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Dec 1, 2009

5 Tips Every MonaVie Distributor Needs to Know About the New FTC Guidelines

The Federal Trade Commission (FTC) recently came out with revised guidelines in regards to endorsements and testimonials effective Dec 1, 2009 (yes that’s today!).  This post is in no means a scare tactic, nor does MonaVie intend to silence its distributors, but this is to inform and to help explain the new FTC guidelines in which all of us must operate. MonaVie wants to make sure all of its distributors are aware of these changes and requires all of its distributors to comply with the new guidelines.   So here are the “5 Tips Every MonaVie Distributor Needs to Know about the New FTC Guidelines:”

1. MonaVie distributors who provide testimonials online AND offline must be truthful AND be subject to typical results.

If you are a distributor and want to share your story or testimonial anywhere, first ask yourself if the results can be typical? Thus testimonials about MonaVie products or money making opportunities must conform to MonaVie approved statements.

While distributors may not think of themselves as “advertisers” nor their individual stories as “endorsements” the new guidelines seem to explain otherwise.  An endorsement is any advertising message (written, verbal demonstrations or depictions of the name, signature likeness or other personal characteristics of an individual or the name or seal of an organization) that would imply is the opinion, experience, belief or finding of a party other than the sponsoring advertiser.

The advertiser must have adequate substantiation for any experience described by the endorser, i.e- typical results. Gone are the days of simply posting “results may vary”.

Ex. “MonaVie Pulse restored my eyesight.” - While that maybe an honest opinion, it is not a typical result, and therefore, any such opinion posted online or said offline would be in violation of the current guidelines, unless there is valid research to support the claim.

Ex. “I made $25,000, in one month with MonaVie, and you can too.” While this statement may be true…the result is not “typical”.  Such statements would be in violation of the current guidelines. Whenever discussing earnings, you should refer to the Income Disclosure Statement and provide the link or the actual document.

2. Distributors must disclose their relationship or identify themselves as a MonaVie independent distributor when making comments in regards to MonaVie or MonaVie products on blogs, websites, message boards, social networking sites (ex. Facebook, Twitter, etc.), etc.

We require all distributors to identify themselves as independent distributors on their blogs and social networking pages. Remember, social networking is about being transparent and authentic. If you are responding to a health article online and are going to say something about MonaVie or simply replying to a friend on Facebook about a new MonaVie product, you should disclose that you are an independent distributor. Posting the disclosure simply on your blog or social networking page is not enough; you must also do so when posting comments.  If you provide an endorsement or testimonial on your blog site that does not comply with these new guidelines, we suggest you take that information down. If you have video testimonials embed into your blog that do not comply with these guidelines, we suggest you take those down.

Within the new guidelines, the FTC has provided several examples of how the new guidelines could be applied. There are very few examples of how it might apply for MonaVie distributors, however here is one example of how distributors who post on message boards or social networking sites should disclose a relationship.

“Example 8: An online message board designated for discussions of new music download technology is frequented by MP3 player enthusiasts. They exchange information about new products, utilities, and the functionality of numerous playback devices. Unbeknownst to the message board community, an employee of a leading playback device manufacturer has been posting messages on the discussion board promoting the manufacturer’s product.

Knowledge of this poster’s employment likely would affect the weight or credibility of her endorsement. Therefore, the poster should clearly and conspicuously disclose her relationship to the manufacturer to members and readers of the message board.”

3. MonaVie AND the distributors can be held liable for failure to comply.

According to the new guidelines “Endorsements must reflect the honest opinions, findings, beliefs, or experience of the endorser.  Endorsements may not imply, suggest, or express any representation that may be deceptive. Endorsers and Advertisers are liable for any false or deceptive statements or for failing to conspicuously disclose required information.”

When one becomes a distributor for MonaVie, you are not just representing yourself, but also MonaVie. As such, under the new guidelines both can be held liable for possible violations. While many of our distributors have compelling stories or testimonials of benefits MonaVie products may have provided for them,  as a distributor, these testimonials can be regarded as endorsements and are thus subject to the new guidelines.

If you are not a distributor, then you are free to post about your experiences.

4. The FTC Does NOT Have a Soft Spot for “Health” Companies

There has been some chatter regarding the enforcement of the new guidelines and how the FTC will police the millions of blogs and comments on the Internet. There is some vagueness as how will these new regulations apply specifically to MonaVie and its distributors, and the regulations themselves state they “do not purport to cover every possible use of endorsements in advertising.”

Richard Cleland, FTC assistant director, division of advertising practices, in a recent interview with Fast Company (http://bit.ly/yjcS) commented on enforcement of the new guidelines (emphasis added):

"I realize there are hundreds of thousands of bloggers out there. Enforcement on a case-by-case basis--that's not even a realistic approach. There are other types of enforcement, surfing the Internet, finding companies that are making significant health claims about products, identifying where problems exist. We'd alert Web sites to potential problems and then invite them to contact us about questions of compliance. I don't think it's a matter of the enforcement side being weak but the most cost-effective tool in our arsenal. In this case, we're going to rely more on voluntary compliance than prosecution. That's the most likely source that we'll be able to use to identify a problem, and if we do see a problem at a ground level and then ask the right questions, we'll figure out why there's a problem pretty quickly and go from there." Also, Cleland adds, "Competitors are very quick to turn people in. I've never suffered from a shortage of competitive complaints."

In researching to obtain clarity on this subject, Cleland repeatedly cited “acai berry” sites as making outrageous claims, and even hinted such sites might not receive a warning.

In addition, do not assume just because the FTC may not have the resources to monitor every single blog or social networking site that our competition is not monitoring what you are saying. MonaVie has seen phenomenal success and growth, and there will be many who will want to see us fail. While it is safe to say that the FTC will likely target sites with many followers/subscribers, as opposed to a small personal blog, it is still best to err on the side of caution because you are a part of highly successful and growing company.

5. Ignorance is NOT Bliss

MonaVie will be monitoring the new regulations and will inform distributors as necessary, but we highly suggest distributors take a chance to read the new regulations themselves and help share this advice with other distributors.

The new guidelines can be viewed here:

http://www.ftc.gov/os/2009/10/091005revisedendorsementguides.pdf

For any other questions about these guidelines contact the compliance team at compliance@monavie.com.

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