Did Mannatech do Ray Gebauer wrong?

Some of you know that Mannatech, under scrutiny for years for product claims, has been sued by the Texas AG, and its chairman, Sam Caster, just resigned last week.

This past week, with great fanfare, the company announced they terminated one of their top ten reps, Ray Gebauer.

I first interviewed Ray in 1996, two years after he’d signed up with Mannatech. He’s been with the company since its first year.

The paper reports this about Ray’s troubles:

“The jury found that Mr. Gebauer failed to file taxes from 1998 through 2001. During that period, his gross income exceeded $3.5 million, most of which was earned through his network’s sales of Mannatech products, Ms. Johnson said. Mr. Gebauer owes at least $316,000 in taxes for those four years, she says, and last filed a tax return in 1996. He could face 20 years in prison when he is scheduled for sentencing in November.”

I don’t take issue with the story here. I was not there.

I have three questions:

1. Did they really terminate him or was the press conference just for show? To make him a public whipping boy and take the legal spotlight and heat off themselves?

2. What if they really did terminate him? Did they do him wrong?

Ray has been building with Mannatech full-time since 1994. They were just a year old when he joined them. Today, nearly 17 years later, he’d built a business which earns him significant income.

Ray’s offense had nothing to do with how he earned his income. He violated no company policies, admitted the current CEO in the public announcement (see above). In fact, Ray Gebauer was a featured speaker this March at their annual national sales conference, MannaFest.

If they terminated him, as they ceremoniously announced, Mannatech and his upline (Jett) get to keep all Ray’s income – which he worked 17 years, full time, to attain. Nearly $1 million dollars per year, if the income figures for 1998-2001 reported are still accurate today. Even HALF that is huge income to have just snatched away with the stroke of a pen.

3. Wouldn’t it be right to put his income and distributorship into a trust for Ray so he can get some of the fruits of his years of work, especially now when he probably needs it most?

22 comments for “Did Mannatech do Ray Gebauer wrong?

  1. Cathy
    September 1st, 2007 at 2:58 am

    I don’t know anything about the termination but…I know Ray.

    I met him about 5 years ago at a Dale Calvery event in KY. He is ‘madly in love’ with his product. He is madly in love with his Savior. He GAVE the book “The PURPOSE DRIVEN LIFE” to all of his new members for Free.

    He was in 20+ MLM’s prior to Mannatech w/o much success and finally his persistence paid off once he joined Mannatech. Talk about being persistent and consistent.

    I have no idea what happened but to your question about what is fair? Ray paid his dues. He was loyal to his company & product.
    I think they should do something, anything besides just terminate him.

    He continued to recruit even after earning millions when a lot of people tend to bow out & retire.

    I find it unfathomable that he has been terminated. There are always 3 sides to the story. His, theirs and the truth BUT..just based on my friendship with Ray, I have to believe it has to do w/ publicity (either masking their other probs OR not wishing to invite more negative publicity)..but either way…I am very surprised. Wow. When someone of that stature gets terminated for reasons seemingly unrelated to normal terminations (cross solicitations etc)..that is a scary thing. Sorry, not trying to ‘beat up’ our beloved industry… but that’s how I feel..that it’s scary… and only because I know Ray and I know his heart and it was (and probably still is) Mannatech all the way.

    My own comfort in this from a personal standpoing is Ray’s best buddy is Jesus and I know He will take care of Ray in these trying times.

    I was not aware that NMC would be a source of ‘Industry News’ but…guess at times it is.

  2. g
    September 1st, 2007 at 1:27 pm

    That he did/did not deserve it is irrelevant here… instant termination has been used in many other – and sometimes apparently undeserving – cases to remove distributor benefits and thereby advantage the corporation.

    As a Network Marketer you don’t have rights you may have taken for granted. In Gerbauer’s case, this is something of which he should reasonably be aware – he certainly had enough time to read his contract, and the money to take appropriate legal advice.

