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Partners clash over business practices

On behalf of Kadish & Associates Law Group posted in Business Litigation on Monday, August 14, 2017.

Sometimes business partners work well together. Sometimes, however, they have conflicts that require them to retain a law firm.

One recent conflict between business partners occurred in Scottsdale. The partners, both octogenarians, are waging a legal war over the practices of one of the largest private companies in Arizona.

The main company, Forever Living Products, is a multilevel marketing business. It has 4,000 employees worldwide and annual revenue of over $2.6 billion. It also has 9.3 million distributors. Its founder and chief executive officer has been listed by Forbes magazine as one of the wealthiest people in Arizona.

The company, along with its affiliates, makes and markets a variety of nutritional supplements, plus food items, creams, lotions, cosmetics, and more. Two of their primary ingredients are bee products and aloe vera. To facilitate the inclusion of the latter, it owns two aloe vera plantations, where the plant is grown, cultivated, and harvested for the gel it produces, which is understood to have healing properties.

At issue is a claim that a unit of the company, Aloe Vera of America, has overcharged for items sold to an affiliated company in Japan. The lawsuit making that claim also accuses the unit of bribing foreign customs officials and smuggling.

The lawsuit does not reference any current investigations into any of those accusations. Additionally, an attorney for Forever Living Products has rejected all accusations in the case as being without merit of any kind. The attorney says that there is ongoing arbitration between Forever Living Products and the Japanese company to try to resolve all differences constructively.

The Japanese affiliate is jointly owned by the founder of Forever Living Products and his Japanese partner. The two men have worked together since 1979, when the company was new, and the Japanese affiliate is the biggest and most profitable in the Forever Living Products group.

Even long-term partners may need legal representation to resolve their issues.

Source: The Republic, “Dispute among partners puts Scottsdale’s Forever Living Products in legal limelight,” Russ Wiles, Aug. 09, 2017

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