Young Living pyramid cult RICO class-action filed in Texas
A new class-action filed in Texas accuses Young Living of operating as an illegal pyramid scheme cult.
The lawsuit, filed by Julie O’Shaughnessy, also claims Young Living is a front for “selling essential oils for quasi-medicinal purposes”.
According to O’Shaughnessy, hundreds of thousands of potential class members have collectively lost thousands of dollars participating in Young Living’s business opportunity.
These payments were made on an “ever-elusive promise of financial success”, which O’Shaughnessy represents is a false representation.
Young Living falsely represents to its Members that participation in Young Living—which necessarily requires regular monthly payments—will result in spiritual and material riches as long as they continue to solicit additional recruits to become Members of the Young Living family.
But that promise is nothing more than a pipe dream for Young Living’s millions of Members.
In reality, Defendants have created nothing more than an unlawful pyramid scheme—the cornerstone of which is Young Living’s emphasis on new member recruitment over the sale of products.
For reference, in our 2014 Young Living review we noted mild autoship concerns and recruitment commissions.
These weren’t however of a strong enough magnitude to trigger alarm bells.
That is of course assuming retail sales are being made, which according to O’Shaughnessy’s lawsuit they aren’t. At least not enough to balance Young Living recruitment and team building.
Citing an average loss per Young Living affiliate of $1175, O’Shaughnessy’s class-action alleges
the only way to make any money through Young Living is to get paid for recruiting new Members and building a “down line”—which is a telltale characteristic of an unlawful pyramid scheme.
O’Shaughnessy herself claims to have joined Young Living in 2015, after attending a home party presentation.
Julie paid $100 to become a Young Living Member, and has since expended thousands of dollars as part of her participation in the Young Living scheme, all of which is now lost.
O’Shaugnessy’s losses are attributed to Young Living’s business model, which is allegedly
overwhelmingly dependent on the recruitment of new people into the Young Living sales force—i.e., the defining characteristic of an illegal pyramid scheme versus a legitimate MLM company.
MLM commission qualification in Young Living is 100 Personal Volume (PV) a month.
O’Shaugnessy states she met this not via retail sales, but by her own monthly affiliate autoship order.
Of the products she ordered, O’Shaugnessy claims
there is no real incentive for a Member to try to become a reseller of oils as opposed to becoming a recruiter of more down line members.
Rather than sell autoship product to retail customers, it is alleged unused product is stored. This is made easy due to the low storage volume Young Living’s essential oils create.
A single closet shelf would be enough space for a failing Young Living Member to store literally thousands of dollars in unsold product, hoping against hope that her down line OGV will grow large enough to trigger a meager commission.
Despite purchasing products on autoship each month since 2015, O’Shaughnessy claims that at no point did Young Living query her (non-existent) retail volume.
Julie bought product month after month whether she needed it or not (she didn’t), and whether she had any hope of re-selling it to someone else (she couldn’t) without Young Living ever questioning whether she was re-selling at least 70% of her purchases.
By the time Julie realized she had been victimized by Young Living, she had purchased more than $4,700 worth of product, but “earned” a commission of only $385 from her
Citing an estimated 0.0015% of current active Young Living affiliates having made it to the top compensation rank, the class-action concludes
the overwhelming majority of Young Living Members lose money by paying far more into the scheme than they receive, while those few at the top reap untold riches, funded by all of the lower level Members paying into the system.
This is the very definition of an illegal pyramid scheme.
The proposed class-action seeks damages in relation to RICO racketeering and mail and wire fraud. Two additional USC violations are also cited.
An injunction preventing Young Living from continuing to operate the alleged pyramid scheme is also sought.
I’ve added the Young Living class-action to our list of tracked cases, so stay tuned for updates as we receive them.