Not so long ago Visalus was a vibrant company selling nutritional products, dietary supplements and energy drinks through a multi-level distributor model.

The company started in 1997 and at one point had 114,000 distributors in its network.

But in April, 2019 everything changed for Visalus. A jury hit it with a verdict in a Telephone Consumer Protection Act (TCPA) case totaling $925 million.

Today–citing the verdict and attendant cost of notice to the class on an effort to re-asses the judgment in light of due process– the company has declared bankruptcy. Petitions here: ViSalus – BK Petition – Updated Format

A once-healthy company generating hundreds of millions in revenue and employing hundreds of thousands of people entirely destroyed by the TCPA. Unfortunately, this is not the first time this has happened. And it almost certainly won’t be the last.

The worst part is that Visalus was not a rampant cold-call telemarketer. They were not a scumbag robocaller pitching VSCs n a press one campaign.

The calls that lead to the judgment against Visalus were actually consented calls– and the consent that Visalus obtained was actually legal at the time it was obtained.

However the law changed. The FCC raised the standard for marketing calls–requiring the new “Troutman 9” for prior express written consent in 2013, rendering the consent Visalus had obtained previously insufficient.

When Visalus made calls in 2014-2016 in reliance on the earlier consent those calls became illegal.

In a dark twist, the FCC actually intervened in Visalus’ behalf–granting a miraculous retroactive waiver of wrongdoing just months after the jury verdict. But it was too late. The Court found the stay of execution had arrived after the prisoner was already dead– Visalus had waived the argument by not presenting it before trial.

It was a final cruel twist of the knife for a company that had suffered one of the most outlandishly unfair penalties in the history of American jurisprudence.

So absurd was the result that the Ninth Circuit Court of Appeals ordered the district court to take a second look at it to assure it complied with the U.S. Constitution.

But, sadly, the company could not withstand even the cost of proceeding with the litigation further and threw in the towel today–electing liquidation of assets and the effective termination of Visalus all together.

The TCPA is an absolute killer for companies that do not understand its arcane, complicated, and sifting rules– none of which are intuitive. People assume that everyone sued under the TCPA is a scamming robocaller– but that is far from the truth.

It really is too bad.