Again in 2017 Youngevity launched Saveur, a “distinctive line of spices impressed by cuisines from all over the world”.
In March 2019 JRJR33, by Spice Jazz LLC, filed a fraud lawsuit towards Youngevity.
Of their lawsuit Spice Jazz accuses Youngevity of “destroying then stealing” their enterprise.
Of their lawsuit Spice Jazz describes themselves as ‘a restricted legal responsibility firm whose sole member is JRjr33, Inc.’
To maintain issues easy I’m simply going to discuss with them as Spice Jazz.
It needs to be famous that JRJR33 filed for chapter in mid 2018. Mid final yr the court-appointed Trustee filed a report alleging government fraud.
I’ve continued to observe the chapter case docket however there haven’t been any important updates.
JRJR33’s chapter doesn’t seem to have had any influence on their Youngevity lawsuit.
Certainly Spice Jazz’s authentic criticism was filed in March 2019, seven months after chapter was declared.
I realized of the lawsuit by a current submitting in Youngevity’s ongoing litigation towards Wakaya Perfection.
A 2022 trial date within the JRJR33 case was referenced in a current standing report, pertaining to doable trial dates within the Wakaya case.
This prompted me to lookup the Spice Jazz case and right here we’re.
Within the opening of their criticism, Spice Jazz, along with its personal claims, states it’s asserting claims on behalf of
Your Inspiration At Dwelling Pty Ltd., an Australian proprietary restricted firm which was the sufferer of the identical wrongdoing as Spice Jazz, by the identical Defendants, however operated in Australia as a substitute of the USA.
Named defendants within the lawsuit are
- Youngevity Worldwide
- Bianca Reyne Djafar-Zade (daughter of Colleen Walters)
- Stephan R. Wallach
- David S. Briskie
- Loren J. Castronovo
“Officers and administrators of Youngevity are additionally listed as “John Doe” defendants.
JRJR33 claims their Spice Jazz enterprise was “destroyed and stolen by” Youngevity.
Previous to submitting their lawsuit, Spice Jazz was headed up by CEO Colleen Walters.
As retold by Spice Jazz;
Ms. Walters apparently got here to consider that she was including extra worth to Plaintiff’s enterprise than she was getting in return.
Accordingly, many months earlier than leaving Plaintiff’s employment formally, she started to arrange for a really energetic demonstration of her worth to the corporate.
Whereas nonetheless employed by Plaintiff, Ms. Walters determined to steal the enterprise from its homeowners, to be able to pursue the U.S. department of the enterprise technique with Youngevity.
Spice Jazz claims their “seven determine” enterprise was ‘destroyed by Ms. Walters’ theft of Plaintiff’s total enterprise mannequin’.
It’s each enterprise proprietor’s nightmare to rent a CEO comparable to Colleen Walters.
The homeowners of Spice Jazz determined to dedicate years of their time and capital to nurturing and launching an organization that will do two issues: design proprietary spices and different culinary merchandise, and market these merchandise by a direct-sales advertising and marketing operation during which its gross sales individuals had been incentivized to recruit different gross sales individuals, by receiving a proportion of not solely their very own gross sales, however these of their recruits.
The corporate’s homeowners needed to spend a number of years supporting Colleen Walters with not solely capital, however their very own time and their religion and endurance whereas the corporate had but to show a revenue.
Nevertheless, after the corporate’s commerce marks (comparable to “Your Inspiration At Dwelling,” YIAH) turned well-known sufficient in Australia and New Zealand, and its operations started increasing internationally, together with into the USA, the corporate started turning a revenue, which ultimately rose into the thousands and thousands, and appeared poised to proceed rising exponentially by its increasing gross sales power.
as soon as Spice Jazz received off the bottom and began to show a revenue, Colleen Walters hatched a scheme—with the help of different key members of the gross sales power—and successfully stole Spice Jazz’s total enterprise by merely “strolling it throughout the road” to a direct competitor, Youngevity.
Youngevity apparently supplied Colleen Walters a sweeter deal for her spices.
Spice Jazz asserts its associates had been
instructed to obtain their gross sales contacts “in preparation for a transfer to a brand new firm.”
