Vemma preliminary injunction briefs
Following the updating of the case docket, we can provide you a bit more information about the Vemma preliminary injunction hearing on September 15th.
Before the hearing took place, Judge Tuchi addressed two previous filings.
The first was from Vemma, who had objected to the FTC’s evidence on the basis it was inadmissible. The second was a motion from the FTC, seeking to prevent Vemma from filing “irrelevant evidence”.
Both filings were denied.
Witness lists were then filed, with Vemma calling up Matthew Thacker (FTC investigator), Stacie Bosley (assistant professor of Economics, Marketing and Strategy at Hamline University), Bonnie Patten (Executive Director of Truth in Advertising) and Ken Johnson (temporarily appointed Vemma Receiver).
The FTC called up E. Emre Carr (Berkeley Research Group), Brad Wayment (Vemma’s Chief Operating Officer) and Allison Tengan (Vemma Legal and Compliance Department Manager).
On the evidence side of things, the FTC submitted
- three declarations by Matthew Thacker
- an “expert declaration” by Stacie Bosley
- a declaration by Bonnie Paten
- “Roadmap to Success” (Vemma marketing material)
- a translation of the Italian pyramid scheme decision against Vemma
- a declaration by Adam Fracassi (Assistant Attorney General at Michigan Department of Attorney General)
- “Everybody Deserves Great Health” booklet (Vemma marketing material)
- transcript of a Vemma event held in Michigan
- corrections to the above transcript
Vemma submitted
- attached exhibits supporting a declaration by E. Emre Carr
- attached exhibits supporting a declaration by Morris C. Aaron and MCA Report
- a declaration by BK Boreyko (Vemma Founder and CEO)
A minutes order at the conclusion of the September 15th hearing advises:
IT IS ORDERED taking this matter under advisement. Formal order to issue by 2:00 p.m. on Friday, 9/18/2015.
Until then, stay tuned…
Footnote: Our thanks to Don@ASDUpdates for providing a copy of the Vemma case docket.
vemma affiliates believe they have a strong case against the court appointed temporary receiver rob evans & associates.
apparently rob evans has been hired 44 times by the FTC to take over companies the FTC has litigated against for fraudulent activities.
in one such case an utah federal court judge, overturned the TRO granted to the FTC, and found that rob evans seemed to be biased to the FTC’s POV, and said he regretted granting the TRO.
kevin thompson in his vemma update after the hearing also reported that the judge seemed to have a ‘physical reaction’ to the FTC’s case, IIRC.
so, vemma affiliates are feeling that rob evans actions of shutting down vemma on day one of their receivership, instead of maintaining status quo, will damage the FTC’s case:
so far, we have only received news of the vemma/FTC hearing from people with a strong bias for vemma.
it is difficult to make any conclusion about the real mood of the hearing on the 15th sept,2015, based on one side of the story.
with great timing [!] there was an article on 15 sept, about rob evans & associates being sued by utah companies for being shut down:
sltrib.com/home/2953787-155/utah-companies-want-to-sue-court-appointed
a very interesting article from vemma attorney kevin thompson, reporting on the vemma/FTC hearing with his own opinions about the arguments in the court.
my take is that affiliates who were buying on autoship, cannot be categorized as ‘ultimate users’, because they were buying in a quantity [autoship] which was required for making commissions.
to make vemma’s arguments win, the judge will have to go one step further than the burnlouge appeal order, and find that not only self consumption, but self consumption on a reasonable amount of autoship, is acceptable behavior for ‘ultimate users’.
in burnlounge the court stopped short of defining how much of an affiliate purchase was motivated by self consumption and how much by recruitment commission:
i guess ‘value of the product’ and ‘amount of autoship’ will have a role to play in the question of ‘degree to which rewards..’
any way, the arguments are getting very messy, and from MLM having ‘no bright lines’ we’re progressing further into the ‘gray’.
an important observation from thompson:
here’s hoping the judge gives some clear guidance on the issues raised, and the MLM industry does not have to work under a cloud of confusion.
thompsonburton.com/mlmattorney/2015/09/17/vemma-preliminary-injunction-hearing-cautiously-optimistic/
🙂 this is so cute.
in his article on the vemma/FTC arguments, published today by vemma attorney kevin thompson, he says:
however in 2014, KT had an article up praising ‘The Academy of Multilevel Marketing [TAMM]’, set up by len clements, for recognizing MLM companies and affiliate talents.
