DENVER, June 25 /PRNewswire/ -- It's a lawsuit that may help determine "who owns who" in the world of multi-level marketing. According to John Terhune, one of the plaintiffs who filed suit in state court in Volusia County, Florida, today, "The last thing we wanted to do was get involved in litigation. All we wanted to do was build businesses and help others do the same."
Terhune, along with former Univera leaders Marshall Douglas and Joe Land, are former distributors of Univera who have joined together in a lawsuit alleging the company has bullied its associates with threats of litigation and economic ruin if their sales networks move to a competitor. The filing comes on the heels of two actions Univera filed against them in Seattle earlier this year.
Terhune and his fellow plaintiffs spent years building their multi-level marketing network into a thriving family business. As a distributor of Univera products, Terhune, Douglas, and Land managed a vast network of associates, many of whom they personally recruited. For several years all three enjoyed a great relationship with Washington state-based Univera, a company known for its popular dietary supplements. Univera recognized Terhune as its Associate of the Year in 2007 and bestowed the Yun Ho Lee Award, Univera's most prestigious leadership and sales award, on Terhune in 2008.
But in 2007, poor management decisions destroyed what had been a promising business opportunity. Univera sacked its flagship product, Ageless Xtra, and replaced it with a "fizzy" liquid supplement called Xperia. The new product, quickly developed a reputation for "exploding" in its packaging and arriving in "soaked boxes." During the same time, the company swapped out its computer platform with great fanfare. It turned out to be a disaster. The new internet applications failed and a flood of customer complaints soon overwhelmed the Univera system. Customers, associates, and profits began to disappear.
In the span of just a few months, Univera squandered years of its associates' hard work and goodwill. Terhune, Douglas and Land had had enough. They transferred their remaining Univera business to their spouses, and began building a new network with another company.
Univera retaliated, accusing them of "getting rich" by "stealing" other people's groups. The company threatened to sue its associates if they followed the departing leaders into their new business venture, even though Univera's policies do not prohibit their associates from choosing to pursue a new business opportunity. Ironically, Univera has used the very same tactics it now decries. Terhune, Douglas and Land and other former Univera associates had previously built thriving networks with Amway. Univera aggressively recruited Land and others from Amway, along with key members of or their entire MLM networks, which is precisely the behavior it now criticizes.
Now, faced with Univera's threats of crushing litigation, Terhune and others are pushing back, making a stand for free markets and fair competition. Terhune and his fellow plaintiffs have brought claims for breach of contract, tortious interference with business relations, defamation, unfair competition, and inequitable retention of plaintiffs' businesses.
A copy of the complaint can be obtained by contacting plaintiffs' counsel, D.J. Poyfair, at (303) 764-4099 or by contacting the Clerk of the Court for the Seventh Judicial Circuit in Volusia County, Florida.
|SOURCE Baker Hostetler LLP|
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