### Amway: The Untold Story

Hanrahan Lawsuit

This class action suit was filed in U.S. District Court, Eastern District of Pennsylvania, on July 20, 1994, naming Dexter Yager, Bill Britt, and Amway Corp. as the defendants. The suit was filed by John and Stacy Hanrahan. Brian Bohrer and Mark and Lori Mensack were also named as plaintiffs. A proposed settlement was entered into as of August, 1996.

Like most of the other lawsuits that I'm aware of, the Hanrahan lawsuit was chiefly concerned with abuses resulting from the covert "tools" business and with factual misrepresentations of the sort that have frequently been reported here and elsewhere by so many others.

The list of allegations included:

- Misrepresentations concerning potential incomes.
- Misrepresentations concerning Amway's affiliations ("joint ventures").
- The coerced sale of motivational materials.
- Customer allocation and price fixing in connection with defendant's motivational materials

(See text of complaint and news articles below for more details.)

### Background

The Hanrahans were in Amway for approximately nine months, the result of which was money lost and a marriage nearly destroyed. Believing that Amway Corp. was probably not aware of the abuses and unethical activities they witnessed and were subjected to in the World Wide Dream Builders organization, the Hanrahans contacted Amway Corp.'s council and Richard DeVos. Amway Corp. repeatedly rebuffed their attempts to discuss these problems or to do anything about them. It was only then that the Hanrahans realized that the only way to help prevent other people from being similarly victimized would be to take their story public, which they did. (For more information on the Hanrahan's Amway experience, Amway's lack of concern and later attempts to malign them, see the article on the American Journal segment on Amway.)

The following article from the 8/17/96 Philadelphia Enquirer summarizes the terms of the settlement.

Amway proposes settling lawsuit

Some distributors claim they lost money. The company wants to give them coupons good for Amway products.

By Julie Stoiber

Amway Corp., global purveyor of everything from insect repellent to lipstick, has agreed to a settlement in a class-action lawsuit—filed by a Delaware County couple—that actually could end up boosting the company’s sales.

The proposed settlement, filed this week in U.S. District Court in Philadelphia, calls for the Ada, Mich., company to compensate disgruntled distributors by giving them discount coupons for Amway’s most popular products.

Stacy and John Hanrahan of Springfield were the lead plaintiffs in the 1994 lawsuit in which they alleged that, as distributors, they lost money selling Amway products. They contended that their sales income didn’t cover the cost of motivational tapes that they were pressured to buy and the sales rallies they paid to attend.

In fiscal 1995, Amway had retail sales of $6.3 billion through its network of independent distributors.

The Hanrahans accused the company and two of its high-level distributors of luring Amway sales recruits with the promise of inflated earnings and of pressing them to buy company sales materials, which benefited the top dealers.

The distributors named in the suit were William Britt, of Carson City, Nev., and Dexter Yager, of Charlotte, N.C.

As part of the settlement, Britt and Yager agreed to put optional-purchase labels on motivational materials, and Amway said it would offer distributors a way to resolve disputes related to those materials. Amway also agreed to incorporate a statement in its distributor agreement affirming individual’s rights to religious and political independence.

Craig Meurlin, senior vice president of Amway, said that the company does not push religious or political philosophies on distributors, but agreed to the provision because “the plaintiffs were concerned with the topic.”

Amway and its codefendants will put $375,000 in to a fund for legal fees and costs. Two Philadelphia law firms represented the plaintiffs, Kohn, Swift & Graf and Conrad, O’brian, Gellman & Rohn.

"We’re just pleased to move on," Amway’s Meurlin said. "Stacy Hanrahan and the other plaintiffs had a very abnormal experience with the company."

In their suit, the Hanrahans described Amway as a pyramid scheme, in which dealers earn money for the distributors who recruited them, with a percentage of each dealer’s revenues passed on to those higher in the pyramid.

Amway and its codefendants have denied all allegations.

Britt and Yager were not in their offices yesterday when they were called for comment. The Hanrahans, who have established an Amway Lawsuit Information Line, did not respond to a message left there.

The proposed settlement could include up to 2.5 million distributors who sold Amway products between Jan. 1, 1990, and Aug. 1 of this year downline from the Britt and Yager distributorships. Any distributor who wants to opt out of the settlement must do so by Nov. 15. A hearing to debate the merits of the settlement will be held Dec. 16 in U.S. District Court in Philadelphia.

The discount coupons, good for six months for distributors, will knock 35% off the cost of products ranging in price from $5 to $50, Meurlin said, including Durashine Floor Polish and Hourgard Insect Repellent. Coupon users will also get a break on postage. Amway has agreed to mail the products at half the normal shipping rate.

Amway said it would not know the total cost of the settlement until the coupons were redeemed.

It is worth noting that, while there had been a number of previous similar lawsuits, this is the first time, to my knowledge, that Amway Corp. had been so strongly linked to the activities of distributors like Britt and Yager. It may be much more difficult for Amway to now claim in other such lawsuits that they have no knowledge of or responsibility for the abuses being perpetrated by its distributors. Also, any distributors who sell motivational materials will be under court order to abide by Amway's rules and Code of Ethics.

It should also be noted that Craig Meurlin, senior vice president of Amway, makes a couple of statements that are so ludicrously inaccurate that they deserve special mention. One is that the Hanrahan's "had a very abnormal experience with the company." An amazing claim, considering that Amway has been sued a number of times before over these very same issues, and that there have been a number of books and articles written describing the covert "tools" business and it's harmful effects on large numbers of distributors. It's even more amazing when we consider that Rich DeVos himself in a 1983 "Directly Speaking" tapes—fully 16 years ago—acknowleged the serious and widespread nature of the "power and pressure" being used by some distributor groups to "extract money" from victimized distributors.

Meurlin also claims that "the company does not push religious or political philosophies on distributors." Perhaps he's thinking of a different "Amway." One of the most common threads in all the research I've done is the extreme political and religious bias that permeates every level and aspect of Amway, to the extent that Amway has been likened to a combination of a Fundamentalist Christian church and a political fundraising organization.

## Articles regarding the filing of this suite

### From "The Legal Intelligencer," August 2, 1994

Vendors File Class Action Suit Against Amway Delaware County--Five former Amway vendors have filed a class-action suit against the company and two regional distributors, saying the distributors grossly exaggerated the profitability of selling Amway products and forced them to buy their motivational materials.

Attorneys James J. Rohn, Karen Scheller and Judson A. Aaron of Conrad O'Brien Gellman & Rohn and Joseph C. Kohn and Robert J. LaRocca, of Kohn Nast & Graf, filed the antitrust and racketeering suit on behalf of John and Stacy Hanrahan of Springfield, Mark and Lori Mensack of Erie and Brian Bohrer of West Point, N.Y.

In the suit, the five say that distributors William Britt of Carson City, Nev., and Dexter Yager of Charlotte, N.C., built a "vast Amway sales organization through "fraud and restraint of competition."

They claim that neither Amway, Britt nor Yager told them that Amway distributors make an average of $65 a month and never informed them about the "considerable business expenses" in building a distributorship.

