Quixtar Loses Round Against Former Distributors

Thursday, October 18, 2007
By Chris Knape, The Grand Rapids Press
Source: MLive This e-mail address is being protected from spambots, you need JavaScript enabled to view it

GRAND RAPIDS -- Quixtar argued Wednesday that former distributors were in contempt of a court order forbidding them from disparaging the firm or using information gleaned from their company affiliation.

Alticor Inc.'s Quixtar wants Kent County Circuit Judge Paul Sullivan to rule the former distributors, operating as independent business owners, are in contempt of the preliminary injunction he issued in August.

In that ruling, he forbid the TEAM business sales organization and its leaders from, among other things, using their former Quixtar networks to disseminate information that could harm Quixtar.

Attorneys for Quixtar argued the event is largely organized using proprietary information TEAM gathered from its Quixtar networks. Late Wednesday, Sullivan ruled the event could go on as planned.

"That is very significant, not only for us, but for the approximately 20,000 people planning on attending that meeting from as far away as Canada to the north and the Bahamas to the south," said Chris De-Witt, spokesman for the defendants.

"We'll certainly look forward to seeing his (Sullivan's) other rulings in this matter."

In August, Quixtar sent notice to its distributor networks forbidding attendance at TEAM events or the use and sale of TEAM materials in conjunction with their Quixtar operations.

TEAM Chief Executive Robert Dickie said the event has nothing to do with Quixtar. He added TEAM has worked hard to separate its business from Quixtar.

TEAM has canceled 127 smaller meetings and pulled all its sales and motivational products related to Quixtar off the market, he said.

Those moves came after Sullivan's initial ruling and following allegations by TEAM leaders that Quixtar is an illegal pyramid scheme.

Dickie, a former Quixtar distributor, said the majority of Louisville event tickets were sold before Quixtar forbid the use of TEAM materials.

Several high-level distributors left Quixtar in August. The company says they were fired, but the distributors said they resigned.

Since, a legal battle has erupted, and more than 15,000 Quixtar distributors have resigned.

Ada-based Alticor believes the resignations were part of a coordinated effort by TEAM, co-founded in 1999 by Orrin Woodward, of Grand Blanc, and Chris Brady, of Florida. TEAM denies that.

Woodward is slated to speak in Louisville, where he will be selling a leadership book co-authored with Brady.

The arguments in court wrapped up Wednesday, but it is uncertain when Sullivan will issue a written ruling.

Quixtar is the name Alticor uses for its U.S. direct-sales unit, known elsewhere as Amway.

The company is planning to drop the Quixtar brand and resume using Amway again within two years.

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