Frank VanderSloot

Frank L. VanderSloot (born August 14, 1948) is an American entrepreneur, radio network owner, and cattle rancher. He is chief executive officer of Melaleuca, Inc., an Idaho Falls, Idaho-headquartered multi-level marketing company that sells nutritional supplements, cleaning supplies, and personal-care products. His other business interests include Riverbend Communications, a group of broadcast radio stations, and commercial cattle and horse ranch operations in Idaho and Utah. VanderSloot also serves on the board of directors and executive board of the U.S. Chamber of Commerce. In 2011, he was listed as the nation’s 92nd largest landowner. VanderSloot served as a national finance co-chair for both Mitt Romney's 2008 and 2012 presidential campaigns. He contributed $1.1 million and helped to raise between $2 million and $5 million for Romney’s 2012 campaign.

VanderSloot has been a major financial contributor to Republican campaigns and has financed attack ads against several Idaho Democratic judicial candidates. His public stances on gay rights issues have generated controversy among journalists and gay rights groups.

VanderSloot sponsors an annual Independence Day fireworks display (the Melaleuca Freedom Celebration), the largest west of the Mississippi. He was the primary funder of the American Heritage Charter School in Idaho Falls.

Early life and education

VanderSloot was born in 1948 to Peter Francis (Frank) VanderSloot (1913–1982) and Margaret May Christensen Sindberg-Woodley VanderSloot (1924–2004). After having resided in Sheridan, Wyoming and Hardin, Montana, his family relocated in 1949 to Cocolalla, Idaho, where VanderSloot was raised on a small ranch owned by his father, who also worked worked as a painter for the Northern Pacific Railway. VanderSloot attended Sandpoint High School, graduating in 1966. At the age of 16, he converted to The Church of Jesus Christ of Latter-day Saints (LDS), and later served on a 2-year LDS mission in the Netherlands.

VanderSloot paid for his college education college by selling cream from a cow his father had given him, working at a laundromat, selling beef jerky in bars, and teaching Dutch to future missionaries." He earned an associate’s degree in business at Ricks College in Rexburg, Idaho, and in 1972, he graduated from Brigham Young University with a bachelor's degree in business administration.

Career

Early career

After graduating from college, VanderSloot was "in management jobs for 9 1/2 years at Automatic Data Processing in three cities." He left ADP to work at Cox Communications in Vancouver, Washington, where he worked as regional vice president.

Oil of Melaleuca, Inc.

In September 1985, VanderSloot was offered the helm of the startup multi-level marketing business, Oil of Melaleuca, Inc., in Idaho Falls by his brother-in-law Roger Ball and Roger's brother Allen Ball. The company had serious problems. On VanderSloot’s third day with the company, the U.S. Food and Drug Administration announced an investigation of its practices out of concern that the company’s salespeople were making exaggerated medical claims. VanderSloot later expressed concerns that the company used a marketing strategy that lured people into buying thousands of dollars of inventory and “offended VanderSloot's sense of fairness." Oil of Melaleuca failed to achieve significant market share, and the partners shut down the company later in 1985.

CEO of Melaleuca, Inc.

In 1985, five months after the closure of Oil of Melaleuca, VanderSloot started a new company, Melaleuca, Inc., serving as CEO and president. The new company eliminated the former organization’s requirement that contractors purchase and warehouse products without the guarantee of being able to sell them. Contractors would still receive commissions from each sale that they made and from signing up new contractors, but products would be shipped by the company directly to the consumer. The company refers to this arrangement as “Consumer Direct Marketing”, a term that it has trademarked. The change in business practices caused half of the legacy distributors from the previous company to leave. VanderSloot hired a new research and development team whose work resulted in a number of U.S. patents for the company, including a muscle relaxant and analgesic containing melaleuca oil, also known as tea tree oil. As of 2004, the company had nine patents and today, it sells nutritional supplements, cleaning supplies, and personal-care products, which are distributed through multilevel marketing.

Melaleuca operates internationally, with U.S. operations centered in Idaho Falls, Idaho, and Knoxville, Tennessee. Inc. magazine included Melaleuca on its Inc. 500 list of the fastest-growing private companies in the United States every year from 1990 to 1994 before being inducted into its Hall of Fame in 1994.

