Herbalife is set to report earnings today after the bell. This will all be coming after Herbalife settled their class action lawsuit vs former distributor Dana Bostick late on last Friday.
Over the weekend, Charlie Gasparino tweeted that “Tim Ramey is telling people that he think it’s very likely $HLF settles with the FTC soon…” This runs alongside the company line these past few weeks, which is that the company “expects to be exonerated.”
While time will tell if he’s right or not, this morning’s NY Post reported something completely different, claiming that “sources close” to the FTC say that it hasn’t entered into any negotiations with Herbalife yet. This would mean Herbalife, and Ramey are simply just throwing those lines around for good PR. According to this morning’s NY Post article by Michelle Celarier:
Some believe the company has been hurt by the spotlight on its practices and business changes it has made to keep regulators at bay. Herbalife has said it expects to be “exonerated.”
The FTC is still interviewing former and current distributors as part of its investigation and hasn’t entered into any negotiations with Herbalife to end the probe, said sources close to the agency.
In addition, the same piece notes that Herbalife critic Brent Wilkes – who served on the FTC’s panel last week for their “Fraud Affects Every Community” event will be objecting to the settlement because “it won’t begin to pay for the true damages that Herbalife has caused the class.”
Separately, some critics, including Hispanic activists, hope to stop the $15 million settlement reached Friday in a class-action lawsuit by several distributors.
“We plan to object to the settlement because it won’t begin to pay for the true damages that Herbalife has caused this class,” said Brent Wilkes, executive director of the League of United Latin American Citizens.
Regardless, we’ll have more information within the next day – Herbalife reports on Monday after the bell.