Vemma preliminary injunction to be decided in 3 days

16 Comments on “Vemma preliminary injunction to be decided in 3 days”

#1

anjali

Sep 16th, 2015 at 8:49 am  anjali(Q)

here are some updates posted by ted nuyten, while the hearing was going on:

-Vemma side looks very relaxed. Investigator confirms they did not find any fraud, accounting botches, or anything of the sort. Confirms management has been very cooperative.

-Kevin Johnson, temp receiver said he asked for docs showing customers vs affiliates and was given the database that shows it. When asked if they can continue to run biz Johnson says “I don’t recall”

-Tina Williams our reporter in the courtroom noted: “Several vemma affiliates are here showing support” and “Report shows vemma has responded in a timely manner to every complaint except ftc. Ftc never notified vemma of any complaints”

-Update: Vemma attorneys are doing well. Other side (FTC) seems disorganized

-Hearing break for lunch. The receiver said he didn’t allow anymore sales because of cost. Defense team confirmed that cost was more because they froze sales. Receiver said he was not legally allowed to sell product but allowed to continue paying commission. Defense confirmed this wasn’t true and he could have continued. Defense definitely ended on a good note.

-Hearing will be continued in 2 minutes, Matt Morrow stated: Kevin Thompson mlm attorney who bought me, Richard Brooke and Todd Falcone lunch says “vemma had a great morning. They defended the facts in a very efficient manner. They revealed many gaps in the FTC analysis”.

-Update Vemma – FTC hearing:
“The state is attempting to say that autoship violates the Amway front loading law. The expert witness from BRG says the 125 pv is a reasonable amount for personal consumption.”

-“Expert witness also states that the affiliate purchases are similar pattern to customers, making most always an end user”

-Hearing update:

“Tables are turning a bit. Testimonial videos are being shown that conflict with what Vemma states is against their policy and procedure”

Vemma states those are older videos when ftc was more lenient. They are now more specific. Alex Morton video was shown.

-Hearing is finished. Constantly heard the 70/30 rule brought up. Judge will take 3 days to decide. Kevin Thompson believes injunction will be modified and allow Vemma to operate in some capacity

i would go with kevin thompsons opinion that vemma will be allowed to operate in some capacity. like, sell the product without MLM.



#2

Oz

Sep 16th, 2015 at 9:24 am  Oz(Q)

Summary from KT:

Brief update after the FTC / Vemma hearing. Surprise and Hope.

Posted by Kevin Thompson MLM Attorney on Tuesday, 15 September 2015



#3

anjali

Sep 16th, 2015 at 9:48 am  anjali(Q)

great update from KT.

if the court finds ‘reasonable’ self consumption on autoship acceptable, this will change the MLM industry forever.

from being the toughest jurisdiction for MLM, the US will instead pave the way for product based pyramid schemes becoming legal.



#4

Oz

Sep 16th, 2015 at 9:55 am  Oz(Q)

And what a mess that will be.



#5

M Norway

Sep 16th, 2015 at 10:09 am  M Norway(Q)

Update from BusinessForHome.org (Ted Nuyten), a few minutes old.

businessforhome.org/2015/09/judgement-day-for-vemma-exclusive-reporting/

It doesn’t really contain anything, but it’s a lengthy story about a day in court. 🙂



#6

M Norway

Sep 16th, 2015 at 10:25 am  M Norway(Q)

M Norway:
It doesn’t really contain anything, but it’s a lengthy story about a day in court.

I did eventually find something …

In asking MLM attorney Kevin Thompson what his opinion was of the hearing at the third recess he said, “Vemma’s legal team has shown that the FTC has not quite done its homework. In my opinion, based on testimony today, they will be able to operate to some capacity again.”

The reason for why I didn’t find anything initially, other than “a lengthy story about a day in court”, was because it was written from a personal perspective with focus mostly on irrelevant factors.



#7

K Chang

Sep 16th, 2015 at 10:37 am  K Chang(Q)

Oh, yes, Vemma will be allowed to continue operating without commission paying.

That’s just FTC giving Vemma more rope to hang itself, because you’ll see a huge number of affiliates quitting their autoship since they ain’t getting paid (no qualification needed) and thus, proving FTC’s point that there is no demand for the product without the attached income opportunity.

Just watch FTC’s case against Burnlounge, and how “music sales dropped to nothing even though the site was not closed” figured into their final complaint.



#8

Bernardo

Sep 16th, 2015 at 10:49 am  Bernardo(Q)

Len Clements: “This whole FTC vs. Vemma episode is so disturbingly wrong…”

This whole FTC vs. Vemma episode is so disturbingly wrong. Seriously consider what has happened here.

