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Judge Dismisses Amway UK Lawsuit

A judge in the UK has dismissed the legal dispute...

Amway can stay in England.

A United Kingdom judge has dismissed government claims against Amway operations there, saying major reforms last year fixed company faults that favored selling training materials over products and misrepresented earnings.

The ruling clears Amway UK, a part of Ada-based Alticor Inc., of the threat of expulsion from one of Amway's oldest international markets.

In a letter to employees around the world, Alticor President Doug DeVos and Chairman Steve Van Andel said the ruling was not a "pop-the-champagne victory."

"This is a reminder that the marketplace and regulators hold us to the highest standards. We have an obligation to meet those standards - and we intend to do so," they wrote.

The company has more than 100 employees in the UK and 10,000 distributors.

The judge in the case expressed his belief Amway allowed "misrepresentations" of its business by independent sellers in years past and failed to act decisively against the misrepresentations.

The reformed Amway business model, he wrote, is "fully formulated, comprehensive, open and transparent and capable of effective and ongoing implementation without supervision."

Spokesman Rob Zeiger said the ruling was a "solid validation" of reforms implemented by the company in the United States and abroad.

UK Secretary of State for Business Agrees With Orrin Woodward About Amway Quixtar Pricing

I hate to say that I told you so (OK I really like to say it), so, I told you so.  I have been talking about Amway/Quixtar product pricing since as a big issue (the biggest issue?) since 2003.

Now the UK authorities are talking about the same issues in this recent article.

TimesOnline:

(Mark Cunningham, QC, on behalf of John Hutton, the Secretary of State for Business, Enterprise and Regulatory Reform):

Mr Cunningham said that the vast majority of products offered by Amway to its agents were overpriced even before they were expected to add a further 20 to 25 per cent for retail. “The unattractive pricing explains some the graver vices that are at the centre of the winding-up application,” Mr Cunningham said.

Update:

According to former high level Quixtar IBO,  Chuck Goetschel's blog, Amway UK has already reduced prices on some products.  Here are some examples:

BODY SERIES™ Concentrated Liquid Hand Soap 250 ml

UK price: £1.75  was Retail £7.95

BODY SERIES™ Fresh Scent Deodorant and Anti-Perspirant Spray 200ml/130 g

UK price: £2.95 was Retail £6.50

BODY SERIES™ 3-in-1 Bar Soap 6 bars - 150 g

UK price: £4.50  was Retail £12.25

SA8 SOLUTIONS™ Pre-Wash Spray 400ml

UK  price: £1.65  was Retail £5.90

L.O.C. ™ Mini Wipes 4 travel packs each with 24 wipes

UK price: £4.25  was Retail £10.90

GREEN MEADOWS™ Air Freshener 150 ml

UK price: £1.25 was Retail £4.30

PURSUE™ Toilet Bowl Cleaner 750ml

UK price: £2.45  was Retail £5.50

L.O.C. ™ Plus SEE SPRAY Glass Cleaner 500 ml

UK price: £1.45 was Retail £5.85

L.O.C. ™ Plus Soft Cleanser 500 ml

UK price: £1.35 was Retail £5.80

AMWAY™ Wax Furniture Polish 400 ml

UK price: £1.45   was Retail £6.65

BODY SERIES™ Concentrated Liquid Hand Soap Refill 1 Litre

UK price: £5.95 was Retail £26.40

UK Taking Amway To Court

WZZM13

Ada - The United Kingdom is moving ahead with plans to take Amway to court.

The company's blog reports the UK Department for Business Enterprises and Regulatory Reform has decided to take legal action.

British regulators are upset with how some of the companies IBO's have promoted their businesses. The company says Amway has "worked tirelessly to address BERR's complaints and in the process reinvented the UK business almost from the ground up."

Amway has 106 employees in the United Kingdom and 12,000 Business Owners. The company's been doing business in the UK since 1973.

