In a final decision handed down April 10th by the U.S. Court of Appeals, Seasilver must pay $120 million dollars for failing to comply with an earlier order to pay $3 million in consumer redress.
This will hopefully be the final ruling in a case that has been going on since 2002 when the FTC and FDA joined forces to put an end to Seasilvers fraudulent claims. The investigation into Seasilver was part of operation “cure-all” which was a joint effort by the FTC and FDA to put an end to health related fraud in the marketplace.
Seasilver claimed that’s its nutraceutical products could cure over 650 diseases, including AIDS, and that Seasilver would lead to significant and permanent weight loss. Seasilver, which is a combination of Aloe Vera extracts, combined with herbs, cranberry (the original superfruit), and phyto-silver sea vegetables.
Seasilver was founded in the 1980’s by Jason and Bela Burkes. While originally the company claimed that their miracle panacea was available through medical professionals, the company went through a restructuring in the mid 90’s and in 1994 relaunched using a multi-level marketing platform.
After joining together with the FDA to seize over $5.3 million in inventory in 2003, the FTC brought Seasilver to court claiming the company made false statements and violated several FTC guidelines about manufacturing plant safety both for equipment and employee safety. The company was barred from making false claims and a $120 million judgment was handed down against them that would be suspended if they paid $3 million in consumer redress in a specified time.
Needless to say, the company and the Berkes’ did not pay the fine and in 2006 was ordered to pay the full $120 million dollar judgment. The defendants appealed the decision, but to no avail as the U.S. Court of Appeals ruled April 10th 2008 that the 2006 ruling will hold up and the company must pay the full $120 million dollar fine.
In March 2003, Bela Berkes stated that Seasilver USA was earning $15 million a month and $180 million a year from selling Seasilver. The company is no longer in operation, although there are some resale sites where the product can be purchased from independent distributors.
This is by far the largest single dollar fine handed down to a Network Marketing company and should be a lesson to companies out there who make ridiculous claims that tarnish both the people who get suckered in but the industry as well.
Seasilver - You are officially in the OpTree Dead Pool Baby!
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