  3. Matthew & Michelle Adams
    September 1st, 2007 at 2:06 pm

    That really ticks me off.

    Here we are…many of us tired of being kicked around by corporate America…only to be kicked again by the companies we represent. When does it end?

    This is a sad thing to see…really.

    “If” he did nothing wrong…it would be time for the distributors to stand up…and protect one of our own.

    Think?

    Matthew Adams
    Max International

  4. Matthew & Michelle Adams
    September 1st, 2007 at 3:19 pm

    Failure To Read

    I must admit I was a little heated by the story above and I failed to read the story from The Wall Street Journal.

    During his trial, Mr. Gebauer argued that paying taxes is voluntary.

    That was a stupid thing to say at your trial for tax evasion.

    Case Closed

    Matthew Adams
    Max International

  5. Erin Ely
    September 1st, 2007 at 6:19 pm

    I agree with you Kim, it appears unfair to Ray.

    The question I have is, why didn’t he pay his taxes? This does not make much sense.

    We can say that paying taxes is voluntary but we all know that’s not really the case.

    If you have that kind of income and you can afford to pay the taxes, why not pay the tax and work to change the tax laws if you do not agree with them?

    We all know that the IRS does not look kindly on people who don’t pay their taxes no matter what the reasons are.

    I often times do not agree with how my tax money is being spent but that has not stopped me from paying my taxes.

    This is one of the issues I have with network marketing and the way it is portrayed, be your own boss, control your own destiny, etc, etc.

    We all see that this is not really true when your company can terminate you at any moment.

    So how do we get around this as independent distributors? The fact that anyone can be terminated at any moment and lose their complete efforts of over 17 years.

    This does not encourage people to put a lot of time and effort into a network marketing business does it?

    Regards,
    Erin Ely
    http://www.elyorganics.com

  6. karenohandley
    September 1st, 2007 at 10:24 pm

    In addition to Kim’s comments about this interesting situation, there’s another excellent blog post about this subject:

    http://tinyurl.com/3csg5e

    The author of the blog, Len Clements, also provides a commentary about Ray Gebauer’s deliberate tax evasion, which you can read as you continue to scroll down the post.

    I do hope that Mr. Gebauer does NOT get 20 years in prison. KO

  7. PeggyfromPorcupine
    September 2nd, 2007 at 2:38 am

    As a consumer of the Mannatech products for over 10 years (& an on again/off again business builder) I must wade into this discussion.

    First of all, under scrutiny for years? Where does that come from? And if that is so are they under scrutiny any more than any other nutritional company?

    Making health claims – look at Mannatech’s literature and then look at the literature from other companies. The smaller, ‘no name’ companies print all the time that their stuff heals – but Mannatech does not. (It is food for Pete’s sake.) But they are a ‘nobody’ so the gov’t isn’t concerned about them at all. And one of the basis of contention is the DSHEA – a Federally passed Act. The State is trying to put its own interpretation on it and we shall see who is ‘right’ – the State gov’t or the Federal Gov’t.

    Secondly I want to clarify the time line of events.

    1. On August 14th it was announced that Mr. Ray Gebauer was found guilty of tax evasion.

    2. On August 17th Mannatech announced that his associateship has been terminated.

    3. It was announced on August 22nd that Sam Caster was handing over the role of COO to Terry Persinger, President of Mannatech. Sam is still Chairman of the Board and now has more time to work in the field with the reps and with Manna Relief.

    My comments:

    1. Ray is fighting what he feels is an illegal tax system in the US. Right or wrong it is his fight. He was warned of the consequences vis a vis Mannatech but he feels very strongly and will continue to fight this wind mill. More power to him – he is fighting for his convictions.

    In his own words ” am unable to return your mail because I have been kidnapped and imprisoned unlawfully. This may strike you as inconceivable and you may even believe or come to believe that I *MUST* have been guilty of some kind of crime because this just ‘can’t happen in America’.