guess who was nominated for the ‘distributor of the year’ section? ahem, Alex Morton!
how fickle are the ways of the world! anointed one year, reviled the next! 🙂
thompsonburton.com/mlmattorney/2015/03/27/academy-of-multilevel-marketing-awards-2014-nominees/
in an article published by the new york times [15/9/2015], correspondent joe nocera approached the FTC with a question about how MLM can be differentiated from a pyramid scheme.
similarly, when professor bill keep, an MLM critic, had asked the same question of the FTC, he was told that following case law, was the best guidance on MLM.
lawyers find it hard to decipher case law, how can normal people make sense of it?
the FTC needs to stop smarting from the sting of the burnlounge appeal order, and start using and defining the term ‘ultimate users’ in its public guidance. just because they cannot insist on cent percent retail anymore, doesn’t mean they should clam up!
nytimes.com/2015/09/15/opinion/joe-nocera-the-pyramid-scheme-problem.html?_r=0
make way! make way!
i found a treasure chest! the TRANSCRIPT of the vemma/FTC preliminary injunction hearing!
whoopeee! enjoy!!
scribd.com/doc/281469993/Vemma-Preliminary-Injunction-Hearing-Transcript-9-15-15?secret_password=Qf5LPOJAEnEHpsx9FaEc
FTC is relatively clear, but people are asking the wrong questions. They cannot expect to get meaningful answers if they cannot identify the correct questions first.
Primary rule:
To determine whether a company operates a legitimate MLM business or a pyramid scheme, a court must look at how the business operates in reality. First then can the correct legal principles be applied.
It means there isn’t any bright line rules. If people ask for bright line rules then they haven’t properly identified the issue = they can’t expect to get any meaningful answers to those questions.
The bright line rule IS that a court must look at the realities (the facts of the individual case). The court cannot look at law theories alone, and neither can the FTC.
Well then, what are the correct questions?
They will need to completely change their ideas?
The problem isn’t in how it works, it’s in how people THINK it works.
Case law isn’t primarily meant to be “a source for self education about legal issues”. When people try to use it that way, it may add something meaningful to their legal understanding or it might fail miserably.
People can clearly get rather distorted ideas if they read case law. Professor Bill Keep isn’t an exception to that rule.
There’s no real difference between a legitimate MLM company and a pyramid scheme disguised behind sale of products or services. They both share exactly the same business model.
It means they will need to be examined closely to be able to detect the difference. A court or a regulator must identify relevant factors for the individual case. Factors can be relevant in one case but not in a different case, so they can’t clearly identify the factors either.
How do they do this? Consult Norway’s Ouija Board?
Like the guy from the FTC said. Look at the case law if you want guidance….its all you’re going to get.
It will need to be about legal principles, e.g. “what legal principles will a court need to apply to determine the difference between a legitimate MLM company and a pyramid scheme disguised behind commercial activity?”.
And there will be many answers to that question. People will need to have understood most of those answers before they ask, so they don’t completely “lose the track”.
“Everyone is equal to the law”. There’s no legal difference between MLM and other business models. Any rule can be relevant, but a court will need to determine which ones are and which ones are not.
“People and businesses can have multiple roles, multiple functions”. Any role or function can be a relevant part of the facts, but a court will need to determine which ones do really have some relevance.
Both those two factors identify the functions of the court as a main part of it.
I have already pointed out that people will need to change their own ideas about “how things work”.
There isn’t any difference between legitimate MLM and illegal pyramid schemes disguised behind product sale. The difference will be in how they operate in reality
So you will need to identify “reality factors” first = the evidence from the actual case.
Evidence from actual cases will be case specific, i.e. you cannot identify any bright line rules based on that either. Findings and conclusions may be different from case to case based on exactly the same type of evidence.
Sounds like a bunch of BS to me. i’ll stick with the case law.
I have no doubts about that. 🙂
Case law will be case specific. Similar logic may be relevant in other cases. Or it may not be relevant.
So there’s something wrong with the idea “I’ll stick to case law”. It assumed that case law always will be relevant. But that’s not true.
A court can’t use the reasoning “case law says …”, and then look for facts that will match the case law.
It must work in the opposite direction, “the facts are” rather than “the law says”. When relevant facts have been established, then it can look for relevant guidance from case law and other legal sources.
