Distributors, the people who Herbalife sells to and then they sell to you, are suing the company for $1 billion in damages due to false promises of getting rich if they followed their business model. This comes after two previous lawsuits, $17.5 million in 2016 and $200 million in 2016. Over 100,000 plaintiffs could partake in this lawsuit, making it one of the largest ever against a Multi-Level Marketing company.
Los Angeles-based Herbalife, a publicly traded company with 2017 net sales of $4.4 billion, has long been embroiled in litigation and regulatory actions over its business practices, which have been compared by some to a pyramid scheme. A spokeswoman declined to comment for this story, although Herbalife attorneys are seeking to get the lawsuit dismissed or moved from Florida to a California court.
In the 2016 lawsuit brought on by the Federal Trade Commission, the agency said in a statement that “only a small minority of distributors have made anything near what the company promises” through promotional materials showing how they lived in expensive homes, drove luxury cars and took exotic vacations.
“A large majority of distributors made little or no money and a substantial percentage lost money,” the FTC said.
This is the center point of this new $1 billion lawsuit against Herbalife. Plaintiffs Patricia and Jeff Rodgers said, “We did everything they told us to do. We attended every event. We traveled and we spent money. And we didn’t get successful like they said we would,” Rodgers said in an interview at the couple’s home in Hallandale Beach, Florida. “You get involved in it, it’s almost like a cult mentality.”
The trial is set for September 2019 if this case isn’t dismissed or settled out-of-court before then.
Fitness Informant’s POV: There are many facets of Herbalife and other multi-level marketing companies we can look at. The main thing we look at here at FI is the quality of these product. They are trash. Simple as that. Why? When you have to pay upward commissions through their recruitment structure, you have to sacrifice product quality to make it for little to nothing and sell it for a bunch to be able to pay the “distributors” and “coaches.”
The plaintiff mention’s it is like a cult-mentality. That’s because they are a cult. Many of the people who “sell” these product know NOTHING about supplementation. A company spokesperson or friend says, “take this, it will help with that,” and the belief system begins. The products are under dosed and are detrimental to your health.
With that said, these lawsuits make me laugh. You, as a “distributor,” are knowingly getting involved in something. Just because someone “promises” you riches, doesn’t mean you should believe it. I do think that the plaintiffs will win, but I wish as a society we would smarten up.
This is what we are here for. We help answer these questions and set the record straight. MLMs sell HOT GARBAGE for products. We will be doing a whole article on MLMs here at FI to help educate you all.
For the record, here is a list of popular MLM companies selling supplements…BEWARE:
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