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THE MLM LEGALITY TEST

The first version of this article was written in 1992, as I was starting my private practice devoted to direct selling issues. That version has been posted on many websites, including my own, and cited and referred to often. It is time for an update and to be more specific about the roles of the persons involved with a network marketing company. For the purposes of this “TEST,” the only two words I will use to describe persons associated with a network marketing company are “participant” and “customer,” with strict definitions.

A “customer” is an end user consumer of the products or services of the company, and in this strict definition, DOES NOT have any opportunity to MAKE MONEY with the company through any later action or conduct.

A “participant” has the opportunity to MAKE MONEY by generating business volume and has the right to introduce other “participants.” Giving the participant the right to introduce other participants distinguishes a single-level income opportunity from a multi-level income opportunity.

“Sponsoring” is the act of introducing another “participant,” and the word is not used to mean finding a customer.

Is there a simple, easy to apply test one can give to an income opportunity that addresses the pyramid law risk without all the pyramid law legal terminology? There is. What follows addresses that need. It is the single-level test for the multi-level income opportunity. It goes like this: Can a participant make some money SINGLE-LEVEL, that is, without introducing or sponsoring another participant? Note the specific use of the word "can," not the word "would." It is usually a given that the participant is urged to sponsor and that the income opportunity presenter will say or imply that the "real money" is in building a group. But that is usually O.K., SO LONG AS participants who choose not to sponsor at all CAN STILL MAKE MONEY.

Note also the use of the word "MAKE." It's "MAKE MONEY," not "SPEND MONEY," meaning paying income taxes if the gross income exceeds expenses associated with producing the income. Buying for personal use at distributor prices, rather than customer prices, while a savings, does not generate INCOME upon which one is required to pay taxes. Buying for personal use by itself is not an income opportunity. If the proposed income opportunity consists ONLY of buying for personal use and sponsoring more participants, with no provision for sales to customers, the design is flawed.

This simple test needs to be applied to two aspects of an income opportunity. The first aspect is the design. What do the company documents say about how one makes money? How does the compensation plan work? Not all of the fine details of every commission, bonus, or reward need to be understood; but simply, can the participant make SOME money without sponsoring? Remember, one does not MAKE money when one just buys products or services for personal use. The application of this test should in no way imply that there is anything wrong or illegal about the personal consumption of the products and services by the participant. It is just that that activity alone cannot be the sole basis for an income opportunity.

The second aspect of the application of the test is the plan implementation. Some plans are designed correctly, but are flawed in the implementation. Can a participant make money—even without sponsoring—as the plan is being taught and implemented by the prospective sponsor and others closely associated with him or her? If there is no acknowledgment or support for the non-sponsoring participant in the income opportunity, something is wrong—maybe not in the design, but surely in the implementation. Reputable and legally designed and implemented multi-level income opportunities provide a money making opportunity SINGLE LEVEL to participants who choose not to sponsor. Of course, if one sponsors others, then ADDITIONAL money making opportunities exist when those sponsored participants generate business volume.

Apply this test to multi-level income opportunities. Look at the plan design, and look at the way the plan is being implemented by the prospective sponsor and associates. If the ONLY WAY to make money is by sponsoring, STAY AWAY—the plan is fatally flawed.

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Gerald P. Nehra is a private practice Attorney at Law. He is one of only a few attorneys nationwide whose practice is devoted exclusively to direct selling and multilevel marketing legal issues. He began his legal career in 1970, and from 1982 to 1991 was the Director of the Amway Corporation Legal Division. He can be reached at Nehra & Waak, Attorneys at Law, 1710 Beach Street, Muskegon, Michigan 49441, 231-755-3800. His e-mail address is This e-mail address is being protected from spambots. You need JavaScript enabled to view it . You are invited to visit the firm web site at www.mlmatty.com. Permission to reproduce, with this attribution included, is granted. 

Mark Birnbaum began his career in Nightlife and Special Events as a promotions director in Ithica, New York in 1998. And in 1998, Mark launched and managed his first nightclub, a 22,000 sq. ft. megaspace in Ithica, New York.

