In the awed silence, you can almost hear the mouths watering as 50 or so people in the audience stare at the screen. The numbers are staggering. BioPerformance, Inc. was founded not even five months ago in Irving, but in that short time, Scott Chandler, standing next to the screen grinning modestly, has made $887,760.52. That's practically a million dollars. This first week of May, Chandler has already raked in $56,754.
To the working-class Mexican crowd, gathered here for BioPerformance's "Super Spanish Saturday," this is what heaven looks like. One woman at the back of the anonymous hotel ballroom near DFW airport, a stack of just-purchased motivational DVDs in her lap, finally digests what she's seeing. "Dios mio!" she murmurs. "My God!"
But Chandler is uncomfortable. Normally, he doesn't have to flaunt his earnings; just telling his rags-to-riches story usually has the crowd eating out of his hand. Not today. Blame it on the language barrier: Chandler's deep piney-woods drawl can be hard for even native English speakers to follow, and there are few of those among the crowd at Super Spanish Saturday.
Otto Gonzalez, the event host, is an enthusiastic translator, but the necessity of alternating speakers and languages breaks up the normal flow of Chandler's patter right from the beginning, and his account of growing up poor in Alabama draws only polite applause. The two are in danger of losing their audience and need something to pump up the audience.
"What I'd like to do is introduce Steven"--Chandler starts to hand off to his protégé Steven Holland, but Gonzalez interrupts.
"Will you show us your deal first? I'll introduce Steven while you show it."
Chandler stalls for time, reluctant. "What should I show?"
"You know," Gonzalez urges, "your e-wallet deal!" He wants Chandler to put his Back Office accounting software up on the projection screen to show everybody just what kind of money can be made. An English speaker in the audience shouts out her agreement: "Yeah! Show it!"
Chandler acts like he has no choice but to go along. Smiling in good-natured defeat, he points at the video camera filming the presentation. "Turn the cameras off and we'll do it."
Chandler has good reason to be cautious. As Holland searches for the right page on a laptop computer, Chandler addresses the audience. "Steven and I always make a disclaimer," he says. "We don't guarantee that you're going to make any money with this company. This is not an enticement by any reason. We just want to show you that it's possible to make this kind of money, OK? So you guys have the same possibility." In Spanish, Gonzalez is even blunter: "The company doesn't guarantee that you're going to make any money with this program," he intones gravely, "nor does it guarantee that this product works."
The product in question is a little green pill called BioPerformance Fuel. Stick the pills into an automotive gas tank and they are supposed to yield vast improvements in mileage, performance and emissions. In the world of $3 gallons of gasoline, demand should be limitless.
So why is Chandler so cautious? The whole point of the meeting is to encourage people to follow in Chandler's footsteps, to climb the ladder at BioPerformance by bringing more and more people into the company's multilevel marketing scheme. Chandler will make money for every person that signs up. But while the numbers holding the audience members in thrall tell one story, statistics tell another: Virtually everybody that joins will wind up a financial loser.
So Chandler has to be extremely careful not to cross the fine line between encouraging and promising. Encouraging someone to give you money is legal--making false promises for financial gain is not. But unbeknownst to Chandler and everyone else at Super Spanish Saturday, Texas Attorney General Greg Abbott would soon decide that BioPerformance crossed that line a long time ago.
"I can remember the first time I used these pills back in December," Steven Holland tells the audience. "My wife said, 'Man, those pills stink! Get those things out of my house!'" He pauses, his glasses and slouching stance giving him the air of a college student. "But now she tells me they smell like money."
Her olfactory confusion is understandable: As of April 29, after fewer than five months of operation, BioPerformance announced an incredible $22,567,349 in sales. At the same time, nearly 50,000 people from all over the country had signed up to sell it, at a rate as high as 600 a day.
