MLM Consulting / Network Marketing, Criminal Law, MLM / Direct Sales

Bruner v. Texas , 463 S.W.2d 205 (1970)

Bruner v. Texas

by Babener & Associates on 1/27/2012

Bruner was accused of selling unregistered securities in violation of Texas state law. Bruner sold soap in an MLM structure to Owens who bought into the program based on representations that he would not have to perform any...more

Barron v. Nevada , 105 Nev. 767 (1989)

Barron v. Nevada

by Babener & Associates on 12/27/2011

The Nevada Supreme Court was asked if the charges of embezzlement and obtaining money under false pretenses were mutually exclusive in the case of the promoter of a pyramid scheme. ...more

Arizona v. Lycett , 133 Ariz. 185 (1982)

Arizona v. Lycett

by Babener & Associates on 12/27/2011

Lycett was convicted of violating Arizona's anti-pyramid law and appealed on the grounds that the statute was unconstitutionally vague and that the legislature unconstitutionally enacted a statute that did not require...more

Alaska v. Bonham, 28 P.3d 303 (2001)

by Babener & Associates on 12/27/2011

The Alaska Court of Appeals was asked to determine if a conviction of mail fraud in U.S. District Court bared the conviction of perjury and submitting misleading securities filings under state double jeopardy rules when both...more

People v. Frederick

When can a judge restrict an expert witness as to the type of testimony to be given, and what is the standard for an "investment...

by Babener & Associates on 8/29/2006

The court held that an expert need not be given an unlimited scope on which they may testify and that an investment contract is the investment of money in an enterprise with the expectation of return, but without the ability...more

Goren v. New Vision , 156 F.3d 721 (1998)

Goren v. New Vision

by Babener & Associates on 9/2/1998

The Court of Appeals held that Goren's complaint was properly dismissed for failure to plead a claim under the RICO statutes or fraud. Goren bought nutritional supplements from New Vision, after listening to an audiotape from...more

US v. Orton, 73 F3d 331 (1996)

What is the proper method of accounting the amount of loss by victims of a Ponzi scheme?

by Babener & Associates on 1/23/1996

The Court of Appeals held that the calculation of loss should be accomplished by adding up the amount of money lost by victims of the scheme, the "loss to losing victims method." The Defendant argued that a "net loss" method...more

Utah v. Hall

Is the Utah State Pyramid Scheme Act unconstitutionally vague?

by Babener & Associates on 8/13/1995

The Utah Court of Appeals held that the statute was constitutional. Generally a statute is unconstitutionally vague when people of average intelligence must guess as to its meaning. The court found the statute in question to...more

Louisiana v. Strother

Do multiple victims of the same investment scheme over a period of time justify an enhanced sentence under state sentencing...

by Babener & Associates on 8/13/1992

The Louisiana Court of Appeals was asked if multiple victims of the same investment scheme over a period of time was justification for an enhanced sentence under state sentencing guidelines. The full case and case summary...more

Probst v. Oklahoma

Can a partnership be a regulatable security if the partner had managerial authority on paper, but was unaware or never exercised...

by Babener & Associates on 3/5/1991

Defendant Probst was in the business of estate planning. He advised clients to invest in a construction project undertaken by a firm he was intimately involved in, although that relationship was not divulged to the...more

Philpot v. Texas

Does the sale of a product as part of a promotional program exempt the program from state statutes forbidding endless chain...

by Babener & Associates on 8/13/1988

The Texas Court of Appeals held that the sale of a product does not allow a program to escape Texas' endless chain statute. The Philco Money Express was a pyramid marketing program that sold participants a quarterly financial...more

Delaware v. Ferro , 1988 WL 39996 (Del.Super. (1988) (Not Reported)

Delaware v. Ferro

by Babener & Associates on 4/15/1988

The court held that the statute prohibiting pyramid schemes was constitutional, and that an airplane scheme fell under the definitions within the statute because it was a "sales device" that transferred a "right" to...more

Schrader v. Maryland , 69 Md.App. 377 (1987)

Is the Maryland Statute prohibiting the promotion of pyramid program unconstitutionally vague?

by Babener & Associates on 12/4/1986

The Maryland Court of Special Appeals held that the statue was constitutional because the meaning of the words used could be derived by their common usage by a person of normal intelligence. In interpreting statutes, the...more