    “You, my friend, are in for a horrifying shock … sooner or later. But I don’t want you to take my word for it. Please consider what Presidential candidate, current Congressman, Ron Paul has to say about it… (he gave a url)”

    My big bone of contention about this is he is waiting in jail for his sentence whereas Baron Conrad Black, bilker of so many other’s fortunes and found guilty for doing so, is free to wander the streets of USA while he awaits his sentencing…

    2. Ray did break one of the Policy & Procedures bylaws which states: 6.4.4: “Any Associate who is convicted by any government agency of a crime related to or in the course of their Mannatech business is subject to immediate termination.”

    And he was found guilty. What the procedures are if it gets overturned I don’t know – and I don’t need to know as it is none of my business!

    Especially now with the company under the microscope what else could the company do? Play favourites? I think not.

    3. This decision of Sam’s was made because of the huge confidence he and others have in Terry Persinger. Sam is a visionary, and this resignation will free him of the almost endless meetings he had to either chair or at the least attend. He and the associates are excited about this decision.

    Now to Kim’s questions.

    1. I think I pretty much answered that already. Take the heat off themselves? Any time the word “Mannatech” is in the news it will make headlines for good or for ill.

    2. Like I said already Ray was found guilty and had to be terminated. Who gets the money – yeah, it is unfair that the company will appear to have more money yadda yadda yadda. Give me a break. The Company is not out to get anyone. If someone resigns (and there have been big earners who have for various reasons) do we weep tears because now the Company may get more from their pay cheque?

    3. Why play favourites? If I was charged with tax invasion from my business, my business would be terminated, too. Should he, because he earned more money, get preferential treatment over me? I think not.
    ~~~~~
    Folks, first and foremost Mannatech is a publically traded company. As such anything they do has to be announced to the public.

    Mannatech is a huge company with a product that no one else has nor can they have unless they produce it synthetically (& ‘they’ are working on it!) So of course they will be a target. This is a good thing – it helps us as Associate and Mannatech as a company be more careful and clearer in its mandate and in its mission.

    Because of what I know I think all this will be a good thing for Mannatech and for the nutritional industry at large. It won’t happen over night, but watch.

    And don’t forget that there are also 2 sides to a story: what is really happening and what the press chooses to report.

    Now my final point. Kim, by bringing up this topic in the way you did, what has that got to do with helping us do our business?

    Whether Ray was done wrong has absolutely nothing to do with “Do I use too much seller talk” in my sales?

    Should Ray have been able to keep his money has nothing to do with “do I believe in my products”.

    By complaining that the company ‘took away his income” is nothing short of a smear campaign.

    All this has is great fodder for gossip. We don’t know all the story right now and speculating like this on the forum does strike me as a gossip session, doing no one any good.

  8. Kim Klaver
    September 2nd, 2007 at 4:18 am

    Peggy –

    I wrote about Ray because I’ve known him for so many years.

    There’s been little attention here, so the gossip factor doesn’t seem to have taken hold.

    According to the links in my post, Mannatech has been under scrutiny for some years for some it its reps’ health claims, which are of course, linked to the company. Sigh.

    We all know that your company’s products have worked for thousands of people…

    So onward and upward indeed.

  9. g
    September 2nd, 2007 at 6:15 am

    Let’s ‘add to the gossip’ and focus on that point of ‘what has that got to do with helping us do our business?’…

    Anything that increases distributor awareness of the active principle & practice of NM is a worthwhile thing. Clements explains it well with his message to his list subscribers:
    ———-
    You should be proud that you have taken a serious, professional approach to your business and cared enough to further educate yourself on your industry and the events occurring within it.
    ———-

    That’s in strong contrast with the too-common see-hear-speak no evil behavior of some who know better, and the ‘yay-way-to-go, whoopee we’re all great’ misplaced enthusiasm of many others.

    If this business is to reduce the ridiculous drop-out rate and associated image of failure, it needs more candid, sensible and pro-active exploration.

