Multilevel marketing programs or vertical marketing programs are surfacing with greater frequency in the marketing of goods and services. Such multilevel marketing programs are often promoted through appeals to the entrepreneurial spirit and wealth creation. In Webster v. Omnitrition International, Inc., the Ninth Circuit Court of Appeals examined the differences between legal multilevel marketing programs and fraudulent pyramid schemes. The central issue was whether Omnitrition could establish as a matter of law that its sales and marketing program was not a pyramid scheme. Pyramid schemes are regarded as inherently fraudulent (S.E.C. v. International Loan Network, Inc. 297 U.S. App. D.C. 22 [D.C. Cir. 1992]).

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