Rose v. Texas

Does a public filing of financial information pertinent to the sale of securities give investors constructive notice of the...

by Babener & Associates on 8/13/1986

Rose was the president of a small oil and gas company. He was convicted for securities fraud relating to the sale of limited partnership interests in an oil well venture without disclosing to investors that the equipment and...more

Wisconsin v. Dahlk

Can the owner of a warehouse where pyramid club meetings took place be held criminally liable for permitting real estate under his...

by Babener & Associates on 8/13/1983

The Wisconsin Supreme Court held that the warehouse owner could be held liable for permitting his property to be used to promote a pyramid program. Wisconsin used the dominant factor test to determine that the scheme fell...more

US v. Simpson, 8 F.3d 546 (1993)

Is it erroneous for a sentencing court to not explain its reasoning for consecutive sentences and for disparate sentences between...

by Babener & Associates on 8/3/1983

The Court of Appeals held that there was no rule that required an explanation for consecutive sentences, and that the record contained enough evidence that justified sentencing Simpson to a longer term that his...more

Schaffer v. Talerico , 118 Misc.2d 66 (1983)

Is a contract in furtherance of a pyramid scheme enforceable?

by Babener & Associates on 2/18/1983

The Utica City Court held that the sales program was a pyramid scheme and enforcing the contract would be a violation of state public policy. Schaffer managed a sales program between Amway distributors where they would...more

Louisiana v. Pearaa

Is the Louisiana state statute imposing criminal liability for promoters of "endless chain" schemes unconstitutionally vague?

by Babener & Associates on 8/13/1981

The Louisiana Supreme Court held that the state statute prohibiting "endless chain" schemes was not unconstitutionally vague because a person of normal intelligence could understand the statute. Though the statute was...more

New York v. Luongo , 58 A.D.2d 895 (1977)

Can the promoter of a pyramid scheme be convicted of larceny by false pretenses if some of the investments made by the promoter...

by Babener & Associates on 7/25/1977

The New York Appellate Division concluded that all of the promoter's promises need not be false to be convicted of larceny by false pretenses. The promoter made some investments in legitimate enterprises, but he also made...more

Wisconsin v. Lambert

Were the state regulations prohibiting chain distributor systems lawfully delegated to an administrative body?

by Babener & Associates on 8/13/1975

The Wisconsin Supreme Court found that the legislature's delegation to the state agency was reasonable. The delegation set reasonable limits on the scope of the agency's power in crafting the specific prohibitions of chain...more

Tennessee v. Netto

Is the Tennessee state statute prohibiting lotteries and pyramid clubs unconstitutionally vague?

by Babener & Associates on 11/6/1972

The Tennessee Supreme Court ruled that the statute was not vague. To be found unconstitutionally vague, a statute must leave people of common intelligence to guess at its meaning. The Tennessee State Constitution flatly...more

US v. Herr, 338 F.2d 607 (1964)

Does acquittal of conspiracy require the dismissal of charges alleging the violation of federal securities laws?

by Babener & Associates on 10/27/1964

The Court of Appeals held that criminal convictions need not be consistent with each other, and that each count of an indictment is a separate charge. The defendants were convicted of selling securities in violation of US...more

Bruner v. Texas , 463 S.W.2d 205 (1970)

Barron v. Nevada , 105 Nev. 767 (1989)

Arizona v. Lycett , 133 Ariz. 185 (1982)

Alaska v. Bonham, 28 P.3d 303 (2001)

People v. Frederick

Goren v. New Vision , 156 F.3d 721 (1998)

US v. Orton, 73 F3d 331 (1996)

Utah v. Hall

Louisiana v. Strother

Probst v. Oklahoma

Philpot v. Texas

Delaware v. Ferro , 1988 WL 39996 (Del.Super. (1988) (Not Reported)

Schrader v. Maryland , 69 Md.App. 377 (1987)

Rose v. Texas

Wisconsin v. Dahlk

US v. Simpson, 8 F.3d 546 (1993)

Schaffer v. Talerico , 118 Misc.2d 66 (1983)

Louisiana v. Pearaa

New York v. Luongo , 58 A.D.2d 895 (1977)

Wisconsin v. Lambert

Tennessee v. Netto

US v. Herr, 338 F.2d 607 (1964)

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