Quixtar Files Arbitration Suit
Against Eric Scheibeler

The complaint claims Mr. Scheibeler was terminated as a distributor in approximately June of 1999.  The majority of the Quixtar complaint centers on claims of defamation.  The complaint makes note of an April 7th letter to cease and desist from making "false and defamatory statements".   The complaint wishes to enjoin Scheibler from making further statements about Amway/Quixtar. 

It is amazing, however predictable, that even after several years of being out of the business, Quixtar is demanding to use the Quixtar arbitration process instead of the public court system.  I find it interesting that Quixtar is now complaining about Scheibeler's statements even though similar ones have been on the internet at MLMsurvivor for years now.    I have copies of documents about the death threats copied from the Internet in October of 2002.   Mr. Scheibeler's statements are also contained in a sworn deposition from a Washington State court case in July 2001.   These deposition excerpts have been on the Internet since the summer of 2003.  These statements are anything but new in my opinion.  In Michigan the statute of limitations for libel is one year and two years for intentional torts.

Let's take a look at Mr. Scheibeler's supposed "false and defamatory" statements listed in the cease and desist letter and in the complaint and look at each sentence one by one.

"I inadvertently discovered and documented literally billions in systematic consumer fraud.  Naively, thinking it was only being perpetrated by kinping distributors, I reported it directly to Amway/Quixtar senior management and to Dick DeVos, who was then president and is the son of the billionaire founder (now running for governor of Michigan)."

• I assume Mr. Scheibeler can back up his statement of discovery of consumer fraud as he claims he has it documented.  Anyone who knows the controversy of the Amway/Quixtar business knows it is about the tools business, which are separate from the DeVos family owned corporations.  The corporation has long know about the issues with the tools business.   If Amway/Quixtar can be considered a "public figure", then they would have to prove that Scheibeler knew his allegations of consumer fraud were false before they could prevail in a real court.
• It is a fact that Mr. Scheibeler did report his findings to Dick DeVos.
• It is a fact that Dick DeVos was president of Amway.
• it is a fact Dick DeVos is running for governor
• It is a fact that Dick DeVos is the son of the billionaire founder of Amway

I'm not sure what Quixtar has to complain about here. What is supposed to be false with this statement?   In any defamation case, truth is the ultimate defense.  Remember,  the comments from Mr. Scheibeler, in one form or another, have been on the internet for almost three years and it is now that Quixtar takes exception to them?

The next "false and defamatory" statements include

"To my shock, I was told in a face-to-face meeting what gun would be used to kill me if I became a whistleblower and made waves.  After a decade of diligent work, our sole income was shut off in an effort to starve me into silence.   My wife and young son received death threats on the telephone, resulting in and FBI tap and trace on our line.   A financial offer was made at the same time we were being pressured to a sign a non-disclosure agreement.   We refused and lost our home and medical insurance and had to declare bankruptcy.    I have been advised that a private investigator was hired to follow me in an attempt to find information that would discredit my character." 

• Certainly Mr. Scheibeler would know if someone had threatened him with a gun.   In this case he did not state it was an employee or official of Amway/Quixtar so I don't know what the attorneys have to complain about.  
• The complaint states that Mr. Scheibeler was a distributor from November 1989, to June 1999, a period of just 9 years and 8 months.  Maybe this is the false statement!
• I think Mr. Scheibeler can prove the FBI ran a tap on his phone.   I'm sure the FBI would not run a tap without such an allegation.  
• If the false statement is that  Mr. Scheibeler did not receive a telephone threat, how would Amway/Quixtar know anyway?   Did Amway/Quixtar secretly have a tap on his phone so that they can prove he never received such a call?
• Are the Amway/Quixtar attorneys asserting that Mr. Scheibeler was not offered a financial agreement and was not being pressured to sign a non-disclosure agreement?    They do not come out and say that this is the false part of the paragraph.  
• It is a fact that the Scheibeler's declared bankruptcy and lost their home. 

So what is false with the statements made by Scheibeler?

"I inadvertently discovered and documented literally billions in systematic consumer fraud.   When I, as a person who was very high up in the organization, discovered and documented the fraud, I informed the senior manager Dick DeVos about it.   Naive, perhaps, but that is what I did.   The result was that I received a direct death threat.   My wife and children have been threatened on the phone.   Amway also cut off my income in an attempt to silence me.   It is ironic, considering that my only aim in writing the book was to protect the distributors." 

• Mr. Scheibeler says he has documentation to back up his statement of consumer fraud.  Maybe Mr. Scheibeler will be able to subpoena tax returns of distributors to see how much net profit distributors really make. I'm sure he has enough testimonials from people to back up his claims.  
• Mr. Scheibeler was a founder's Emerald in the Amway/Quixtar.  Maybe in the view of the attorneys, an Emerald is not very high in the organization.  Maybe that is what is "false" with the statement!
• It is a fact, Mr. Scheibeler did send a letter to Dick DeVos about his concerns. 
• Again, Mr. Scheibeler would know if someone had threatened him.   Scheibeler did not state that the threats were from an employee or official of Amway/Quixtar so I'm not sure what the attorneys have to complain about.
• According to Mr. Scheibeler's deposition,  Amway did stop sending him is commission checks and put the money in escrow and removed a 10% servicing fee for the supply of products to his downline.  The money was released once he threatened to go public. 

When I read their complaint, I am more than a bit confused as to what they are saying is false with Mr. Scheibeler's statements.    The attorneys never specifically state what is "false" about the statements such as "Dick DeVos is not the son of the billionaire founder", or "Mr. Scheibeler did not document billions in consumer fraud".    They never state "Mr. Scheibeler was never threatened, and his family never received death threats on the phone".  They don't state "Mr. Scheibeler never had a FBI tap on his phone", and they don't state "Amway never stopped sending the Scheibeler's their checks".  I cannot find one rebuttal of one specific item in the paragraphs.  They only make broad sweeping generalizations that the statement is "false and defamatory".

It will be interesting to see how the case comes out.  In a similar case, a distributor was accused of making disparaging statements against his upline, but the JAMS retired judge Samuel A. Thompson said JAMS lacked jurisdiction in the matter since the respondent was no longer a distributor.    Predictably, the defamation claims were never taken up in a public court. 

I suspect that if JAMS makes a similar finding that they lack jurisdiction, since Scheibeler has not been a distributor for several years, and that most likely that similar statements from his depositions have long been on the Internet, that the case will not be taken up in a public court.  

As always this page is written as my opinion, the reader should read the complaint and make his own judgements about the case. 

Mr. Scheibler's book and story can be downloaded from his website for free.