Jeunesse lawsuit accuses Darren Jensen of raiding
Although they seemingly have no problems with their affiliates raiding other companies, turns out Jeuenesse aren’t so blase about the issue in their own backyard.
A lawsuit first filed by Jeunesse on January 8th names Darren Jensen as defendant, and accuses him of raiding the company.
For those unfamiliar with the term, “raiding” in MLM refers to a former executive or affiliate plundering one company’s affiliate-base to populate another. Typically the company benefiting is one the affiliate or executive doing the raiding recently signed up with.
Named defendant Darren Jensen in this particular alleged instance of raiding, was President of Jeunesse until May, 2015.
Claiming to spend ‘enormous resources to train, develop and support its independent distributors‘, Jeunesse state that Jensen (right) voluntarily terminated his employment with them on May 15th, 2015.
As per Jensen’s Employment Agreement, this triggered ‘restrictive covenants to protect Jeunesse’s relationship with customers and distributors, as well as its confidential information‘.
In a nutshell, upon departing Jeunesse, Jensen agreed for them to hold his marketing balls in a vice-grip for three years.
After quitting as Chief Sales Officer, Jensen straightaway became an employee of a competing network marketing company called LifeVantage Corporation.
LifeVantage is a competitor of Jeunesse because both companies operate as direct selling businesses and thus compete for distributors and customers in many of the same geographical locations.
In addition, the companies both sell products that are in the same product market.
Upon information and belief, as CEO, Jensen has substantial responsibilities at LifeVantage including company growth, development of new products and generation of sales for LifeVantage.
In breach of his Employment and Separation Agreements, Jeunesse claim Jensen has used
confidential information gained during his employment with Jeunesse in his work wit LifeVantage, to the detriment of Jeunesse’s efforts to grow its business and market share.
This purportedly includes use of Jeunesse’s product formulas, pricing strategies, cost of goods sold, marketing plans, suppliers, vendors and manufacturers,
to develop a new product for LifeVantage that is based on a formula that is very similar, if not identical, to the formula used by Jeunesse to create Instantly Ageless.
Anyone else just hit with a chronic blast of dejavu?
In addition to ripping off Jeunesse’s Instantly Ageless to develop LifeVantage’s TrueScience serum, Jeunesse also claim Jensen
contacted, solicited and/or recruited several Jeunesse distributors.
Each of these individuals were active distributors of Jeunesse working to build their respective distributorships at the time they were contacted and solicited by Jensen.
Upon information and believe, Jensen continues to use confidential information obtained from Jeunesse, to assist other individuals, including other LifeVantage executives, in soliciting, recruiting and inviting Jeunesse distributors and employees to LifeVantage.
Jeunesse remitted notice to Jensen of these foregoing breaches of the Employment and Separation Agreements and has further demanded that he cease recruiting and soliciting Jeunesse employees and distributors to LifeVantage.
Despite this notice and demand, Jensen has not stopped soliciting and recruiting Jeunesse employees and distributors to LifeVantage.
Jeunesse’s lawsuit alleges four causes of action against Jensen; breach of Employment Agreement, breach of Separation Agreement, Misappropriation of Trade Secrets and Conversion.
Darren Jensen’s reply to the lawsuit was filed on February 2nd, in which he mostly denies Jeunesse’s claims against him.
Defenses raised by Jensen include
- failure to state a claim upon which relief may be granted
- that Jeunesse’s claims are barred by the doctrines of unclean hands, economic loss and estoppel
- any damages caused were not caused by any actions or omissions of Jensen and/or are the result of actions of third parties, for whom Jensen is not responsible
- failure to mitigate damages, if any
- Jeunesse’s claims have been brought in bad faith
- a claim that Jeunesse released its claims against Jensen
- one or more of the contract claims are unreasonable in both duration and scope, and are therefore unenforceable
Jensen has asked the court dismiss Jeunesse’s complaint with prejudice and order the company pay his legal fees.
We’ll certainly be watching this one closely as it unfolds, stay tuned…
Update 20th September 2016 – In late August Jeunesse and Darren Jensen reached a confidential settlement agreement.
Jeunesse’s case against Jensen has been subsequently dismissed without prejudice.