Quixtar
Encyclopedia
Amway Global is a multi-level marketing
(MLM) or network marketing company, founded 1959 in Ada, Michigan, United States. It is privately owned by the families of Rich DeVos and Jay Van Andel
through Alticor
which is the holding company
for businesses including Amway
, Amway Global, Fulton Innovation, Amway Hotel Corporation, Gurwitch Products
, Hatteras Yachts and manufacturing and logistics company Access Business Group. After the launch of Amway Global originally operating under the name Quixtar, it replaced the Amway business in United States, Canada and the Caribbean, with the Amway business continuing to operate in other countries around the world. Company officials confirmed in June 2007 that, over the subsequent 18 to 24 months, Quixtar will merge with its sister companies of Amway organizations around the globe to form under one new name Amway Global.
Amway Global is also a member of the Direct Selling Association
and the Better Business Bureau
.
initially founded the Ja-Ri Corporation, a multi-level marketing distributorship for Nutrilite
products, in 1949. Ja-Ri was incorporated in 1959, and changed its name to "Amway" in 1963. As of 2007, Amway operates in more than 80 countries around the world. In 1999, the founders of the Amway corporation launched a sister Internet-based company named Quixtar. The Alticor corporation owns both Amway and Quixtar, plus several other concerns. Quixtar replaced the North American business of Amway in 2001 after the majority of the distributors moved to Quixtar, with Amway operating in the rest of the world.
On June 13, 2007, the Associated Press confirmed that over the next 18 to 24 months, the Quixtar business would be phased out in favor of a unified Amway Global brand in North America. According to Chairman Steve Van Andel and President Doug DeVos, "We are going through a global transformation of our business; this includes rethinking our global approach to products, training, brands, and how we operate in all the countries in which Alticor operates. As part of that, in 18 to 24 months, we're planning to begin using the Amway name in North America to unite our business opportunity under a single global brand."
and Canada
, including Nutrilite
dietary supplements, XS Energy Drink
s, personal care, home care, air and water purifiers and Artistry
cosmetics.
Quixtar also markets through their website products from partner stores whose list can be found at Quixtar website. Quixtar utilizes the Employee & Affiliates Purchase Program discount pricing structure for purchases from most of these third-party partner stores. Purchases from some of them (generally called discount-only partner stores) may not gain the P/V & B/V (measures of sales volumes, used for calculating bonuses to be paid) normally associated with an IBO's purchases.
In 2001, after the majority of Amway Independent Business Owners (IBOs) had transferred to the new company, Quixtar completely replaced Amway as the marketing venture for Amway/Alticor products in North American regions. The Quixtar business model differs from the earlier Amway business model in many aspects, such as the way distribution is performed as well as the products and services offered through partner stores. Rather than ordering product from a distributor who delivers them in person, Quixtar customers can place orders online and have the products shipped to them directly. In mid-2007 however, Quixtar announced they were phasing back in the Amway name over two years and discarding the Quixtar name. Along with the re-branding campaign, Amway Global is investing over 580 million dollars into both increased compensation for IBOs and for extensive advertising of the new brand name.
Individuals may buy products through Quixtar's web site with a referral number from an IBO. Quixtar also gives IBOs the option to create free personal websites that can be personalized to focus on health, beauty, health and beauty, and/or gift and incentive products. The referring IBO then receives the retail/wholesale profit (usually 30%), and a percentage ("bonus") of the cost of the sold goods (from 3% up to 31% depending on total PV generated), with Quixtar-exclusive products yielding a higher bonus per dollar in Point Value and Business Value (PV/BV). Quixtar offers a wide range of products for its IBOs to purchase for personal use and/or to sell to customers through Quixtar.com and IBO personal e-commerce sites.
IBOs pay a registration fee and build their businesses through retail sales to customers, referring business to Quixtar.com, and by helping other IBOs build similar businesses. Their earnings are based on their business' sales and the volume of sales and purchases of IBOs registered by them.
The structure of a Quixtar's IBO organization is hierarchical, but an individual can earn more than those who bring them into the organization. Pin levels are similar as in Amway. There are several major pin levels in the model denoting particular level of success in building their IBO business.
Quixtar reports that the average income for an "active" Quixtar IBO in 2005 was $115 a month ($1,380 annually), as documented in The Quixtar IBO Compensation Plan and on a Quixtar website. The average annual Quixtar income for an IBO that qualified at the Platinum level in 2005 (0.1683% of IBOs) was $47,472 and for a Diamond (.0120% of IBOs) it was $146,995. The largest single annual bonus (in addition to monthly incomes) for a Diamond was $1,083,421.
An "active" IBO is qualified on the IBO Registration form: Based on an independent survey during 2001, “Active” means an IBO attempted to make a retail sale, or presented the Independent Business Ownership Plan, or received bonus money, or attended a company or IBO meeting in the year 2000. Approximately 66% of all IBOs of record were found to be "Active."
ranked Alticor
, as America's 27th largest privately owned company with estimated revenue of $7.29 billion. In 2006, Internet Retailer ranked Quixtar.com as the number one site in the "health and beauty" category and 18th largest e-commerce site (for revenue) overall.