Self-proclaimed "church growth evangelist" Lowell Mims founded BioPerformance with his Irving neighbor Gus Romero with the stated goal of "creating 1,000 millionaires," but even he probably didn't envision such explosive growth. Mims brought his longtime friend Chandler in as part of the first sales team, and Chandler quickly rose to the rank of International Sales Manager. Titles in BioPerformance aren't job descriptions; instead, they're indicators of how many people the bearer has recruited as "downlines"--in Chandler's case, more than 18,000. Holland is one of Chandler's most successful downlines, a Senior Vice President and a top earner in the company. Holland says he's already more than doubled the $150,000 annual salary he had at his old job.
Individually, the numbers would seem to indicate BioPerformance is a runaway success. Taken together, however, they mean a few people at the top make money while the rest of the massive "sales force" loses it. At least, that's the way Attorney General Abbott saw it last week. Abbott filed a lawsuit that branded BioPerformance an illegal pyramid scheme, landing a restraining order that shut the company down.
Tests commissioned by the state found the pill was not an "enzymatic catalyst" as claimed but rather the toxic coal tar derivative naphthalene, which until recently was the active ingredient in mothballs. Abbott mocked Mims' stated goal of creating "1,000 millionaires," saying, "You can't become a millionaire by selling a worthless product." But Abbott is suing under a Texas statute that Robert Fitzpatrick, a prominent critic of multilevel marketing, calls the worst in the nation. D. Jack Smith, a Memphis lawyer who helped set up BioPerformance, says he asked Abbott if there was anything wrong with the company in a March 3 letter. "I said, 'If you see anything you'd think should be changed or that we need to talk about, all you have to do is call me,'" Smith says indignantly. "And no one ever did."
There should be plenty for them to talk about in court. The pill isn't what BioPerformance says it is and can't do what it's supposed to. The "technical information" posted on the company's Web site is misleading and largely irrelevant. BioPerformance's "exclusive marketing rights" to the product turn out to be shared with a Maryland company called Bio Plus Fuel International.
Perhaps that explains why, at recruiting meetings like Super Saturday, it's clear that actually retailing the product is an afterthought at best. "Now if somebody wants to set up in a flea market or sit on the side of the road and sell it, they might be that kind of person," Chandler tells the crowd with a dismissive shrug, "but for most people, that is not the best way to get started in the business."
The best way, of course, is to buy into the company as a "manager" or "area manager" at a cost of $149 or $499. BioPerformance managers can turn around and recruit more managers, eliminating the tiresome necessity of convincing actual retail customers to shell out $40 for a bottle of 40 pills. Whenever someone buys in at the bottom level, those in their "upline" get a collective 65 percent of the action, all the way up to Chandler. It's a classic pyramid scheme, though industry advocates prefer to call it multilevel marketing, or better yet, network marketing. MLMs that sell legitimate products to real customers are not illegal; witness the success of Dallas-based cosmetics giant Mary Kay. On the other hand, if you're selling mothballs for a dollar each, odds are your company's business model doesn't count on wooing many real customers.
In Ed Biehl's SMU office a few days later, the same pungent smell that Steven Holland associates with money leads the Chemistry Department chair to quite a different conclusion. "Naphthalene," Biehl says as soon as he inhales the powerful aroma of sample pills provided by the Dallas Observer. "Mothballs!"
But just to be sure, Biehl runs the pills through five different processes, all aimed at determining their composition. He also runs one of the same tests on a known sample of pure naphthalene to compare the results. Every test points Biehl to the same conclusion: "The whole thing is about 99 percent naphthalene. There's a little dye in it, I'm sure, but it's almost pure naphthalene."
This is at serious odds with BioPerformance literature--which, in turn, is occasionally at odds with itself. One "technical information" document posted on the Web says the "main component" of the pill (also offered as a powder) is a single enzyme. The company's PowerPoint presentation that it distributes to its members says there are two enzymes, while many distributors insist there are three. Biehl is hard-pressed to find any. "If we had those enzymes we'd certainly see it, unless it's so small in quantity that you really can't," he says.
