News

The FTC announced that it had reached a $25 million settlement with four major marketers of weight loss supplements for unfair and deceptive advertising arising out of claims made for their weight loss products. The products involved are well-known brands - Xenadrine EFX, CortiSlim, TrimSpa and One-A-Day WeightSmart. The FTC had separately sued each of the companies alleging that their respective weight-loss and weight-control claims were not supported by competent and reliable scientific evidence.

Articles

Dietary Supplement Marketing - Rethinking the Use of Third Party Material - The Sequel - More on the use of the use and misuse of the Third Party Labeling Excemption in dietary supplements marketing, including coverage of the impact of the FDA's Xango Warning Letter.

The FTC's Proposed Business Opportunity Rule and How It Affects MLM Marketers - The proposed rule represents a serious challenge for direct sellers because it contains onerous obligations that will restrict their flexibility in recruiting new distributors and dramatically compromise the confidentiality distributors. This article describes the challenge and how industry can respond.

Seeing the Forest for the Trees - There is an overwhelming misperception among network marketing executives that they have nothing to worry about from the Federal Trade Commission or State Attorneys General so long as their compensation plans are not pyramids. In the case of network marketing programs, regulators focus first and foremost on the conduct of the company and its sales force to determine if they are engaging in unfair or deceptive consumer practices in their sales and marketing techniques. Since this is what regulators look at first, network marketing companies are well advised to follow the regulators' lead.

The Preminence of Value - One hundred and thirty six years of direct selling history in the United States absolutely establish that the most important factor is the value of the products, making value not only a business issue, but one of the most important factors affecting the legality of any network marketing program.

Customer Programs - A customer program is the single best thing that a company can do to bullet-proof itself legally. Moreover, it is also one of the best things the company can do for its and its distributors bottom lines.