Quixtar-powered IBOs generated revenues of $1.118 billion for Quixtar for the fiscal year ended December 31, 2006, the fourth consecutive year in which the company surpassed the billion-dollar mark. IBOs also generated record $84.6 million in revenues for Quixtar’s Partner Stores in 2006.
, American pole vaulter Jennifer Stuczynski
, American Olympic sprinter Sanya Richards
, U.S. Olympian Shawn White, Cinematographer Wes Anderson
,Chinese Olympic hurdler Liu Xiang
; Brazilian soccer player Ronaldinho
, heavyweight boxer Evander Holyfield
, NFL player Emmitt Smith
and Heisman Trophy winner Ron Dayne. Tim Foley
, a member of the undefeated 1972 Miami Dolphins
, is a Quixtar Founders Crown Ambassador.
Author John C. Maxwell
, who writes leadership books including The 21 Irrefutable Laws of Leadership, is known to support Quixtar affiliated organizations such as Worldwide DreamBuilders and co-authored a book, Becoming a Person of Influence, with Jim Dornan, Quixtar Founders Crown Ambassador and founder of Quixtar support organization Network TwentyOne. Orrin Woodward and Chris Brady, both former IBOAI board members for Quixtar, co-authored the #1 bestseller, Launching a Leadership Revolution. Both Woodward and Brady were terminated by Quixtar and participated in a class action lawsuit against Quixtar alleging that Quixtar operated as an illegal recruitment scheme. Paul Harvey
, a radio broadcaster, known for his 'The rest of the story' tagline, has long been associated with the Quixtar program that is advertised on his show.
As a guest speaker at the Quixtar LIVE! conference in 2003, Phil McGraw
("Dr. Phil") reportedly described Quixtar as "one of the greatest success stories in American business history." In a 2006 settlement involving a class-action lawsuit brought against McGraw and his Shape-Up diet products, plaintiffs could receive a share of $6.0 million in Quixtar-brand Nutrilite
vitamins and $4.5 million in cash.
for the Orlando Arena, home to the NBA
's Orlando Magic
, which was formerly known as the TD Waterhouse Centre. In the deal, the arena became known as Amway Arena. As part of the contract, Amway also had the exclusive right to first negotiations for the naming rights of the arena's successor, and secured in early August 2009 a 10-year deal to name the new facility Amway Center.
, Amway Global signed a three-year deal with the San Jose Earthquakes
to become the team's official jersey sponsor.
A major part of the partnership is focused on community initiatives in the Bay Area
. As a result, Amway Global is now also the official sponsor of the team's Kicks for Kids program that focuses on fitness and healthy lifestyles, as well as bringing underprivileged children to Earthquakes games.
The partnership also saw the creation of the Amway Global Street Team, which appears at all Earthquakes home games and at a number of soccer and non-soccer events throughout the Bay Area. The members of the Amway Global Street Team give away Earthquakes-branded merchandise and provide soccer skills demonstrations at each event.
. That deal would last only one year, as the Sol folded after the 2009 season
.
A class action lawsuit was filed in 2007 against Quixtar and some of its top-level distributors in California, alleging fraud, racketeering, and that the products business and the tools business are pyramid scheme
s. A similar case filed in California in August 2007 by TEAM affiliated IBOs whose contracts had been terminated was dismissed. On November 3, 2010, Amway announced that it had agreed to pay $56 million to settle the class action, $34 million in cash and $22 million in products, and while denying any wrongdoing or liability, acknowledged that it had made changes to its business operations as a result of the lawsuit. The settlement is subject to approval by the court, which is expected in early 2011. The total economic value of the settlement, including the changes to the business model, is $100 million.
In his online book "Merchants of Deception", former Quixtar IBO Eric Scheibeler stated that he and his family received death threats from his uplines during a business meeting and from an anonymous phone call. In 2006, a Swedish newspaper published statements attributed to Scheibler which implied that Amway/Quixtar employees were responsible for these threats. Amway and Quixtar sued Scheibler on February 27, 2007 for defamation. In July 2007, Scheibeler wrote a letter to an attorney for Amway and Quixtar clarifying among other things that, to his knowledge, Doug DeVos or Amway/Quixtar employees never made any death threats to him.
In July 2007, a lawsuit was filed by IBS (Internet Business Solutions), owned by Quixtar Emeralds Henry and Sue Skaggs, naming Bill and Peggy Britt, Paul and Leslie Miller, Rocky Covington, Kevin and Beth Bell, and Britt World Wide, all of whom are Emeralds and above in Quixtar, as defendants. The suit alleges that the Skaggs, having developed a software system to allow for direct order fulfillment of tools to their downline, received approval from Britt to continue the development of the software program for eventual rollout to all of BWW (a tool system within Quixtar). During this time, the Skaggs state that they carried the burden of the development costs. According to the lawsuit, Bill Britt stated in 2005 that the program would not be rolled out across BWW. The Skaggs then claim they were de-edified by their upline. The suit alleges breach of contract, racketeering, and intentional interference with economic relations. In response, the defendants claimed that no contract was entered into and challenge the lawsuit on various other legal grounds.
offers advice for potential MLM members to help them identify those which are likely to be pyramid schemes.
In the 1979 ruling In re. Amway Corp.