If the pills are naphthalene, BioPerformance is guilty of more than just deceptive trade practices. The EPA regulates naphthalene as a pesticide and has banned it from domestic use. Companies are prosecuted every year for illegally importing mothballs made of the chemical. If ingested or absorbed it attacks red blood cells, the kidneys and the liver. In 2004 it was also added to the EPA's list of possible carcinogens.
Yet BioPerformance bills its product as nontoxic, both on the bottle and on the material safety data sheet posted on its Web site. At the top of the sheet, under "Hazardous Ingredients," the entry reads "none." Paradoxically, at the bottom in the "First Aid Measures" section, the entry next to "Ingestion" reads, "Seek medical attention." In one case, a distributor contacted the company, worried that his "nontoxic" powder was eating its way through the plastic bottles.
Faced with an increasing number of tests showing that the BioPerformance pill is simply naphthalene, the company has taken a new position: The pill is actually made of naphthenates, close cousins of naphthalene. Yet some naphthenates are also toxic, and even if the claim is true, it still doesn't square with the company's own literature.
The documentation BioPerformance offers on its pill is as voluminous as it is suspect. "Lab test" results don't identify either the lab or how the tests were conducted, while the prose portion is a parody of scientific language. Rick Mallinson, a professor of chemical engineering at the University of Oklahoma, was left scratching his head after examining one tract. "There's a lot of cut-and-paste of stuff that doesn't say what their performance is," he says. "They're using some very strange phrases like they're looking at very old textbooks." One passage purports to explain that the pill modifies the structure of fuel molecules through "Brownian movement." But Brownian movement is the phenomenon that causes simple diffusion, not any sort of enzymatic reaction. "That's all just gobbledygook as far as I'm concerned," Mallinson says.
Yet amidst the gobbledygook there might be at least a shred of fact: Naphthalene mothballs have been used by motorheads as a homemade octane booster for decades. The practice was common enough that the Discovery Channel program Mythbusters gave it a try in 2004. Though the show's hosts didn't scientifically measure the results, their test engine ran somewhat smoother, and they officially rated the mothball octane booster myth as "plausible." Richard Hoffman, a U.S. Department of Energy scientist, agrees on the agency's Web site: "Yes, mothballs will slightly assist the octane rating of gasoline." But Hoffman also notes, "The ratio of carbon to hydrogen in the molecules makes for a very dirty-burning fuel. Too many mothballs and your engine will load up with carbon deposits--very bad news in the performance department."
So much for BioPerformance's assertion that the pill cuts emissions and cleans the fuel system. Mallinson has grave doubts about the emissions data BioPerformance uses to support that claim. "The fuel you put into the tank, that has some sulfur in it," Mallinson notes. "What went into that tank has to come out. They're saying they decreased the sulfur emissions by 50 percent. Well, where did that sulfur go? You can't make sulfur disappear."
The Better Business Bureau of Dallas began getting a slow but steady flow of complaints not long after BioPerformance began operating in December. The Bureau contacted the company and asked for proof that the claims they were making about their product were true. In response, BioPerformance sent a lab test that came from an identifiable source, a real Mexican government testing facility in Mexico City. According to the document that BioPerformance submitted, one set of readings did indeed show reduced emissions and a 25 percent mileage increase. But that test was a do-over, performed only after the first one showed increased emissions and no mileage gain.
To reiterate: BioPerformance had the chance to provide scientific data to prove its product works, an opportunity to avoid an unsatisfactory rating from the BBB. The only report it could muster offers this conclusion: "The vehicular emissions lab...feels that the tests performed are not sufficient to provide results with regards to the performance of the product."
"We expected a lot of bad reporting on it because with most good companies, you know, there's going to be some negative publicity," says Donna Ahrlett, a BioPerformance manager from Venus, a tiny town south of Mansfield. She is still an ardent supporter of the company even after seeing a negative report on the fuel pill on WFAA-Channel 8 the night before. "I knew it was coming on. I didn't expect it to come out well since the Exxon company does own that news channel." Ahrlett's assertion would probably come as a surprise to most Belo executives, but she is confident that her source, a fellow BioPerformance manager, wouldn't lead her wrong. "The oil companies are very upset with us," she says as young children squeal in the background. "We are taking money from them and trying to save other people money."
