AdvoCare Deal Puts FTC's 13(b) Authority In Spotlight

Law360 (October 4, 2019, 5:24 PM EDT) -- When AdvoCare International LP abandoned its direct selling business model in May, we wrote in Law360 that it was likely the result of an investigation by the Federal Trade Commission and a potential lawsuit under Section 13(b) of the FTC Act. What we didn’t know was what would come next: litigation or settlement. Well, more than four months later we finally got our answer: both litigation and settlement. 

The FTC announced on Oct. 2 in a press release[1] and conference that AdvoCare, its former chief executive officer and two top distributors had settled charges that the company operated an illegal pyramid scheme by...

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