The suit says that Amway knew Britt and Yager lied to distributors, but did nothing to stop them.

"It was in Amway's self-interest to permit such practices to continue, and although Amway has been aware of such practices for years, Amway has never terminated the distributorships of defendants Britt and/or Yager," the suit says.

The suit also says that Amway is a "pyramid scheme" that allows distributors to profit from the sales of vendors beneath them. Amway vendors make money only when they recruit several vendors below them to sell products, the suit says.

Britt and Yager are at the top of two pyramids, the suit claims, and have used their position to force their so-called "down-line" distributors to buy their motivational materials and attend their motivational conferences.

The suit says that Britt and Yager make most of their money from selling motivational materials. Their down-line vendors cannot buy materials from anyone else, the suit says, and the two have "strictly controlled" the resale prices for the materials. The case has been assigned to Senior U.S. District Judge J. William Ditter, Jr.

### From "Time Out," August 10-17 1994

Amway Faces Class Action

Two distributors of the Amway Corporation, the multi-billion dollar multi- level marketing company which was the subject of a "Time Out" investigation earlier this year (June 22-29) have been served with a class action complaint in the Pennsylvania District Court by five former distributors.

The corporation, which sells a wide range of household good and products through a network of more than two million independent distributors around the world, is named in the 40-page complaint, along with two of its top distributors--know as "black hats"--Dexter Yager and Bill Britt. The complaint alleges that the latter two have built their vast sales organizations through the perpetration of fraud and restraint of competition and that Amway, while fully aware of this, had taken no action to halt such practices.

The lawsuit alleges that:

- Britt and Yager misrepresented to potential distributors the level of earnings they could expect to achieve by becoming involved with Amway and also the amount of time it would take to achieve such earnings.
- Britt and Yager misrepresented the affiliation between Amway and other large corporations, giving the impression that the companies were involved in profitable business relationships with Amway.
- Britt and Yager coerced distributors into purchasing motivational materials in the form of books and audio cassette tapes and falsely represented to distributors that they would be unable to build and maintain successful Amway distributorships without the purchase of such materials.

The action further alleges on each count that at all times, Amway was aware of and encouraged such practices by Britt and Yager and that it was in Amway's economic self-interest to permit such practices to continue.

As a class action, the lawsuit represents not just the five named former distributors but also any other former or current distributors dating back to the time when the action is deemed to have begun--in this case January 1990. Amway is expected to contest the action.

"Time Out's" article investigated similar allegations which have emerged from some of the corporations 73,000 British distributors and also examined evidence that, while Amway itself is not a cult, the techniques used by high level distributors such as Britt, Yager and their British counterparts to motivate and recruit people into the network often displayed alarming similarities to those used by cults.

In her book on cults, "Dangerous Persuaders," published by Penguin Australia in March, author Louise Samways states: "Increasingly, Amway is adopting similar tactics to many cults in order to attract recruits then to keep them involved and committed to the cause... extremely large gatherings are held regularly and at these many techniques used by traditional cults are employed to reinforce values and enhance commitment, for instance confessions, success sharing and singing. Participants are expected to conform to strict dress codes, jacket and tie for men, smart dress and jackets for women."

The lawsuit, if successful, would indicate that there has been direct involvement and cooperation between the Amway Corporation and its senior distributors, though it would only be at the end of the case, which is expected to take at least a year to come to trial, that such a link could be proved.

## Complete text of the complaint

                   IN THE UNITED STATES DISTRICT COURT
                  FOR THE EASTERN DISTRICT OF PENNSYLVANIA

    JOHN and STACY HANRAHAN,               :      CIVIL ACTION N0.
    129 Kent Road                          :        94-4615
    Springfield, Pennsylvania 19064,       :
                                           :
             and                           :
                                           :
    BRIAN BOHRER,                          :
    649 Montroyale Drive                   :
    Erie, Pennsylvania 16504,              :
                                           :
             and                           :
                                           :
    MARK and  LORI  MENSACK,               :
    523H South Moore Loop                  :
    West Point, New York 10996,            :
                                           :      JURY TRIAL DEMANDED
    on behalf of themselves and all        :
    others simirlarly situated,            :
                                           :
                  Plaintiffs,              :
                                           :
             v.                            :
                                           :
    WILLIAM BRITT, individually and        :      CLASS ACTION
    t/a, d/b/a AMERICAN MULTIMEDIA,        :
    INC.; BRITT MOTIVATION, INC.;          :
    BRITT LEASING, INC.; BRITT             :
    MANAGEMENT, INC.; BRITT                :
    RESOURCES, INC.; EXECUTIVES            :
    UNLIMITED, INC.; EXECUTIVE             :
    PLANNERS,  INC.,                       :
    2533 N. Carson Street                  :
    Carson City, Nevada 89706,             :
                                           :
             and                           :
                                           :
    DEXTER YAGER, individually and         :
    t/a, d/b/a YAGER ENTERPRISES;          :
    DEXTER R. YAGER, SR. &  FAMILY      :
    ENTERPRISES, INC.; D &  B YAGER     :
    ENTERPRISES, INC.; DEXTER YAGER        :
    SECURITIES, INC.; DEXTER YAGER         :
    MOTIVATION, INC., INTERNET             :
    SERVICES CORPORATION; INTERNET         :
    SERVICES, INC.; INTERNATIONAL          :
    COMMUNICATION CORPORATION OF           :
    AMERICA; YAGER RESORT PROPERTIES,      :
    INC.; DREAMBUILDERS REVIEW,            :
    12201 Steele Creek Road                :
    Charlotte, North Carolina 282?3,       :
                                           :
             and                           :
                                           :
    AMWAY CORPORATION, INC.,               :
    7575 East Fulton Road                  :
    Ada, Michigan 49355,                   :
                                           :
                  Defendants.              :

    CLASS ACTION COMPLAINT

            Plaintiffs, John and Stacy Hanrahan, Mark and Lori Mensack
    and Brian Bohrer (hereinafter "plaintiffs"), on behalf of
    themselves and all others similarly situated, for their complaint
    allege as follows:

            l. This is a class action brought to remedy defendants'
    violations of the Sherman Act, 15 U.S.C. § l, the Racketeer
    Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961 et
    seq., and state common law arising from defendants' efforts to
    build their vast Amway sales organizations through the
    perpetration of fraud and restraint of competition. The
    fraudulent, deceitful and coercive behavior of defendants, as
    described herein, continues to cause substantial injury to the
    members of the Class, for which the Class seeks monetary and
    injunctive relief.

    I. PARTIES

            2. Plaintiffs John and Stacy Hanrahan are individuals and
    citizens of the Commonwealth of Pennsylvania residing at 129 Kent
    Road, Springfield, Pennsylvania 19064, who were distributors of
    products marketed by the Amway Corporation from in or about
    January 1992 through in or about August 1992.

            3. Plaintiffs Mark and Lori Mensack are individuals and
    citizens of the state of New York residing at 523H South Moore
    Loop, West Point, New York 10996, who were distributors of
    products marketed by the Amway Corporation from in or about April
    1991 through in or about August 1992.