Though Ahrlett has only managed to sell one bottle of the pills so far, she still likes her prospects. She and other BioPerformance faithful no doubt took comfort in the feisty message from Lowell Mims that appeared in place of the company Web site the day after the lawsuit was filed: "We are right now working with OUR Attorneys to vigourously [sic] defend OUR Company. Over the next few days you will be hearing and seeing some negative press. When you are successful in your industry a lot of people take shots at you because they want to obtain the success that the BioPerformance family has created. Just like Amway, Herbalife and Mary Kay we will come out of this challenge stronger than ever!"
A subsequent message forbade distributors to talk to the press, instructing them to refer all inquiries to Clifton Jolley of Advent Communications, "the finest media relations firm in the world." Like Mims, Jolley has made a career out of multilevel marketing companies. A biography posted for an MLM conference where Jolley was speaking is refreshingly honest about his talents: "His skill in crisis intervention and media relations has been credited with rescuing dozens of Advent clients from media scrutiny."
Jolley did not respond to requests for an interview by press time. In fact, phone calls, e-mails, handwritten notes and even impromptu personal visits by the Observer over the course of more than a month were unsuccessful in gaining an interview with either Mims or Romero. Chandler and Holland didn't respond either. According to a former employee of BioPerformance who did not want to be named for fear of losing any chance at recovering back pay, that deafening silence is a familiar sensation for the company's "downline" distributors.
Even before the first media reports questioning the company, the small Irving staff of about five struggled to keep up with complaints from the exponentially growing ranks of distributors. Company policy dictates that complaints can only be submitted through the Back Office software as a "ticket"--never by phone or in person.
Most tickets were prompted by the fact that by March, the growth of the company had far outstripped the supply of pills coming from Mexico. A 14-day delivery "guarantee" was changed to 21 days, but still shipments fell behind. Distributors who paid their $499 to join and signed up for $59 "auto-ship" deliveries were billed regularly but got nothing in return, sometimes for months.
After criticism of the company began appearing in the media, some members sent tickets demanding answers from Mims and Romero. Others began reporting that their vehicles were getting worse mileage or breaking down altogether. In the days leading up to the government restraining order that shut down the company, up to 500 tickets a day were coming through the system, many of them angry demands for refunds. As of May 17, the day the Web site was taken down, BioPerformance members had submitted 18,548 complaints. Only 3,785 were answered.
Reading the increasingly desperate or irate tickets is a crash course in pyramid-scheme psychology. A distributor asks for advice on what to tell his downline who has seen her mileage get progressively worse: "She's wondering if maybe she's not putting enough product in her tank since it took a bigger drop. She's hoping so bad this will work and wondered if you had any suggestions..." A member in Ohio writes in after a report aired: "It looked really bad on the news! It made this company look like a scam. I believe in this product because it has worked for my family."
The most common complaint, however, is the supply shortage. The pleas are heart-rending: "You are ruining my business and it just isn't right! Every one of these people are beginning to think you (and me) are a scam. Do you know how hard it is to talk to these people everyday and assure them that this is a reputable business?" One distributor shows dawning awareness: "Lack of response to my open tickets further validates my suspicion that this company is not on the up-and-up."
One Dallas distributor (who did not want his name used because he is considering a lawsuit) built a team of more than 100 people and then found himself forced to explain seemingly arbitrary policy changes. "You tell all these people about the company, and then the company switches and leaves you holding the bag," he says. "You tell them what's in their literature, and they just change their literature." At first, payment was allowed by credit card, but soon people were asked to provide checking account numbers and, later, a backup account. "Some people were giving out their savings account numbers."