The FTC convinced a judge to close down an eleven year old, $200 million company, with over 200 employees and 250,000 active Affiliates, not only without the defendant being given an opportunity to defend themselves, but without even being made aware the hearing was taking place!

facebook.com/photo.php?fbid=10207239430685198&set=a.10207239465846077.1073741827.1266893798&type=1&permPage=1



#9

M Norway

Sep 16th, 2015 at 10:56 am  M Norway(Q)

anjali:
if the court finds ‘reasonable’ self consumption on autoship acceptable, this will change the MLM industry forever.

“Reasonable amounts of self consumption” is an accepted standard. It doesn’t really matter whether it’s on autoship orders or one time orders.

You probably meant to be specific about it, “if the court finds Vemma’s sale to distributors …”.

The current legal issue isn’t about the pyramid scheme, but about the Preliminary Injunction (assets freeze, receiver, etc.). It’s about whether FTC has a relatively solid case, and about modifications to the preliminary injunction.



#10

K Chang

Sep 16th, 2015 at 10:59 am  K Chang(Q)

The problem with Mr. Clement’s narrative is self-conflicting.

If you follow the FTC narrative, it’s shutting down a 11 year SCAM. Whether Vemma has any time to prepare a defense is irrelevant. If it was truly innocent, it shouldn’t need to.



#11

Oz

Sep 16th, 2015 at 11:01 am  Oz(Q)

To anyone who was at the hearing, at any point did Vemma get up and say “for year X, we made $x in retail sales and $x in affiliate purchases”?

And if they did, which was greater?



#12

M Norway

Sep 16th, 2015 at 11:34 am  M Norway(Q)

Oz:
To anyone who was at the hearing, at any point did Vemma get up and say “for year X, we made $x in retail sales and $x in affiliate purchases”?

The hearing wasn’t about that. It was about the preliminary injunction, whether it should be granted, modified or denied. It was a pre-trial hearing.

It will most likely be modified to some degree, e.g. allowing Boreyko’s child support and reasonable living expenses.

The TRO froze all assets and virtually all business activity, placing it under the control of a receiver. The Preliminary Injunction will replace the TRO.



#13

M Norway

Sep 16th, 2015 at 12:36 pm  M Norway(Q)

Bernardo:
Len Clements: “This whole FTC vs. Vemma episode is so disturbingly wrong…”

Len Clements has probably misinterpreted something.

The hearing with both parties present was today, September 15th. It could have been heard on September 3rd, but Vemma needed more time to prepare its defense.

If Vemma wasn’t ready on September 3rd, it wouldn’t have been ready on August 21st either (or whatever date the TRO was heard ex parte).

The FTC convinced a judge to close down an eleven year old, $200 million company, with over 200 employees and 250,000 active Affiliates, not only without the defendant being given an opportunity to defend themselves, but without even being made aware the hearing was taking place!

The potential closedown was heard today. The other one was a temporary closedown, not a final one. Vemma has clearly had the chance to defend itself in court.



#14

anjali

Sep 16th, 2015 at 1:22 pm  anjali(Q)

M Norway: “Reasonable amounts of self consumption” is an accepted standard. It doesn’t really matter whether it’s on autoship orders or one time orders.

self consumption is perfectly all right. but, autoship introduces a pay to play factor, and encourages recruitment.

i think autoship just creates a product based pyramid scheme, because burnlounge accepted self consumption as product sales.

self consumption on autoship, is just one step tooo far, IMO.



#15

M Norway

Sep 16th, 2015 at 1:45 pm  M Norway(Q)

anjali:
self consumption is perfectly all right. but, autoship introduces a pay to play factor, and encourages recruitment.

Autoship in itself isn’t any problem?

Autoship means recurring orders, e.g. monthly orders, the same order each month. It will save time and work both for the customers and the company, if we compare it to non-autoship orders.

It simply means “Continue to send me the same products each month, until I decide otherwise”.

It can be a very convenient solution for some products, e.g. one month supply or 3 month supply of “Dailies Contact Lenses”. The alternative is “email reminders”, where the company frequently sends out new offers and you order new products manually.



#16

anjali

Sep 16th, 2015 at 2:45 pm  anjali(Q)

M Norway: Autoship in itself isn’t any problem?

duh, no. why should autoship be a problem?

mandatory autoship in MLM is a problem. keep shunting product to affiliates every month and keep paying commissions on that.
it’s pyramid scheme made ‘extra easy’.