North American Power terminate MLM business opportunity
Sometime in the last twenty four hours North American Power announced that they are terminating their MLM business opportunity.
Effective immediately, Independent Representatives will be unable to refer new customers or representatives to Thrive or North American Power.
All referral sites have been disabled.
Additional information has been provided to North American Power affiliates via email:
Per the Independent Representative Agreement and Policies and Procedures, Independent Representatives will continue to receive residual payments on customers that have been referred to date.
In addition, once successfully processed, any pending enrollments that have been referred to date will receive the normal up-front commissions.
Independent Representatives that have earned Free Energy will continue to receive Free Energy for as long as they remain qualified.
Noticeably absent from North American Power’s email is an explanation as to why the MLM opportunity has been abandoned.
The company only states that the “extremely difficult decision” was made ‘after a lot of thoughtful analysis, discussions, and soul-searching‘.
Representative (affiliate) support has also been shut down, with affiliates simply told to contact the company by email if they have any questions.
I’m guessing the lack of an explanation in the communication means they’re probably not going to be answering questions regarding the closure via email either.
BehindMLM reviewed North American Power back in late 2012. At the time I noted there was no true retail activity taking place within the opportunity:
In letting their basic customer level (which is supposed to be true retail and have no involvement in the compensation plan and business opportunity), North American Power effectively eliminate true retail from the business.
You can join as a customer and not refer anyone, however there’s no differentiation between these customers and those that do, other than their own actions. As far as the compensation plan goes, they are treated as one and the same.
Whether or not this has anything to do with the abrupt shutdown is currently unclear.
Update 14th January 2015 – I’m not sure if these have anything to do with NAPower’s shutdown, but there are two recently filed class-action court cases naming the company as a defendant.
Both cases are civil and allege North American Power has been overcharging its customers.
Peggy Zahn filed her lawsuit in October 2014 –
This action seeks to redress the deceptive pricing practices of North American Power & Gas, LLC (“North American Power”) that have caused thousands of Illinois consumers to pay considerably more for their electricity than they should otherwise have paid.
North American Power engages in a classic bait-and-switch deceptive marketing scheme aimed at consumers hoping to save on the cost of electricity.
North American Power lures consumers into switching by offering a teaser rate that is lower than local utilities’ rates for
electricity supply.When the teaser rate expires after a couple of months, Defendant switches customers to a viable rate, which North American Power represents is based on market pricing.
These representations are misleading. In fact, North American Power’s electricity rates are substantially higher than market rates, they are not competitive, and they do not reflect the cost of purchasing electricity on the wholesale market.
As a result, Illinois consumers are being fleeced millions of dollars in exorbitant charges for electricity.
This suit is brought pursuant to the Illinois Consumer Fraud and Deceptive Business Practices Act.
Michael Tully filed his separate class-action complaint on January 8th.
Tully’s complaint reads near-identical to Zahn’s, except that it pertains to Rhode Island.
Both Tully and Zahn are represented by Finkelstein, Blankinship, Frei-Pearson & Garber, LLP (New York).
In the Zahn case, just two days ago (the day before they announced the closure of their MLM operations), the company filed a Motion to Dismiss the case.
In their motion North American Power do not dispute that they ripped Zahn off, but instead claim
Plaintiff’s Complaint fails to recognize that the exclusive and/or primary jurisdiction over the claims asserted by the Plaintiff, Peggy Zahn (“Plaintiff”), rests solely with the Illinois Commerce Commission.
Since the crux of all of Plaintiff’s claims is that she was charged too much for electricity, Plaintiff cannot deny that her Complaint is based on the reasonableness of the rates charged by NAPG, which is within the exclusive jurisdiction of the Illinois Commerce Commission (“ICC”).
Since the ICC has exclusive jurisdiction over Plaintiff’s claims, the Complaint should be dismissed in its entirety.
Even if exclusive jurisdiction did not lie with the Illinois Commerce Commission, Plaintiff’s claims should still be dismissed, because Plaintiff fails to set forth sufficient causes of action under the Illinois Consumer Fraud Act, breach of contract, and unjust enrichment.
Plaintiff cannot show through the terms and statements in the alleged contracts attached to her Complaint that there were any deceptive or misleading statements.
To the contrary, NAPG was clear that the rate charged was variable and not fixed. As such, Plaintiff cannot show that NAPG breached the alleged contract.
Finally, since Plaintiff pleads a breach of contract claim, Plaintiff cannot set forth a claim for unjust enrichment based upon an alleged breach from these supposed contracts as it is contrary to clear Illinois law.
Basically they’re arguing improper jurisdiction and that, because they made it perfectly clear they would charge a variable rate, the contract Zahn signed was not breached, irrespective of how much she was charged.
