doTerra Wellness Advocates Arbitration Info

Attorneys working with ClassAction.org believe doTERRA International may have violated various laws prohibiting deceptive business practices, and they’re now gathering affected Wellness Advocates to take legal action.

Further, the attorneys believe doTerra may have violated California laws by automatically renewing subscriptions without proper disclosures (or an easy way to cancel) and prohibiting Wellness Advocates from criticizing the company.

Are doTerra’s Wellness Advocate Income Claims a Scam?

The attorneys believe that doTerra’s income disclosures could be misleading in that the company emphasizes commissions without acknowledging the costs Wellness Advocates must pay.

For instance, doTerra’s representations highlighting yearly commission averages for Wellness Advocates do not account for the vast majority of advocates who do not earn commissions at all, according to the attorneys.

Indeed, it’s suspected that many doTerra Wellness Advocates end up losing money after paying the $35 sign-up fee and annual renewal fees, buying inventory that they are unable to sell and cannot return, giving out free samples (as encouraged by doTerra) and/or paying for expensive classes offered by other Wellness Advocates.

According to doTerra’s 2020 income statement, a little over half of its Wellness Advocates made no money at all that year and only 5% made more than $1,370 a month.

Many consumers, including former doTerra Wellness Advocates, have posted on Reddit and other online forums about their experiences with the MLM company—with some claiming doTerra is a scam, asking how to leave doTerra or even asking how to help loved ones who have lost money on doTerra.

Below is a sampling of these complaints [sic throughout]:

I used to be in doterra (unfortunately) and most people are definitely not rich. I think my best year I made $700....for the entire year. The next year I made probably about $200 for the whole year, and I quit shortly after. I spent money I didn't have, much more than my very minor yearly earnings. … Most of the other people I know who were in doterra had spouses that made enough to support them, while they were struggling to get people under them (so not making any money). They are all about the illusion that they're successful, but their income disclosure statements say differently.”
— Odd-Expression5589, Reddit.com

Let me share my pain with you all, my wife started with this doTerra thing about 5 months ago and she is trying to do business since day one so far she has been spending money and time doing zoom meeting marketing in everything single social network that out there but still, she hasn't get a single dollar from it, I've telling her to give it up and focus her time to study or do other stuff whatever, but only I get into troubles because she says I don't support her and so on.”
— Ok-Entertainer7028, Reddit.com

I’ve seen people saying it’s NOT a scheme but my mom is working for them and she barely gets paid and she spends around 600$ a month on it. She’s like a walking ad towards everyone in the family. She wears merch and is her whole lifestyle. She’s been working there for a year and only makes around 50-60$ per month from them sometimes.”
— Imh3ppy, Reddit.com

[I]n order to earn ‘points’, you’ve gotta order at least 50 points worth of merch. Which isn’t exactly $50 sometimes. And they want you to earn those points for free products... BUT charge you $3 to redeem them at all for anything. I mainly just purchased because I felt skeezy recruiting friends or loved ones. So, definitely lost money. But I preface that with the oils are definitely still good. But very overpriced I’m finding out.”
— [deleted account], Reddit.com

Is doTerra a Pyramid Scheme?

The attorneys believe doTerra’s multi-level marketing operation may qualify as a pyramid scheme—an illegal business model in which participants are paid primarily by recruiting other participants instead of selling products.

Legitimate MLM companies sell their products or services through direct person-to-person sales, and participants (sometimes referred to as “distributors” or “contractors”) can make money by selling products to customers and by recruiting others to sell products. While not all MLMs are pyramid schemes, the Federal Trade Commission (FTC) has warned that pyramid schemes “can look remarkably like legitimate MLM business opportunities.”

According to the FTC, promises that an MLM can “change your life” or help you get rich by selling the company’s products are a lie—and most people who join even legitimate MLMs either make little to no money or lose money.

