The results are clear—a record-breaking year and an unequivocal demonstration that direct selling is dedicated to serving America. —Joseph N. Mariano, President, DSA
Direct selling companies invested significant resources to transform their companies virtually. —Ben Gamse, Director of Industry Insights, DSAThe Direct Selling Association (DSA) released its Growth and Outlook Survey results for 2020 showing a record level of growth for the channel in one of the most economically challenging years in U.S. history. Despite the onset of the COVID-19 pandemic in March 2020 and the subsequent shutdowns that ended the longest period of U.S. economic expansion on record, the DSA reported channel growth of 13.9 percent over the previous year, reaching a record $40.1 billion in 2020 retail sales. This is quadruple the growth of U.S. retail sales overall, which the U.S. Department of Commerce reported was 3.4 percent for 2020.
It is alarming that the FTC seems to have prejudged the public comment process and concluded that the scope of the Rule should be expanded to impose a new regimen of rules and regulations on the direct selling industry. —Larry Steinberg, Chair of Multilevel Marketing Industry Group, BuchalterThe Federal Trade Commission (FTC) announced on June 14 a review of the Business Opportunity Rule by the end of the year. The Rule was first proposed in 2006 and was finalized with amendments in 2012 after direct selling companies and the Direct Selling Association (DSA) vigorously argued for, and ultimately received, a generalized exclusion from the Rule.
House Bill 2668, which Congressman Cárdenas introduced last week, addresses the two significant judicial limitations to Section 13(b) of the FTC Act. —Rebecca Kelly Slaughter, Acting Chairwoman, FTCTo the relief of many direct sellers, the U.S. Supreme Court issued a unanimous ruling in the closely-followed AMG Capital Management, LLC v. Federal Trade Commission case. In a April 22 decision authored by Justice Stephen Breyer, the court held that Section 13(b) of the FTC Act does not authorize the Commission to seek “equitable monetary relief such as restitution or disgorgement,” ruling that the “permanent injunction” reference in Section 13(b) only grants the FTC the ability to stop future actions of a targeted individual or company.
There were a number of factors that led us to think that the timing was right for this type of conference, including indications from the Federal Trade Commission that they are tightening focus on the MLM industry. —Douglas M. Brooks, Attorney
Anti-MLM influencers appear to be more interested in fostering a cottage industry of their own than they are to an inclusionary dialogue on how best to promote entrepreneurship. —Direct Selling AssociationFor decades, direct selling’s opponents have worked to challenge the channel from the relatively confined spaces within their respective legal, academic and media circles. The occasional high-profile court case would generate publicity for a few news cycles, and newspaper and magazine articles would follow with passing coverage.
The (FTC) is saying ‘we’ve got other tools,’ but what they are hoping for is that Congress will act. —John Villafranco, Partner, Kelley Drye & Warren LLP
At a time when the FTC should be contrite for having been caught for abusing its power, they’re doubling down. —Kevin Thompson, Partner, Thompson Burton PLLCThe Federal Trade Commission’s (FTC) focus on its power to punish continued in recent weeks as it threatened the use of punitive action against its favorite targets. The Commmission’s latest announcement has important implications for industries under its scrutiny, including the direct selling channel.
The DOL’s effort to rescind the final rule runs counter to the realities of the modern economy. —Evan Armstrong, Founding Member, Coalition for Workforce Innovation
We will continue working with the Administration and Congress to ensure direct sellers are clearly classified as independent contractors under all federal laws. —Brian Bennett, Vice President of Government Affairs and Policy, Direct Selling AssociationAn array of business groups are suing the U.S Department of Labor over its decision to rescind a rule that would set parameters for when companies—including direct sellers—could classify workers as independent contractors. At issue: a Donald Trump administration regulation published in late January, about two weeks before the White House was set to switch hands, making it easier for businesses to classify workers as independent contractors. The rule marked a major victory for the direct selling channel, along with gig economy companies specializing in ride-sharing and food delivery.
No choice but to power down. —Michael Fallquist, CEO, Griddy
Griddy turned their customers into amature energy traders, because they were fully exposed to the market. —Rob Snyder, Founder and General Partner, KynectTexas-based direct selling electricity provider Griddy was abruptly banned from the power market on Feb. 26, capping a chaotic two-week period for the 4-year-old energy retailer brought on by historic winter storms no one was prepared for. The storms not only paralyzed the state of Texas but drew national attention to its deregulated power grid, as well as to the tenuous relationship between electricity retailers, consumers, and operators in the Lone Star State.