Those that requested too many questions, or actively resisted the transfer, had been threatened with being minimize off from your entire operation, together with from their very own gross sales contacts, and even from their emotional help networks and friendships.
Not solely did Colleen take just about all the important thing members of Spice Jazz’s gross sales power alongside along with her by these techniques, she additionally transferred a treasure trove of the proprietary recipes and merchandise Spice Jazz had been efficiently advertising and marketing.
To Spice Jazz’s homeowners, who had invested years of time and capital into this venture, the message was basically: “Thanks for all of the years of help, see ya later.”
To which could possibly be added: “Oh, and by the way in which, I’m taking all the important thing members of your gross sales power, and your whole greatest spices and recipes with me too.”
Colleen Walters seems as a Model Ambassador for Youngevity of their advertising and marketing movies;
Spice Jazz claims its ‘proprietary spice blends had been saved on a spreadsheet that ‘solely 4-5 prime staff (together with Ms. Walters) had entry to’.
Ms. Walters was capable of steal these blends and recipes and transfer them to Youngevity just by stealing the Excel spreadsheet on which they had been recorded.
Reasonably than reproduce similar blends for Youngevity, Spice Jazz claims Walters
tinkered with each the recipes and their names, to be able to make their particular contents, and their names, barely totally different from what they had been earlier than.
Spice Jazz present a number of examples which, all issues thought-about, do seem to point out an simple sample.
(Walters) took a spice recipe referred to as “Queen of the Nile Dukkah,” containing Egyptian-inspired elements and marketed as an Egyptian-inspired product, tinkered with the recipe (whereas holding it largely related), renamed the product “Egyptian impressed Dukkah,” and repackaged that as a Youngevity product.
Spice Jazz owned a “Louisiana Creole Combine;” after Spice Jazz’s CEO moved to Youngevity, Youngevity abruptly developed, in a single day, a “Spicy Cajun Dip Combine.”
Spice Jazz owned a “South African Cape Rub”; after Ms. Walters left, Youngevity abruptly developed, in a single day, a “Safari Rub.”
Spice Jazz owned a “Thai Inexperienced Curry Dip Combine,” which morphed into Youngevity’s “Thai Combine.”
Spice Jazz had a “Wasabi Dukkah” spice mix, Youngevity abruptly developed, in a single day, a “Japanese Impressed Dukkah.”
Merchandise Spice Jazz owned that mysteriously “reappeared” as Youngevity merchandise after Ms. Walters moved to Youngevity embrace, however usually are not restricted to: Moroccan Mint tea, South African Dawn Tea, Tandoori Spice, Taco Spice and Guacamole Combine.
Furthermore, notably, upon data and perception, both your entire “Saveur” line of merchandise marketed by Youngevity or a considerable portion of that line of merchandise, as shall be revealed by discovery, bear a hanging resemblance to Spice Jazz’s blends.
On the MLM aspect of issues, Spice Jazz additionally claims “gross sales pitches and strategies”, developed by Walters for the corporate, had been taught to Youngevity distributors.
Stealing recipes is one factor however personally I feel asserting MLM advertising and marketing strategies is proprietary is a bit wealthy.
Claims relating to Spice Jazz’s distributor database are bit extra minimize and dry.
This proprietary database was maintained by Plaintiff’s program supervisor, who by no means agreed to affix the conspiracy between Ms. Walters and Youngevity.
On account of this truth, Ms. Walters and her co-conspirators had been unable to steal the database itself; nevertheless, she instructed her gross sales administrators to retailer the names and make contact with data of the gross sales representatives underneath them, and of all their particular person prospects, to be able to transfer that data to Youngevity, and on this method was capable of recreate the vast majority of the proprietary database and transfer it to Youngevity regardless of failing to persuade this system supervisor to steal the database outright.
With hindsight in thoughts, Spice Jazz asserts;
Transferring a whole gross sales power and troves of proprietary recipes and bodily merchandise on to a competitor shouldn’t be an in a single day operation.
