HERBALIFE

Herbalife Nutrition is a global multi-level marketing corporation that develops, markets, and
sells nutrition supplements, weight management, sports nutrition, and personal-care products.
The company was founded by Mark Hughes in 1980
Its corporate headquarters located Los Angeles, California.
The company operates in 94 countries through a network of approximately 3.2 million
independent distributors
The company is required to prove that at least 80 percent of its sales are made to individuals
outside of its distributor network.
The settlement also required that distributors are only able to earn two-thirds of their rewards
based on retail sales of Herbalife products.
The company is also required to show a differentiation between individuals who join as a
distributor to buy discounted products and those seeking a business opportunity.
In February 1980, Mark Hughes began selling the original Herbalife weight management product
from the trunk of his car.
Hughes often stated that the genesis of his product and program stemmed from the weight loss
concerns of his mother Joanne, whose premature death he attributed to an eating disorder and
an unhealthy approach to weight loss.
His first product was a protein shake designed to help people manage their weight.
He structured his company using a direct-selling, multilevel marketing model.
Problems they are addressing
Herbalife's "nutrition" products include weight-loss and protein shakes.
The company's products also include protein bars, teas, aloes, vitamins, and sports hydration,
energy and personal care products
The company's original product is the Formula 1 protein shake, a soy-based meal-replacement
shake.
Other products include products for heart health, digestive health, skin care, and the 24 sports
line.
Since 2013, the company has operated a botanical extraction facility in Changsha, Hunan
Province.The facility produces botanical extracts, including teas, guarana, chamomile, broccoli,
and bilberry, for use in many of the company's products.
Problems and Allegations
In 1982, Herbalife received complaints from the Food and Drug Administration for claims made about
certain products and the inclusion of mandrake, poke root, and 'food grade' linseed oil in another. As
a result of the complaints, the company modified its product claims and reformulated the product.
The Department of Justice of Canada filed criminal charges against the company in November 1984
for misleading medical claims in advertisements.
Herbalife's claims of health benefits from its products have met scrutiny from the medical
community, consumers, and government agencies.
In 2008, Herbalife was sued after laboratory tests indicated that levels of lead in several Herbalife
products were in excess of California state law and could lead to liver problems over an extended
period of time.
Hospitals in Israel, Spain, Switzerland, Iceland, Argentina, and the United States had reported liver
damage in a number of patients, some of whom had used Herbalife products.