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Bill Britt Refusing to Reimburse UK BWW IBO's for Canceled Meetings

Here is an update about Bill Britt's actions in the UK related to his BWW support system:

It would appear another potential lawsuit is on the horizon. Britt Worldwide dream builders and other network marketing mlm organizations have given the impression they were waiting for Amway to reimburse and compensate them for canceled functions.

My source, who is a diamond has told me they were given the distinct impression by Amway personnel that they would be compensated by then, for cancelled funtions. He refers to the original letter from Amway 4th may to quote

"Enquiries  For example, if any IBO has a planned meeting for which tickets have been sold (that is required to be cancelled and ticket purchases refunded), or
they have unsold inventory of BSM, or
have unsold Starter kits, or have completed applications not yet submitted to Amway, they may contact the dedicated enquiry telephone number – 01908-629400 (press option 4)."

With respect this part of the letter can be interpreted any ways.

The following emails are quite interesting it would appear Amway was prepared to come some wazs and then backed off.

The diamond has commented, luckily we did not have a seminar plan so our people are not owed monies. However I know BWW owe around $75-$100 thousand dollars to their ibos.

it is a real mess, they are blaming Amway and visa versa.

I would think that the wealthy diamonds in the USA will foot the bill.

I have met Bill Britt on one of the councel meetings in the past and would say he is one of the most genuine honest people I have met. I am surprised he has not sorted out this potential scandal earlier. He obviouly has not been informed that his Uk ibos are hurting and have not been reembursed.

It does beg the question that if the BWW Britt World wide dream builders have known Amway were not going to refund the ticket monies, what has happened to the 100k plus monies and why have the 1000 approx. ibos not been refunded.

Accountabilty is such a strong teaching point in all organizations, BWW are really sending out the wrong message and it going to affect us all, if they are not careful.

Lets hope Bill and Peggy Britt payout their uk ibos, sooner rather than later, it is the right and honorable thing to do. I think they will be horrified as to whats going on.

Lets hope the DTI in the UK, do not get involved in this.

May 15 2007

Dear Diamonds,

Please find attached a copy of the guidelines that Amway will use to address reimbursing appropriate costs for event cancellation. To treat every situation equally Amway will not stray from these guidelines. We appreciate your cooperation in this process. This attachment addresses what costs Amway will cover, what is required before this cost will be address and the duration of this support. I hope that this will answer any questions you or your groups may have on this subject.

Sincerely

Ben Woodward
Branch Manager, Amway UK/RoI
Direct Tel:   01908 629420

GUIDELINES FOR REIMBURSEMENT OF COSTS ASSOCIATED WITH CANCELLED MEETINGS:

Amway will consider offering reimbursement to IBOs who have planned events that now need to be cancelled due to the change of UK operations dated 4th May.

Before reimbursement will be considered by Amway the following needs to take place:
1. Evidence provided to Amway to satisfy them that the meeting has been cancelled (a formalised letter sent out to the group by the provider of the meeting for example).
2. Refunds offered to those who have purchased tickets.
3. All refunds have been processed and documents that support this are provided to Amway.
4. All other supporting documentation that relates to the reimbursement are provided to Amway. This would include copies of contracts signed with venues that evidence cancellation fees are required, invoices that demonstrate charges have been made etc.
5. Amway requires that meetings be cancelled promptly in response to our original requests for suspending such events.

Amway considers its reimbursement of venue costs as appropriate support. No costs associated with speaker fees, travel arrangements, accommodation etc will be reimbursed. These are the costs of doing business and will remain the responsibility of the IBO. No other costs outside of venue fees will be reimbursed.

Reimbursement as mentioned above will apply only to those meetings that were scheduled, booked and promoted prior to May 4th and were due to take place from that date (May 4th) up to the date that meeting suspensions are lifted.

Please note that failure to reimburse ticket-holders could result in Amway seeking such reimbursement on behalf of the ticket-holder, from bonuses of responsible ticket-sellers.