            4. Plaintiff Brian Bohrer is an individual and citizen of
    the Commonwealth Pennsylvania residing at 649 Montroyale Avenue,
    Erie, Pennsylvania 16504, who was a distributor of products
    marketed by the Amway Corporation from in or about July 1992
    through in or about February 1993.

            5. Defendant William Britt ("Britt"), individually and t/a,
    d/b/a American Multimedia, Inc., Britt Motivation, Inc., Britt
    Leasing, Inc., Britt Management, Inc., Britt Resources, Inc.,
    Executives Unlimited, Inc. and Executive Planners, Inc., is a
    distributor of Amway products who is involved in the promotion of
    Amway distributorships, the distribution of Amway products, the
    production and distribution of motivational materials for use by
    Amway distributors, the sale of motivational materials to Amway
    distributors, and the organization of motivational rallies for
    attendance by Amway distributors.

            6. Defendant Dexter Yager ("Yager"), individually and t/a,
    d/b/a Yager Enterprises, Dexter R. Yager, Sr. &  Family
    Enterprises, Inc., D &  B Yager Enterprises, Inc., Dexter Yager
    Securities, Inc., Dexter Yager Motivation, Inc., Internet
    Services Corporation, Internet Services, Inc., International
    Communications Corporation of America, Yager Resort Properties,
    Inc. and Dreambuilders Review, is a distributor of Amway products
    who is involved in the promotion of Amway distributorships, the
    distribution of Amway products, the production and distribution
    of motivational materials for use by Amway distributors, the sale
    of motivational materials to Amway distributors, and the
    organization of motivational rallies for attendance by Amway
    distributors.

            7. Defendant Amway Corporation, Inc. ("Amway") is a
    corporation which is engaged in the manufacture, distribution and
    sale of Amway products, and the promotion of Amway
    distributorships.

    II. JURISDICTION AND VENUE

            8. This Court has jurisdiction over this action under 28
    U.S.C. § 1331, as this action arises under the laws of the
    United States, and has supplemental jurisdiction over the state
    law claims under 28 U.S.C. § 1367.

            9. Venue properly lies in the Eastern District of
    Pennsylvania pursuant to 28 U.S.C. 1391(b) because this is the
    judicial district in which a substantial part of the events or
    omissions giving rise to the claim occurred, and defendants do
    business in the Commonwealth of Pennsylvania in this judicial
    district.

            10. By the acts, conduct, combination, conspiracy, schemes
    and other wrongs complained of herein, defendants directly and
    indirectly used the means and instrumentalities of interstate
    commerce.

    III. FACTUAL STATEMENT

            11. Amway manufactures a wide variety of consumer household
    products which it sells nationwide through hundreds of thousands
    of distributors.

            12. The Amway sales plan is a pyramid type scheme, whereby
    any purchase or sale of Amway goods by a distributor financially
    benefits not only Amway, but also those Amway distributors who
    occupy higher levels in the Amway distributorship pyramid. In
    Amway parlance, those who occupy positions below a distributor in
    his or her branch of the pyramid are called the distributor's
    "downline." In order to earn significant profits as an Amway
    distributor, one must develop a sizeable downline by recruiting
    and sponsoring other distributors into the Amway sales
    organization.

            13. Plaintiffs and members of the Class all became Amway
    Distributors by entering into Distributorship Agreements with
    Amway, whereby they acquired the right to sponsor new Amway
    distributors, and to sell Amway products primarily to their
    sponsored distributors.

            14. Defendant Britt occupies a position at the top of his
    own Amway distributorship pyramid. Defendant Britt runs his own
    vast Amway distributorship network comprised of tens of thousands
    of downline distributors and, upon information and belief, earns
    millions of dollars annually through his Amway business
    organization. Plaintiffs John and Stacy Hanrahan and Brian Bohrer
    were Amway distributors in the downline of defendant Britt.

            15. Defendant Yager occupies a position at the top of his
    own Amway distributorship pyramid. Defendant Yager runs his own
    vast Amway distributorship network comprised of tens of thousands
    of downline distributors and, upon information and belief, earns
    millions of dollars annually through his Amway business
    organization. Plaintiffs Mark and Lori Mensack were Amway
    distributors in the downline of defendant Yager.

            16. Defendants Britt and Yager's wrongful conduct, as
    described herein, was carried out by and through defendants'
    business organizations, which organizations are comprised of and
    include defendants individually, the various corporations and
    entities through which defendants conduct their respective
    businesses, and the employees, agents and representatives of
    defendants' respective business organizations.

            17. The success of defendants Britt and Yager is integral to
    the success of defendant Amway, as Amway directly benefits
    financially from the sponsorship of each Amway distributor within
    the Britt and Yager organizations, and from the sale of Amway
    products by and to each Amway distributor within the Britt and
    Yager organizations.

    Misrepresentations Concerning Potential Earnings

            18. At all times relevant hereto, defendants Britt and Yager
    routinely and intentionally misrepresented to plaintiffs the
    amount of profits Amway distributors could realistically expect
    to earn, which misrepresentations included by were not limited
    to:

                    (a) statements that grossly exaggerated the
    profitability of Amway distributorships;

                    (b) representations that as Amway distributors
    plaintiffs could expect to earn tens of thousands and even
    hundreds of thousands of dollars, when in fact defendants know
    that during the relevant time period the average monthly gross
    income for active Amway distributors was approximately $65;

                    (c) representations that plaintiffs' recruiting and
    sponsoring efforts would result in geometrical increases in the
    number of Amway distributors in plaintiffs' downlines, when in
    truth Amway distributors are unlikely to recruit and sponsor
    substantial numbers of other distributors or earn substantial
    profits from the efforts of their downline distributors;

                    (d) representations that as Amway distributors
    plaintiffs would earn substantial profits in only a few months;
    and

                    (e) representations that plaintiffs would earn
    substantial profits by working on only a part-time basis as Amway
    distributors.

            19. In addition to the aforesaid material
    misrepresentations, at all times relevant hereto defendants Britt
    and Yager intentionally failed to disclose material facts to
    plaintiffs, which material omissions included but were not
    limited to:

                    (a) defendant's failure to advise plaintiffs of the
    substantial business expense involved in building and maintaining
    a profitable Amway distributorship;

                    (b) defendants' failure to advise plaintiffs of the
    substantial investment of time required to build and maintain a
    profitable Amway distributorship;

                    (c) defendants' failure to advise plaintiffs of the
    high turnover rate prevalent among Amway distributors;

                    (d) defendants' failure to advise plaintiffs that they
    were likely to earn profits comparable to the average gross
    income for active Amway distributors, which during the relevant
    time period was approximately $65.00.

            20. At all times relevant hereto, Amway was aware of and
    encouraged the aforesaid material misrepresentations, and Amway
    was further aware that the aforesaid material facts were not
    being disclosed to Amway distributors. It was in Amway's economic
    self-interest to permit such practices to continue, and although
    Amway has been aware of such practices for years Amway has never
    terminated the distributorships of defendants Britt and/or Yager.