, the Federal Trade Commission
determined that Quixtar predecessor Amway was not an illegal pyramid scheme
because no payments were made for recruitment. In addition, Amway (and later Quixtar) rules required distributors to sell to at least 10 retail customers per month, or have $100 in product sales, or a total of 50PV from customer purchases in order to qualify for bonuses on downline volume. Quixtar IBOs are required to report this customer volume on Quixtar.com or they do not receive bonuses on downline volume. Furthermore, an IBO must also personally sell or use at least 70% of the products personally purchased each month. The FTC established that these rules help prevent inventory loading and other potential abuses of the marketing model.
In 1986 Amway Corp. agreed, under a consent decree filed in federal court, to pay a $100,000 civil penalty to settle Commission charges it violated a 1979 Commission order that prohibits Amway from misrepresenting the amount of profit, earnings or sales its distributors are likely to achieve. According to a complaint filed with the consent decree, Amway violated the 1979 order by advertising earnings claims without including in it clear and conspicuous disclosures of the average earnings or sales of all distributors in any recent year or the percent of distributors who actually achieved the results claimed.
The FTC has required the information on average income to be provided to all prospective Quixtar business owners since the above 1979 FTC ruling clearing the Amway business model as legal.
A 1985 Forbes
magazine article quoted Dexter Yager, an IBO, as stating that about 2/3 of his income is from BSM's.
In 2004, Dateline NBC
aired a report, alleging that some high-level Quixtar IBOs make most of their money from selling motivational materials rather than Quixtar products. Quixtar published an official Quixtar Response website where it showed '"Interviews Dateline Didn't Do"'. Quixtar also states on its response site that Dateline declined their request to link to the site.
During the registration process for a new IBO, Quixtar contracts clearly inform prospective IBOs that BSM are optional and that the producers and sellers of the BSM may make profit or loss from their sale (like any other business). This is also publicized on Quixtar websites. Quixtar's Business Support Materials Arbitration Agreement (SMAA) requires the immediate seller of BSM's to buy-back materials, which were purchased only for personal consumption within a 180 day time frame, on commercially reasonable terms, upon request of the purchaser. BSM's purchased for inventory or to be sold to others downline are not covered by the buy back policy.
On August 10, 2007, Quixtar announced that it had terminated the businesses of] fifteen of the plaintiffs involved in the lawsuit, and sought and received a temporary restraining order and preliminary order of injunction hosted by QuixtarNewsroom.com in a Michigan court preventing them from interfering with the LOS, soliciting IBOs for their new company, or disparaging Quixtar or the business in any way. In mid October 2007, Quixtar argued that the former distributors were in violation of the court order since Team continued to have meetings and sell motivational materials. In Grand Rapids, Michigan, Quixtar argued that Team was using Quixtar's proprietary information to promote its meetings and sell materials. The court held in favor of Woodward and Brady and allowed Team to continue to operate. Specifically, the court held, "The Court finds particularly noteworthy the steps that both Mr. Orrin Woodward and TEAM took to make a good faith effort to comply with the preliminary injunction."
In an effort to ensure its injunction wasn't being violated, Quixtar filed an action against 30 anonymous bloggers. Specifically, Quixtar is seeking to discover if Woodward and Brady are involved in a blogging campaign to disparage the company. The California lawsuit was dismissed on October 5, 2007.
In the summer of 2004, some Quixtar leaders and IBOs allegedly launched a Web initiative designed to make their web pages more prominent in search results, aka Google Bombing.
Media articles
Government documents
Multi-level marketing
Multi-level marketing is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a downline of distributors and a hierarchy of multiple levels of compensation...
(MLM) or network marketing company, founded 1959 in Ada, Michigan, United States. It is privately owned by the families of Rich DeVos and Jay Van Andel
Jay Van Andel
Jay Van Andel was an American businessman best known as co-founder of the Amway Corporation, along with Richard DeVos. He also served as Chairman of the U.S...
through Alticor
Alticor
Alticor is a privately held corporation, owned and run by members of the DeVos and Van Andel families. It was established in 1999 to serve as the parent company for a handful of business ventures, most notably the direct selling company Amway and Quixtar and a manufacturing and distribution...
which is the holding company
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
for businesses including Amway
Amway
Amway is a direct selling company and manufacturer that uses network marketing to sell a variety of products, primarily in the health, beauty, and home care markets. Amway was founded in 1959 by Jay Van Andel and Richard DeVos...
, Amway Global, Fulton Innovation, Amway Hotel Corporation, Gurwitch Products
Gurwitch Products
Gurwitch Products produces, manages and markets Laura Mercier Cosmetics, a global brand of high-end cosmetics, skincare and body and bath. Launched in 1996 and based in Houston, Texas, the Laura Mercier line is available in over 650 doors in 24 countries....
, Hatteras Yachts and manufacturing and logistics company Access Business Group. After the launch of Amway Global originally operating under the name Quixtar, it replaced the Amway business in United States, Canada and the Caribbean, with the Amway business continuing to operate in other countries around the world. Company officials confirmed in June 2007 that, over the subsequent 18 to 24 months, Quixtar will merge with its sister companies of Amway organizations around the globe to form under one new name Amway Global.
