US: Mannatech Settles Holder Suits
Dietary-supplements maker Mannatech
Inc. said it settled several lawsuits with shareholders who accused the
company of using improper sales tactics to boost the value of the stock.
The company, based in Coppell, Texas, said it had
agreed to make or has already made "certain corporate governance
changes," which it did not specify. It also agreed to pay $850,000 in
attorney's fees to the plaintiffs' counsel in the five shareholder
The company said in a statement that it admitted no
fault. Jeffrey Fink, a San Diego attorney who represented one of the
shareholders, said the lawsuits forced Mannatech to "make significant
changes to their compliance.''
The cases, filed in federal and district courts,
accused the company's corporate leadership, as well as some members of
its freelance sales force, of promoting the supplements as cures and
treatments for disease. The U.S. Food and Drug Administration bars
supplements and dietary aids to be sold as treatments and cures since
the government does not verify their efficacy.
The company has said it has done nothing illegal.
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