            21. Contrary to defendants' misrepresentations that
    plaintiffs would reap significant profits as Amway distributors,
    upon which misrepresentations plaintiffs relied to their
    detriment, plaintiffs all lost money as Amway distributors.

    Misrepresentations Concerning Amway's Affiliation

            22. In order to induce persons to become Amway distributors,
    at all times relevant hereto defendants Britt and Yager falsely
    represented to plaintiffs that Amway distributors are involved in
    profitable business relationships--variously described as, inter
    alia, "joint partnerships," "network marketing," and "joint
    ventures"--with major corporations, including Fortune 500
    companies. Defendants represented that plaintiffs could expect to
    reap substantial financial benefits as a result of the
    aforementioned business relationships with numerous major
    companies.

            23. At all times relevant hereto, Amway was aware of and
    encouraged the aforesaid misrepresentations regarding Amway's
    affiliation. It was in Amway's economic self-interest to permit
    such misrepresentations to continue being made to Amway
    distributors, and although Amway has been aware of such practices
    Amway has never terminated the distributorships of defendants
    Britt and/or Yager.

            24. Contrary to defendants' aforementioned representations,
    plaintiffs were not involved with other companies in any
    profitable business relationships, nor did they benefit
    financially from any "joint ventures," "partnerships," "network
    marketing," or other such business relationships in which Amway
    may have been involved.

            25. By their aforesaid misrepresentations, defendants
    intentionally distorted the true nature of the Amway
    distributorship and overstated the financial value of the Amway
    distributorship. In truth, by entering into their Amway
    distributorships Amway distributors simply acquired the right to
    sell Amway products and sponsor other distributors.

            26. Plaintiffs entered into their Amway distributorships in
    reliance upon defendant's misrepresentations that Amway
    distributors are involved in and reap substantial financial
    benefits from business relationships with numerous companies as
    described hereinabove.

    The Coerced Sale of Motivational Materials

            27. Defendants Britt and Yager have created their own
    independent businesses that publish motivational materials, such
    as books and audio cassette tapes, and that organize and promote
    motivational rallies for Amway distributors throughout the United
    States. Through their independent businesses, defendants Britt
    and Yager sell vast quantities of motivational materials to their
    respective downline distributors and hold rallies throughout the
    United States that their downline distributors must pay to
    attend.

            28. Defendants Britt and Yager derive a substantial portion
    of their incomes not from the sale of Amway products, but from
    the sale of motivational materials to persons in their downlines
    and from the money earned through their rallies.

            29. At all times relevant hereto, defendants Britt and Yager
    regularly represented to plaintiffs that their success as Amway
    distributors was contingent upon the purchase of defendants Britt
    and Yager's motivational materials, and that without such
    materials plaintiffs would be unable to build and maintain
    successful Amway distributorships. Defendants Britt and Yager
    further represented to plaintiffs that they should purchase only
    those motivational materials produced and/or distributed by
    defendants Britt and Yager.

            30. At all times relevant hereto, defendants Britt and Yager
    further represented to plaintiffs that they should purchase a
    weekly supply of defendants' motivational audio tapes through a
    tape-of-the-week program that defendants Britt and Yager
    described as the "standing order" tape program and, moreover,
    defendants represented that such weekly purchases of defendants'
    audio tapes we essential to plaintiff's success as Amway
    distributors.

            31. At all times relevant hereto, defendants Britt and Yager
    further represented to plaintiffs that their regular attendance
    at the motivational rallies organized and promoted by defendants
    was essential to plaintiffs'success as Amway distributors.

            32. In fact, the motivational materials produced and/or
    distributed by defendants Britt and Yager and the motivational
    rallies organized and promoted by defendants Britt and Yager were
    unnecessary to the success of Amway distributors, and plaintiffs
    all lost money as Amway distributors despite their purchase of
    said materials and attendance at said rallies.

            33. At all times relevant hereto, Amway was aware that the
    aforesaid misrepresentations regarding defendants Britt and
    Yager's motivational materials and motivational rallies were
    being made to Amway distributors. It was in Amway's economic
    self-interest to permit such misrepresentations to continue being
    made to Amway distributors, and although Amway has been aware of
    such practices for years Amway has never terzninated the
    distributorships of defendants Britt and/or Yager.

            34. In reliance upon the misrepresentations of defendants
    Britt and Yager, plaintiffs purchased massive quantities of
    defendants Britt and Yager's motivational materials and attended
    defendants Britt and Yager's motivational rallies, all of which
    contributed significantly to the financial loss sustained by
    plaintiffs.

    Customer Allocation and Price Fixing in Connection with
    Defendants' Motivational Materials

            35. At all times relevant hereto, defendants Britt and Yager
    allocated customers for their motivational materials in the
    following way: Defendant Britt regularly represented to
    distributors in his downline that their success as Amway
    distributors was contingent upon their purchasing only those
    motivational materials distributed by defendant Britt, and that
    distributors in defendant Britt's downline should not purchase
    motivational materials distributed by others. Similarly,
    defendant Yager regularly represented to distributors in his
    downline that their success as Amway distributors was contingent
    upon their purchasing only those motivational materials
    distributed by defendant Yager, and that distributors in
    defendant Yager's dowlnine should not purchase motivational
    materials distributed by others.

            36. In reliance upon defendants' representations, plaintiffs
    and members of the Class in defendant Britt's downline purchase
    only those motivational materials distributed by defendant Britt,
    and plaintiffs and members of the Class in defendant Yager's
    downline only those motivational materials distributed by
    defendant Yager.

            37. At all times relevant hereto, defendants Britt and Yager
    fixed the prices charged for their motivational materials by
    strictly controlling the resale price of their motivational audio
    tapes, such that at all times relevant hereto the resale price
    charged for motivational audio tapes distributed by defendant
    Britt was the same or substantially the same as the resale price
    charged for motivational audio tapes sold by defendant Yager.

            38. At all times relevant hereto, Amway was aware of and
    encouraged defendants Britt and Yager's aforesaid practices of
    customer allocation and price fixing in connection with the sale
    of their motivational materials, and it was in Amway's economic
    self-interest to permit such practices to continue. Indeed,
    although Amway has been aware of Britt and Yager's aforesaid
    activities for years, Amway has never terminated the
    dstributorships of defendants Britt and/or Yager.

            39. Defendant Britt and Yager's aforementioned practices of
    customer allocation and price fixing in connection with the sale
    of their motivational materials had the effect of preventing
    plaintiffs and members of the class of availing themselves of
    legitimate motivational materials and sales aids produced by
    third parties.

    IV.   CLASS ACTION ALLEGATIONS

            40. Plaintiffs bring this action, on behalf of themselves
    and all others similarly situated, as a class action pursuant to
    Rule 23(a) and Rule 23(b)(3) of the Federal Rules of civil
    Procedure, on behalf of the following class :

    all persons in the United States who, since January of 1990,
    have been or are Amway distributors and have been or are in
    the sales organizations or downlines of defendants William
    Britt and/or Dexter Yager, excluding from the proposed Class
    the defendants herein, any entity in which the defendants
    have a controlling interest, and the officers and directors,
    affiliates, legal representatives, heirs, successors, or
    assignees of the defendants or their officers and directors.

