Remember Those Lawsuits Against MK Liquidators I Mentioned in December?
You surely remember my post on December 6, 2008 regarding the fact that Mary Kay Inc was targeting online resellers of Mary Kay products with lawsuits.
As you know, I take seriously the privacy of the sources of my information. Unless they give me permission to name them, I don’t and don’t want to.
Unfortunately, one of the impending lawsuits I was informed of personally became public with its official filing in late November 2008.
The lawsuit against Mary Kay Inventory Liquidators Sharon & Dennis Lilly is similar to the lawsuit against Touch of Pink.
Sharon Lilly became a Mary Kay consultant in January of 2006. Mary Kay Inc alleges that Ms. Lilly was advertising and selling Mary Kay products online and sent her a letter demanding she stop. When she didn’t, MK terminated her consultant agreement on May 17, 2006. Apparently that’s when Sharon Lilly opened her online store, www.sharonscosmeticshoppe.com
However, according the the complaint filed, Sharon’s husband Dennis signed up to be a Mary Kay consultant on May 26, 2006, allegedly so Sharon could continue buying MK products at a discount. It took Mary Kay Inc nearly two years to figure this out: they didn’t terminate Mr. Lilly’s consultant agreement until April 30, 2008. Now, Mary Kay Inc calls Mr. Lilly’s act of signing up as a consultant “fraud” which is pretty strong language.
The main accusation in the lawsuit against the Lillys is that they interfere with Mary Kay Inc’s business model by soliciting consultants to sell their product to them, the Lillys, rather than an actual “end user,” as they claim Touch of Pink does as well.
Mary Kay Inc also claims unlawful use of their trademarks and that the defendants confuse consumers into thinking that they are purchasing guaranteed Mary Kay products from an “authorize” Mary Kay consultant. But how confused do you need to be to think you’re buy from a Mary Kay consultant when the Lillys’ site clearly displays a disclaimer that they aren’t affiliated with Mary Kay cosmetics? (Hint: pretty darn confused. Step away from the TimeWise.)
So far, the Lilly’s have been subpoened and we await their depositions and the continuing proceedings in this case.
Like I told you in December, Mary Kay Inc is apparently going after the Inventory Liquidators online, whether they’re selling on eBay or from the own site. No doubt other lawsuits will be formally filed in the future.
Here’s the entire lawsuit filed against the Lillys for your reading enjoyment:
Mary Kay Inc., Plaintiff v. Sharon K. Lilly and Dennis C. Lilly, Defendants 
Please note that the lawsuit document is over 2 MB — it’s large, so it will take a few extra moments to download and appear on your computer.
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Too bad MK Corp’s greed doesn’t allow them to care about anything but themselves. Why IBC’s need to get “something” out of their bad investment and why they have to sell what they can’t return to a MK Liquidator.
It will be interesting to see how this all plays out. The website drawing trafficedoes not allude by it’s name that you would even find MK there!
They (MK) may have a bit of a leg to stand on in that Dennis became an IBC after Sharon was terminated, but can they prove he wasn’t selling MK to consumers at retail and that the product he purchased went into Sharon’s web site?
When all these lawsuits begin to hit the coursts, won’t that make jurors and judges wonder aboutthe MK “opportunity”?
It will be interesting to see how all of this plays out.
what about mk’s “diq’s” inventing names & faking orders to qualify for director? that ’s been happening for some time fromwhat i understand-they should look in their own back yard first!
maroli, I agree, but they only want to stop those outside MK from making a buck! MK, corporate greed at it’s finest.
Oh Maroli, that’s nothing…
On another site I lurk on there’s a gal who claims to have had her SD charged with identity theft. SD used the info on the consultant agreement to apply for the card in this gals name and charged a whole ton of product.
Since the gal didn’t know what else to do and didn’t want her credit runied she made payments until it could get sorted out and since her making payments was viewed by the CC company as implied consent she had to contact MKC and the police.
Apparently MKC verified to the police that the SD was the one who placed the order, so they knew about it.
I don’t personally know this gal so can’t vouch for the truthfulness, but she includes enough details & ongoing updates in her story that it rings true. Sigh.
Somehow they can’t police their own and seem to look the other way when directors do questionable things. And consultants have been selling their excess on eBay for years. Liquidators have been running MK reselling business for years too, so why all of a sudden do they start going after them?
I just want to say that yes there are some people in MK who are greedy and do things that aren’t quite fair to make it but there are also people trying to make an honest living from it. People like myself. It really hurts to have people read stories online and make mean comments. Perhaps your experiences with MK haven’t been great and I respect that but please don’t categorize all MK consultants as dishonest.
I can also understand why the company is going after liquidators and eBay sellers. If customers can buy their products online for [often times much less] than retail why would they shop from actual consultants?