Direct Sales and Multi-Level Marketing

Advising direct sales companies of any size, from start-ups to multi-million-dollar organizations

Corporate, Tax, Banking & Finance Employment & Labor Government Regulations Intellectual Property Litigation

Overview

Located minutes from dozens of successful direct sales and multi-level marketing (MLM) companies, Parsons Behle & Latimer’s Utah and Idaho offices are well-acquainted with the culture and concerns of the industry. Our attorneys work closely with clients to expertly navigate through growth opportunities as well as legal, employment and regulatory challenges.

Team

Key Contacts

View the full team

Experience

Jonathan Hillbery v. Nu Skin Enterprises United States, Inc.

After moving to compel arbitration of distributor’s federal court claims against Nu Skin, we successfully litigated every imaginable issue regarding the enforceability and scope of the arbitration agreement. The U.S. District Court Utah ordered the issues to be determined by an arbitrator, and later appointed an arbitrator after the parties could not agree on one. Then, the parties had a two-day arbitration on arbitrability, through which Nu Skin demonstrated that the distributor’s claims were in fact arbitrable.

Counseled Nevada Multi-level Marketing Company

Routinely advised a Nevada multi-level marketing company regarding a variety of issues including management, regulatory compliance, strategy and contractual structures.

Defense of a Delaware Direct Sales Company for Alleged Business Torts and Misappropriation of Trade Secrets

Successfully defended a Delaware direct sales company against litigation from another direct selling company for alleged business torts and misappropriation of trade secrets. Successfully and actively participated in extensive factual and motion practice related to international employment.

Capabilities

Employment & Labor

Direct sales companies rely upon people, and Parsons’ employment and labor team is adept at both thoughtfully structuring new organizations as well as counseling existing companies with various issues, including:

Employee handbooks
Employee training
Employment agreements
Expatriate management
Labor Commission representation
Noncompetition provisions
Non-solicitation provisions
Worker’s compensation issues

Litigation

Parsons’ MLM team assists clients in avoiding costly and disruptive legal issues, but when litigation is unavoidable, the firm has a proven track record of successfully representing the interests of direct sales companies, distributors and independent contractors with various issues, including:

Breach of contract
Cross-company recruiting or “raiding”
Defamation
Distributor rights and obligations
False advertising
Federal Trade Commission (FTC) allegations, claims and litigation
Licensing agreements
Mediation involving distributors, competitors and/or companies
Non-compete and non-solicitation rights, obligations and violations
Partner disputes
Policies and Procedures rights, obligations and violations
Shareholder suits and disputes
Trade secrets, violations of policies and procedures and non-competition

Corporate, Tax, Banking & Finance

Direct sales companies have repeatedly recruited Parsons' corporate transactions, tax, and banking and finance teams for guidance through complex mergers and acquisitions as well as other industry-specific matters, including:

501(c)(3) set up and management
Commission software agreements
Company acquisitions
Compensation plans
Cross-border transactions
Distributor agreements
Distributor compliance and discipline
Event and vendor contracts
FDA/FTC compliance
Foreign Corrupt Practices Act
GDPR compliance
Global intellectual property strategy management
Immigration
International expansion strategy and set up
Novel food issues
Policies and procedures
Product licensing agreements
Sales and marketing tools
Social media and ecommerce compliance
Supply chain and manufacturing contracts and agreements
Terms and Conditions for distributor incentives
Website

Intellectual Property

Parsons’ intellectual property team excels at protecting clients’ ideas, inventions, trade secrets and products through a variety of mechanisms, including:

U.S. and international patent protection and patent infringement litigation and defense
U.S. and international trademark protection and trademark infringement litigation and defense
U.S. and international copyright protection, including copyright infringement litigation and defense
Counseling and litigation regarding trade secrets and breaches of contract involving intellectual property
Counseling and litigation regarding privacy and unfair competition

Government Regulations

Parsons’ government regulations team has deftly guided clients through regulatory requirements at both state and federal levels, including interactions with the Federal Trade Commission, the U.S. Securities & Exchange Commission, the Food and Drug Administration and the Utah Division of Consumer Protection. Additionally, our attorneys have successfully lobbied client needs before the legislature and represented direct sales clients in administrative proceedings before various governmental regulatory agencies.