Amway Global is also a member of the Direct Selling Association
Direct Selling Association
The Direct Selling Association is the name of several similar trade associations in the United States, United Kingdom, Australia, Malaysia, Singapore, and New Zealand that represent direct selling companies, including those that use multi-level marketing compensation plans or party plan product...
and the Better Business Bureau
Better Business Bureau
The Better Business Bureau , founded in 1912, is a corporation consisting of several private business franchises of local BBB organizations based in the United States and Canada, which work through their parent corporation, the Council of Better Business Bureaus .The Better Business Bureau, through...
.
History
Rich DeVos and Jay Van AndelJay Van Andel
Jay Van Andel was an American businessman best known as co-founder of the Amway Corporation, along with Richard DeVos. He also served as Chairman of the U.S...
initially founded the Ja-Ri Corporation, a multi-level marketing distributorship for Nutrilite
Nutrilite
Nutrilite is a brand of mineral, vitamin, and dietary supplements created in 1934 by Dr. Carl F. Rehnborg. Nutrilite products are currently manufactured by Access Business Group, a subsidiary of Alticor whose products are sold via the Amway and Amway Global Corporations worldwide...
products, in 1949. Ja-Ri was incorporated in 1959, and changed its name to "Amway" in 1963. As of 2007, Amway operates in more than 80 countries around the world. In 1999, the founders of the Amway corporation launched a sister Internet-based company named Quixtar. The Alticor corporation owns both Amway and Quixtar, plus several other concerns. Quixtar replaced the North American business of Amway in 2001 after the majority of the distributors moved to Quixtar, with Amway operating in the rest of the world.
On June 13, 2007, the Associated Press confirmed that over the next 18 to 24 months, the Quixtar business would be phased out in favor of a unified Amway Global brand in North America. According to Chairman Steve Van Andel and President Doug DeVos, "We are going through a global transformation of our business; this includes rethinking our global approach to products, training, brands, and how we operate in all the countries in which Alticor operates. As part of that, in 18 to 24 months, we're planning to begin using the Amway name in North America to unite our business opportunity under a single global brand."
Products
Quixtar is the exclusive distributor of Alticor products in the United StatesUnited States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
and Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
, including Nutrilite
Nutrilite
Nutrilite is a brand of mineral, vitamin, and dietary supplements created in 1934 by Dr. Carl F. Rehnborg. Nutrilite products are currently manufactured by Access Business Group, a subsidiary of Alticor whose products are sold via the Amway and Amway Global Corporations worldwide...
dietary supplements, XS Energy Drink
XS Energy Drink
XS Energy Drink is an energy drink manufactured by a California-based company, and exclusively distributed by Amway Global in the USA, Canada, New Zealand, Australia, the UK and Japan.-Product information:...
s, personal care, home care, air and water purifiers and Artistry
Artistry (cosmetics)
Artistry is a brand of skin care and colour cosmetics, produced by Access Business Group and marketed by Amway in more than 90 countries and territories worldwide. Access, Quixtar, and Amway are part of the Alticor group of companies...
cosmetics.
Quixtar also markets through their website products from partner stores whose list can be found at Quixtar website. Quixtar utilizes the Employee & Affiliates Purchase Program discount pricing structure for purchases from most of these third-party partner stores. Purchases from some of them (generally called discount-only partner stores) may not gain the P/V & B/V (measures of sales volumes, used for calculating bonuses to be paid) normally associated with an IBO's purchases.
Business model
Quixtar relies primarily on person-to-person referral rather than advertisements for sale of products; however, Quixtar has recently announced the launch of a multi-million dollar ad campaign. A large part of the marketing budget is spent on paying bonuses to distributors. IBOs were paid more than $370.1 million in bonuses and incentives in fiscal year 2006.http://www.quixtar.com/about. Bonuses are paid for individual sales and sales generated by people one sponsors but not for sponsoring itself.In 2001, after the majority of Amway Independent Business Owners (IBOs) had transferred to the new company, Quixtar completely replaced Amway as the marketing venture for Amway/Alticor products in North American regions. The Quixtar business model differs from the earlier Amway business model in many aspects, such as the way distribution is performed as well as the products and services offered through partner stores. Rather than ordering product from a distributor who delivers them in person, Quixtar customers can place orders online and have the products shipped to them directly. In mid-2007 however, Quixtar announced they were phasing back in the Amway name over two years and discarding the Quixtar name. Along with the re-branding campaign, Amway Global is investing over 580 million dollars into both increased compensation for IBOs and for extensive advertising of the new brand name.
Individuals may buy products through Quixtar's web site with a referral number from an IBO. Quixtar also gives IBOs the option to create free personal websites that can be personalized to focus on health, beauty, health and beauty, and/or gift and incentive products. The referring IBO then receives the retail/wholesale profit (usually 30%), and a percentage ("bonus") of the cost of the sold goods (from 3% up to 31% depending on total PV generated), with Quixtar-exclusive products yielding a higher bonus per dollar in Point Value and Business Value (PV/BV). Quixtar offers a wide range of products for its IBOs to purchase for personal use and/or to sell to customers through Quixtar.com and IBO personal e-commerce sites.
IBOs pay a registration fee and build their businesses through retail sales to customers, referring business to Quixtar.com, and by helping other IBOs build similar businesses. Their earnings are based on their business' sales and the volume of sales and purchases of IBOs registered by them.