From:  Ben Woodward
    Sent: 05/16/2007 10:00 AM GDT
    Subject: Important clarification to my note of yesterday re: cancellation costs

Dear Leader,

After further clarification from my upline, we need to clarify that any venue costs that Amway will consider will be in the form of a loan deducted from your bonuses. Therefore, ultimately Amway cannot bear any net financial liability for the cancellation of meetings for which tickets have been sold.

We appreciate your co-operation and understanding at this time.

Yours sincerely,

Ben Woodward
Branch Manager, Amway UK/RoI
Direct Tel:   01908 629420

Source: MLMLeads.eu

Official Amway UK Update - Change in on the way...

I received a funny comment on my TyTribble.com web site this morning. (OK the "web site" is really a blog but I am not really actively blogging on it and I use it more as a landing page - I know too much information). The comment was from someone at Amway and they suggested that I enjoy a post on the Amway Media Blog with my morning cup of coffee.

So I replied back to them asking for permission to re-post the entire update here at the MLM Blog. Amway game me full permission to "have at it" so here you go...

Amway Media Blog:

We would like to update you on events in the United Kingdom, where Amway, Network 21 and Britt World Wide are involved in a legal dispute with the UK’s Department of Trade and Industry.

What’s happening

Following an investigation that lasted more than a year, DTI last month issued individual petitions against each of the three companies, claiming each was engaged in “objectionable” practices.

The DTI’s petitions initiated civil court proceedings, which, if successful, could lead to the closing of each company’s business operations in the UK.

We are obviously disappointed that the DTI felt the need to take us to court. We certainly do not agree with all their claims.

But most important, we intend to address the problems that may exist in the UK and around the world so that no government ever sees the need to step in again.

What it means

The heart of the DTI’s position, as we understand it, is that the business opportunity is promoted by incorporated and unincorporated organizations in a manner that does not reflect the financial rewards people are likely to earn when they participate in the Amway business.

The DTI also objects to the manner and frequency in which meetings and BSMs are promoted by the sales organizations in conjunction with the Amway business opportunity.

Amway’s fault, according to the petition, lies in our failure to take sufficient action to prevent these abuses from occurring.

Following a first court hearing on May 21, 2007, the DTI’s case is now scheduled to be heard by the Court later this year.

At that hearing, the Court ordered DTI to set out its case in more detail so that Amway, Network 21 and Britt know precisely what is being alleged. Each company will have the opportunity to respond to the claims and to submit evidence.

What’s ahead

Though the trial is still months away, Amway has already offered important “undertakings” to the Court, which we believe address the DTI’s principal concerns. These undertakings make it clear that Amway will stand accountable for the experiences people have when they join the Amway business.

In shortened form, they are:

• Prohibiting business support materials that are not authorized and
  distributed by Amway.
• Prohibiting meetings where an entry fee is charged, unless Amway has
  approved the meeting and its content.
• Imposing a moratorium on the registration of new IBOs for 120 days,
  then introducing a revised registration policy.
• Providing the DTI 21 days’ notice before restarting the registration
  of IBOs.
• Amway will not implement any policy that requires payment of a
  registration fee prior to the hearing of the petition.
• Amway has also volunteered to inform the DTI of any violations of the
  corrective measures, and the action that Amway will take in response to the
  violations.

Once the business review in the UK has been completed and a new mode of operation has been devised, we will inform the DTI of the details. If the DTI is satisfied that their concerns have been addressed, then Amway will invite the DTI to end its legal action. If the DTI is not willing to agree to this, then the matter will be decided by the Court.

One further note. We have already weighed in against “spin” from tool companies. We have read the complaints. These problems are not Amway’s alone. Comments that suggest otherwise are wrong, plain and simple.

Conclusions

We fully intend to provide business reforms in the UK and in any other market where we see that business practices can be improved. A promised global review of practices is underway, and we are on track to release its findings next month.

We are holding ourselves accountable to deliver on what we promise.

We expect all our business partners to deliver as well.

