United States Ninth Circuit

The district court's order granting a permanent injunction against defendant's continued operation based on the court's holding that defendant's multi-level marketing business was an illegal pyramid scheme in violation of section 5(a) of the Federal Trade Commission Act is affirmed, where: 1) defendant's scheme satisfied both prongs of the Webster v. Omnitron International, Inc., 79 F.3d 776 (9th Cir. 1996), pyramid scheme test because defendant's focus was recruitment, and because the rewards it paid in the form of cash bonuses were tied to recruitment rather than the sale of merchandise; and 2) the district court did not abuse its discretion in admitting the Federal Trade Commission's expert testimony because the testimony was relevant and reliable.

Appellate Information

• Decided 06/02/2014
• Published 06/02/2014

Judges

• CHRISTEN

Court

• United States Ninth Circuit

Counsel