In 2002, Mark Birnbaum formed the Nightlife consulting company Operative Ince., to open Lobby, a chic midtown Manhattan nightclub. Lobby's launch in 2003 was among the most successful in nightlife history.

In 2004, Mark Birnbaum began overseeing the marketing, public relations, promotions, and events for AER Lounge. Soon after, AER was named by Condenast Traveler, as one of the top picks for nightclubs in the world, and number one in Manhattan.

Today, in addition to owning and operating New York's most exclusive nightclub, TENJUNE, Mark Birnbaum and partner Eugene Remm manage the EMM Group, an Events and marketing company that has been responsible for many of the country's most upscale, and star studded events. Successful EMM Group events have taken place in New York, Miami, Los Angeles, Las Vegas, Park City, and Chicago.

Source: Mark Birnbaum

 

A Brand New World Wide Company is NOW in Pre-Pre-launch!!

It is extremely important to you and your loved ones to pay close

attention to this email! This opportunity is in PRE pre launch!

The site is not even ready yet! Launch will be in October!

This new company is based out of Germany and the name is Falkito
 

http://www.prelaunch.falkito.com/register.php?rid=7991


Everyone Earns, No Sponsoring Required and if you want to refer
but can't....we take care of that too!

We have 3 sources of money here:

1. Income from Advertising – For every partner, active or passive
2. Penny Auctions – Uni-level Plan
3. Members Sales – Dual Plan/Speed Money
4. …and more to come in the near future…

Obtainer, the world’s biggest MLM magazine was so impressed with

our concept they have a huge 6 page report on Falkito that will be

published at launch time!

This will be a Life-Changing Opportunity!!

Falkito signifies income, whether active or passive, and there has never

been anything like this before !

By joining our team now every Partner in the pre-launch phase will 
receive the status of VFP – Very First Partner.

For every other partner that you personally bring to Falkito, you will be

rewarded with one VFP point. These VFP points are for a lifetime.

Lifelong participation in Falkito is where it’s at: 3% of the turnover

worldwide will flow into these points, which can only be collected during

the pre-launch phase.

There is no cost to register and learn more. Hurry now to:

http://www.prelaunch.falkito.com/register.php?rid=7991


DO NOT MISS OUT on this ground floor opportunity to be a part of the

next HUGE income opportunity that can provide you and your family a

long term full time income!


PS: Why are people worldwide so convinced ?
1. Because we are the first company that found a way to make a more than 1000% commission payout.
2. Because everybody's Downline can be build up automatically just by pressing some buttons
3. Because every beginner transform to a professional and can earn money with ease
4. Because everybody can make real good money even without sponsoring
5. Because Falkito itself is giving generated real partners to existing parters for free, just to make everybody successful
6. Because we found additional income and this takes care that everybody is at least earning the monthly costs, so everybody will stay forever
7. Because Falkito found a way to make MLM and Network Marketing 100% automated so that 100% sure everybody reach by time the highest position
8. Because Falkito will grow up to the biggest marketplace worldwide

 

When looking for New York City’s best nightlife hot spots, you will inevitably come across restaurants and venues by the names of Catch, Lexington Brass, Catch Roof, Tenjune, The Chandelier Room, SL east, four Hundred, the Estate, and Abe and Arthur. What do all of these spectacular spots have in common? They are managed by none other than, Mark Birnbaum.
Mark Birnbaum gained most of his success in the hospitality business when he co-founded the EMM Group, which specializes in managing some of New York City’s top nightlife establishments. With the help of his two partners Eugene Remm and Michael Hirtenstein, the EMM group has launched a number of highly-successful restaurants and venues, which are at the top of New York City’s Nightlife.
Due to Mark Birnbaum’s dedicated management, his establishments have gained a positive reputation in the restaurant business and keep a solid flow of new and returning customers. People will visit Mark Birnbaum’s many establishments because of their excellent reputation, and people keep coming back due to their great experience and service. It is very true that Mark Birnbaum is known for managing fun and trendy New York venues, but what is it about these venues that make them such hits? One major factor is the incredible service the customers experience upon visiting any of Mark Birnbaum establishments. Customers find themselves very impressed with the impeccable service and hospitality they receive. Customers really enjoy this great service, and crave for their next visit to any of Mark Birnbaum’s venues.
Along with the excellent customer service and hospitality, the ambiance also attracts many customers. You really feel like you are in the middle of New York City’s nightlife surrounded by the modern and trendy décor that permeates throughout all of Mark Birnbaum’s venues. The details of each venue are fabulous, and customers return just to re-experience this magnificent setting. The best way to describe this type of ambiance would be as “luxurious,” because upon visiting one of these establishments, customers feel that they are in a place of pure luxury.
It is safe to say the Mark Birnbaum has left his mark in all of the venues he has managed; he has also created an excellent business worth envying. A true legend of New York City’s nightlife, Mark Birnbaum is a name you will never forget because of all the contributions he has made to New York City’s hospitality industry.