You try to make case law become “the only true source of legal guidance”, as some type of Bible (“the true Words of God”).
went through the transcript of the vemma preliminary injunction hearing. phew. well done.
cutting through all the arguments, vemma did not have a satisfactory reply about why those they labelled as ‘customers’ would be on ‘autoship’ if they had joined just to enjoy the products.
there is no difference in the cost of vemma products sold to either affiliates or customers. so customers really have no reason to join vemma as affiliates, unless they want to try the business opportunity.
vemma expert dr carr, gave some unconvincing roundabout explanation about how non affiliatepack purchasing, non recruiting affiliates were actually customers.
the root of the matter is affiliates buying inventory to remain commission qualified, and vemma’s autoship and encouragement of autoship achieves just that.
vemma loses, unless the judge finds vemma autoship is motivated by something other than commissions.
@Hoss
Here’s one example for where case law ideas will fail, from the Webster v. Omnitrition decision.
“If Koscot is to have any teeth …” is clearly related to some case specific evidence. You can’t extract it as a “Rule of Law”, e.g. “this is how the Law will see it in every case in the future”.
It doesn’t say you can either. You can’t assume that the court, “in all its wisdom”, wrote that statement so that people should be able to pick it up from self studies and include it in their own “fundamental values”.
That is incorrect. Case law encompasses numerous cases and theories. its broad and flexible.
That’s correct.
The plaintiff is suggesting the court follow case law precedent.
If the facts support it then you would expect the court to cite the analysis used in Koscot to justify its ruling. If the court does that, its ruling will stand up under appeal.
No lawyer worthy of the name will ignore precedent and case law and you shouldn’t either.
228 pages?! Aint nobody got time for that!
This close to a decision I think I’m just going to wait for that. And on that note, are we looking at a modified preliminary injunction being granted?
Might be the Judge wants to go release some funds he deems unrelated to the operation of Vemma, but otherwise the injunction stands. Have to wait and see.
Thanks for the analysis. The whole concept of auto shipping is suspicious in my book. I don’t trust it.
You must read the whole argument before you can decide whether something is correct or incorrect.
Here’s the whole argument.
There’s no guarantee that the case law always will be relevant, even in a very similar case. So you cannot read it like a Bible (“the Word of God”).
Here you can also see why it will fail, e.g. because people often focus on small pieces of information rather than on the whole message.
You responded only to the first statement. You didn’t even read the whole paragraph, 3 short statements. So your interpretation wasn’t very meaningful.
It was part of the opinion of the appellate court, not a part of plaintiff’s arguments. It was quoted from one of my own comments in a WakeUpNow thread.
behindmlm.com/companies/that-free-thing/wakeupnow-fail-to-address-retail-elephant-in-the-room/#comment-272817
I don’t think I have said you can ignore case law?
My point has been that you cannot read it like a Bible.
The legal principle’s are already incorporated into the case law. Do you think Amway, Koscot, Omnitrition, Burn Lounge et al were decided without reference to legal principles? Do you?
Of course they were.
Case law is our accumulated knowledge base on how to analyze, and judge these schemes… and the Court is expected to apply case law and statutes to the facts.
Nobody, including the FTC, presents evidence in a case law vacuum.
Norway: “Here’s the evidence!”
The Court: “Evidence of what?”
Norway: I will first establish the relevant facts.
The Court: What are you trying to prove?
Norway: I don’t know, its your job to apply legal principles to the evidence i present.
The Court: Dismissed for failure to state a claim.
Next case.
That was about my post #10?
Then you have probably derailed from something.
Oz, From Jeff Babener
Your threads of dialogue on Vemma have been very good. With the TRO and Preliminary Injunction hearings complete, some observations may be appropriate prior to the Court’s ruling. The comments relate to the procedural injunction aspects and not the merits of the case.
A brief review of the rough transcripts of the TRO hearing and Preliminary Injunction hearing are very instructive on possible outcomes.. Also, the following observations come through the “lens” of one who has served as a law clerk/advisor to a U.S. district judge, where such injunction cases have arisen, and from one who has served as a trial lawyer in business and direct selling litigation, in federal and state courts, for several decades.
The resolution on the merits will occur at a much later date. And the resolution, whether by stipulated settlement or adjudication will be guided by an inquiry under the most recent pyramid standards set forth in the BurnLounge appeal case, ie. requiring a fact “driven” analysis of whether a program is product/sales driven or recruitment/purchase driven.
