Neora Part I: The Decision And Its Implications

THE DECISION AND ITS IMPLICATIONS

In a long-awaited decision, last week Judge Barbara Lynn in the United States District Court for the Northern District of Texas granted Neora, LLC (formerly, Nerium) a victory, denying every single claim the FTC brought, including the FTC's argument that Neora was operating an illegal pyramid scheme and made deceptive income and product claims. In the 56-page decision, Judge Lynn weighed the evidence presented at trial and provided meaningful guidance as to how and why Neora satisfied important safe harbors from FTC action. The court rejected many of the theories the FTC argued constituted hallmarks of a pyramid scheme. And the court agreed with Neora that many of its policies and procedures demonstrated it was operating a legitimate direct-sales organization.