 

Source: Mark Birnbaum

Revel Resort's HQ Nightclub in Atlantic City

HQ Nightclub, an exquisite 40,000-square-foot nightclub comprises of four distinct levels, each emanating a different feel within a flawless setting that catches the attention of even the most discerning club-goers and trendsetters.

Fall is here and EMM Group and Angel Management Group continue to bring the biggest names in electronic dance music and House to HQ nightclub within the Revel Resort in AC. Mark Birnbaum, Eugene Remm, Michael Hirtenstein of EMM Group and business partners at Angel Management Group are making sure the superlative nightclub quickly catches the attention of the industry by bringing the biggest names to the stage.

Here’s the line-up for this upcoming weekend.

Roger Sanchez – Friday, September 14, 2012

Roger Sanchez is a Grammy Award winning producer and DJ and has remixed tracks for Kylie Minogue, Madonna, No Doubt, Maroon 5, The Police, Janet Jackson, Michael Jackson, Daft Punk and more.

 

Paul Oakenfold – Saturday, September 15, 2012

A Grammy nominated artist, Paul Oakenfold, is considered a legend in the world of dance music. He has been a leading force since revolutionizing the music genre Ibiza in 1987 and he has managed to keep his name as an industry leader with current hits and forward thinking beats.

 

Chris Lake – Sunday September 16, 2012

Chris Lake is also a globally recognized artist. He produces some of the most exciting and cutting edge beats in the industry and mixes together everything from house, electro and even techno. Lake stands out for his innovative tracks, reflecting the darker and deeper elements of electronic music.

 

Source: http://www.markbirnbaumemmgroupinc.com/2012/09/11/hq-nightclubs-fall-line-up/

This past week, EMM Group owners Mark Birnbaum and Eugene Remm celebrated the much anticipated opening of SL Miami in the flagship nightlife venue in Manhattan. SL, short for Simyone Lounge, is located in the meatpacking district just below EMM Group’s restaurant Abe & Arthur’s.

The instant success of SL in the Meatpacking District led EMM Group owners, Mark Birnbaum, Eugene Remm and Michael Hirtenstein to open an outpost of the nightclub in East Hampton, NY. SL East is a seasonal venue that opens up Memorial Day Weekend for the summer months.

Mark Birnbaum and Eugene Remm celebrated the soon-to-be opened SL Miami with a bash hosted by the newest additions to the EMM Group family, SL Miami operators, Marko Gojanovic and Michael Malone.

DJ Sam French performed his famous beats for A-list guests, including New Jersey Nets’ Kris Humphries, actor Bryan Greenberg and his girlfriend Jamie Chung, Miami Heat player Chris Bosh, Boston Celtic’s Rojan Rondo, actors Michael K. Williams and Omar Epps, and Sports Illustrated model, Nina Agdal. Guests partied until 3am while wearing neon hats with South Beach palm trees and sipping on Absolut Miami cocktails all while the nightclub’s video-walls illuminated the venue.

SL Miami is set to open this November.

Source: Mark Birnbaum.

“Work hard and party harder”, is the clear rooting of most city people these days. Gone are the days when weekends used to mean watching boring old movies and sleepover with friends, it's much more now, and the new word called 'nightlife' has come into quick existence.

