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Herbalife must now prove that at least 80 percent of its sales are made outside the company's distributor network, with a small portion of that number allowed for personal consumption by the nearly 300,000 distributors in the U.S. Those distributors must also provide receipts for their sales to show they have legitimate end customers. In addition, the company agreed to an outside monitor for seven years to make sure it complies with the new rules. Though the company said preparing distributors


Though the cut in guidance could give the activist investor William A. Ackman renewed ammunition in his claim that Herbalife's business will suffer under the weight of the FTC's new rules, the strength of documented sales from outside the company's distributor base runs counter to his claims that Herbalife has no real customers. These figures should put an end to any questions regarding demand for our nutritional products and the strength of our go-to-market business model, said Richard P.

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