    At the very least, one way in which this ‘helps do our business’ is by making distributors more aware of what can and will happen – whether fairly or otherwise.

    If, in consequence, that causes them to temper the zeal with which they present their specific company/product/opportunity and tone down ‘greatest, ever, unlike any other’ claims then they’ll be received more fairly by the majority of people and might just in consequence do better business.

    Hopefully, it’ll encourage some to read their contracts, and in so doing recognize that the corporations are businesses and will behave accordingly – in pursuit of profit, and thus any spin of ‘sharing…’ has to be taken accordingly. And that’s a welcome thing.

    So yeah, sensible post on a worthwhile subject.

  10. Chuck
    September 2nd, 2007 at 6:54 am

    I think this kind of thing has a chilling effect across the entire industry;
    A reminder that your business isn’t yours as much as you thought it was, and just as in the the ‘real world’, you can work your whole life at a company, building something, and be kicked to the curb with no due process.
    Not even allowed to sell the business he ‘owned’.

  11. Cathy
    September 2nd, 2007 at 7:58 am

    To Peggy,

    Peggy, I appreciate your insight re: the situation with Ray. Rules are rules and I suppose it’s a fair thing that a company won’t bend the rules regardless of tenure
    & income, provided that the ground
    they stand upon is their P&P.

    The timing is not the best to be totally convinced of that from the outside but…as you say..it’s none of my biz either.

    I was wondering the same as you re: why did this info show up on Kims site? And I did not feel that Kims reply to your post really addressed your question/ concern. (Hope Kim does not get angry at me for saying that and I’m sure she does not need anyone to come to her defense but I will offer my .02 anyway)

    It is a gray area for sure and my best guess would be that she (Kim) maybe even hesitated to post on the
    “Ray G.” incident to start with, tho I have no idea of course if she did or did not.

    But…the more I think about this,
    the more I believe that random and sensitive issues do serve us as a whole.

    How? I’ll get there in a sec.

    I think we are all a part of NMC primarily because Kim tells it like she sees it. Yes, we might
    attract someone who is not happy w/ their company by being a part of her community…but I don’t think that is why we are attracted to her site.

    The training is awesome and that is certainly appealing. But I think the main reason for the ‘raw’ attraction is the lack of
    hype. i.e. Real World Stuff.

    Kim’s goal, at least that I can determind, is to be real. Good, bad, or indifferent… it’s REAL.

    We are in a real world business. Any real world biz has their
    woes. If sugar and spice and everything nice were all that was available at NMC, it would not be the real world and this site would be like tons of other ‘help’ sites out there.

    I agree this post deviated from ‘how can I sell my product’

    However, so long as the majority of the content weekly is germane to
    moving our biz’s forward (which I find it to be), imo, sprinkling in some realities of our industry’s challenges is not a bad thing.

    And..as always, for those who can’t take it, they would not have made it anyway.

    Side Bar: NMC has been ‘warning’ Distributors from all companies
    re: claims for a long time. That is a huge service for all. It happened to have been Mannatech who was taking the most recent heat but it could easily have been any number of companies..most are not big enough for the “powers that be’ to worry about so I guess they pick on co’s the size of Mannatech. I add this ‘side bar’ to point out other times that NMC has highlighted ‘stuff’ that companies are going through that appear to be negative but..which serve the NMC commuinty in so far as ‘heads ups’.

    In closing, I guess the Q I would pose… Is it ok from time to time
    to expose dirty laundry on our industry on a site that is
    geared towards assisting people during their journey.

    I say yes, because nothing is perfect and it speaks to the heart of what I perceive to be Kim’s mission, which is to be real.

    Just my .02.

  12. Lynn Dorman, Ph.D.
    September 2nd, 2007 at 5:26 pm

    Poor Ray? Hardly.

    I am a Mannatech Associate who feels Mannatech was correct in regard to terminating Ray Gebauer and feel the need to jump into this discussion.

