with, here is the best phrase from the current Swiss judgement (Country Court
of Werdenberg-Sarganserland, reference number: VV.2018.82-WS1ZE-HWI). The
judgement shall be enforceable.
“The lack of transparency of the defendant’s
(Lyoness) business model does not mean that its unfairness is not detectable. In
this sense, the unfair snowball system is transparent.” Or in short: “The only
thing that is transparent concerning Lyoness is the snowball system!”
currently legally binding judgement (reference number VV.2018.82-WS1ZE-HWI) of
4 June 2019 of the Swiss court notes:
minutes of hearings recorded the statement of the Swiss Lyoness lawyer Adrian
Bieri: “Furthermore, the […] plaintiff’s allegation, that Lyoness was operating
a snowball system, will have devastating consequences for the reputation of
Lyoness, in case of an approval of this legal action.”
judgement of 4 June 2019, the court did approve the action and did not let
itself be blinded by the lawyer’s weepy objection. In this case again, the
court decided in favour of the plaintiff and imposed a five-figure amount of
CHF. Furthermore, it was clarified once
more that Lyoness is a snowball system.
worldwide reputation of Lyoness already is, to put it in the words of the
Lyoness lawyer, so “devastating” that this judgement may hardly carry any
weight. The deception of the bought sports sponsorship anyway only works for
people who think that power simply comes from the socket.
plaintiff had registered himself as a private person and his company with
Lyconet and had agreed to the new Terms and Conditions and the Lyconet
Agreement including the Compensation Plan. The grandiosely announced
participation in a worldwide dealer network once more turned out to be pure
shows the increasing dissatisfaction and disappointment of the SMEs. As soon as
the forecast sales are not emerging and questions are being asked, the global
company Lyoness quickly becomes silent towards its members. But as soon as a
new idea for filling up the coffers is concocted by Lyoness’ creativity
department, Lyconet marketers will pounce on the SMEs using the tried and
tested wording “…now everything is going through the roof”, “whoever is not
taking part right now, is going to miss a lifetime opportunity” and so on. By
the continual renewing and advancing the Terms and Conditions and the
implementation of further Additional Agreements, SMS are more and more getting
enmeshed in an opaque network of contracts. Apart from numerous Austrian
courts, Norwegian and Italian authorities, once more that is also the view of
the Swiss courts.
judgement of 4 June 2019, the court states:
Within the excerpts from the 26-page judgement text, we will add the company’s
name “Lyoness” to the word “defendant”, so that even the self-proclaimed
“Lyconet Chief Manager” Ede Buser will understand it! It will be rather
interesting, how he is going to interpret this judgement towards his followers
via his fake website www.basel-lyconet.ch.)
to Article 2 UWG, every business practice, that is deceptive or violates the
good faith principle and affects the relationship between competitors or
between providers and customers, is unfair and unlawful. According to Art. 3
(1) lit. r. UWG, a person is in particular acting unfair, if he/she offers the
supply of goods, the payment of premiums or other services on terms that mainly
imply a benefit obtained by the recruitment of further people and to a lesser
extent by the sale or consumption of goods or services (snowball scheme or
with page 15 (and others), the court further notes:
the theoretical bisection and the mostly confusing information in the Terms and
Conditions and the Additional Terms and Conditions, the economically relevant
payment depends on the payments of new members of the defendant’s system
there is a redistribution from the pyramid’s base up to its top. This is
demonstrated by the remuneration structure of the business model which almost
exclusively comes from a member’s Lifeline. The Lifeline of a member consists
of the new members he/she recruited (2nd level) and the members
recruited by them (3rd level)…..
the 3rd level, the Terms and Conditions and the Additional Terms and
Conditions draw an artificial barrier and try to disguise or shorten the
pyramid structure inherent to the business model. And so is written in the
Terms and Conditions, that no friendship bonus can be obtained for other
indirectly recruited members. “Other indirectly recruited members” are the
members acquired by indirectly recruited members and so on. In other words, the
member will not obtain remunerations for payments made by members lower than
the 4th level of his/her Lifeline…..
generated advanced member bonuses are not paid out by the defendant (Lyoness)
but can only be used within the System of the defendant (Lyoness) by converting
them to so-called units that can be used for purchases at partner companies in
the form of vouchers. The use of the vouchers for purchases at partner
companies effects the remuneration of the upper levels of the member who
purchases. The system ligation of the
defendant’s services (Lyoness) effects the dissolution of the artificial
barrier between the 3rd and the 4th level and allows the
money flow from the base to the top. …..
…..Only for the sake of completeness, it should
be mentioned, that all new recruited members are contracting with the defendant
(Lyoness) respectively the initiator of the system, which makes the system of
the defendant (Lyoness) a snowball system in the proper meaning of the word. As
a summary, it can be stated, that the first offence prerequisite of Art. 3 (1)
lit. r. UWG is fulfilled……
…..The lack of transparency of the business
model or its remuneration structure is a further indication of the existence of
an unfair snowball system according to Art. 3 (1) lit. R.UWG. Both the business
model of the defendant (Lyoness) and its remuneration structure are opaque. The
opacity touches not only individual components, but rather also their overall
structure respectively their economical interaction.…..
summary, the business model of the defendant (Lyoness) is an unfair snowball
system, pyramid scheme or Ponzi scheme according to Art. 3 (1) lit. R. UWG…..
closed on the basis of an unfair snowball system are ethically unacceptable…..
business model as a whole is unfair…..
Note: If one compares all previous judgements, it has to be stated that judgments are becoming more concrete and that the so-called improved or adjusted Terms and Conditions and Additional Terms and Conditions, Lyoness uses to eliminate the problem, are only giving them a little more time. An appeal may be lodged against this judgment.