Melaleuca reported gross sales in excess of one billion dollars in 2011. In 2004, 25% of company revenue came from Taiwan, Korea, Japan, Australia, New Zealand, and the United Kingdom. As of 2006, 95% of households that bought Melaleuca products in any given month repurchased products the next month. Melaleuca is a member of the United States Direct Selling Association (DSA), a trade association. In 2008, VanderSloot began a 3-year term as one of the eight members of the DSA's board of directors. In December 2009 VanderSloot and his wife contributed $10,000 to the DSA’s political action committee.

VanderSloot states that the company has a "business model for those people who want to supplement their income." According to Dan Popkey of the Idaho Statesman, Melaleuca had 800,000 customers for its household and nutritional products As of 2011. Roughly 37 percent were also part of the company's sales force of independent contractors, referred to as “marketing executives", and about 90 percent of the sales force averaged less than $2,100 in annual income from Melaleuca. The average annual income for 72 percent of Melaleuca's marketing executives, according to a report issued by the company, was $90. As executives recruit, their title changes and they make more money.

Melaleuca has been targeted by Michigan regulators, the Idaho attorney general's office, and the U.S. Food and Drug Administration for various marketing violations including "false and misleading" claims about its supplements, and the company has signed a consent decree agreeing to "not engage in the marketing and promotion of an illegal pyramid.”

Ranching

VanderSloot owns Riverbend Ranch, one of the largest purebred and commercial cattle operations in the United States. According to general manger David Brown, the ranch's mission is “providing ranchers in the Intermountain West with the best genetics at an affordable price”. Its annual bull sale is one of the largest in the world. VanderSloot also owns Fort Ranch Quarter Horses in Promontory, Utah.

Natural Guardian Land Holdings

In 1994, VanderSloot created Natural Guardian Limited Partnership (doing business as Natural Guardian, LLC as of 2011 ), a holding company which owns or leases approximately 1,500 acres of land in Wolverine Canyon, Idaho.

Broadcasting

VanderSloot owns Riverbend Communications, a group of radio broadcast stations in Eastern Idaho. He purchased the company from Bonneville Communications in 2006. Riverbend Communications operates KLCE Classy 97, KCVI Kbear 101, KTHK 105.5 The Hawk, KFTZ Z103, KBLI News-Talk AM 690 - 1260, and KBLY AM 1260.

Snake River Cheese factory

In 1994, VanderSloot bought a $1 million interest in the Snake River Cheese factory in Blackfoot, Idaho after Kraft Foods announced its decision to shutter the factory. VanderSloot paid off a $2 million debt owed to the area's dairymen, and later brought in Beatrice Cheese, a subsidiary of ConAgra, to run the factory. In 1999, the company netted $278 million dollars in sales. In 2000, VanderSloot sold all of his interest in the company to Suprema Specialties, and in 2006, the factory, which by then had been renamed as the Blackfoot Cheese Company, was sold to Sartori Foods.

Paving and construction

VanderSloot was the owner of HighStone (formerly Eagle Rock Construction; RBH Gravel; VIP Construction) an Idaho Falls-based asphalt construction and maintenance company. HighStone’s projects included a $421,000 state government contract to repair a stretch of Idaho State Highway 33 in Idaho Falls, as well as work on road repairs in Rexburg. In September 2011, HighStone merged with DePatco, a family-owned heavy construction company in St. Anthony, Idaho. The merger deal created the largest locally-owned company in the industry in eastern Idaho.

Net worth

According to Forbes, in 2004 VanderSloot was worth $700 million and his company Melaleuca, for which he owned 55% of the voting stock and 44% of the nonvoting stock, was valued at $1.4 billion. Although VanderSloot does not publically disclose his personal worth, estimates in 2011 suggested that Melaleuca would be valued between $3.2 billion and $3.9 billion were it to go public. In 2012, VanderSloot was listed by The Land Report as the 92nd largest landowner in the United States. In 2006, Ridenbaugh Press listed VanderSloot at number 15 on its list of the 25 most influential people in the state of Idaho.

Public activity

United States Chamber of Commerce

VanderSloot is on the board of directors of the United States Chamber of Commerce, and in 2004 he was named to the organization's executive board.

Political campaign financing

According to Dan Popkey of the Idaho Statesman and Roger Plothow and Marty Trillhaase of the Idaho Falls Post Register, VanderSloot supported Idaho Democrat Larry EchoHawk’s 1994 gubernatorial campaign and endorsed Democrat Jackie Groves Twilegar for Idaho state controller in 2006, but VanderSloot has otherwise favored and been a major donor to Idaho Republicans; he has been described as the state's "most boisterous conservative financier” and "perhaps the single most influential campaign donor [in Idaho]".