The former office employee says that working for BioPerformance shattered any illusions about MLMs. "I thought that these networking people just all followed each other around. I thought they were all like this little clique that kind of went from networking company to networking company, so I thought that they were all little scammers that would scam each other. But as I saw they were getting new people involved and as I was talking to people on the phone, there were people bursting into tears." Tired of the stress and guilt, the employee quit before the company was shut down. "I'm really, really upset with them right now, just what they've done to people. I just can't believe it. I trusted them fully."
Gaining the trust of strangers is easier when you're a minister. Lowell Mims certainly has the look of a TV evangelist with his shiny suits and impeccably coiffed hair. He also has a Web site for Lowell Mims Ministries that describes him as an "internationally known church growth evangelist." The site claims Mims has flown more than 4 million miles in 17 years, an average of 235,000 miles a year. The ministry has no physical address, and the phone number, which the Web site says is answered 24 hours a day, is in fact picked up by a malfunctioning answering machine. The site touts Mims' expertise in growing churches "numerically and financially," a skill set that overlaps considerably with his MLM activity.
Eric Scheibeler, a former pyramid scheme victim who now runs the anti-MLM Web site merchantsofdeception.com, says that MLMs commonly use religion to attract and motivate members. The best-known example, he says, is Quixtar (formerly Amway), where families have been known to hire cult counselors to extricate loved ones. Craig Lunde, a disgruntled BioPerformance member from California, says the fact that Mims was a minister influenced him to join. "Everyone seems to be so sincere and so honest and so Christian and so decent, and I went with that," Lunde says.
The Dallas distributor who did not want his name used also bought into the image of a Christian company. "I'm really upset that someone who claims to be a preacher has done what he has done," he says. Many of his recruits were members of his church, and he had planned to use the money he made to finance the church's Web site. Instead, he's using it to pay his downlines back.
The sad truth of pyramid schemes, Scheibeler says, is that most victims join for noble reasons. "Some people say, 'Well, they're greedy and stupid and they deserve it,'" he says. "That's not it at all. The MLMs promise what we all want. They promise peace of mind, freedom from debt, more time with your family, the ability to help those people you love and care about. Who doesn't want that? They prey on their highest motivations."
MLM veteran Ernie Land is tall, with bushy gray hair and a mustache and a voice disconcertingly similar to cartoon character Hank Hill from King of the Hill. Some versions of the company Web site featured Land standing in front of a sprawling ranch house with a gleaming pickup on each side, a living testament to the success of BioPerformance. Not surprisingly, he is an ardent defender of the company. "We feel good that, at the end of the day, we'll be justified in all that we've done," Land says.
The Florida resident uses the name "DOC FOG" within the company, so much so that many members don't know his real name. The letters stand for "Director of Circulation for the Favor of God," a moniker he invented as a DJ on local Christian radio.
Mims and Romero sought Land's advice when they concocted BioPerformance, and in return they invited Land to join the initial sales team with Scott Chandler. (The third member is Dallas resident David Bass.) "These guys have made every effort to dot every 'i' and cross every 't' to be perfectly aboveboard and legal," Land says. "This isn't something that they just drummed up overnight and put together. This is something that they've worked on and thought through."
Land's advice centered on protecting BioPerformance from the legal challenges that bedevil most MLM companies. "MLM is constantly attacked as an industry by both the media and the legal system because it's outside the norm, it's outside the mainstream," Land says. "It's entrepreneurial, and it's usually cutting-edge products that aren't totally proven." He sees the litigation as an unjustified but inevitable attack. "There's two things I brought to this company," Land boasts. "No. 1 is that they make people sign sworn affidavits to verify claims the product works.
"The second thing I brought to them is to disclaim everything." There is no hint that Land is aware of the contradiction in the two statements. "You let people judge for themselves whether a product works rather than placing yourself in a liability situation."
