The weather is cooler, the leaves are falling, the holidays are drawing near….peace is in the air. In the span of a few days, Amway has made two HUGE announcements about the settlements of pending lawsuits between itself and multiple parties. First, they announced the settlement between themselves and MonaVie, which was anticipated to be an epic battle between the MLM giants. Click Amway v. MonaVie to read the original complaint. In the lawsuit, Amway alleged MonaVie was using unfair marketing practices while raiding Amway’s downline.
In the same announcement, Amway announced a settlement with Orrin Woodward and TEAM. The Amway / Woodward / Team litigation has been insanely intense since August of 2007. I was there for the start and I’m certain there’s much relief on both sides as a result of the settlement. The Amway / Woodward litigation produced a cutting edge court opinion about the limits of First Amendment protection for anonymous bloggers that disparage a company. Click here for the opinion.
Second, Amway announced today of its settlement of the Pokorny class action lawsuit. News of this settlement is not really surprising given Amway’s loss over its arbitration provision back in April of 2010. This was a very contentious case and Amway’s exposure was substantial. Due to the size of this settlement, I anticipate more lawsuits like Pokorny will be filed against other MLMs that rely heavily on tool companies. It’s ok to work with tool companies; however, when the tail starts wagging the dog, it can lead to HUGE, Pokorny-like problems.
The past few years have been busy for Amway as they’ve made some efforts to clean up their house. They’ve lowered prices, implemented quality control standards for the tool companies, invested more in IBO training and….settled their lawsuits.
The real losers as a result of these settlements…..THE LAWYERS.
What do you think about this news of the settlements?