    The answer to Kim’s question “Did Mannatech do Ray Gebauer wrong?” NO!

    Ray hurt Mannatech; Ray hurt all network marketing companies.

    In response to the person who cited “due process.” Ray had due process – he was found guilty in a court of law!

    Will Ray go broke? I seriously doubt that – his wife and family are also associates.

    Ray knew exactly what he was doing – he made his own choices based on his beliefs and he knew what were the consequences. He chose to act as he did and Mannatech chose to act according to its published policies – which, by the way, we agree to when we join.

    Do I feel sorry for Ray? Not at all.

    Lynn Dorman, Ph.D., J.D.
    grow older better

  13. Curtis Siters
    September 2nd, 2007 at 7:34 pm

    This really is a mixed bag.

    The way the game is played today he violated the perceived version of the “law” and if I were Mannatech yes I would fire him. No parachute, trust or anything else – otherwise I (“they”) would be condoning criminal action. With the position they are in right now they should be looking very closely at any laws that applies to them and their distributors and NOT tolerating anything that may be “illegal”.

    However I am not so sure that the tax law is really legal to begin with. Aaron Russo did a documentary on the law – you can watch it at this blog. According to Aaron he discovered in the Congressional Library a document regarding the tax law that reads:
    Income means a corporate profit…NOT…wages or labor. The law clearly states that “taxes” will be paid on “corporate” income, and that taxes on wages and labor are “voluntary.”

    So thanks for bringing this up Kim because it reminds me to contact my Pre-Paid attorney to see what they have to say about the tax laws.

  14. spaghetticoder
    September 2nd, 2007 at 11:16 pm

    If one agrees to the terms and conditions of the contract of any network marketing company, that person is bound by those terms. If an independent distributor/associate breaks federal or state law while operating their business, those terms and conditions that they agreed on is broken as well. It’s their responsibility to abide by those terms and also be aware of updates to new bylaws or policies during the life of their association with the company they represent.

    Since Mr. Gerbauer breaks the law and he has an association with the company, Mannatech would have a concern in protecting the image of the company with all the crises they’re going through, it’s a no brainer that they terminate Mr. Gerbauer’s association with the company.

    If your responsible for protecting the assets of your company and one of your star players break the rules, which could have external impact on your company, you must remove that impact by terminating the relationship between your company and your star player or you won’t be doing your job.

    My 2 cents…

    Sidney

    http://www.e-dental-plus.com

  15. peggyfromporcupine
    September 3rd, 2007 at 3:04 am

    Kim I can appreciate that you are hurting for your friend Ray. That I understand.

    I want to touch on this ‘health claims’ bit. According to the DSHEA provision is supposed to be there that if you can show scientifically that consuming (product name) will help with (disease name) then you can say that.

    Based on that and the 300,000 plus published medical extracts, many in Mannatech have been doing that either privately one-on-one or in meetings. And when they have said something it generally has been using generic names, not the company brand name.

    Others in other companies have been saying the same thing, using their brand names.

    I think what is happening is the AG of Texas has a different take on the definition of ‘scientific’ thus making even the claim of drinking water to cure dehydration illegal

  16. Kim Klaver
    September 3rd, 2007 at 5:16 am

    Thanks to all for your thoughts.

    I was hesitant to post on this, but did so anyway. Ray’s been one of Mannatech’s biggest promoters for years. He even wrote to chastise me a few months ago for reporting some of the bad media press, which comments I also duly reported.

    Granted almost no one will win the voluntary tax position for the foreseeable future. There IS a position, as one commenter noted, which is held by a large number of folks with tax law knowledge. (Yes, I pay my taxes, regardless of this question.)

    While Ray lost this battle in court, the war on the question of “voluntary personal income tax” may not be over. Who knows?

    It just seems to me that if I had been as loyal and central to the success of a company as he has been for nearly 20 years, having the people you know as family terminate you summarily one day, while you are sitting in jail for the first time in your life,likely in shock, is not what I’d like to have done to me.