            41. A class action is superior to other available methods
    for the fair and efficient adjudication of this controversy since
    the members of the Class are so numerous and their residence so
    widespread that joinder of all members is impracticable.

            42. This action satisfies the requirements for class
    certificatiort under Federal Rules of Civil Procedure 23(a)(1)-
    (4) and 23 (b)(3), in that:

                    (a) The Class is so numerous that the individual
    joinder of all members is impracticable under the standard of
    Fed. R. Civ. P. 23 (a)(1). While the exact number of class
    members is unknown to plaintiffs at this time, it is known to
    defendants and is ascertainable by appropriate discovery, and
    plaintiffs are informed and believe that the Class includes
    thousands of members.

                    (b) Common questions of law and fact exist as to all
    members of the Class, and predominate over any questions which
    affect only individual members of the Class. These common
    questions of law and fact include:

                            i) whether defendants violated the Sherman Act by
    engaging in an unreasonable restraints of trade in connection
    with the sale of defendants' motivational materials to plaintiffs
    and members of the Class through defendants' practices of
    customer allocation and price fixing;

                            ii) whether defendants violated RICO by conducting
    the affairs of an enterprise through a repeated and continuing
    pattern of wire and mail fraud, in connection with the promotion
    of Amway distributorships, the sale of motivational materials and
    the promotion of motivational rallies to plaintiffs and members
    of the Class;

                            iii) whether Amway aided and abetted defendants
    Britt and Yager's RICO violations;

                            iv) whether defendants violated state common law
    as alleged herein in connection with the promotion of Amway
    distributorships, the sale of motivational materials and the
    promotion of motivational rallies to plaintiffs and members of
    the Class;

                            v) whether defendants misrepresented the amount of
    profits plaintiffs and members of the Class could expect to earn
    as Amway distributors and/or the financial success plaintiffs and
    members of the Class could expect to achieve as Amway
    distributors;

                            vi) whether defendants misrepresented the
    financial benefits plaintiffs and members of the Class could
    expect to reap from Amway's purported affiliations with other
    major companies, and/or whether defendants misrepresented that as
    Amway distributors plaintiffs and members of the Class would
    become involved in profitable business relationships with major
    companies other than Amway;

                            vii) whether defendants fraudulently represented
    to plaintiffs and members of the Class the need to purchase
    defendants' motivational materials and attend defendants'
    motivational rallies in order to succeed as Amway di stributors;

                            viii) whether the aforesaid acts and/or omissions
    of defendants, as directed towards plaintiffs and members of the
    Class, were done fraudulently;

                            ix) the amount of revenues and profits obtained by
    defendants attributable to defendants' misconduct;

                            x) the appropriate nature of classwide equitable
    relief; and

                            xi) whether the members of the Class have
    sustained damages as a result of defendants' wrongdoing and, if
    so, what is the proper measure and appropriate formula to be
    applied in determining such damages.

                    (c) Plaintiffs' claims are typical of the claims of the
    members of the Class, since plaintiffs entered into their Amway
    distributorships, maintained their Amway distributorships,
    purchased defendants' motivational materials, and attended
    *defendants' motivational rallies in reliance upon fraudulent
    misrepresentations made by or caused to be made by defendants,
    thereby suffering damages. Plaintiffs and members of the Class
    sustained damages arising out of defendants' common course of
    conduct in violation of federal and state laws as complained of
    herein. The losses of each member of the Class were caused
    directly by defendants' wrongful conduct in violation of federal
    and state common law and statutory law as alleged herein.

                    (d) Plaintiffs will fairly and adequately protect the
    interests of the members of the Class. Plaintiffs have no
    interests which are antagonistic to the interests of the Class.

                    (e) Plaintiffs have retained counsel who are
    experienced in class action litigation and complex litigation
    involving claims of consumer fraud and violations of the
    antitrust and racketeering laws.

                    (f) The issues which affect plaintiffs and members of
    the Class in common predominate over any issues which affect the
    interests of individual Class members.

                    (g) A class action is superior to any other available
    methods for the fair and efficient adjudication of this
    controversy under Fed. R. Civ. P. 23(b)(3) since individual
    joinder of all members of the Class is impracticable.
    Furthermore, the cost and burden to the court system of
    adjudication of such individualized litigation would be
    substantial.

    V. CLAIMS FOR RELIEF

    COUNT I
    [Against Defendants Britt and Yager and Amway
    For Violation of the Sherman Act, 15 U.S.C. § 1]

            43. Plaintiffs, on behalf of themselves and all others
    similarly situated, reallege, as if fully set forth, each and
    every allegation contained in paragraphs 1 through 42 hereof, and
    further allege as follows.

            44. The unreasonable restraint of trade alleged herein
    occurred in the market for motivational materials and sales aids
    for use in the marketing of consumer household products.

            45. Competition in the market for motivational materials and
    sales aids for use in the marketing of consumer household
    products was unreasonably restrained by defendants Britt and
    Yager's practices of allocating customers for and fixing the sale
    prices of their motivational materials, including but not
    necessarily limited to cassette audio tapes.

            46. Defendants Britt and Yager engaged in an illegal scheme
    to allocate customers for their motivational materials, as set
    forth in more detail in paragraphs 27 through 39 hereinabove,
    whereby defendant Britt used fraudulent and coercive conduct to
    compel his downline distributors to purchase only those
    motivational materials produced and/or distributed by the Britt
    organization, and whereby defendant Yager used similarly
    fraudulent and coercive conduct to compel his downline
    distributors to purchase only those motivational materials
    produced and/or distributed by the Yager organization.

            47. Defendants Britt and Yager's scheme to allocate
    customers for their motivational materials constituted a
    combination or conspiracy that unreasonably restrained, hindered,
    frustrated, suppressed and eliminated competition in the market
    for motivational materials and sales aids for use in the
    marketing of consumer household products.

            48. Defendants Britt and Yager's unlawful scheme to allocate
    customers for their motivational materials began at least as
    early as January of 1990 and continues today.

            49. The object of defendants Britt and Yager's combination
    or conspiracy to allocate customers for their motivational
    materials was to control customer markets for their motivational
    materials by restricting the supply of motivational materials to
    their downline distributors, and by employing fraudulent and
    coercive tactics to ensure that distributors in defendant Britt's
    downline purchased only those motivational materials produced
    and/or distributed by defendant Britt, and that distributors in
    defendant Yager's downline purchased only those motivational
    materials produced and/or distributed by defendant Yager.

            50. Defendants Britt and Yager's unlawful scheme to allocate
    customers for their motivational materials constituted an
    unreasonable restraint of interstate trade and commerce in
    violation of Section 1 of the Sherman Act.

            51. At all times relevant hereto, defendant Amway had
    knowledge of and participated in defendants Britt and Yager's
    combination or conspiracy to allocate customers for their
    motivational materials. Amway encouraged and permitted such
    practices to continue, as it was in Amway's economic self-
    interest to permit such practices to continue, and indeed Amway
    has never terminated the distributorships of Defendants Britt
    and/or Yager.

