Turns out the best defense may not be a good offense, at least when litigating against the FTC.  The Northern District of Illinois yesterday rejected an attempt by multi-level marketer Neora, LLC (formerly Nerium) to obtain a declaratory judgment that the company did not operate as a pyramid scheme and that the FTC was not

The replay of our recent webinar Product and Earnings Claims in the Time of COVID-19 is available here.

The FTC has recently sent warning letters to hundreds of companies for allegedly falsely implying that products can be used to treat, cure, mitigate, or prevent COVID-19. The FTC has also issued warning letters for implied

Last week, the FTC sent warning letters to ten multi-level marketing companies alleging that the companies failed to stop their participants from making deceptive product and earnings claims related to COVID-19.  The letters request that the companies report within 48 hours what actions they have taken to stop their distributors from claiming their products can

The year ended with a flurry of activity related to the FTC’s ability to obtain permanent injunctions and restitution under Section 13(b) of the FTC Act.  As we head into 2020, a level-set is in order.

To File or Not File is No Longer the Question

On December 19, 2019, the FTC filed a petition

The continuing questions over the extent of the FTC’s enforcement authority to obtain monetary relief under Section 13(b) did not stop the Commission from filing a lawsuit on November 1 against multi-level marketer Neora, LLC and its CEO Jeffrey Olson for purportedly operating an illegal pyramid scheme that used deceptive marketing to sell supplements, skin

On May 17, AdvoCare International LP, marketer of “innovative nutritional, weight-management and sports performance products,” made the extraordinary announcement that it was abandoning its business model. It would no longer engage in multilevel marketing; all sales from here on in would be direct-to-consumer, a single-level marketing compensation plan.

In making this announcement, AdvoCare disclosed

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.  

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