The BurnLounge standard requires emphasis on sales to ultimate users, which includes nonparticipant retail customers and distributor personal use in reasonable amounts. Primary motivation for distributor purchases should be its destination to ultimate users and not to qualify in the plan for compensation.
Far more discovery, beyond these hearings, will be needed to adequately address the merits.
However, as to the procedural issue of either the TRO and a Preliminary Injunction, the proceedings raise serious concerns as to whether or not injunctive relief is appropriate.
Preliminary relief is an extraordinary remedy. It is equitable in nature and requires a court to consider several factors, and find in favor of the plaintiff (FTC) on such issues.
It may well be that the FTC burden has not been met. (Again, this relates to the procedural injunction issue….and not necessarily to the ultimate outcome on the merits.)
1. The court must find that there is a substantial likelihood of success on the merits of the case. In this instance, at best, it appears to be a “push”, requiring length discovery of facts that will be applied to the legal standard, in order to rule on the merits.
In these proceedings, it appeared that the FTC, at the TRO hearing, may have over promised, and under delivered at the Preliminary Injunction hearing.
Although true consumer protection issues were highlighted, for an investigation that had gone on for a year, too much of the presentation relied on old tapes, old footage, hearsay, opinion and even a loose interpretation of the current state of the law to focus on “retail sales” rather than sales to ultimate users and assessment of whether or not purchases for personal use or resale were in reasonable amounts.
(In fact, the FTC seemed to play fast and loose with the state of the law in the TRO order submitted to and signed by the Court in which the company was prohibited from paying commissions on any sales that were not specifically to non- participants.
This is neither the state of the law under Koscot, BurnLounge, nor even under the 2004 FTC Staff Advisory on MLM which recognized legitimacy of paying commissions on distributor personal use in reasonable amounts.)
The evidence provided at the TRO hearing did not necessarily paint the whole picture of updates to the program, satisfied customers and ultimate users, nor provide statistics as to the destination of product.
Cross examination of FTC witnesses at the Preliminary Injunction hearing indicated that “much work was yet to be done” to truly understand whether or not the current program ran afoul of BurnLounge standards.
There is no question that older materials urged affiliates to purchase and recruit, but no evidence of garage loading was present, no real evidence of harmed consumers, nor evidence that product did not end up being used by the ultimate user, the standard in BurnLounge.
And, as to the other aspect of the BurnLounge test, the primary intent of distributors when they purchased product, the best that can be said is that extensive discovery will be needed in the future to answer this question.
And thus, it appears that the most important burden, proof of substantial likelihood of success, was not necessarily met.
At best, it can be said that the parties will have a “real live” and “disputed” case going forward. In the end, the FTC may prevail, but it has a long way to go. And if this is the case, then a preliminary injunction may not be warranted…because “may prevail” is not good enough for a preliminary injunction.
2. A second prong is that there is a substantial threat (and immediate threat) of irreparable damage if the injunction is not granted.
Again the evidence presented failed to take into account improvements in the program.
Most importantly, evidence of irreparable damage seemed to be absent in that the worst case scenario was that purchasers of energy drinks ended up with lots to drink or could return the product…. but no evidence seemed to be presented that product “dead ended” in basements and garages, leaving victims of inventory loads.
3. A third prong requires that the balance of the harms weighs in favor of the government. This test requires an examination of the harm to the consumer vs. the harm to the business.
As noted, the evidence was weak as to harm to the consumer. However, the harm to defendant Vemma was and is extraordinary…. utter destruction of a 10 year old business, causing layoffs of scores of employees, depriving the sales force of a living and customers of a product and effectively ruining the life of the owner.
4. A fourth prong is that there is no other available remedy. In other words, the court should fashion the least intrusive remedy.
It appears from the FTC perspective, it was an all or nothing. After the evidence at the hearing, it was abundantly clear that a remedy could be fashioned to provide consumer safeguards and that this was a remedy totally amenable to the defendant.
5. A fifth prong is that the injunction will serve the public interest. Given the answers to the first prongs, it seems that an injunction, in its TRO format, is not necessary to protect the public interest.
A Modest Suggestion:
After such a process, what might be a reasonable response of a U.S. district court. Perhaps, given the mandate to adopt the least intrusive remedy to protect the consumer, a good result would be for the Court to invite the parties back to the court, extend the existing injunction for three days and instruct the parties to reach an amicable resolution during the pendency of the lawsuit that would address consumer safeguards, avoid sales of product that were not based on reasonable needs, assure that product went to and was used by the ultimate user, discarded any misleading communications on earnings possibilities, and adopted program materials that are clearly based on product sales and use rather than purchases for qualification and recruitment of others to do the same.
