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WEBSTER v. OMNITRITION INTERN., INC.

Nos. 94-16477, 94-16478.

79 F.3d 776 (1996)

Shaun WEBSTER and Robert Ligon, Plaintiffs-Appellants, v. OMNITRITION INTERNATIONAL, INC.; Jim Fobair; Roger Daley; Charles Ragus; and Jerry Rubin, Defendants-Appellees. Shaun WEBSTER and Robert Ligon, Plaintiffs-Appellants, v. Douglas ADKINS; and Gardere & Wynne, Defendants-Appellees.

United States Court of Appeals, Ninth Circuit.

Decided March 4, 1996.

Attorney(s) appearing for the Case

Richard M. Heimann and Karen E. Karpen, Lieff, Cabraser & Heimann, San Francisco, California, for plaintiffs-appellants.

William Christopher Carmody, Dallas, Texas; Robert T. Sullwold, Orrick, Herrington & Sutcliffe, San Francisco, California; Edward King, San Francisco, California, for defendants-appellees.

Before CHOY, BEEZER and DAVID R. THOMPSON, Circuit Judges.

BEEZER, Circuit Judge:

We consider what constitutes an inherently fraudulent pyramid scheme for purposes of several federal antifraud statutes.

Shaun Webster and Robert Ligon represent a class of participants (collectively "Webster") in a "multi level marketing" program promoted by Omnitrition International, Inc. ("Omnitrition"). Webster alleges that Omnitrition, Roger Daley, Charles Ragus, James Fobair and Jerry Rubin...

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