Sherman, TX – March 28, 2025 – The ongoing legal battle between Michael Rutherford and Pruvit Ventures, Inc., a prominent multi-level marketing (MLM) company, has hit a new milestone as the verdict from a recent bench trial has been withheld pending mediation. The decision, announced on March 24, 2025, by the U.S. District Court for the Eastern District of Texas, signals a potential shift toward a negotiated resolution in a case that has drawn significant attention within the MLM industry.
The lawsuit, identified as Rutherford et al v. Pruvit Ventures, Inc. (Case No. 4:2024cv00561), stems from a contentious dispute over a settlement agreement reached between Rutherford and Pruvit in 2023. Rutherford, a former top-earning distributor for Pruvit, alleges that the company breached the terms of the agreement, which entitled him to receive up to $100,000 per month in commissions after his departure from active participation in the company. According to court documents, Rutherford claims Pruvit and its CEO, Brian Underwood, undermined the deal by altering the company’s compensation plan and recruiting distributors from Rutherford’s downline into a competing MLM, Frequence.
The bench trial, which began on February 10, 2025, was expected to deliver a ruling that could set a precedent for how MLM companies handle distributor contracts and commission disputes. However, instead of issuing a judgment, the court has ordered both parties to engage in mediation by April 30, 2025, in an effort to resolve the matter outside of a final verdict. This development follows the dismissal of claims involving co-plaintiff Keisha O’Neal on March 19, 2025, after she reportedly reached a separate settlement with Pruvit.
Rutherford’s legal saga with Pruvit is not new. In 2023, he filed a lawsuit against the company after it suspended his commissions, alleging that Underwood had pressured him to share a portion of his earnings. That case was settled, but Rutherford returned to court in June 2024, claiming the terms of the settlement were not being honored. His latest filing included a request for a temporary restraining order and preliminary injunction to secure his commission payments, which was denied in September 2024 after the court found no irreparable harm would result from withholding the relief.
The mediation order has sparked speculation about the potential outcomes. Industry observers suggest that a settlement could avoid further scrutiny of Pruvit’s business practices, which have faced criticism amid reports of declining commissions and executive payroll issues. Rutherford’s attorneys have argued that the company’s actions not only violated their client’s rights but also highlighted broader issues of transparency and fairness in the MLM model. Pruvit, meanwhile, has maintained that its actions were within its contractual rights and has accused Rutherford of attempting to circumvent prior agreements.
Adding complexity to the case, Rutherford’s legal team faced internal challenges late last year when two attorneys withdrew from representation due to unpaid fees, a move approved by the court in October 2024. Despite these setbacks, Rutherford has pressed forward, with the mediation now offering a potential off-ramp from the protracted litigation.
As the April 30 deadline approaches, all eyes will be on the mediation process. A successful resolution could bring closure to a dispute that has already spanned multiple lawsuits and years of contention. However, failure to reach an agreement may see the court proceed with a final ruling, potentially reshaping the relationship between MLM companies and their distributors. For now, the industry awaits the outcome of this high-stakes negotiation, set against the backdrop of a trial whose verdict remains on hold.
We anticipate to see this case end quickly through mediation as Pruvit will most likely need to have this case settled as a term of their merger agreement with Herbalife. CLICK HERE to read more about Pruvit and Herbalife.