The result of Land's advice is a disclaimer so broad it's hard to believe BioPerformance ever got off the ground. It's worth quoting at length:
"Any and all testimonies are NOT intended directly or indirectly to guarantee you in any way with similar savings. The testimonies have not been proven in any way by BioPerformance, Inc. to be true, because they are simply people sharing their results from using BioPerformance Fuel. The testimonies are valuable replies from your fellow Americans. Each reply is believed to be true in its content. These stories are not backed by independent research, so you must evaluate them for yourself and then let us hear your story.
"Also, the BioPerformance, Inc. Compensation Plan does not in any way guarantee you any income from any examples that may be derived from the explanation of the Compensation Plan. BioPerformance, Inc. does NOT guarantee any incomes at all."
At the top of the BioPerformance sales hierarchy, variations of this disclaimer serve as verbal punctuation. "If you're cautious, you go overboard and make sure that you put up disclaimers that literally make it seem as if something doesn't work so that they can't come back and say you've made false claims," Land explains. The thought of avoiding false-claims charges by not making false claims doesn't seem to have occurred to him.
It is a matter of opinion which is more powerful: the company's blanket statement disavowing any claim that the pill works, or the stacks of affidavits swearing that it does. On their own, the testimonials are certainly impressive. Among the examples obtained by the Observer, Deann Black of Conroe says her mileage increased by 26 percent. Doyle Kiker of Arlington swears his mileage improved by 36 percent. And Thomas Arlin Bice of Hurst attests to a whopping 41 percent gain.
The Dallas distributor who wanted to fund his church's Web site initially saw benefits from the pills as well, but the improvements soon vanished. Rather than dismiss the product, however, he is more inclined to question the integrity of the company. "My take on that is that they couldn't get enough of the product and they've diluted it some," he says. As evidence, he points to the fact that his first pills were green, while later they were brown. "Their claim is that enzymes change colors. Every chemist I've talked to states that you add things together, the same chemical mixture, you're going to get the same color."
It stands to reason, then, that the pills being sold by BioPerformance would be the same color as those distributed by Bio Plus Fuel International of Maryland. Despite the Irving company's insistence that it holds the exclusive rights to the pill (or as Land put it during a Florida radio interview, "We own the product from the ground to the consumer"), the EPA has it registered to one Michael G. Bonds, senior vice president of Peco, S.A. in Annapolis, Maryland. Bonds is also the head of Bio Plus Fuel International, a company that has sold its Bio Plus Fuel Additive pill since 1998.
Not only do the two pills share an EPA registration number, but they also share testimonials, such as that of Miriam Yeager of Oklahoma, who is delighted with the 51 percent increase in mileage she garnered from either or both brands. And that Mexican lab test that BioPerformance submitted to the Better Business Bureau? It was actually performed on Bio Plus Fuel. Sources familiar with the relationship say that some of the money flowing up the pyramid in Irving winds up in Maryland.
If BioPerformance has a twin in Bio Plus Fuel, it may have a first cousin in EnviroMax, yet another miracle fuel additive. According to a letter that briefly appeared on the BioPerformance Web site, EnviroMax makers Extreme Research have accused BioPerformance of copyright infringement. In light of Attorney General Abbott's assessment of BioPerformance as "useless," it's doubtful Extreme Research will continue its push to prove the similarities between the two. (Extreme Reseach's law firm, Dallas-based Rose Walker, declined to comment.)
But Extreme Research is just one of at least three MLM fuel additive companies eager to pick up where BioPerformance has left off. The others are Freedom Fuel International with its MPG Cap additive and 4-E Corp with Ethos FR. Already predatory Internet ads wooing disillusioned BioPerformance distributors to the other plans have appeared on marketing message boards.
This apparent glut of companies doesn't represent some new explosion of MLM schemes. "We have grown every year for the past 20 years," says Amy Robinson, a spokeswoman for the Direct Selling Association, the principal MLM trade organization. The DSA faces the formidable task of ridding the MLM industry of its shady reputation and leans heavily on the likes of Avon, Tupperware and Mary Kay for support. "There are many legitimate companies out there," Robinson insists, "but there are definitely some that are not legitimate."