            52. Defendants Britt and Yager further engaged in an illegal
    scheme to fix the prices charged for their respective
    motivational materials, as set forth in more detail in paragraphs
    27 through 39 hereinabove, whereby defendants Britt and Yager
    fixed the same or substantially the same sale price for the
    cassette audio tapes produced and/or distributed by defendants
    Britt and Yager.

            53. Defendants Britt and Yager's scheme to fix the prices
    charged for their respective motivational materials constituted a
    combination or conspiracy that unreasonably restrained, hindered,
    frustrated, suppressed and eliminated competition in the market
    for motivational materials and sales aids for use in the
    marketing of consumer household products.

            54. Defendants Britt and Yager's unlawful scheme to fix the
    prices charged for their respective motivational materials began
    at least as early as January of 1990 and continues today.

            55. The object of defendants Britt and Yager's combination
    or conspiracy to fix the prices charged for their motivational
    materials was to control customer markets for their motivational
    materials by restricting the supply of motivational materials to
    their downline distributors, and by ensuring that distributors in
    their respective downlines purchased only those motivational
    materials produced and/or distributed by each de f endant.

            56. Defendants Britt and Yager's unlawful scheme to fix the
    prices charged for their motivational materials constituted an
    unreasonable restraint of interstate trade and commerce
    inviolation of Section 1 of the Sherman Act.

            57. The effect of defendants Britt and Yager's combination
    or conspiracy to allocate customers and fix prices was to ensure
    that plaintiffs purchase substantial quantities of defendants'
    motivational materials, and to deprive plaintiffs of the
    opportunity to avail themselves of motivational and sales
    training materials from other sources outside of the combination
    or conspiracy.

            58. At all times relevant hereto, defendant Amway had
    knowledge of and participated in defendants Britt and Yager's
    combination or conspiracy to fix prices charged for their
    motivational materials. Amway encouraged and permitted such
    practices to continue, as it was in Amway's economic self-
    interest to permit such practices to continue, and Amway has
    never terminated the distributorships of defendants Britt and/or
    Yager.

            59. Defendants' illegal practices of allocating customers
    and fixing prices in connection with the nationwide distribution
    and sale of their motivational materials had a substantial and
    adverse effect on interstate commerce.

            60. Plaintiffs and members of the Class were damaged by the
    aforesaid illegal practices of allocating customers and fixing
    prices for their motivational materials in an amount in excess of
    $100,000, in that plaintiffs and members of the Class expended
    significant amounts of money on unwanted and unnecessary
    motivation materials distributed by defendants, and were further
    deprived of the opportunity to avail themselves of motivational
    and sales training materials produced and distributed by third
    parties which could have assisted them in developing their Amway
    distributorships. Plaintiffs and the Class are entitled to
    recover from defendants Britt, Yager and Amway treble damages,
    costs and attorneys' fees as a result of the aforesaid violation
    of the Sherman Act.

    COUNT II
    [Against Defendants Britt and Yager
    for Violation of RICO, 18 U.S.C. § 1962(c)]

            61. Plaintiffs, on behalf of themselves and all others
    similarly situated, reallege, as if fully set forth, each and
    every allegation contained in paragraphs 1 through 60 hereof, and
    further allege as follows.

            62. Defendants Britt and Yager are "persons" as that term is
    defined in 18 U.S. C. § 1961.

            63. The association-in-fact of defendant Amway and its
    network of Amway distributors is an "enterprise" as that term is
    defined in 18 U.S. C. § 1961, which is engaged in and affects
    interstate commerce.

            64. In violation of 18 U.S.C. § 1962 (c), defendants Britt
    and Yager, as persons associated with the aforesaid enterprise,
    participated in the affairs of the enterprise through a pattern
    of racketeering activity consisting of wire fraud, 18 U.S.C. §
    1343, and mail fraud, 18 U.S.C. § 1341. Defendants' participation
    in the affairs of the enterprise consisted of their guiding,
    managing, directing or otherwise exercising some control over the
    affairs of the enterprise. Through acts of mail and wire fraud
    these two individuals, William Britt and Dexter Yager,
    participated in the affairs of the RICO enterprise, which was
    comprised of a large international corporation (Amway) and its
    vast network of hundreds of thousands of individual distributors.
    The cloak of legitimacy provided to defendants Britt and Yager by
    this seemingly legitimate enterprise afforded said defendants
    access to and influence over huge numbers of Amway distributors,
    thus enabling defendants Britt and Yager to execute their scheme
    to defraud plaintiffs and members of the Class, as described at
    length herein.

            65. Defendants Britt and Yager's pattern of racketeering
    activity, which consisted of mail and wire fraud, was perpetrated
    through direct telephone communications, the Amvox telephone
    voice mail system and the mails, pursuant to and for the purpose
    of executing defendants'scheme to defraud plaintiffs and members
    of the Class by communicating false and fraudulent information,
    including but not limited to:

                    (a) statements that fraudulently represented the amount
    of profits plaintiffs could expect to earn as Amway distributors;

                    (b) statements that fraudulently represented that
    plaintiffs'success as Amway distributors was contingent upon
    purchasing substantial quantities of the motivational materials
    produced and/or distributed by defendants Britt and Yager,

                    (c) statements that fraudulently represented that
    plaintiffs'success as Amway distributors was contingent upon
    attending motivational rallies organized and promoted by
    defendants Britt and Yager; and

                    (d) statements that fraudulently represented that Amway
    distributors were involved in profitable business relationships
    with other major companies, as described in paragraphs 22 through
    26 herein.

            66. Defendants Britt and Yager's patterns of mail and wire
    fraud included but were not necessarily limited to:

                    (a) numerous direct telephone communications to inter
    alia, plaintiffs and members of the Class, made by and caused to
    be made by defendants Britt and Yager, regarding Amway and
    defendants' Amway sales organizations;

                    (b) numerous messages communicated over the Amvox
    telephone voice mail system to, inter alia, plaintiffs and
    members of the Class, which telephone voice mail communications
    were made by and caused to be made by defendants Britt and Yager,
    regarding Amway and defendants' Amway sales organizations;

                    (c) numerous mailings of defendants Britt and Yager's
    motivational materials to, inter alia, plaintiffs and members of
    the Class, which mailings were made by and caused to be made by
    defendants Britt and Yager;

                    (d) numerous mailings of defendants Britt and Yager's
    publications to, inter alia, plaintiffs and members of the Class,
    which publications included but were not necessarily limited to
    Dreambuilders Review, Dreambuilders Newsletter and Dreambuilders
    Review Magazine;

                    (e) numerous mailings of documents to, inter alia,
    plaintiffs and members of the Class, which mailings included but
    were not necessarily limited to travel itineraries and
    confirmations, pursuant to the organization and promotion of
    defendants Britt and Yager's motivational rallies; and

                     (f) numerous mailings of Amway publications, including
    but not necessarily limited to the Amagram magazine.

