Federal Judge Grants Final Approval to 12.5 Million Herbalife Event Ticket Class Settlement

A federal judge in Los Angeles has granted final approval to a 12.5 million dollar class action settlement resolving claims that Herbalife misled distributors about the financial benefits of attending its company-sponsored events.

In an order dated November 16, 2023, U.S. District Judge John A. Kronstadt of the Central District of California approved the settlement in Lavigne et al. v. Herbalife, Ltd., et al. The case was first filed in the Southern District of Florida in September 2017 by eight distributors or spouses of distributors. The claims of four plaintiffs were later transferred to California, while the claims of the others were sent to arbitration.

The operative complaint, brought against Herbalife International of America, Inc., alleged racketeering, conspiracy, unfair competition and negligent misrepresentation. Plaintiffs claimed Herbalife and roughly 100 top-level distributors produced and sold tickets to a cycle of events marketed as the Circle of Success, and that attendees were told the events were key to financial success they did not achieve. Named plaintiffs alleged spending tens of thousands of dollars on events and products.

The settlement class covers U.S. Herbalife distributors who bought tickets to at least two Herbalife events from January 1, 2009 through April 6, 2023, the date the court granted preliminary approval. Top-tier members of the Chairman's Club and Founder's Circle are excluded. Payments are based on the number of event tickets each class member purchased.

The court cut class counsel's requested attorneys' fees to 4 million dollars, or 32 percent of the fund, and approved 337,926 dollars in litigation costs, 840,270 dollars in administration costs and 74,100 dollars in awards to the class representatives, leaving a net settlement fund of about 7.25 million dollars. A parallel suit against individual distributors in Florida had been stayed pending final approval, with the parties intending to dismiss it once the settlement was approved.