Some former Wellness Advocates and others have claimed online that doTerra is a pyramid scheme, warning that only those who recruit others to be part of their “downline” can truly make money on doTerra:

I’m a clinical aromatherapist who started out with doTERRA. Left as I was in university for essential oils. The way they have you use them is dangerous. The structure of the biz is set up to profit those on top. You’re required to purchase 150$ a month in product or you don’t get paid. That’s how those on top make their money. You make pennies from sales, it’s recruiting that makes you money. Getting those under you to buy their monthly 150$. I worked like a dog and when I asked for help or complained, I was told I was the problem. I needed faith in the product. Use more product. Take more of their personal development courses, for a fee. Attend conventions, for a fee. Go to their events, for a fee. ‘Invest in yourself by investing in your biz.’”
— ButterscotchIll1523, Reddit.com

Pyramid scheme 100% I have worked extra hard, spending money I do not have, in order to meet their minimum order policy. I save and save and save points, to afford a ‘free’ product of which they get to choose to not have available. That's one. Two, I have an emergency ***** so I called to pause my account but they want me to get neighbors or friends involved and for me to order anyway OR I'll lose my entire status and all the points it took me half a year to earn. Wth?? This is a complete pyramid scheme.”
— Rena A, March 13, 2023, BBB.org

One thing that really surprised me was how insanely confusing the compensation structure is. I suppose that's to hide the pyramid scheme structure and also to make it impossible to figure out how much you would actually earn. They put all sorts of artificial requirements and limits in. Like you earn X% from someone after they join but only for 60 days. Why? To shovel more $ into DoTERRA's pockets, that's why, obviously. It's highly shady.”
— lala4now, Reddit.com

doTerra Faces Lawsuits, Regulatory Scrutiny

doTerra is no stranger to litigation and warnings from regulators.

As early as September 2014, doTerra was sent a warning letter from the U.S. Food and Drug Administration (FDA) that said several of the company’s essential oil products were being illegally marketed to cure, treat or prevent diseases and medical conditions—including infections, cancer, brain injury, autism, endometriosis, Grave’s Disease, Alzheimer’s Disease, tumors and ADD/ADHD—despite not having FDA approval.

In April 2020, the FTC sent the company a warning letter demanding that its distributors stop representing that certain doTerra essential oils could be used to treat or prevent COVID-19 without the support of “competent and reliable scientific evidence.” The agency also warned that doTerra distributors were making false claims about the potential to become wealthy or make significant income given “participants generally do not achieve such results.”

In October 2020, the National Advertising Division (NAD) determined that doTerra had not provided a reasonable basis for marketing claims that its essential oils provide certain health benefits, including mental and emotional benefits. The NAD also found that there was not enough evidence to support doTerra’s “certified pure therapeutic grade” claim for its essential oils and recommended that the company discontinue its use—a decision that was upheld upon appeal to the National Advertising Review Board.

In March 2023, the FTC filed lawsuits against three doTerra Wellness Advocates for making “baseless” claims in a series of 2022 webinars that the company’s oils and dietary supplements could treat, prevent or cure COVID-19. The distributors were each ordered to pay a $15,000 penalty.

Is This a doTerra Lawsuit? What Am I Signing Up For, Exactly?

You are not signing up for a lawsuit, but rather a process known as mass arbitration. This is a relatively new legal technique that, like a class action lawsuit, allows a large group of people to take action and seek compensation from a company over an alleged wrongdoing. Here is a quick explanation of mass arbitration from our blog:

[M]ass arbitration occurs when hundreds or thousands of consumers file individual arbitration claims against the same company over the same issue at the same time. The aim of a mass arbitration proceeding is to grant relief on a large scale (similar to a class action lawsuit) for those who sign up.”

doTerra’s Wellness Advocate terms and conditions contain an arbitration clause requiring Wellness Advocates to resolve disputes via arbitration, a form of alternative dispute resolution that takes place outside of court before a neutral arbitrator, as opposed to a judge or jury. It’s for this reason that attorneys working with ClassAction.org have decided to handle this matter as a mass arbitration rather than a class action lawsuit.

How Much Does This Cost?

It costs nothing to sign up, and you’ll only need to pay if the attorneys win money on your behalf. Their payment will come as a percentage of your award.

If they don’t win your claim, you don’t pay.

How Much Money Could I Get from Arbitration?

There are no guarantees as to how much money you could get or whether your claim will be successful. However, Wellness Advocates who sign up may be able to recover their actual damages or potentially more under state and federal consumer protection statutes.

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