Bankruptcy represents a longstanding commitment in this country to helping people get a fresh start. This principle has never been giving only certain people a fresh start.
Some critics of TEAM and LIFE have made much fuss about the bankruptcy filings of a few people in leadership positions. Personally, I think that should be a private matter and nobody’s business but their own and their creditors’, but the fact of the matter is, it’s a matter of public record, and it’s already been made a public issue, so let’s address it.
- All of these people were sued by Amway, an $11.3 billion corporation. It costs a lot to defend against a lawsuit, even if you settle…which everyone did, except for Bill and Jann Newton, who had initiated their own case against Amway for their termination due to siding with TEAM in Amway’s dispute with them. The Newtons claimed $3.3M in liabilities in their bankruptcy, $2M of which were a direct result of their Amway lawsuit. Some of the other debts included substantial legal fees — for what, do you think? That’s part of the same case.
- All of these people lost roughly half their income, overnight. Besides the lawsuit itself, you also have to look at the circumstances surrounding the lawsuit. As a direct result of that situation, most of them had their network marketing income cut in half. Then they were tied up under a non-compete for 6 months. And even when they did finally join the LIFE opportunity, that’s simply not going to get replaced overnight. The Newtons didn’t participate in the settlement (and didn’t get active in LIFE while their case was still pending), and fought their case for five years before it was finally resolved. How long could you go with your income cut in half before you started racking up substantial debt?
- LIFE wasn’t even around when these bankruptcies occurred. Some critics have wondered why these people were allowed to speak at events, even while they were going through bankruptcy. They weren’t teaching financial principles — they were teaching on building communities, and losing half your income and needing protections doesn’t make you incompetent to speak on that topic. In fact, in that situation, the right response is to build a bigger community to make more money!
- Bankruptcy doesn’t mean you don’t understand finances. It can be the result of past history, one bad decision, a major downturn in one’s industry, or unforeseen expenses — like lawsuits (in this case) or medical expenses (the #1 cause of bankruptcy in the U.S., though admittedly, not a factor in any of these, to the best of my knowledge). The critics may not want to hear “about how bankruptcy can be a good thing — a teachable moment…and that Abraham Lincoln or Thomas Jefferson went through bankruptcy themselves”, as did Henry Ford, Walt Disney, Milton Hershey, H.J. Heinz, Donald Trump, and most recently, Robert Kiyosaki, due to a $23.7 million lawsuit award against him, but it’s true. It happens, and people move on. As pointed out in the quote at the top of this story, bankruptcy is a fresh start…for everyone who needs it.
The real story here is not that a handful of TEAM leaders filed bankruptcy — it’s that only a handful of TEAM leaders (I think 6?) filed bankruptcy. Between 2008-2012, 6% of American households filed bankruptcy! The economy tanked…in case you forgot. 🙂
Faced with severe income losses, the cost of defending a lawsuit by a multi-billion-dollar corporation, and the ultimate settlement of that lawsuit, it’s a testament to the financial principles taught in TEAM and the strength of the organization that only a few had to file bankruptcy. Not only that, those very same people stayed in TEAM/LIFE and rebuilt their businesses, requalifying for top leadership positions.
That’s not people blaming TEAM/LIFE for their financial woes — that’s people crediting TEAM/LIFE for the education, life principles, and supportive community that helped them get through those tough times and ultimately achieve even more than they had before.