restating the general standard for pyramid schemes set forth in the FTC’s 1975 Koscot decision and then goes on to … Continue Reading

Vemma Settles Ongoing Litigation with FTC over Pyramid Charges

By Donnelly L. McDowell on December 15, 2016 Posted in Direct Sales, Federal Trade Commission

The FTC announced today that it had settled charges with multi-level marketer and seller of health and wellness drinks Vemma over allegations that it operated a pyramid scheme. The FTC initially filed the action in August 2015 in federal court in Arizona, alleging that Vemma encouraged participants to buy products to qualify for bonuses and … Continue Reading

FTC Chairwoman Ramirez Addresses Direct Sales Association; Offers Compliance Recommendations for Industry and Signals that Additional Guidance is on its Way

By Donnelly L. McDowell on November 1, 2016 Posted in Direct Sales

Last week, FTC Chairwoman Edith Ramirez spoke at the Direct Sales Association (DSA) Business & Policy Conference in Washington, D.C. In her comments, Chairwoman Ramirez acknowledged that the direct selling industry was a $36 billion industry that “has the capacity to provide consumers with valuable goods and services and an opportunity to try an entrepreneurial … Continue Reading