    There might have been other ways to attain the same effect – showing they’re doing something about people who are doing things they shouldn’t. But Ray’s infractions had nothing to do with how he did his business – the very kinds of things Mannatech itself is under investigation for by the Texas AG.

    I will let it go now. Sigh.

  17. Ilka
    September 3rd, 2007 at 11:54 pm

    That is just so sad! I feel for anyone who’s got trouble with the IRS.

    I really don’t think Mr. Gebauer should have been terminated for that though and I wish the company would have handled the situation a different way.

    This makes it look like…even in this industry…we are very much dispensable no matter how much we contributed to the success of a company. It should be a lesson to all of us to learn from that.

    My thoughts and prayers go out to Mr. Gebauer and his family and I hope he doesn’t get 20 years in prison.

  18. Michael
    September 4th, 2007 at 3:35 am

    Very sad. Very sad indeed. Ray’s story in the Truth book thrilled my heart, as I could identify with many of his struggles.

    Yet Ray took a stand, and while my heart is with him, I think it is suicidal folly to take on the IRS while not paying your taxes.

    Such has been demonstrated over and over again. Fight them if you must, but pay your taxes in the meantime, for you will accomplish little from jail.

    I also think it constitutes very poor judgement when you have others depending on you. So what is his wife and children to do while their husband and father sits in jail? I don’t mean financially, I mean overall. This seems like too great a sacrifice for others to make on your behalf on an issue that has yet to be won ever at the trial court level.

    Of course the company is legally right in what they did but I don’t think it was a morally right thing to do. Put his distributorship under his wife. If he truly owned his business he wouldn’t necessarily lose it by going to jail.

    Bad press? They should just say to the press what they tell people anyway when they recruit them, its a business of your own, so we can keep him from any future activity but his past work belongs to him.

    Short of that the old school needs to stop lying about who really owns what when they recruit you.

    I know of a number of people who have been terminated just with an accusation, so to Mannatech’s credit, at least they waited until the trial was over. It probably has to do with the fact Ray was such a big hitter, but nonethless they did wait.

    There are a number of lessons to be learned here in my opinion.

    One is that corporate, even NM corporate, doesn’t have your back. They can’t really, given today’s regulatory environment. At the first hint of trouble with a rep they usually bail, for fear of the gov’t monstrosity coming down on them.

    So all reps, buyer beware. Have your contract vetted by a lawyer, and set yourself up as much as is legally possible to insulate yourself from undue and perhaps unfair termination. My guess is that the Pre-Paid Legal reps on this list ought to be doing a very brisk business with NMC folks.

    Another lesson to learn is that while a NM business provides flexibility and independence, you really don’t own it. Given that reality it is not just enough, if you plan on being a bigwig, to build a residual income through selling, recruiting or both. That is good for sure. But you also need to build an income that is independent of the business as well, which means you need to take a lot of that hard earned residual income and invest it so that it also produces a passive/residual income.

    That way should you run into trouble down the line you won’t be unduly impacted by a sudden termination.

    I have always marketed services. I have never in NM marketed a product, largely because I never was onboard 100% with any product, and also because I like big commissions up front, as well as a nice back end residual, which very few NM marketing products provide.

    The dream in services was to build a block of business that produced a residual income. Exactly like what Kim teaches about building up customers.

    But the very first company I worked with, AL Williams, now Primerica, constantly preached about saving your money. Art used to say, “we judge you in this company by TWO things, how much money you make AND how much money you accumulate.”

    Financial independence at ALW was measured NOT by how large your residual was, or fancy cars, or furs, etc., but rather when your passive/residual income from your investments was enough to allow you not to have to work.

    There is wisdom there. The first time I learned Hector LaMarque, a big hitter at Primerica, had saved over $50,000,000 dollars I darn near fell out of my chair. That was about 10 years ago and he is a pipsqueek compared to some other Primerica big hitters in terms of overall wealth.