There have been enough of these disappointments. They are serious distractions to the operations of the company, embarrassments to the many IBOs and Amway markets that provide exemplary service to the public, and a threat to the company’s long-term health.

Change is on the way.

Amway Media Blog Update on Network 21 & Jim Dornan

I was reading the posted letter from Jim Dornan of Network 21 at the Amway Media Blog and ran across a couple of sentences that sounded interesting to me:

We live in a world that is far more complex than many of us are used to. We must now adjust our actions and strategies to assure we are delivering the right messages with integrity and responsibility. Please help me to continue to seek careful and responsible communications regarding this issue.

I can't help but think that Mr. Dornan is talking about the fact that people now find out about "actions and strategies" via blogs. Blogs are the new word of mouth and the information travels a lot faster than before. For example, somewhere in the neighborhood of 5,000 unique people will look at this post before the end of the week.

What seems telling about the statement above is that "now" the system leaders must "adjust our actions and strategies" to assure that "integrity and responsibility" come through in the messages that are being reported.

My question: What were they doing before "now" and would they care about integrity and responsibility if not for the blog coverage of their actions?

New Amway UK Information Update

There is a semi-secret source for all of this Amway UK information at MLMLeads.eu. I check out the site about once a day and post the updates here. So if you want to sneak over and get the updates at the source, head on over to MLMLeads.eu:

comment from webmaster. This email shows quite clearly and insight into the internal working of a network, it is interesting to expereince the desperation of a hard working ibo, to get his so called mentors to listen, it is really a cry for help and shows how genuine people are about there Amway businesses. his reward for this email was to be banned.

Dear Demetrius,

I was present at the meeting with our awesome US upline and there was no talk of any one been banned. In fact the meeting talked about how unified we were.

Since then I realise I was mislead.

I have found out since the ibo who sent this email, was in fact told he was not welcome at the meeting. The reason because he sent it crossline. Well if this was the reason, no one should have been at the meeting!

Yes the email is slightly over the top but knowing the ibo, who is eccentric to say the least and very funny, this should have been taken into consideration.

I agree with his points, its a shame they were not allowed to voice them. I am extremely disapointed. I will email the ibo today to let him know I have posted his email.

Hopefully they wont be upset. I have taken their names and my name of, I hope you undestand this.

Subject: Re: plat meeting sat Al b etc,

I gather the DTI complaints don’t involve the BWW team, however as we have a 8 week sabbatical and the meeting on Saturday will it gives us the opportunity to sort out our own act.

You probably heard the expression "pig don’t know pigs stink" and based on my last tools meeting, recent events and the attitude of some of you, to your upline and britt office here in the UK. It is a remarkable opportunity to see if we can all get on the same unified UK page. I would also say the lack of our needs by the US Britt office and based on my last tools meeting, is totally arrogant to the UK needs and strikes me that we are never going to be listened to, unless we have a massive business and BWW have something to loose.

Before I start, how many of you have phoned the Britt office to offer your support to S and to Pe and Lo
I would point if the DTI come hunting it will be the Britt office staff and P and L who will carry the proverbial can, your US upline wont!. God Bless them they are under extreme pressure, and your encouraging words would help. They deserve a bit more tlc, than some of you have shown.

I occasionally get emails from some of you crossline with something like, "we are the most unified team in the world blah! Blah! Blah!"

Well blah blah blah why don’t you show it, to your UK leadership.

Actions recently have further highlighted your lack of edification and unity here. I will list a few, just in the last couple of months.

Attitude booked for 19th 20th May

UK BWW Meeting Blows Up

Here is the latest report from an Amway UK Diamond who has been keeping us up to speed on his site:

THINGS HAVE REALLY BOILED UP OVER THE WEEKEND.

I have just heard on the Amway grapevine that the British worldwide team leaders (I think that is what the abbreviation BWW stands for) held a meeting with their US upline, on Sunday 13th May.

Apparently some of the leaders were banned from the meeting for apparent dissent and lack of loyalty, bullies always use these mind games, dont they. They had a 7 point plan drawn up to improve the system.

