Ohio v. Harper

When is the owner of a pyramid scheme company personally liable for statutory violations?


The Ohio Court of Appeals held that if the owner performs sufficient acts, and receives sufficient benefits from the company, they will be held personally liable for the company's violations the state Anti-Pyramid Statute, and the Consumer Sales Practices Act. Plus Gold operated a pyramid scheme where new members paid a fee in exchange for travel coupons and the right to solicit new members. The trial court found the company liable for violating the Anti-Pyramid and the Consumer Sales Practices Act, but not Harper. He was not found liable because all of his actions were authorized by the company, and were done only for its benefit. The Court of appeals reversed, reasoning that as the owner of the company, he personally benefited from his actions on behalf of the company, and was therefore liable for his actions under both statutes.

Case and case summary are also available online at: http://www.mlmlegal.com/legal-cases/Ohio_v_Harper.php

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Reference Info:State, 6th Circuit, Ohio | United States

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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