            67. Defendants Britt and Yager's participation in the
    affairs of the enterprise through a pattern of racketeering
    activity commenced no later than January of 1990, continued
    throughout the relevant time period, and projects into the future
    with a threat of repetition, posing a threat of continuing harm
    to the businesses and property of members of the Class.

            68. Plaintiffs and members of the Class were injured in
    their business or property by reason of defendants' foregoing
    pattern of racketeering activity in violation of 18 U.S.C. § 1962
    (c), in an amount in excess of $100,000. Plaintiffs and the Class
    are entitled to recover from defendants Britt and Yager treble
    damages, costs and attorneys' fees as a result of defendants'
    RICO violations.

    COUNT III
    [Against Defendants Britt and Yager
    for Violation of RICO, 18 U.S.C. § 1962(d)]

            69. Plaintiffs, on behalf of themselves and all others
    similarly situated, reallege, as if fully set forth, each and
    every allegation contained in paragraphs 1 through 68 hereof, and
    further allege as follows.

            70. Defendants Britt and Yager are "persons" as that term is
    defined in 18 U.S.C. § 1961.

            71. The association-in-fact of defendant Amway and its
    network of Amway distributors is an "enterprise" as that term is
    defined in 18 U.S.C. § 1961, which is engaged in and affects
    interstate commerce.

            72. In violation of 18 U.S.C. § 1962(d), defendants Britt
    and Yager conspired to violate 18 U.S.C. § 1962(c), in that
    defendants Britt and Yager agreed to commit the aforesaid
    predicate acts of mail and wire fraud with knowledge that such
    acts were part of a pattern of racketeering activity. Through the
    aforesaid acts of mail and wire fraud these two individuals,
    William Britt and Dexter Yager, participated in the affairs of
    the RICO enterprise, which was comprised of a large international
    corporation (Amway) and its vast network of hundreds of thousands
    of individual distributors. The cloak of legitimacy provided to
    defendants Britt and Yager by this seemingly legitimate
    enterprise afforded said defendants access to and influence over
    huge numbers of Amway distributors, thus enabling defendants
    Britt and Yager to execute their scheme to defraud plaintiffs and
    members of the Class, as described at length herein.

            73. The RICO conspiracy was composed of defendants Britt and
    Yager and had as its objective the sponsorship of persons into
    the Amway organization and the maintenance of persons as Amway
    distributors, in order that defendants could further, continue
    and perpetuate the conspiracy for their own financial gain.

            74. The aforesaid RICO conspiracy commenced no later than
    January of 1990, continued throughout the relevant time period,
    and projects into the future with a threat of repetition, posing
    a threat of continuing harm to the businesses and property of
    members of the Class.

            75. In furtherance of the RICO conspiracy, defendants Britt
    and Yager communicated to plaintiffs and members of the Class
    false and fraudulent information, including but not limited to:

                    (a) statements that fraudulently represented the amount
    of profits plaintiffs could expect to earn as Amway distributors;

                    (b) statements that fraudulently represented that
    plaintiffs'success as Amway distributors was contingent upon
    purchasing substantial quantities of the motivational materials
    produced and/or distributed by defendants Britt and Yager;

                    (c) statements that fraudulently represented that
    plaintiffs'success as Amway distributors was contingent upon
    attendin motivational rallies organized and promoted by
    defendants Britt and Yager;

                    (d) statements that fraudulently represented that Amway
    distributors were involved in profitable business relationships
    with other major companies.

            76. Plaintiffs and members of the Class were injured in
    their business or property by reason of defendants' foregoing
    RICO conspiracy in violation of 18 U.S.C. 1962(d), in an  amount
    in excess of $100,000. Plaintiffs and the Class are entitled to
    recover from defendants Britt and Yager treble damages, costs and
    attorneys' fees as a result of defendants' RICO violations.

    COUNT IV
    [Against Defendant Amway for Aiding and Abetting
    Violation of RICO, 18 U.S.C. § 19 61 et seq.]

            77. Plaintiffs, on behalf of themselves and all others
    similarly situated, reallege, as if fully set forth, each and
    every allegation contained in paragraphs 1 through 76 hereof, and
    further allege as follows.

            78. Defendant Amway is a "person" as that term is defined in
    18 U.S.C. § 1961.

            79. At all times relevant hereto Amway was aware of the
    aforementioned pattern of racketeering activity, consisting of
    wire and mail fraud, that was perpetrated pursuant to and for the
    purpose of executing defendants Britt and Yager's scheme to
    defraud plaintiffs and members of the Class by communicating
    false and fraudulent information, including but not limited to:

                    (a) statements that fraudulently represented the
    profits Amway distributors couldexpect to earn;

                    (b) statements that fraudulently represented that the
    success of Amway distributors was contingent upon purchasing
    substantial quantities of the motivational materials produced and
    Jor distributed by defendants Britt and Yager;

                    (c) statements that fraudulently represented that the
    success of Amway distributors was contingent upon attending
    motivational rallies organized and promoted by defendants Britt
    and Yager; and

                    (d) statements that fraudulently represented that Amway
    distributors were involved in profitable business relationships
    with other major companies.

            80. At all times relevant hereto Amway has been aware of
    complaints by Amway distributors that they have been injured
    financially and in their family and personal lives as a result of
    the aforementioned pattern of racketeering activity perpetrated
    by defendants Britt and Yager, and it was in Amway's economic
    self-interest to permit such activity to continue. Indeed,
    although Amway has been aware of Britt and Yager's aforesaid
    activities for years, Amway has never terminated the
    distributorships of defendants Britt and/or Yager.

            81. In allowing the pattern of racketeering activity of its
    distributors, defendants Britt and Yager, to continue, Amway
    financially benefits, in that AmWay earns substantial profits
    from the sale of Amway products by and to distributors in
    defendants' Britt and Yager's downlines.

            82. Amway has aided and abetted the pattern of racketeering
    activity perpetrated by its distributors, defendants Britt and
    Yager, by giving substantial assistance to said defendants, in
    that at all times relevant hereto Amway associated itself with
    the business activities of defendants Britt and Yager and
    permitted defendants Britt and Yager to associate themselves with
    Amway.

            83. Plaintiffs and members of the Class were injured in
    their business or property by reason of defendant Amway's aiding
    and abetting of the foregoing pattern of racketeering activity in
    violation of 18 U.S.C. § 1962 (c) and (d), in an amount in excess
    of $100,000. Plaintiffs and the Class are entitled to recover
    from Amway treble damages, costs and attorneys' fees as a result
    of defendants' RICO violations.

    COUNT V
    [Against Defendants Britt and Yager for Fraud]

            84. Plaintiffs, on behalf of themselves and all others
    similarly situated, reallege, as if fully set forth, each and
    ever y allegation contained in paragraphs 1 through 83 hereof,
    and
    further allege as follows.

            85. Defendants made knowing and fraudulent
    misrepresentations to plaintiffs by misrepresenting the amount of
    profits Amway distributors could expect to earn, and the amount
    of time in which Amway distributors could expect to earn such
    profits, which fraudulent misrepresentations are set forth in
    more detail in paragraphs 18 through 21 hereinabove.