Robinson has a few tips on distinguishing the bad MLMs from the good. "Call the company directly," Robinson says. "Ask them some questions. If the company won't talk to you directly, steer clear." BioPerformance's published phone number has been out of service for weeks. "Make sure you're actually selling an actual product or service that is actually going to be used by the consumer." The green pill leaves room for doubt there as well. Robinson's third tip: Most legitimate MLM companies cap their pyramids at three or four levels. BioPerformance has no cap.
With such clear signs, it may have been inevitable that BioPerformance would attract legal scrutiny. By contrast, Dallas has recently seen at least two MLM companies with unsustainable multilevel marketing schemes collapse without ever facing prosecution. Earlier this year, International Galleries of Addison, an art-reproduction MLM that in 2005 claimed 100,000 members, was quietly liquidated in Chapter 7 bankruptcy, while in 2004, the parent company of Dallas-based Excel Communications suddenly went belly-up when enrollment of new members was no longer enough to sustain it. Some Excel executives have joined a new Dallas-based MLM, Stream Energy, which sells electricity service. One of Stream's founders admitted to The Dallas Morning News that unless the company could expand beyond Texas it would collapse in two years.
None of these companies were challenged by the attorney general. Anti-MLM activist Robert Fitzpatrick, author of the book False Profits, says that's because of the state's toothless pyramid scheme law, adopted in 1995. "The Texas law is by far the worst in the nation," Fitzpatrick says. "It removes the requirement that the funds from the product have to be derived from sales to true end users," he argues. Without that requirement, the pattern of new recruits buying product from the previous group of recruits goes unchecked. "They can eat it, they can use it, they can give it away--it really doesn't matter as long as they bought it." The law, Fitzpatrick says, fails to recognize the true mark of the fraudulent pyramid scheme: "What drives them is not the product. The business opportunity is to sell the business opportunity."
If you like this story, consider signing up for our email newsletters.
SHOW ME HOW
You have successfully signed up for your selected newsletter(s) - please keep an eye on your mailbox, we're movin' in!
It's probably not a coincidence that the DSA enlisted Texas Republican Congressman Joe Barton's help in pushing for national anti-pyramid legislation in 2004. The bill would have, for the first time, defined exactly what makes an MLM legal at the national level. As DSA Legislative Director Joe Mariano puts it, "Clearly we're on the side of the angels here." That's not at all clear to Fitzpatrick. He says Barton's bill would have all the weaknesses of the Texas law, which is logical because much of the language was identical. Had it passed, Fitzpatrick says, it would have fatally weakened tougher federal standards that are based on various court precedents.
Eventually, the DSA dropped its push for a federal law and focused its attention on getting other states to adopt the Texas model. That may be why D. Jack Smith was so flabbergasted when Texas filed suit against BioPerformance. "It was designed, as I have designed all my companies over 23 years, not to be [illegal]." The Memphis attorney prides himself on his friendly relationship with most attorneys general. "Litigation is almost a thing of the past for me."
Smith's March 3 letter to Abbott included a copy of BioPerfomance's entire marketing plan, along with a 16-point analysis of why Smith thought it was legal. In Smith's mind, Abbott could have avoided a lawsuit simply by responding with a phone call. "It's a strange way of doing business when a citizen goes to them with his hat in his hand asking for help, and the AG doesn't bother to make a phone call," Smith says with righteous anger. "It's going to cripple the livelihood of thousands and thousands of people." Of course, the same criticism could apply to BioPerformance's aversion to answering cries for help from its own members.
Whether it's prosecution or collapse that puts a halt to BioPerformance, the prognosis is the same for the fantasy of easy riches that Steven Holland spins for the hopeful crowd at Super Spanish Saturday. Imagine, Holland says, that you're sitting in your mansion, paid for by BioPerformance. "At this point you're going to realize that everything that you've dreamed in life, everything that you've ever wanted, everything that you ever thought could come true as a kid or as a teenager or as an adult, anything and everything that you want, whatever your imagination can begin to make you think that you can have--you can have it."