All of this could be accomplished, even under the watchful eye of a court appointed special master or even a delimited receiver.
Such a resolution would serve both parties. Vemma for obvious reasons. But it would also serve the FTC.
In the absence of such a resolution, the FTC faces a real possibility of denial of the injunction. If this occurs, Vemma will no doubt litigate this matter for years, leaving the FTC prosecution inconclusive.
More importantly, a loss here for the FTC will label it as overreaching and impact its credibility with other courts in the future as it seeks a TRO or other extraordinary injunctive relief.
With respect to a detailed advisory to direct selling companies to prepare for an event such as the Vemma TRO/Preliminary Injunction, please see my upcoming article, Vemma: Preparing for the FTC Ambush, to be published September 21, 2015 in the World of Direct Selling, worldofdirectselling.com.
The thrust of the article is to discuss the importance of “vetting” all public marketing communications, tracking the end destination of product to ultimate users and adopting methodologies for assuring distributor purchasing protocols are designed to fill only reasonable needs of distributors for expected resale or personal use.
Terrific. Thanks.
That would explain my blog coverage on Vemma got hit with 3 anon comments about how great Verve products are and why affiliates would buy them without any expectations of profit within a few hours today.
@Jeff Babener
I offered two feedback posts to your previous article. You won’t need to read the details, but you can get my conclusion.
I looked into the article, the audience here, this website and how it works. I also looked into “how people work”.
My conclusion was that we can accept relevant material, “something that adds to a story already covered or about to be covered”. It will most likely find an audience.
Specialized articles will more likely “feed the wrong animal” (the few ones, the ones eager to discuss details).
I have already covered the conclusion, but here are the two feedback posts. They’re written from the perspective of a sales person. I will analyse the “product” and the “market” from some specific perspectives.
post #87
behindmlm.com/companies/vemma/babener-weighs-in-on-ftc-vemma-lawsuit/#comment-346369
post #129
behindmlm.com/companies/vemma/babener-weighs-in-on-ftc-vemma-lawsuit/#comment-346618
Thanks for sharing your insight Jeff.
I’d have no issues with a limited preliminary injunction that saw Vemma permitted to pay commissions on sales made to non-affiliates, as that side of the comp plan is not under contention.
I do think however there’s been enough evidence raised to suggest that losses will continue should Vemma be permitted to operate as is.
I mean just look at all the top-leaders who walked out when the FTC announced their action (and Morton shortly before).
Do you really think if these affiliats had sizeable retail customer bases they’d just walk away from them?
Instead all we’ve heard of is blabber about them “protecting their teams”.
And these are the top-earners in Vemma, some of which have made millions. I mean really, other than Ted Nuyten and some naive kids who think they’re gunna be the next Alex Morton… who’s even left to market Vemma?
thankyou for an insightful post mr babener, i must admit i have learnt most of my MLM from your MLMlegal website!
my question would be, if restructuring of a pyramid scheme is possible, then why was it not on the cards for burnlounge?
even burnlounge was found to have a ‘product’ and the problem was similar to vemma’s ie the bundling of the product and business opportunity made the motivation behind the purchase suspect.
the court found against burnlounge, and did not offer a restructuring of the business, just because there was a product of some value.
vemma has been in business internationally for ten years, and because of this, it had pyramid sales money to build its offices and employ hundreds. this surely cannot be a reason to let a pyramid scheme continue by restructuring?
unless a new precedent about reasonable commissionable autoship is established, i don’t know how the judge can allow vemma the advantage of restructuring.
The state of the law seems to be twofold
* One state for legitimate MLM companies
* One state for illegal pyramid schemes = Koscot / BurnLounge
It will make sense if you apply normal presumption standards.
It can be one state of the law for legitimate MLM companies, and another state of the law when other evidence already have shown the existence of an illegal pyramid scheme. Both standards can be correct.
Vemma’s current state, “as the law sees it”, is that it is a legitimate MLM company defending itself against pyramid scheme allegations = FTC cannot apply the specific “Koscot / BurnLounge” standard and throw out Vemma’s evidence as irrelevant.
