As part of a massive 131 judgment, the Arizona court hearing the FTC’s case has held the Success by Health Defendants liable of evidence spoliation.
Back in September 2021
sanctions were ordered against the Success by Health Defendants
over the same conduct.
The individual Success by Health Defendants in question are Jay Noland, Lina Noland, Thomas Sacca and Scott Harris.
At the time I wasn’t sure what the sanctions were or possible lead to, as none were detailed in the order granting the FTC’s request for sanctions.
That’s been up in the air until a
May 11th order finding Success by Health was a pyramid scheme
.
Because these issues are relevant to all of the FTC’s outstanding claims against Defendants—they have the potential to affect the Court’s findings both as to liability and as to remedies—the Court addresses them here.
In its order the court revisits the spoliation conduct in question.
In its order, the court examined ten documented “acts of dishonesty”.
On May 15, 2019, Wells Fargo inadvertently disclosed to Noland that the FTC had subpoenaed bank records related to him and his companies.
The very next day, Noland instructed the “SBH Leadership Council,” which included Harris and Sacca, to install the Signal messaging application on their phones.
Around the same time, Defendants also switched to using ProtonMail, a Swiss encrypted email service that emphasizes user privacy.
On May 29, 2019, the FTC asked that Defendants “suspend any ordinary course destruction of documents, communications, and records.” (Id.)
Rather than suspend document destruction, Defendants instructed each other (as well as other SBH employees and affiliates) to use Signal or ProtonMail for “anything sensitive” or “important things.” (Id.)
The Court concludes, in its capacity as finder of fact, that Defendants’ purpose in switching to Signal and ProtonMail was to conceal evidence from the FTC.
Because this issue came up during the Success by Health trial (held earlier this year over January and February), the court addressed the Success by Health Defendant’s testimonial explanations.
Cited as the “second act of dishonesty”, the court noted;
During their testimony at trial, Defendants sought to provide various innocent explanations for their decision to begin using Signal the day after learning about the FTC’s investigation.
Noland testified that the timing was a “coincidence.”
The Court found this testimony to be incredible and damaging to Defendants’ credibility.
In a related vein, the Court was unpersuaded by Defendants’ testimony at trial that they only used Signal’s messaging feature for non-substantive logistical texts (such as scheduling phone calls) and reserved their substantive discussions for phone calls conducted via Signal.
This explanation was not credible for at least two reasons.
First, before switching to Signal, Defendants exchanged a large volume of substantive text messages via the “SBH Leadership Council” group chat on What
🤖 Quick Answer
What is the evidence spoliation case against Success by Health?An Arizona court held Success by Health defendants liable for evidence spoliation as part of a significant FTC judgment. The defendants—Jay Noland, Lina Noland, Thomas Sacca, and Scott Harris—faced sanctions in September 2021. A May 2024 order determined Success by Health operated as a pyramid scheme, with spoliation findings affecting liability determinations across all outstanding FTC claims.
Who are the individual defendants in the Success by Health case?
The Success by Health defendants include Jay Noland, Lina Noland, Thomas Sacca, and Scott Harris. These individuals were held liable for evidence spoliation in the FTC's case heard by an Arizona court, which resulted in sanctions and contributed to findings that Success by Health operated as a pyramid scheme organization.
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