MLM Distributor Rights


By Jeff Babener, Copyright 2017

Preface: The following congratulatory and support letter and accompanying article, MLM Distributor Rights: Dialogue as an Agent of Change, were communicated to the first Conference on MLM Distributor Rights, held March 12, 2004:


First, congratulations on establishing the Distributor Rights Conference. It is important work and you and others involved should be commended. Although our legal representation focuses on the direct selling company, our portfolio of books and writings at are overwhelmingly aimed at supporting aspirations and business needs of distributors. In fact, it is not surprising that many of the founders of leading network marketing companies come from the ranks of distributors. I applaud the dialogue you are having.


Such a conference causes one to reflect on a roadmap that involves “dialogue” rather than polarization, confrontation, petty behavior and a closed mind. It is much more likely that an open mind and receptivity to dialogue between those of differing positions will accomplish a much more positive result. In fact, that is the theme of your meeting, i.e., creating dialogue between distributors and companies, finding common goals and reconciling differing points of view. In fact, we are all in this together. And thus, I have attached a brief article, entitled MLM Distributor Rights: Dialogue as an Agent of Change. And so, with admiration and solidarity, I wish you and your conference the best of luck in forging an open dialogue on issues of the day. By striving for the noble ideas and rejecting petty closed mindedness, you will make a positive contribution to the livelihoods of all involved.


Sincerely, Jeffrey Babener

MLM Distributor Rights:


You Had Me At Hello

Contrary to popular myth, the interests of network marketing companies and their family of distributors are one and the same. Without the one, the other could not exist. One cannot be a winner if both are not winners. Distributors are the backbone of all direct selling organizations. Although it has become trite, the film character Jerry McGuire had it right when he said, "You complete me."


Decisions of a direct sales company are accepted if they are grounded in defense of supporting the livelihood of thousands of distributors rather than the bottom line of a corporation. A "we" environment is much more conducive to success than a "we-they" adversary relationship. The success of Mary Kay is attributable to the philosophy of its founder, Mary Kay Ash. Respected by those inside and outside of the direct selling industry, and having risen herself from distributor ranks, she intuitively "got it." In her book On People Management, she noted "Good people are a company’s most important asset. People are more important than the plan … we want our message to be 'We’re a people company.'"

Open Eyes, Open Ears, Open Minds

An open forum of ideas is the best place to start. Progress is not made by the faint of heart or those with closed minds and petty grievances. There is room in the "big tent" for all ideas. Those that prefer polarization to dialogue are doomed to live with their head in the sand. Censoring or stifling criticism of companies or practices is a sure way to lose credibility among your peers. As Indira Gandhi said, "you cannot shake hands with a clenched fist."


Mischaracterizing sincere or truthful criticism of abusive companies or abusive practices as anti-MLM/network marketing or anti-direct selling/direct sales ignores the fact that such companies or practices poison the pool of potential recruits for those millions of distributors who are thwarted in building their businesses. No service is provided by the person who puts his hands over his neighbor’s ears and eyes.


In her insightful work on relationships, Mary Kay Ash went on to comment on the art of listening, "Good Managers are good listeners. God gave us two ears and only one mouth, so we should listen twice as much as we speak. When you listen, the benefit is twofold: You receive necessary information, and you make the other person feel important … people can be distracted by their own petty prejudices … Listening is an art. And the first tenet of the skill is that undivided attention to the other party."

Listen to Your Ultimate Market—The Consuming Public

And finally, it is not only important to listen to each other. It is important for all parties in the industry to listen to their ultimate audience, the consuming public to whom is offered both products and a business opportunity. A fair-minded guiding principle in this dialogue is "Be positive, be realistic … pro-MLM, anti-scam." In the preface to the book for distributors, Network Marketing: What You Should Know (Jeffrey A. Babener, 2003), the theme is always one of fair-minded balance of interests:


"Network Marketing – Love it or hate it, this book is for you. For all its supporters and detractors, it must be agreed that this channel of marketing touches many lives. Although an ultra niche industry with less than one percent of retail market share, its hallmark is that it is interactive, blurring the line between seller and consumer - in the U.S. alone capturing involvement by individuals in one out of every ten households, 10 million strong with sales approaching $30 billion.


"This industry has had its image challenges, some earned and some misdirected. It’s a business that costs 'next to nothing' to join, and, as such, it brings out the best and worst in many. When done right, however, and understood primarily for what it is, part-time auxiliary income, this business can meaningfully enhance individual lives with income, recognition, team spirit, and earned self-respect. To those, this book is intended to provide a realistic, yet positive look at the business and practical self-help to be successful as a network marketer."


The Future is Longer than the Present Milton Friedman, Nobel Award Economist

As economists are prone to analyze, there is a short run and there is a long run. In the short run, confrontation and polarization can be a way of life, albeit a very poor one. In the long run, any society can only thrive through dialogue and reconciliation. The MLM industry is a microcosm of the larger society. The better road is to capture the opportunity of cooperation and give and take. Close your eyes? Well, as poetically noted by the musical group Kansas, "I close my eyes, only for a moment, and the moment’s gone."

Other Pages of Interest

MLM Law Library

MLM law in 50 states, IRS Publication 911, the MLM Textbook, as well as a comprehensive index of articles on the direct selling industry.

read more »

Power Index

The library is full of articles, case studies, statutes and other material useful as a resource to those interested in network marketing. This index is designed to help you find information on a category-specific basis.

read more »

MLM Business Articles

General topics, advertising, personal use, restrictions on distributors, MLM evaluation, taxes, technology, international, startups, and MLM consulting articles.

read more »

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