Jeunesse filed a lawsuit on January 8th, accusing its former President, Darren Jensen, of "raiding" the company's distributor network and misusing confidential business information. The action alleges Jensen breached employment agreements after departing the direct selling firm in May 2015.
In the multi-level marketing industry, "raiding" describes a practice where a former executive or affiliate recruits a company's distributors to join a competitor. This often involves transferring established networks to a new organization the individual recently joined.
Jensen served as President of Jeunesse until his voluntary termination on May 15th, 2015. His Employment Agreement included restrictive covenants designed to protect Jeunesse's relationships with its customers and distributors. It also covered its confidential business information. These covenants typically impose a period during which a departing executive cannot solicit former colleagues or misuse proprietary data. Jeunesse states Jensen agreed to these terms, which would restrict certain activities for three years following his departure.
Immediately after leaving Jeunesse, Jensen became an employee of LifeVantage Corporation, another direct selling company. Jeunesse contends that LifeVantage is a direct competitor. Both firms operate in the same market, vying for distributors and customers across similar geographic regions. The companies also offer products within the same market segment. Jensen now holds the CEO position at LifeVantage.
The lawsuit claims Jensen used confidential information obtained during his tenure at Jeunesse. This information allegedly included product formulas, pricing strategies, cost of goods sold, marketing plans, and details about suppliers, vendors, and manufacturers. Jeunesse asserts Jensen utilized this data to develop a new product for LifeVantage. The company describes this new product as "very similar, if not identical," to Jeunesse's Instantly Ageless. LifeVantage's TrueScience serum is specifically cited in the complaint.
Jeunesse also alleges Jensen contacted and recruited several of its active distributors. These individuals were actively building their Jeunesse businesses when Jensen purportedly solicited them. Jeunesse claims it invests significant resources to train, develop, and support its independent distributors. Their departure represents a substantial loss.
The lawsuit seeks to enforce the restrictive covenants and recover damages for the alleged breaches. Jeunesse's legal complaint details the contentious nature of executive transitions within the direct selling industry, particularly regarding proprietary information and distributor networks.