The Supreme Court, through Justice Sonia Sotomayor, denied ACN's request for a stay on December 21, 2021. The multi-level marketing company had sought to freeze a District Court class-action lawsuit against members of the Trump family while it prepared a writ of certiorari. ACN's application, filed around December 13, argued that lower courts had mishandled the Federal Arbitration Act, creating a circuit split needing Supreme Court resolution.
ACN contended that allowing the class-action case to proceed would inflict irreparable harm, effectively nullifying any future relief granted by the Supreme Court. The company faced a unique challenge: it was not named as a defendant in the lawsuit. Plaintiffs had instead sued the Trump family for endorsing ACN products and services. ACN, however, asserted this was a distinction without a difference, claiming it was central to the allegations.
The company detailed its position in the stay application. While the Trumps were the direct defendants, the complaint itself directly attacked ACN's marketing materials as fraudulent and labeled its business model unlawful. Damages were calculated based on fees paid to ACN, minus any amounts recovered by affiliates. ACN argued its reputation had already suffered financially and publicly in ways that could not be undone.
Media coverage, often describing ACN as a "marketing scam targeting the poor and working class," compounded the perceived damage. ACN reported that distributors, employees, and prospective recruits began questioning the company's legitimacy after seeing these reports. Many assumed ACN was a direct defendant in a fraud class action, leading distributors to report difficulty in attracting new recruits and customers. ACN characterized this situation as fundamentally unfair, claiming it was enduring reputational damage in a dispute where it had no opportunity to defend itself directly.
Justice Sotomayor's denial of the stay left ACN's cert petition in theoretical limbo. While ACN was not a party to the lawsuit, its business practices and legitimacy were implicitly scrutinized. Courts generally hesitate to grant special procedural relief to non-parties, even those claiming collateral damage from ongoing litigation. The core dispute remained between the plaintiffs and the Trump family.
The class-action lawsuit accused the Trump family of engaging in a racketeering enterprise by promoting ACN. The plaintiffs alleged the Trumps used their celebrity status to lure individuals into ACN's multi-level marketing scheme, which they claimed was deceptive and predatory. Such RICO (Racketeer Influenced and Corrupt Organizations Act) claims carry significant legal weight, often involving allegations of fraud and systemic illicit activity.
ACN's argument for a circuit split under the Federal Arbitration Act focused on conflicting interpretations among federal appellate courts regarding the enforcement of arbitration clauses, particularly when non-signatories to an arbitration agreement are involved. A favorable Supreme Court ruling could have set a precedent, potentially forcing the plaintiffs' claims against the Trumps into arbitration, thereby removing the case from public court proceedings. Many critics of multi-level marketing companies frequently question whether a substantial portion of their revenue comes from genuine retail customers or primarily from product purchases by their own distributors. These concerns often arise in discussions about the legitimacy of such business models.
Despite ACN's strong assertions about the need for Supreme Court intervention and the irreparable harm it faced, the company never filed the promised writ of certiorari after Justice Sotomayor denied its stay request in December 2021. This decision to forgo further appeal effectively ended ACN's direct involvement in the higher court proceedings. Ultimately, the entire ACN Trump RICO class action was dismissed on January 11, 2024.