The structure of a Quixtar's IBO organization is hierarchical, but an individual can earn more than those who bring them into the organization. Pin levels are similar as in Amway. There are several major pin levels in the model denoting particular level of success in building their IBO business.
Income of Quixtar IBOs
Quixtar IBOs earn income in different forms in various categories including IGP (Immediate Gross Profit), Performance Bonus, Leadership Bonus, and other Growth incentives. IGP is the profit made when customers of an IBO buy products and services from Quixtar at retail price. A majority of IBOs who make income in the beginning are in this category only . Performance bonus on a scale of 3% to 25% of the group volume (total BV of the sale made by the group) is paid if the PV level of the IBO is more than 100 PV in a month. Leadership bonus is paid at 4% of BV of each qualified leg who is at 25% or 7500 PV. Growth incentives are announced by Quixtar every year in the form of bonuses and paid trips at various levels. These bonuses are awarded to IBOs who are at Platinum or higher achievement levels.Quixtar reports that the average income for an "active" Quixtar IBO in 2005 was $115 a month ($1,380 annually), as documented in The Quixtar IBO Compensation Plan and on a Quixtar website. The average annual Quixtar income for an IBO that qualified at the Platinum level in 2005 (0.1683% of IBOs) was $47,472 and for a Diamond (.0120% of IBOs) it was $146,995. The largest single annual bonus (in addition to monthly incomes) for a Diamond was $1,083,421.
An "active" IBO is qualified on the IBO Registration form: Based on an independent survey during 2001, “Active” means an IBO attempted to make a retail sale, or presented the Independent Business Ownership Plan, or received bonus money, or attended a company or IBO meeting in the year 2000. Approximately 66% of all IBOs of record were found to be "Active."
IBO Association International
The IBO Association International (IBOAI) was founded in 1959 as the American Way Association with the goal of "serving the common interests of Independent Business Owners throughout North America." Members are served by an 18-member Board of Directors who are supported by seven full-time staff. The Association's board members are "elected by its voting members", who must be "Qualified Platinums and above."Accreditation
In 2006, Quixtar, in partnership with the IBOAI (IBO Association International) launched the "Quixtar Accreditation" program in order to address concerns about the companies that provide Business Support Materials to Quixtar IBOs. North American Diamonds (high-level IBOs) and their associated training companies may apply to Quixtar to be accredited by the corporation. Among other things, accreditation specifically states that promotion of particular religious or political viewpoints is unacceptable. Additionally, accredited programs must agree to a range of other guidelines, including "full" transparency in any compensation paid for Business Support Materials. The "full" transparency only applies to the IBO's who are participants in the BSM income, for most groups this means Platinums and above, representing a very small percentage of IBO's. Accreditation lasts two years and is enforced through reviews of materials and surveys of IBOs. The full guidelines are listed in the IBO Communications Platform. In April 2006 "eFinity" became the first Quixtar affiliated support organization to receive accredited status.Sales and ranking
ForbesForbes
Forbes is an American publishing and media company. Its flagship publication, the Forbes magazine, is published biweekly. Its primary competitors in the national business magazine category are Fortune, which is also published biweekly, and Business Week...
ranked Alticor
Alticor
Alticor is a privately held corporation, owned and run by members of the DeVos and Van Andel families. It was established in 1999 to serve as the parent company for a handful of business ventures, most notably the direct selling company Amway and Quixtar and a manufacturing and distribution...
, as America's 27th largest privately owned company with estimated revenue of $7.29 billion. In 2006, Internet Retailer ranked Quixtar.com as the number one site in the "health and beauty" category and 18th largest e-commerce site (for revenue) overall.
Quixtar-powered IBOs generated revenues of $1.118 billion for Quixtar for the fiscal year ended December 31, 2006, the fourth consecutive year in which the company surpassed the billion-dollar mark. IBOs also generated record $84.6 million in revenues for Quixtar’s Partner Stores in 2006.
Promotion
Athletes who have promoted Quixtar or its products include Jamaican Olympic sprinter Asafa PowellAsafa Powell
Asafa Powell C.D is a Jamaican sprinter who specialises in the 100 metres. He held the 100 m world record between June 2005 and May 2008, with times of 9.77 and 9.74 seconds respectively. Powell has consistently broken the 10-second barrier in competition, with his personal best of...
, American pole vaulter Jennifer Stuczynski
Jennifer Stuczynski
Jennifer "Jenn" Suhr is the number one ranked American pole vaulter since 2006. She has won a total of 9 US National Championships. She holds the American women's pole vault record both indoors and outdoors. In 2008 she won the U.S. Olympic trials setting an American Record of and won a silver...
, American Olympic sprinter Sanya Richards
Sanya Richards
Sanya Richards-Ross is a track and field athlete who competes internationally for the United States. She won an Olympic gold medal in the 4×400 meters relay at the 2008 Olympic Games in Beijing, China, an individual bronze medal at the 2008 Olympics for the 400 m, and a gold medal in the 2009...
, U.S. Olympian Shawn White, Cinematographer Wes Anderson
Wes Anderson
Wesley Wales Anderson is an American film director, screenwriter, actor, and producer of features, short films and commercials....