    And he didn’t say it about himself, but Tom Hopkins, one of the nations top sale trainers said it at one of his seminars, telling folks that Hector used to call him whenever he broke a monetary milestone, and he started calling him when was at 1,000,000.

    Hector credits Tom for making his business what is today because he adopted his techniques back when Art Williams firmly preached against learning from outside sales trainers. He did this because he felt most trainers were just theorists, and hadn’t accomplished anything in the field.

    The key to the story however is that Hector lived in the same 1200 square foot house, drove the same not so cool car, had the same furniture in his house, even when he was earning over $800,000 a year and had saved over $1,000,000. When a new recruit questioned his credibility he would simply pull out his investment statement and that would settle all questions. He didn’t start to upgrade his lifestyle until he had saved that $1,000,000.

    Given his savings rate, had he run into trouble he probably would have been okay.

    At any rate a word to the wise. Set up your business and your finances in such a way that you can insulate yourself from trouble, especially if you are actively pursuing controversial topics or your company is drawing national attention.

    In the meantime, we should prayer for Ray. If Jesus is his best friend as one poster suggested, he must have missed the lesson Jesus shared with St. Peter on not being a tax revolutionary.

    20 years – sheeeeeezzzzzz.

    Michael
    World Leadership Group

  19. Anonymous
    September 4th, 2007 at 8:02 am

    V. comments, Mannatech has only been in business since 1994, so it has been 13 years.

  20. Roxanne Green
    September 4th, 2007 at 1:19 pm

    This all boils down to one simple little thing and it’s in almost every comment I have done here. Someday people will learn to get educated, but for now, these companies have “back doors” they can use to get rid of people whenever they want. In this case it happened at a perfect time because now that they have terminated Ray, Mannatech has more income coming in to help fight their lawsuits. Granted – it will take much more, but it’s a dent in it.

    Here is that one simple little thing that I keep saying –

    Read your Policies and Procedures

    That’s it.

    There are companies out there that say they can terminate you at ANY TIME for ANY REASON. A lot of you are building organizations in these companies. That is your contract. You agree to it when you join the company.

    Go back and read it. If it says things like you must have ongoing sales or ongoing sponsoring or you must accompany your downline to all company functions – these things mean you can never retire. Never.

    If your Policies say things like company reserves the right to accept or reject any application or renewal application – that means that when your contract is up for renewal, the company can reserve the right to reject the renewal. Even if it’s an automatic renewal and you have to do nothing to renew it. The company can terminate you for no reason whatsoever when your contract comes up for renewal if that clause is in there.

    If your Policies say the company can terminate you at any time – run the other way.

    I don’t know about you, but I know I don’t want to build for years to have an income of that size yanked out from under me. Do you?

    I’m sure Ray didn’t. But…just like most people here, Ray had probably never read the contract he agreed to when he joined the company. If he did read it, he probably said/thought “Oh – they won’t do that to me”. Lots of people have thought that and lots of people have been terminated from companies that need money by using clauses in the Policies & Procedures.

    Some companies also state in the contract that you can not discuss any company business for at least one year after termination. That’s why you don’t always hear about these unethical things that companies do. When I was terminated from a company, the legal department “reminded” me that in my contract it stated that I couldn’t discuss any of what had happened with anyone for a period of one year or they would bring a lawsuit against me. Back then, that scared me and I shut my mouth.

    Go read your Policies and Procedures. See what’s in there. If the company says they can terminate you at any time or when your contract is up for renewal or if you don’t accompany your downline to all company functions – ask yourself – is this the company I want to trust with my family’s future? Ray trusted Mannatech to be there for him and his family.

    Roxanne Green
    NetworkMarketingRules.com

  21. Anonymous
    September 7th, 2007 at 1:08 am

    With regard to the comment from peggyfromporcupine “making even the claim of drinking water to cure dehydration illegal.” A little knowledge is a dangerous thing. One should study basic physiology and biochemistry – you would have to know the cause and extent of dehydration. Reminds me of a certain “21 year old millionaire” and his vitamin C/scurvy classic.