One can solely fairly conclude that Colleen will need to have been planning her operation for months whereas nonetheless amassing a considerable wage as Plaintiff Spice Jazz’s CEO.
Spice Jazz’s homeowners had been successfully paying her for stealing from them.
As talked about above, a CEO like Colleen Walters is each enterprise proprietor’s worst nightmare.
Her betrayal value the venture’s homeowners and buyers a large quantity.
As to Youngevity, Spice Jazz put forth;
Youngevity ought to no extra have accepted Walters “presents” of a close to full enterprise than a pawn store proprietor ought to settle for stolen items of unsubstantiated windfall.
The nice instances at the moment are over for Colleen Walters and for Youngevity and its management, who so openly benefited from her scheme, when, as refined company officers and administrators, they clearly ought to have recognized higher.
It’s … inconceivable that this whole operation would have been executed and not using a inexperienced gentle from Youngevity, as a result of earlier than she started the extended and sophisticated technique of executing this scheme, Ms. Walters wanted to know that there was a secure harbor for her to park all her co-conspirators and all of the stolen commerce secrets and techniques.
She wouldn’t have executed this scheme topic to the danger that nobody would need to rent her, her associates or launch her deliberate line of spices and that she would merely be left stranded in the midst of the desert in Australia with a whole enterprise and enterprise mannequin, having misplaced her place and revenue with Spice Jazz/YIAH, having misplaced any capacity to capitalize that enterprise, and all of her associates having misplaced their positions and incomes as effectively.
Accordingly, Spice Jazz are searching for
simply compensation for the theft of all of its proprietary and extremely profitable recipes, advertising and marketing methods and commerce secrets and techniques; for the entire future earnings it may and will have earned by its profitable and rising gross sales power and plan to take the corporate public; for the lack of the earnings that will have been earned when Plaintiff, as soon as its enterprise was sufficiently profitable, was bought in an anticipated extremely profitable public providing; in addition to, for any intentional wrongdoing that’s confirmed, punitive damages in an quantity decided by the jury.
I’m undecided how huge part of JRJR33’s annual income Spice Jazz was, however little question shedding the enterprise contributed to JRJR33’s chapter.
Ms. Walters’ stab within the again was so profitable that it successfully kneecapped Plaintiff’s total enterprise operations.
In consequence, Plaintiff’s revenues, which had beforehand been within the seven figures yearly and projected to proceed rising, collapsed to zero, or near zero, inside one quarter.
That is all from Spice Jazz’s fourth amended criticism, filed on February fifteenth, 2021.
What’s attention-grabbing is Colleen Walters shouldn’t be a defendant within the case.
JRJR33 sued Walters individually in September 2017. Walters compelled arbitration, after which JRJR33 deserted the case.
Walter’s daughter, Biance Djafar-Zade, is called as a defendant as a result of she
collected a considerable wage from Spice Jazz by representing to Spice Jazz’s homeowners that she was performing beneficial providers for the corporate.
Her mom, Ms. Walters, additionally represented to Spice Jazz’s homeowners that Bianca Djafar-Zade was offering the corporate with beneficial providers, that justified a considerable wage, and Defendant Djafar-Zade had an obligation to right these misrepresentations however failed to take action.
In actuality, Ms. Djafar-Zade was performing no providers, or only a few providers, for Spice Jazz, and was solely amassing a wage by advantage of the truth that her mom was the CEO of the corporate
Spice Jazz are going after Djafar-Zade for fraud.
Youngevity and its executives are up for
- tortious interference with contracts;
- federal misappropriation of commerce secrets and techniques;
- state-law misappropriation of commerce secrets and techniques; and
- aiding and abetting breach of fiduciary responsibility.
Wanting ahead, a compulsory settlement convention has been scheduled for Might nineteenth.
I’ve added Spice Jazz’s case to our case calendar so keep tuned for updates.
Replace twentieth Might 2021 – The settlement convention went forward as scheduled.
A minute entry on the case docket information a standing convention listening to schedule for July 1st.
I’ve scheduled our subsequent case docket calendar test for July 2nd.
Replace third October 2021 – The Spice Jazz v. Youngevity settlement settlement has been finalized and accredited.