I have already covered that when I mentioned “feeding the wrong animal”. 🙂
vemma Corporate Videos and marketing stuff were directly encouraging people to sign up, buy the affiliate pack and get on autoship as this would qualify an affiliate for commissions and bonuses.
the vemma CFO [COO?} who was put on the stand and cross examined by the FTC made some unconvincing arguments about how vemma was merely giving information to people about how they could earn with vemma, and not instructing them or encouraging them. i mean, c’mon try again.
as the price of vemma products is the same for affiliates and customers, there is no margin for retail. this is clear ‘discouragement’ of sales outside the network.
autoship provided just 10% discount on the product, which is not sufficient to encourage retail. it would be far more cost effective to build a downline on autoship.
the vemma ‘plan’ in itself is slanted towards recruitment, it is not merely ‘compliance issues’ which can be addressed to make vemma a viable business.
so, you’re a fan of MLMlegal too? 🙂
The problem is until there’s a satisfactory criteria to separate those who could be considered “self-consumers” (i.e. who signed up as affiliate just to get access to the stuff) vs. affiliates (who is following the “drink some and share some” slogan because they think they are doing marketing… it’s actually PRUDENT for FTC to cut all commissions except those paid to true retail (i.e. non-participants).
And since Vemma has LONG violated the 10 retail customer Amway Safeguard rule (their comp plan, the current one, requires ONE (the affiliate him/herself), and at best, 3 (self, and two downlines)… what retail emphasis is there in the company?
Vemma can’t really even lay claim to be a MLM company if it does not follow the Amway safeguard rule, can it?
Not many people left to read after Nehra and Grimes have been disgraced…
I used it to look at “Amway 1979” and TravelMax “Inside An MLM Trial”. In March 2014.
since people here are too lazy 🙂 to go through the court transcript of the vemma hearing, here is an important point to consider.
there was no talk about retail sales that i noticed, or that had any relevance in the hearing.
the conversation was about the difference between a ‘customer’ and an ‘affiliate’ and self consumption. and about compliance towards amway safeguards, and the profit/loss of vemma, and the receivers actions, but no talk of retail, or retail percentages.
as KT said, this is the post burnlounge MLM universe.
if the court uses burnlounge as a precedent, it will find that the FTC has likelihood of success on the merits of the case. product and opportunity bundled together = recruitment commissions is the primary motivation.
the ever widening base of vemma affiliates will lose money to autoship every month. this is a substantial and immediate threat. if a burnlounge pack of approx 400$ was considered to be a threat enough to shut down the scheme, then why not vemma’s 150$ autoship every month? [one difference here in favor of vemma, is that burnlounge packs were non refundable]
vemma targeting young adults is a harm which weighs in favor of the government. keeping a long running pyramid scheme in operation to protect the jobs of a few score employees cannot be the concern of the court.
FHTM was an old scheme that was shut down because it was recruitment heavy. burnlounge was shut down because it was recruitment heavy. the court did not make an effort to ‘save the business’ in those cases?
the court is not obliged to fashion a remedy for a recruitment heavy pyramid scheme. if this were a case of only poor compliance or misrepresentation of the business opportunity, then the court could have fashioned a remedy.
vemma is trying to create the impression that there are ‘difficult issues’ to be resolved here, which need lengthy fact finding, but, commission qualifying autoship sales are the bulk of their revenue, and burnlounge is clear that this is not bonafide self consumption.
vemma cannot stick a ‘new definition’ of ‘customers’ to the court and get the TRO cancelled. their ‘definition’ of ‘customer’ is not found in any precedent case law.
public interest is served by halting monthly losses on autoship orders. public interest is served by protecting young adults from vemma’s encouragements to purchase affiliate packs and go on autoship.
excuse me mr babener, i’m just pushing my luck ^^^ with my ‘not legally informed’ opinions, so please bear with me 🙂
OK before the Big Decision comes today, heres what the parties have stated on 16th sept 2015:
over to judge tuchi, and may the best man win!
cronkitenews.azpbs.org/2015/09/16/vemma-ceo-confident-after-tempe-companys-court-hearing-on-pyramid-scheme-allegations/
One addition to that one …
A reasonable person cannot assume that the Ninth Circuit Court, “in all its wisdom”, intended its own decisions to be applied “here and there” where people feel it will support a specific legal theory.
In other words:
There’s a missing legal reasoning there for what the BurnLounge standard is about and why it can be applied to certain legal issues.