            86. Defendants knowingly and fraudulently misrepresented to
    plaintiffs that Amway distributors were involved in profitable
    business relationships with numerous major companies, variously
    described as, inter alia, "joint partnerships," "network
    marketing," and "joint ventures," through which business
    relationships plaintiffs could expect to reap substantial
    financial benefits, as set forth in more detail in paragraphs 22
    through 26 herein above.

            87. Defendants knowingly and fraudulently misrepresented to
    plaintiffs that their recruiting efforts would result in
    geometric increases in the number of distributors in their
    downlines, and that such geometric increases would occur in a
    relatively short period of time.

            88. Defendants knowingly and fraudulently misrepresented to
    plaintiffs that they could earn substantial profits as Amway
    distributors by working only on a part-time basis.

            89. Defendants failed to disclose to plaintiffs the high
    turnover rate prevalent among Amway distributors.

            90. Defendants failed to disclose to plaintiffs the
    substantial business expense and time involved in building and
    maintaining a profitable Amway distributorship.

            91. Defendants failed to disclose to plaintiffs that they
    were in fact likely to earn profits comparable to the average
    income for Amway distributors.

            92. Defendants made the aforesaid misrepresentations of
    material fact, and failed to disclose the aforesaid material
    facts, intending that plaintiffs become Amway distributors.

            93. But for the aforesaid fraudulent representations upon
    which plaintiffs justifiably relied to their detriment, and but
    for the aforesaid omissions of material facts, plaintiffs would
    not have entered into or maintained their Amway distributorships.

            94. Defendants knowingly and fraudulently misrepresented to
    plaintiffs that their success as Amway distributors was
    contingent upon the purchase of motivational materials produced
    and/or distributed by defendants.

            95. Defendants knowingly and fraudulently misrepresented to
    plaintiffs that their success as Amway distributors was
    contingent upon attending defendants' motivational rallies.

            96. Defendants made the aforesaid misrepresentations of
    material fact intending that plaintiffs purchase defendants'
    motivational materials and expend money to attend defendants'
    motivational rallies in the belief that such expenditures were
    necessary to plaintiffs'success as Amway distributors.

            97. But for the aforesaid misrepresentations of material
    fact, upon which plaintiffs justifiably relied to their
    detriment, plaintiffs would not have purchased substantial
    quantities of defendants' motivational materials and would not
    have expended significant amounts of money traveling to and
    attending defendants' motivational rallies, which motivational
    materials and rallies were in fact unnecessary to
    plaintiffs'success as Amway distributors.

            98. Plaintiffs, in justifiable reliance upon defendants'
    fraudulent representations, were damaged in an amount in excess
    of $100,000, in that plaintiffs entered into their unprofitable
    Amway distributorships and expended significant amounts of money
    on unwanted and unnecessary motivation materials and rallies.
    Plaintiffs and the Class are entitled to recover from defendants
    Britt and Yager compensatory damages unitive damages, costs and
    attorneys' fees and such other relief as this Court deems just.

    COUNT VI
    [Against Defendants Britt and Yager for
    Negligent Misrepresentation]

            99. Plaintiffs, on behalf of themselves and all others
    similarly situated, reallege, as if fully set forth, each and
    every allegation contained in paragraphs 1 through 98 hereof, and
    further allege as follows.

            100. Defendants failed to exercise reasonable care in
    communicating information to plaintiffs concerning the amount of
    profits which Amway distributors could expect to earn, the amount
    of time in which Amway distributors could expect to earn such
    profits, Amway's affiliation with other entities, and the need to
    purchase defendants' motivational materials and attend
    defendants' motivational rallies, which misrepresentations are
    set forth in more detail in paragraphs 18 through 39 herein
    above.

            101. In addition to the aforesaid negligent
    misrepresentations, defendants negligently failed to disclose to
    plaintiffs the high turnover rate prevalent among Amway
    distributors, the substantial business expense and time involved
    in building and maintaining a profitable Amway distributorship,
    and that plaintiffs could expect earnings comparable to the
    average earnings of Amway distributors.

            102. Plaintiffs, in justifiable reliance upon defendants'
    negligent representations, were damaged in an amount in excess of
    $100,000, in that plaintiffs entered into their unprofitable
    Amway distributorships and expended significant amounts of money
    on unwanted and unnecessary motivation materials and rallies.
    Plaintiffs and the Class are entitled to recover from defendants
    Britt and Yager compensatory damages, costs and attorneys' fees
    and such other relief as this Court deems just.

    COUNT VII
    [Equitable (Injunctive and/or declaratory) Relief]

            103. Plaintiffs, on behalf of themselves and all others
    similarly situated, reallege, as if fully set forth, each and
    every allegation contained in paragraphs 1 through 102 hereof,
    and further allege as follows:

            104. Based upon the facts set forth above, plaintiffs, on
    behalf of themselves and all others similarly situated, request
    the following equitable relief:

                    (a) That a judicial determination and declaration be
    made of the rights of plaintiffs and Class members and the
    responsibilities of the defendants; and

                    (b) That defendants be enjoined to cease and desist all
    practices described in the FACTUAL STATEMENT section of this
    Class Action Complaint relating to the unlawful, fraudulent,
    coercive and anticompetitive practices described herein.

    VI. DEMAND FOR A JURY TRIAL

            105. Plaintiffs demand a jury trial for themselves and the
    Class on all claims so triable.

    VII. PRAYER FOR RELIEF

            WHEREFORE, the representative plaintiffs, on behalf of
    themselves and all others similarly situated, pray for judgment
    against defendants as follows:

            l. An order confirming the class certification of the Class
    and appointing plaintiffs and their counsel to represent the
    Class;

            2. For treble damages and/or equitable relief under the
    Sherman Act, the Racketeer Influenced Corrupt Organizations Act
    and state common law as alleged herein;

            3. For any additional and consequential damages suffered by
    plaintiffs and the Class;

            4. For punitive damages against defendants for fraud in an
    amount sufficient to punish defendants and deter others from
    similar wrongdoings;

            5. For attorneys' fees;

            6. For pre- and post- judgment interest;

            7. For cost of suit; and

            8. For such other and further relief as this Court may deem
    just and proper.

    Respectfully submitted,

    James J. Ron, Esquire                   Joseph C. Kohn
    Pa. I.D. No. 21636                      Pa. I.D. No. 36565
    Karen M. Scheller, Esquire              Robert J. La Rocca, Esquire
    Pa. I.D. No. 25751                      Pa. I.D. No. 26203
    Judson A. Aaron, Esquire                Kohn, Nast &  Graf, P.C.
    Pa. I.D. No. 63794                      2400 One Reading Center
    Conrad 0'Brien Gellman                  1101 Market Street
      &  Rohn, P.C.                         Philadelphia, PA 19107
    1515 Market Street, l6th Floor          (215) 238-1700
    Philadelphia, PA 19102-1916
    (215) 864-9600
                                            ATTORNEYS FOR PLAINTIFFS
                                            AND THE CLASS