  22. Rich Humpal, JD
    September 8th, 2007 at 12:35 am

    Ok, all of your comments forced me to jump in! As an investigative lawyer, and one that has helped build a ‘downline’, I have read with interest a lot of ‘stuff’ that tells me NO ONE HAS A CLUE as to what is TRUTH regarding Ray Gebauer verses IRS (and ‘the company’). Perhaps I don’t either, but after 20 years of searching for ANY law that makes one liable and therefore obligated to FILE and pay any type of ‘income tax’, the ONLY one I have ever found is the ‘Buck Act’. This Act provided for Congress to pass laws to tax franchises ONLY within the jurisdiction of the United States (not the United States of America by the way). If I am wrong, please show me!!!

    Lynn Dorman (Phd AND JD) should understand that what most people believe is probably a lie. Isn’t this what we as associates in ‘the company’ believe? Well, as Dr. Wilkins so adamantly stated, no one should give an opinion without FULLY investigating all sides to the issue.

    Now I could write and talk all about ‘case law’ but most of it is trash and hearsay evidence because you and I did not have a chance to voice our own opinion and give our own evidence with these cases. So I won’t. As I see it, there are actually two issues.

    1. Did Ray violate ANY policy/rules with ‘the company’? Perhaps he did, but what IS the remedy that provides ‘due process’ for associates to ascertain the truth here? Who gets the benefit of the bargain? How are we (associates) to know–for sure?

    The contract I read states that the associate IS responsible for ALL taxes, not ‘the company’. What doesn’t ‘the company’ understand here? It therefore makes NO difference whether or not Ray didn’t pay the alleged income tax, neither does it make any difference whether or not we, as associates, provide the truth (what ever it is) on the 1040 Tax form, (without the correct OMB numbers I might add, thereby making the form invalid), because ‘the company’ has distanced themselves from this type of activity.

    Therefore, paying taxes has nothing to do with ‘the company’! Want to argue this? Try! There is NO nexus, therefore IF Ray wanted to file a suit against ‘the company’, then the fact finders would and should find for Ray. What does this do for ‘the company’? Who knows?

    2. After interviewing many of the presidentials of ‘the company in Portland last week, it is my understanding that the majority of them were surprised at what ‘the company’ did to Ray’s business. Many of them are now worried and are fearful of ‘stepping on glass’.

    Here is the thing: Are we allowed to tell the truth, or are we being forced to tell lies? This is extremely important. For those of you interested in Heaven, (and I assume most of us are) read the warning found in Revelation 21:8 and 22:15. Check out what God said about those that are cowards and practice or even believe a (ONE) lie? Hey, I didn’t write this, but Ray not only knew this and practiced it in his business and devotion, but Ray lived it! He is STILL living it. No one, not even ‘the company’ or the government could get Ray to lie about what is the truth regarding income tax! PERIOD!!! This is what God demands from each one of us that wants to belong in the Kingdom of Heaven.
    Now, as to what we as associates can or can’t do about all of this, I believe this blog can help IF all of us are willing to voice our honest opinions and let ‘the company’ know. After all, ‘the company’ is supposed to be a company led by God.

    My own opinion? Ray may have made some fatal mistakes by thinking you can get a fair trial in America. You can’t! I have made those same mistakes. Many of you have. The judicial system is irretrievable broken. Don’t attempt to change the status quo. Jesus tried and they killed Him. ‘The company’ doesn’t have the knowledge or insight to fight the beast. I wish they were more on the offensive, but who knows, perhaps they will wait until the foe is tired, and then ‘kick him while he is down’. Me? I think like Reg. Blow them away with the science and testimonies. This business of not being able to tell the WHOLE truth for fear of being terminated is nonsense. What would Jesus do or say?

    You can answer my ‘ranting’ by emailing me at: bgh4rjh@aol.com R. Humpal, JD

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