Zrii settles with LifeVantage; Two more top reps leave

by louabbott on December 24, 2009

Zrii “Takeover¬† Attempt” and Settlement Details

More details were covered by the Farmington Daily Times regarding the $400,000 settlement of the lawsuit that Zrii instituted earlier this year against newer MLM company LifeVantage.

Utah-based Zrii LLC, a marketer of nutritional fruit drinks endorsed by popular doctor Deepak Chopra, has agreed to settle a flurry of lawsuits filed after a senior-management rebellion against its owner and CEO lead to a mass exodus.

Competitor LifeVantage Corp. of San Diego paid $400,000 to Zrii. The California company is where several former Zrii managers went to work after leaving the Draper company in February.

Zrii sued LifeVantage, claiming it had conspired with the executives to either take over the Utah company on the cheap or ruin it.

A federal judge in California signed an order this week dismissing the case. Zrii also agreed to settle lawsuits filed in Delaware and Utah against the managers, top independent distributors and employees who were fired or quit after an attempt to buy the company from CEO William F. Farley failed.

LifeVantage CEO David Brown said Wednesday that in the settlement, his company did not admit to any interference with Zrii. “We continue to maintain that, while the circumstances were unfortunate, we didn’t do anything wrong. We understand that maybe there were some hurt feelings, but I think all sides thought it was the best thing to move forward and get it behind us.”

Here are some of the details of the “rebellion” according to the article:

In February, Farley, a former Fruit of the Loom executive who lives in Chicago, arrived at Zrii’s Draper headquarters and found no employees, except a few in customer service. He was presented with letters calling on him to resign and with an offer to buy the company.Senior managers and several top independent distributors charged that the company was nearly broke because Farley had treated it like his personal bank account and used funds extravagantly. They also said he violated sales tax laws, authorized illegal political campaign contributions and engaged in unspecified inappropriate personal behavior.

Farley in turn sued, saying the top managers and distributors had tried to force him out in order to take over the company on the cheap.

Another development echoes some of the comments of the previous Zrii defectors:

Zrii top-level distributors Doug and Dave Vass of Calgary, Canada, announced Tuesday they had resigned from Zrii and would move to Nu Skin Enterprises of Provo.

The brothers, who had been among the most vocal critics of the actions of the former company managers, said on a Web site video they based their decision to leave on principles of participating only in companies that have integrity, honesty and innovative products.

In an e-mail, Doug Vass said he would not comment further. The brothers said they were earning “six figures” at the time they left Zrii.

Also see our Zrii profile or our LifeVantage profile.

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{ 1 comment… read it below or add one }

Deborah Tutnauer, LCSW December 25, 2009 at 12:05 pm Thumb up 1 Thumb down 0

Lou,

I have been watching the events at Zrii for a long time. I stopped working my Zrii business about 13 months ago, prior to the “attempted takeover” at Zrii in February 2009. The most recent events involving the resignation of Doug and Dave Vass, Founding Zrii Distributors validates even more, my decision over a year ago.

You are right, which is why I read your content regularly. Network Marketing often shows us both the best and worst of companies and much in between. Usually, when a door closes in one scenerio, it allows a window to open to something better. That is what happened in life and I couldn’t feel more blessed.

Zrii is a very good product. In fact I still consume an ounce every day and have not been ill in over 2 years. As a business, their are much better options. Any Zrii distributor who is feeling upset or concerned, needs to know that…and to open their eyes and their hearts to choices that will lead them to their dreams.

Peace and Abundance,
Deborah Tutnauer

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