,Chinese Olympic hurdler Liu Xiang
Liu Xiang
Liu Xiang is a Chinese 110 meter hurdler. Liu is an Olympic Gold medalist and World Champion. His 2004 Olympic gold medal was the first in a men's track and field event for China....
; Brazilian soccer player Ronaldinho
Ronaldinho
Ronaldo de Assis Moreira , commonly known as Ronaldinho or Ronaldinho Gaúcho, is a Brazilian footballer who plays for Flamengo and the Brazilian national team as an attacking midfielder or forward. He is a two-time winner of the FIFA World Player of the Year, awarded to the best player over the year...
, heavyweight boxer Evander Holyfield
Evander Holyfield
Evander Holyfield is a professional boxer from the United States. He is a former undisputed world champion in both the cruiserweight and heavyweight divisions, earning him the nickname "The Real Deal"...
, NFL player Emmitt Smith
Emmitt Smith
Emmitt James Smith, III is a retired American football player who was a running back in the National Football League for fifteen seasons during the 1990s and 2000s. Smith played college football for the University of Florida, where he was an All-American; thereafter, he played professionally for...
and Heisman Trophy winner Ron Dayne. Tim Foley
Tim Foley
Thomas David "Tim" Foley is a retired American football player.Foley starred at Loyola Academy in Wilmette, Illinois before moving on to Purdue University, where he received All-American honors as a defensive back in 1969. He then played 11 seasons , primarily with the Miami Dolphins of the...
, a member of the undefeated 1972 Miami Dolphins
Miami Dolphins
The Miami Dolphins are a Professional football team based in the Miami metropolitan area in Florida. The team is part of the Eastern Division of the American Football Conference in the National Football League...
, is a Quixtar Founders Crown Ambassador.
Author John C. Maxwell
John C. Maxwell
John Calvin Maxwell is an evangelical Christian author, speaker, and pastor who has written more than 60 books, primarily focusing on leadership. Titles include The 21 Irrefutable Laws of Leadership and The 21 Indispensable Qualities of a Leader: Becoming the Person Others Will Want to Follow...
, who writes leadership books including The 21 Irrefutable Laws of Leadership, is known to support Quixtar affiliated organizations such as Worldwide DreamBuilders and co-authored a book, Becoming a Person of Influence, with Jim Dornan, Quixtar Founders Crown Ambassador and founder of Quixtar support organization Network TwentyOne. Orrin Woodward and Chris Brady, both former IBOAI board members for Quixtar, co-authored the #1 bestseller, Launching a Leadership Revolution. Both Woodward and Brady were terminated by Quixtar and participated in a class action lawsuit against Quixtar alleging that Quixtar operated as an illegal recruitment scheme. Paul Harvey
Paul Harvey
Paul Harvey Aurandt , better known as Paul Harvey, was an American radio broadcaster for the ABC Radio Networks. He broadcast News and Comment on weekday mornings and mid-days, and at noon on Saturdays, as well as his famous The Rest of the Story segments. His listening audience was estimated, at...
, a radio broadcaster, known for his 'The rest of the story' tagline, has long been associated with the Quixtar program that is advertised on his show.
As a guest speaker at the Quixtar LIVE! conference in 2003, Phil McGraw
Phil McGraw
Phillip Calvin McGraw best known as Dr. Phil, is an American television personality, author, former psychologist, and the host of the television show Dr. Phil, which debuted in 2002...
("Dr. Phil") reportedly described Quixtar as "one of the greatest success stories in American business history." In a 2006 settlement involving a class-action lawsuit brought against McGraw and his Shape-Up diet products, plaintiffs could receive a share of $6.0 million in Quixtar-brand Nutrilite
Nutrilite
Nutrilite is a brand of mineral, vitamin, and dietary supplements created in 1934 by Dr. Carl F. Rehnborg. Nutrilite products are currently manufactured by Access Business Group, a subsidiary of Alticor whose products are sold via the Amway and Amway Global Corporations worldwide...
vitamins and $4.5 million in cash.
Orlando Arena naming rights
In December 2006, Amway secured the naming rightsNaming rights
In the private sector, naming rights are a financial transaction whereby a corporation or other entity purchases the right to name a facility, typically for a defined period of time. For properties like a multi-purpose arena, performing arts venue or an athletic field, the term ranges from three...
for the Orlando Arena, home to the NBA
National Basketball Association
The National Basketball Association is the pre-eminent men's professional basketball league in North America. It consists of thirty franchised member clubs, of which twenty-nine are located in the United States and one in Canada...
's Orlando Magic
Orlando Magic
The Orlando Magic is a professional basketball team based in Orlando, Florida. They play in the Southeast Division of the Eastern Conference of the National Basketball Association and are currently coached by Stan Van Gundy...
, which was formerly known as the TD Waterhouse Centre. In the deal, the arena became known as Amway Arena. As part of the contract, Amway also had the exclusive right to first negotiations for the naming rights of the arena's successor, and secured in early August 2009 a 10-year deal to name the new facility Amway Center.
San Jose Earthquakes
Prior to the 2009 Major League Soccer season2009 Major League Soccer season
The 2009 Major League Soccer season was the 14th season of Major League Soccer. The season began on March 19 and ended with Real Salt Lake winning the MLS Cup 2009, on November 22 at Qwest Field in Seattle, Washington-Changes from the 2008 season:...