This involved less function, working far closer with Amway and an idea for the system to be 95% UK training by IBOS, NOT AS IT IS in its present format, 95% US training aids and US speakers.

The US leaders made it clear they were not welcome at the meeting. I wonder why?

Free Speech and free enterprise rules ok!

Amway Drills Network 21 Over UK Letter

I am a little late to the party on this but it looks like a site posted a letter about the UK Sanctions and DTI from Network 21 leader, Jim Dornan (the post with the letter has now been removed). Then Amway responded to the letter by saying the following on the Amway Media Blog:

We’ve read the letter, too. And for the record, we do not stand by its assertions.

In its complaint against Network 21, the DTI makes serious allegations about the way Network 21 represents the Amway business opportunity in the UK. It troubled us to read that complaint. It also troubled us to read, in a separate complaint filed against Amway, that the DTI feels we did not do enough to police the misrepresentations made by Network 21 and others.

The Amway Media Blog ends the post with:

The spin that Network 21 is putting on this situation is not productive.

I tried to find the letter online, but was not successful. If anyone has a copy of the Network 21 letter, please forward it to mlmblog (at) mlmblog.net.

I must say that I like the tone of Amway in this case, using the term "spin" regarding a letter drafted by someone as visable and influential as Jim Dornan takes oranges.

Amway UK Ben Woodward Letter - May 10, 2007

Here is an update letter from Ben Woodward regarding the Amway UK RoI Sanctions:

UK IBO Communication
May 10th, 2007

To:                 UK/RoI IBO Leader
From:                 Ben Woodward, Branch Manager, Amway UK/RoI

RE:         Further information on announced changes

Amway would like to take this opportunity to share more information with you regarding some of the points referenced in the recent announcement of changes made effective May 4th 2007.
Firstly, in reference to meetings scheduled by IBOs; please understand that ALL meetings that have a ticket charge associated will need to be cancelled until further notice, and all ticket fees for cancelled meetings must be refunded. As any activity associated with recruitment (for example showing the plan) is currently suspended, there should be no need for open meetings at present. There can be no redefining of meetings to circumvent these requirements. Please appreciate that this action is necessary. No recruitment also includes no registering of Members. Amway will notify you when this decision is reviewed and what criteria will be applied to the authorisation by Amway of future ticketed meetings and activities in connection with signing up new IBOs.

The sale and distribution of Amway products continues and bonuses will continue to be paid as all bonuses are paid out based upon the sale of products.

Please be assured that during the course of this sponsoring moratorium Amway is looking at ways to ensure that everyone is treated fairly in respect of qualifications and rewards to ensure that people do not miss out due to the difficulties associated with our current mode of operation.

The reference to training IBOs to re-qualify them is in relation to Amway ensuring all IBOs understand and will deliver only appropriate messages in their Amway business. Hence sponsoring is suspended for 60 days to allow Amway the opportunity to develop this training. Amway will meet first with its leadership. Leadership being defined as IBOs qualified as Platinum and above. Following this meeting Amway will host a series of meetings or roadshows around the UK and Ireland where all IBOs will be required to participate should they wish to be qualified to sponsor new IBOs. Details of this process will be made available shortly.

Please understand that these decisions have been taken by Amway in the interests of and its commitment to the long term life and well being of the UK and Irish markets. The Amway business opportunity is a wonderful one and we have many, many committed and loyal IBOs across these two markets that are sincere, hard working, trustworthy and dependable. Difficult times or times of change reveal our true leadership abilities. I have been most grateful for and am heartened by the messages of understanding, support and cooperation that I have received from IBOs. Thank you to each of you. To others that are not so sure I give you Amway’s assurance that such change is well thought out, that IBOs long term interests are at the heart of these decisions and that the principles and values that founded this company continue to flow through the decisions made recently.

Sincerely

Ben Woodward
Branch Manager, Amway UK/RoI