A summons was issued to North American Power in the Tully case on January 9th. They have yet to respond.
Maybe they’re anticipating more of these cases so that’s why they pulled the plug?
Death to energy deregulation MLMs
Each of them competing for pennies in difference
Excellent reporting, as always. Thank you.
SD
There was an audio that also went out to the reps. In it the owner basically says the margins were too thin to compete with mlm energy companies that have a cost to join, the fallout from last winter, and the new legislative issues that have come from that.
As time goes along I am sure more will come out as to the reasons why. Seems odd due to the recent national convention and new branding and products. 2 months later they are done.
I’m gunna go with legislative issues and margins.
They likely figured they couldn’t go on grossly overcharging people, and the recent class-action lawsuits only confirmed that.
A question for those who run this web site (for whom I have great respect!):
Besides ACN, has any MLM company that sells something “invisible” such as long distance service and/or electricity ever lasted more than 5 years? 10 years? 15+ years?
Just wondering . . .
Thanks for all you do.
I don’t think most of them are 5 years old yet.
Some of the wireless companies might qualify.
Agreed, not worth the hassle of switching as the all use lead in teaser rates and then hammer you just like with most mobile deals were they lure you with discount smart phone and then hammer you for $40. a month for data plan whihc is mandatory.
Total ripoff as I see it, and yes, rates nearly double for most after first 90 days, so I expect more law suits, just as T-Mobile was renently hit with for excess charges.
Oz
Both Stream (ignite) and Ambit are over 5 years old. Both very solid companies with competitive and many times, better rates in my area.
As a 31 year veteran and professional network marketer, my heart goes out to each affiliate and customer who have lost in this crisis of your company’s demise.
If there is any solace I can provide, it is that our profession, not unlike others, have no iron clad guarantee for sustainability beyond its capacity.
I know, I’ve been stricken by a similar situation. I would venture to say many of us have. During the 2008 global economic crash, my partners and I lost millions and dozens of international markets and partners with our internet company.
The good news is we as entrepreneurs have the internal fortitude and drive to pick ourselves up and continue on in our journey wherever it is that brought us into this magnificent industry where people from all walks of life are given a chance to accomplish extraordinary outcomes.
Sure, we must be diligent in the courses we choose to take when something like this happens to us and our partners. The silver lining is everyone gets another chance.
In our case we chose a tangible product vs. intangible when forced to find a new path to our destination. It was the best decision and course we’ve ever made.
Collectively and individually, that forced change charted us on a course that delivered the most successful past 5 years that any of us had experienced in our past.
As we look back at that difficult period of transition, we see that the latter was only a mountain, what lies in front is a mountain range of more hope and prosperity for those who refuse to give up on their dreams. I wish you all God speed in your new chosen direction.
They need to investigate in Ohio also…They ripped me and a lot of my friends by a teaser rate and doubled the rate after the intro.
Do u have any updates on the stream energy MLM? I saw back in 2010 u said u would put the MLM on your list.
Since then I found that they had a lawsuit against them in Texas and Georgia (apparently the lawsuit in Georgia was dismissed due to procedural issues). I have a friend who asked me to get involved with the MLM, and wants me to go with him to a meeting.
I’d like to know if u have anything more then what I found on them by googleing them. Thanks
Hi Ace, I was going to pen an update on this in April (BehindMLM’s anniversary).
As it stands I simply don’t have enough time to get through my reviews. That’s despite publishing over 400 articles in 2014 alone.
Some companies have been on my review list for years now and that’s obviously just not good enough. I hope to address this later in the year and free up more time to publish content for BehindMLM.
Re. Stream, I haven’t had a chance to look at the company so I can’t offer you anything further at this time (Yes, they’re still on my review list).
Got totally screwed over in Maine by this company. Wound up paying about $700 more than usual this winter. So mad!!!
North American Power and Gas scammed many Dominion Gas customers in The Cleveland, Ohio area.
My, company, Digital One in Mentor, Ohio was defrauded by North American’s dishonest practices.
First of all we were offered low teaser rates. We were promised a $50.00 Visa Gift card as a signing bonus. We never received the gift cards.
The representative who signed us up, James King, stated the company was sold and that new ownership was not honoring the promise.
The bigger complaint is that starting in January, 2015 after the initial contract expired, North American raised the natural gas rate to $6.99 per McF.
For comparison, the going Dominion rate for this winter was closer to $3.60.This is costing me and many others hundreds and even thousands of dollars due to the fact that it takes 2 to 3 months to get switched to another supplier.
Please include me in any class action law suits against this fraudulent company.