, Amway Global signed a three-year deal with the San Jose Earthquakes
San Jose Earthquakes
The San Jose Earthquakes professional soccer team is located in the San Jose, California, United States suburb of Santa Clara, and participates in Major League Soccer , the top level soccer league in the United States and Canada....
to become the team's official jersey sponsor.
A major part of the partnership is focused on community initiatives in the Bay Area
San Francisco Bay Area
The San Francisco Bay Area, commonly known as the Bay Area, is a populated region that surrounds the San Francisco and San Pablo estuaries in Northern California. The region encompasses metropolitan areas of San Francisco, Oakland, and San Jose, along with smaller urban and rural areas...
. As a result, Amway Global is now also the official sponsor of the team's Kicks for Kids program that focuses on fitness and healthy lifestyles, as well as bringing underprivileged children to Earthquakes games.
The partnership also saw the creation of the Amway Global Street Team, which appears at all Earthquakes home games and at a number of soccer and non-soccer events throughout the Bay Area. The members of the Amway Global Street Team give away Earthquakes-branded merchandise and provide soccer skills demonstrations at each event.
Los Angeles Sol
In March 2009, Amway Global signed a multi-year deal to become the official presenting partner of the Los Angeles Sol of Women's Professional SoccerWomen's Professional Soccer
Women's Professional Soccer is the top level professional women's soccer league in the United States. It began play on March 29, 2009. The league was composed of seven teams for its first two seasons and fielded 6 teams for the 2011 season, with continued plans for future expansion...
. That deal would last only one year, as the Sol folded after the 2009 season
2009 Women's Professional Soccer season
The 2009 Women's Professional Soccer season served as the inaugural season for WPS, the top level professional women's soccer league in the United States...
.
Litigation
For several years Quixtar was involved in litigation with the tools businesses of former Crown Distributor Kenny Stewart and Double Diamond Brig Hart. In February 2008 a federal judge dismissed the case.A class action lawsuit was filed in 2007 against Quixtar and some of its top-level distributors in California, alleging fraud, racketeering, and that the products business and the tools business are pyramid scheme
Pyramid scheme
A pyramid scheme is a non-sustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, rather than supplying any real investment or sale of products or services to the public...
s. A similar case filed in California in August 2007 by TEAM affiliated IBOs whose contracts had been terminated was dismissed. On November 3, 2010, Amway announced that it had agreed to pay $56 million to settle the class action, $34 million in cash and $22 million in products, and while denying any wrongdoing or liability, acknowledged that it had made changes to its business operations as a result of the lawsuit. The settlement is subject to approval by the court, which is expected in early 2011. The total economic value of the settlement, including the changes to the business model, is $100 million.
In his online book "Merchants of Deception", former Quixtar IBO Eric Scheibeler stated that he and his family received death threats from his uplines during a business meeting and from an anonymous phone call. In 2006, a Swedish newspaper published statements attributed to Scheibler which implied that Amway/Quixtar employees were responsible for these threats. Amway and Quixtar sued Scheibler on February 27, 2007 for defamation. In July 2007, Scheibeler wrote a letter to an attorney for Amway and Quixtar clarifying among other things that, to his knowledge, Doug DeVos or Amway/Quixtar employees never made any death threats to him.
In July 2007, a lawsuit was filed by IBS (Internet Business Solutions), owned by Quixtar Emeralds Henry and Sue Skaggs, naming Bill and Peggy Britt, Paul and Leslie Miller, Rocky Covington, Kevin and Beth Bell, and Britt World Wide, all of whom are Emeralds and above in Quixtar, as defendants. The suit alleges that the Skaggs, having developed a software system to allow for direct order fulfillment of tools to their downline, received approval from Britt to continue the development of the software program for eventual rollout to all of BWW (a tool system within Quixtar). During this time, the Skaggs state that they carried the burden of the development costs. According to the lawsuit, Bill Britt stated in 2005 that the program would not be rolled out across BWW. The Skaggs then claim they were de-edified by their upline. The suit alleges breach of contract, racketeering, and intentional interference with economic relations. In response, the defendants claimed that no contract was entered into and challenge the lawsuit on various other legal grounds.
FTC investigations
The Federal Trade CommissionFederal Trade Commission
The Federal Trade Commission is an independent agency of the United States government, established in 1914 by the Federal Trade Commission Act...
offers advice for potential MLM members to help them identify those which are likely to be pyramid schemes.
In the 1979 ruling In re. Amway Corp.
In re. Amway Corp.
In re Amway Corp. is a 1979 ruling by the United States Federal Trade Commission concerning the business practices of Amway, a multi-level marketing company...
, the Federal Trade Commission
Federal Trade Commission
The Federal Trade Commission is an independent agency of the United States government, established in 1914 by the Federal Trade Commission Act...
determined that Quixtar predecessor Amway was not an illegal pyramid scheme
Pyramid scheme
A pyramid scheme is a non-sustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, rather than supplying any real investment or sale of products or services to the public...
because no payments were made for recruitment. In addition, Amway (and later Quixtar) rules required distributors to sell to at least 10 retail customers per month, or have $100 in product sales, or a total of 50PV from customer purchases in order to qualify for bonuses on downline volume. Quixtar IBOs are required to report this customer volume on Quixtar.com or they do not receive bonuses on downline volume. Furthermore, an IBO must also personally sell or use at least 70% of the products personally purchased each month. The FTC established that these rules help prevent inventory loading and other potential abuses of the marketing model.