Have you ever wondered when did the turning point come in the industry and when did the major revolution in the pub and bar industry take place? Who is actually responsible for a string of lucrative clubs in the country, which makes the night scene interesting?

After a week full of hard work, people often feel entitled to a day out in the club. They simply want to unwind, booze, dance, and enjoy with friends and family and there is one person who is responsible for this major shift in the lifestyle of people. The constant beating trance to the breathtaking ambiance of the new clubs, it’s something so drastically different from the past that people are literally planning each working day, where they will go this weekend and what shall they wear.

Mark Birnbaum, together with his partners Eugene Remm and Michael Hirtenstein has paved a way for an ultra-modern nightlife for the people in the country. They jointly own a company called EMM Group and it is one of the major firms in the nation that has a string of the most gorgeous and most happening clubs and restaurants in the vicinity. He is one of those few people that have defined partying, in true sense of the word.

They have given a whole new meaning to 'night outs'. It's not simply about grabbing a beer and dancing with girls at night clubs, it’s got a whole new meaning. There are so many exhilarating clubs these days that have different things like fine dining, dance floor and serve you the best liquor in the world.

There are so many celebrities that come to these high profile clubs from all across the nation and people also have a chance to literally party with them. Mark Birnbaum is a person who has actually made nightlife safe for women. They don't need to worry about going for solo night outs anymore. This is a change of era and has been marked by the broad-mindedness and healthy thinking and a culture that have been brought about in the society with the help of able people like Mr. Birnbaum.

Source: Mark Birnbaum EMM Group Inc. on Blogspot

“Work hard and party harder”, is the clear rooting of most city people these days. Gone are the days when weekends used to mean watching boring old movies and sleepover with friends, it's much more now, and the new word called 'nightlife' has come into quick existence.
Have you ever wondered when did the turning point come in the industry and when did the major revolution in the pub and bar industry take place? Who is actually responsible for a string of lucrative clubs in the country, which makes the night scene interesting?
After a week full of hard work, people often feel entitled to a day out in the club. They simply want to unwind, booze, dance, and enjoy with friends and family and there is one person who is responsible for this major shift in the lifestyle of people. The constant beating trance to the breathtaking ambiance of the new clubs, it’s something so drastically different from the past that people are literally planning each working day, where they will go this weekend and what shall they wear.
Mark Birnbaum, together with his partners Eugene Remm and Michael Hirtenstein has paved a way for an ultra-modern nightlife for the people in the country. They jointly own a company called EMM Group and it is one of the major firms in the nation that has a string of the most gorgeous and most happening clubs and restaurants in the vicinity. He is one of those few people that have defined partying, in true sense of the word.
They have given a whole new meaning to 'night outs'. It's not simply about grabbing a beer and dancing with girls at night clubs, it’s got a whole new meaning. There are so many exhilarating clubs these days that have different things like fine dining, dance floor and serve you the best liquor in the world.
There are so many celebrities that come to these high profile clubs from all across the nation and people also have a chance to literally party with them. Mark Birnbaum is a person who has actually made nightlife safe for women. They don't need to worry about going for solo night outs anymore. This is a change of era and has been marked by the broad-mindedness and healthy thinking and a culture that have been brought about in the society with the help of able people like Mr. Birnbaum.
Source: Mark Birnbaum EMM Group Inc. on Blogspot

This casino development group is working closely with the Shinnecock Indian Nation of Long Island, New York to secure the Nation’s ability to develop and open a gaming enterprise along with federal, state and local officials and potential vendors. He took care of the site selection and land acquisition, construction firm selection, management selection, assistance in obtaining a gaming compact and in establishing casino operations.

 

 

 

He was also involved in the development of two more casinos, a hotel and a golf course for the Bay Mills Indian Community in Brimley, Michigan.

 

 

 

Some of Michael J Malik’s efforts include establishing the following gambling halls and casinos for Michigan’s Little River Band of Ottawa Indians in Manistee, and the Bay Mills Indian Community in Brimley as well as a proposed off-reservation casino in Port Huron.

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