“The BurnLounge standard”
A vague label like that can be about almost anything. People can easily interpret it to be about product sales to external consumers, emphasis of the business, purchase patterns, ultimate users, “unrelated vs. completely unrelated”, the standard of expert witnesses, etc. etc.
That’s just grand. Which state of the law should be used in the Vemma case? The legitimate state or the illegitimate state?
This idea of “if Vemma sold burgers” just popped into my head about selling restaurants instead of burgers.
Unfortunately I am far from a keyboard so if someone want to take a crack at it go ahead.
Well not everyone wants to own and operate a restaurant. Yet its not very hard to get people interested in buying burgers from one.
But how much can a person make telling people to buy the burgers than buying the restaurant? This is the element that is the draw of mlm.
Getting people interested in being affiliates selling the vemma burgers “products” instead of being restaurant “member/owners”.
I for one probably won’t be too interested in the vemma products month to month “autoship” or as an owner trying to sell people on the idea of owning or reselling the system.
Seems the bigger money is “locking in” people on buying these products over and over.
It becomes hard to project earnings on a few sales here and there on customers not on autoship. A real struggle for that guy that is starting out on the bottom of someones massive downline.
If he has to build retail sales up against all the other sellers in the marketplace. This is more than a Vemma issue.
Cheap products are everywhere – how does one compete?
That was explained in post #31, but post #40 questioned that type of reasoning — the use of vague labels as part of legal theories.
There’s nothing in the BurnLounge decision that indicates that a “new standard” has been introduced there. The appellate court clarified some factors, but it didn’t introduce any new set of rules.
The prelim injunction decision is out. Going through it now, article up within the hour (crack of dawn here so bear with me).
I’ve had enough of Nuyten’s deceptive anti-government Vemma marketing all week. Please don’t link to it here.
Amateur reporting hour is over, the verdict is in. I’ll the facts up shortly (2000 words in).
Forget it. The Court’s do not judge different companies by different legal standards.
Whatever you have dreamed up in this regard is contrary to practice, logic and fairness. looking forward to your next inspiration.
but in the context of mlm, they do and that’s the problem.
no smart business person wants the exact same ‘restaurant’ right next door, 2 doors, 3 doors down from them. But if they can get a kickback from those ‘restaurant’ owners just for existing, what do they care if they are successful or not.
The field I operate in, the manufacturers and distributors don’t want dealers in other dealer’s backyards.
It doesn’t do them any good if 2 dealers fail because they are on top if each other then if only one exists. mlm doesn’t give a shit.
I haven’t said that either. That’s why I pointed to the original post #31.
Vemma’s “satisfied consumers” evidence can be relevant in certain parts of the case, but may be irrelevant in other parts. That doesn’t mean that Vemma will need to become a different company during the case.
Your idea was about different companies. I didn’t mention that.
Nuyten’s already aligned himself with the MLM narrative. His investment with Vemma only adds to “lost cost” fallacy.
He lost all of his brownie points back during the Zeek days. This is may be his swan song.
Here’s Vemma’s version of burger analogy. 😉
A: Hi, try out these Vemma burgers.
B: How much are they?
A: They’re free, for now, just demo, you know. Free sample. Here, one for you and one for me.
B: Not bad. How much are they?
A: $3
B: $3!?!?! But (BLEEP) has then for only $1.60!
A: And you have to buy at least $60 worth a month.
B: You are f***ing crazy, man!
A: And it comes with a mini restaurant.
B: WHAT?!?!?!?!?!
A: So you can give away these burgers… like I’m doing now.
B: Wait, what do you get out of it?
A: If I can find two people to buy the mini restaurant, which comes with monthly supply of burgers, mind you, I get a bonus. And you can do the same.
B: Let me get this straight, I can’t buy the burger separately. But if I order a mini restaurant, which comes with the burgers, shipped to me every month, you make money. How do I make money?
A: You have to find people that will buy mini restaurants, like I’m trying to convince you now.
B: You are f***ing nuts, man.
A: But you can make possibly millions! And get a car lease payment every month if you qualify!
B: Get away from me!
There you have the answer. We’re not lazy, we’re smart. We know that someone eventually will do most of the job for us, saving us a lot of time and work. 🙂
There was no way known I was going through 227 pages knowing a decision was going to be made in less than 24 hrs.
Hell by the time I’d put something together I’d be moving straight onto the decision!
I followed the same idea, so I browsed through a few pages before I decided to wait for the decision.
hmm, nice.
how about paying me then??