In 1986 Amway Corp. agreed, under a consent decree filed in federal court, to pay a $100,000 civil penalty to settle Commission charges it violated a 1979 Commission order that prohibits Amway from misrepresenting the amount of profit, earnings or sales its distributors are likely to achieve. According to a complaint filed with the consent decree, Amway violated the 1979 order by advertising earnings claims without including in it clear and conspicuous disclosures of the average earnings or sales of all distributors in any recent year or the percent of distributors who actually achieved the results claimed.
The FTC has required the information on average income to be provided to all prospective Quixtar business owners since the above 1979 FTC ruling clearing the Amway business model as legal.
Income from tools and business support materials
In 1983, Rich DeVos, one of Amway's founders, made recordings which, among other things, communicated his displeasure with several issues regarding some of the high ranking distributors/IBO's. These recordings are entitled "Directly Speaking" and were addressed to Direct Distributors (now called Platinums), who are considered leaders with various responsibilities for their downline group. In January 1983 Rich DeVos announced that Amway would pay BV on Amway produced tapes. He expressed concern about the level of income from the sale of Business Support Materials (BSM; tapes, CDs, books, and business conferences/functions) compared to the income the high level distributors were making from Amway products. He stated his legal team was concerned if the tool income exceeded 10% of their Amway income, and stated that BV payouts on tapes can never exceed 20% of the distributor's total Business Volume.A 1985 Forbes
Forbes
Forbes is an American publishing and media company. Its flagship publication, the Forbes magazine, is published biweekly. Its primary competitors in the national business magazine category are Fortune, which is also published biweekly, and Business Week...
magazine article quoted Dexter Yager, an IBO, as stating that about 2/3 of his income is from BSM's.
In 2004, Dateline NBC
Dateline NBC
Dateline NBC, or Dateline, is a U.S. weekly television newsmagazine broadcast by NBC. It previously was NBC's flagship news magazine, but now focuses on true crime stories. It airs Friday at 9 p.m. EST and after football season on Sunday at 7 p.m. EST.-History:Dateline is historically notable for...
aired a report, alleging that some high-level Quixtar IBOs make most of their money from selling motivational materials rather than Quixtar products. Quixtar published an official Quixtar Response website where it showed '"Interviews Dateline Didn't Do"'. Quixtar also states on its response site that Dateline declined their request to link to the site.
During the registration process for a new IBO, Quixtar contracts clearly inform prospective IBOs that BSM are optional and that the producers and sellers of the BSM may make profit or loss from their sale (like any other business). This is also publicized on Quixtar websites. Quixtar's Business Support Materials Arbitration Agreement (SMAA) requires the immediate seller of BSM's to buy-back materials, which were purchased only for personal consumption within a 180 day time frame, on commercially reasonable terms, upon request of the purchaser. BSM's purchased for inventory or to be sold to others downline are not covered by the buy back policy.
Disputes with TEAM
On August 9, 2007, a group of Quixtar distributors, including founders of the TEAM training organization filed a lawsuit seeking to enjoin Quixtar from enforcing its distributor contracts, including the non-competition and non-solicitation provisions. The plaintiffs alleged that the company knowingly operates as a pyramid scheme, and prevents its distributors from leaving the organization through the aforementioned provisions.On August 10, 2007, Quixtar announced that it had terminated the businesses of] fifteen of the plaintiffs involved in the lawsuit, and sought and received a temporary restraining order and preliminary order of injunction hosted by QuixtarNewsroom.com in a Michigan court preventing them from interfering with the LOS, soliciting IBOs for their new company, or disparaging Quixtar or the business in any way. In mid October 2007, Quixtar argued that the former distributors were in violation of the court order since Team continued to have meetings and sell motivational materials. In Grand Rapids, Michigan, Quixtar argued that Team was using Quixtar's proprietary information to promote its meetings and sell materials. The court held in favor of Woodward and Brady and allowed Team to continue to operate. Specifically, the court held, "The Court finds particularly noteworthy the steps that both Mr. Orrin Woodward and TEAM took to make a good faith effort to comply with the preliminary injunction."
In an effort to ensure its injunction wasn't being violated, Quixtar filed an action against 30 anonymous bloggers. Specifically, Quixtar is seeking to discover if Woodward and Brady are involved in a blogging campaign to disparage the company. The California lawsuit was dismissed on October 5, 2007.
In the summer of 2004, some Quixtar leaders and IBOs allegedly launched a Web initiative designed to make their web pages more prominent in search results, aka Google Bombing.
External links
Media articles
- CNET article about Quixtar launch
- NY Times article about Quixtar launch
- eWeek - Quixtar: Cleaning Up
- Taipei Times article about Quixtar "Ditto" Program
- Quixtar sues bloggers about Quixtar's lawsuit against 30 anonymous bloggers.
Government documents