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FTC vs. Vemma

In September of 2015, the FTC placed a Ex Parte Temporary Restraining Order and Asset Freeze on Vemma Nutrition Company. The reasons for the case focused on income claims, marketing videos, public statements from company leaders, and the company's young target market, but the repercussions land squarely on compensation norms across the industry. Our coverage of the case provides a detailed picture of the legal landscape before the case, the rhetoric behind the case, and the long-reaching effects the case may have on the industry.

  • October 20, 2015

    Multi-level Marketing and Internal Consumption

    The Vemma case put the spotlight on internal consumption (or personal volume) as potentially problematic for multi-level marketing companies that require a minimum amount of personal consumption as a part of their commissions qualifications. A recent article by Crittenden and Albaum (2015) provides a nice sum... Read more ›

  • October 12, 2015

    Selling a Feeling

    As we recently reported, the court appointed receiver in the Vemma case has been replaced with a monitor, but before that happened, the receiver released a report of its findings on Vemma’s business practices. This report is still worth reading. From it you can glean insights into the FTC’s concerns and g... Read more ›

  • October 12, 2015

    MLM and Regulators: Innovation, Not Infraction

    Every time a direct seller has an issue with the Federal Trade Commission, critics of the industry are quick to jump on it, hailing it as a step in the right direction towards shutting down multi-level marketing completely. They’ll say that it is finally being shown as the unsustainable business practice th... Read more ›

  • October 12, 2015

    The FTC playbook: What happens when a company is shut down

    I am not a lawyer. This is just one lay persons view based on my years in the industry. When the FTC decides to make a case against an MLM company, their methods follow a consistent pattern or playbook. When the FTC decides to run their “playbook” against a company, I have never seen a company survive[1].... Read more ›

  • October 12, 2015

    Vemma Allowed to Re-open: The conditions and what they might mean for the industry

    The Federal District Court of Arizona issued an order detailing the decision to allow Vemma to reopen its doors for business, while the case is being litigated. This is big news; as pointed out by MLM lawyer Kevin Thompson in his last article about the case, in the last sixteen cases the FTC has brought again... Read more ›

  • October 7, 2015

    Avoid the FTC’s Crosshairs! The Wisdom of Jerry Garcia

    I went to a Grateful Dead concert in 1976. The band was at the height of cool at the time as they represented the counter-culture movement from the Haight-Ashbury district of San Francisco. Although I had been to a number of concerts before seeing the Dead, this concert was different because it was the first ... Read more ›

  • October 5, 2015

    The FTC Wins, You Lose. The FTC Loses You Lose.

    The response across the web to the court ruling on September 18, 2015 has been mixed. Some reporters have called it a “loss,” expecting the court to eventually declare Vemma a pyramid and shut them down for good. Many have seen it as a “win” for Vemma and for the industry, given the fact that no MLM i... Read more ›