The Dirty Little Secret MLMs Don’t Want You to Know

SALT LAKE CITY — This week I’ve been writing a series on the compelling story of Burke Hedges, author and MLM upstart entrepreneur. In just over a week Hedges will get his long-awaited day in court in the case of Burke Hedges v LifeVantage.

The civil trial, which will take place in front of a jury in Salt Lake City on November 27th, is poised to have all the intrigue of any case about salacious misconduct, deceit and money. But underneath all of that Hedges belief is this case stands to set precedents around distributor rights.

The questions Hedges is seeking to answer are:

• Can a distributor take away your contract and downline with no repercussions?
• Is this the way an ethical MLM business treats distributors?
• Are there more sinister motives at play?

The Case Against LifeVantage

In summary of the case, which we’ve detailed in previous posts, Hedges’ embarked on a contract as a LifeVantage distributor in May 2009. By August 2010, he received a termination for alleged misconduct, despite vehemently denying claims against him to company stakeholders. Hedges was blindsided by the allegations and very little information has been shared with him about his reported offenses to date.

Today, he questions whether LifeVantage’ termination of his contract was instead motivated by money. At the time of termination, he believed they were struggling to live up to the agreement between LifeVantage and his company Backbone Worldwide, Inc. Reportedly, much of the downline infrastructure that Hedges brought to LifeVantage remains in place.

To this day, Hedges believes LifeVantage makes million of dollars off of his downline, and he receives no residual income from it. Presently, LifeVantage is a company that grosses almost $200 million in sales each year off of anti-aging supplements and nutritional health products.

In a book Hedges authored before joining LifeVantage, Who Stole the American Dream, he outlined tales of corporate greed and juxtaposed the freedom hardworking people can experience when they become independent distributors for MLM companies. In an almost prophetic turn of events, Hedges now believes that same greed caused his termination from LifeVantage, and contributed to the false notion that all MLM companies are scams.

Did the guy who wrote the book on MLMs fall victim to the same crooked system that has plagued other distributors? And will this trial be a step in the right direction for distributor rights, or just another drop in a large buckets of distributor complaints?

Is the dirty little secret that MLMs don’t want us to find out that they can take your livelihood away as easily as they provide the opportunity to make it?

Stay tuned to this blog for answers to those questions.