Melaleuca wins two victories in Idaho courts

by louabbott on January 9, 2010

Last week marked a very successful week for Melaleuca in the legal arena:

First and foremost, Melaleuca was granted a TRO (temporary restraining order) against Max International.  The conclusion of the rather remarkable order from the United States District Court for the District of Idaho reads this way:

The Court finds that the plaintiff has met its burden for a TRO and preliminary injunction by demonstrating the likelihood that it will succeed on the merits, the irreparable harm it will incur, and that the balance of the inequities and the public interest tip sharply in its favor. Accordingly, Plaintiff’s Motion for TRO and Preliminary Injunction is hereby Granted. Furthermore, Defendant Max International is hereby ENJOINED from accepting as Max business associates, former Marketing Executives of Melaleuca who are in the downlines of any current Max associate who is currently or has been in the last twelve months a Melaleuca Marketing Executive. It is further ORDERED that for any Max business associate proposed to be accepted in the downlines of Rick or Natalie Foeller, Gwen or Ledell Miles, Chuck or Cheryl Alimena, and Raymond and Laurie Agren, Defendant Max shall obtain a certification from that proposed business associate stating the associate has not been a Melaleuca Marketing Executive in the previous twelve months and was not solicited directly or indirectly by any of the above named individuals or by any other person who has been a Melaleuca Marketing Executive with the previous twelve-month period.

Max International’s response was:

On January 7, 2010, the Honorable William F. Downes, United States District Court Judge, entered an order enjoining Max International, LLC (?Max?) from ?accepting as Max business associates,? former Melaleuca, Inc. (?Melaleuca?) Marketing Executives ?who are in the downlines of any current Max associate who is currently or has been in the last twelve months a Melaleuca Marketing Executive.?

While Max intends to comply fully with Judge Downes? Order, Max will continue to vigorously defend the lawsuit filed by Melaleuca. Max views it as deeply unfortunate that Melaleuca has decided to use the litigation process to preclude former Melaleuca Marketing Executives from having the freedom to decide where they want to work. Max believes that litigation tactics designed to intimidate and cause fear among multi-level marketing associates are counterproductive, and not in the long-term bests interests of the industry.

A complete copy of Judge Downes? Order is available from the United States District Court for the District of Idaho.

What this means for you is that until further notice, in order to comply with the court order, current and former Melaleuca marketing executives may not become Max associates.

Also, according to ktvb.com in Boise, ID, in a completely unrelated legal action, a former VP of Marketing for Melaleuca was ordered to repay over $240,000 to Melaleuca over a breach of a separation agreement that paid him over $300,000.

Idaho State Judge for the Seventh District, Judge Greg Moeller, ruled:

A state judge has ordered the former vice president of marketing at Melaleuca Inc. to return more than $240,000 after violating an agreement to not criticize the company president.A state judge late last month ruled he violated the agreement when he made written statements criticizing company president Frank VanderSloot.

According to a February 2006 agreement, the VP agreed to receive more than $300,000 in exchange for not saying “anything negative or disparaging about Melaleuca, its policies, philosophies, products or personnel.”

But he sent e-mails, a letter and co-authored a statement to the Idaho Legislature calling VanderSloot hypocritical and managing by fear and intimidation.

Seventh District Judge Greg Moeller rejected the argument about the possible validity of his statements to rule that the real issue was the VP violating the agreement.

For more background news, see Related Posts below.

Also, see company profile posts for Melaleuca and Max International.

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