VanderSloot spent more than $100,000 on independent advertising on three winning judicial campaigns, two for Idaho Supreme Court and one for district judge in Bonneville County. VanderSloot and Melaleuca were financial supporters of Concerned Citizens for Family Values, an organization that ran attack ads targeting incumbent Idaho Supreme Court Justice Cathy Silak during her 2000 re-election campaign against challenger Daniel T. Eismann. The ads alleged that if Silak were re-elected, same-sex marriage and "partial-birth abortion" could become legal in Idaho.

In 2002, VanderSloot and Melaleuca contributed more than $50,000 opposing the election bid of Democrat Keith Roark, a former Blaine County prosecutor, for Idaho Attorney General. The contributions included a $35,000 donation to Roark’s Republican opponent, Lawrence Wasden, and a $16,500 donation to Concerned Citizens for Family Values, an organization run by VanderSloot, to finance a radio attack ad against Roark in Eastern Idaho. That year, VanderSloot and Melaleuca also donated $7,000 towards Republican Dirk Kempthorne’s 2002 gubernatorial campaign .

In 2006 VanderSloot and his wife Belinda donated $16,000 through the PAC Citizens for Truth and Justice, and via direct payments for advertising, for attack ads against Idaho 7th District Court Judge James Herndon, a Democrat, in a three-way race against challengers Darren Simpson and DaLon Esplin. Ads criticizing Herndon also aired on radio stations run by Riverbend Communications, owned by VanderSloot and his wife Belinda.

In 2010 VanderSloot funded two political action committees (PACs) that launched last-minute attack ads against Idaho 2nd District Judge John Bradbury, a Democrat, during his electoral run for state Supreme Court against Republican incumbent Justice Roger Burdick. VanderSloot donated $19,000 to the PAC Idaho Citizens for Justice and financed the PAC Citizens for Commonsense Solutions. Idaho Secretary of State Ben Ysursa announced that the PACs were fined $1,900 collectively for failing to appoint a certified treasurer prior to accepting contributions from VanderSloot and for failing to disclose large expenditures for its attack ads before the election, as required by law.

VanderSloot served as the national finance co-chair for Mitt Romney's 2008 and 2012 presidential campaigns. In 2012, VanderSloot’s companies contributed a total of $1.1 million to the Restore Our Future political action committee, a group that supports Romney for President. According to VanderSloot, he raised between $2 million and $5 million for the Romney campaign.

VanderSloot spent $1.3 million in 2012 to sponsor TV commercials and other advertising in favor of ballot initiatives (Propositions 1,2, and 3) supporting education reforms enacted by Idaho public school supervisor Tom Luna in 2011. Luna's educational reform package, which consisted of an eight-year $180 million program limiting teachers’ collective bargaining rights, and requiring online classes and mandate laptops for ninth-graders, was opposed by the National Education Association and its local state affiliate, which supported a 'no' vote on the ballot initiatives.

Obama campaign mention

On April 20, 2012, a website operated by Barack Obama’s campaign team included VanderSloot on a list of 8 major donors to Mitt Romney’s 2012 presidential campaign who have "questionable and troubling records on various issues" and described him as "litigious, combative, and a bitter foe of the gay rights movement". The campaign website was labeled the president’s “enemies list” by the media and Republican politicians. In response, VanderSloot made a series of appearances on the several television networks in which he called for donations to Romney in protest of the list. VanderSloot accused the Obama campaign of targeting him unfairly and said that he went through "living hell" and told Fox News host Bill O’Reilly that Melaleuca had lost about two hundred customers in the first two weeks after after his mention on the Obama campaign website. Two days later he told the Idaho Statesman that “unbelievable” and “unexpected” national support was turning out to be good for business.

In July 2012, VanderSloot said he was the subject of two new federal audits, one by the Internal Revenue Service and the other by the U.S. Department of Labor. VanderSloot said that the timing of the audits was curious and questionable, claiming that he received notice of the IRS audit two months after he was "singled out by the Obama campaign;" however, he noted that he did not think that the President was directly behind the audits.

LGBT issues

VanderSloot's stances on certain issues of interest to the gay community have drawn criticism from journalists and gay rights advocates.

In 1999 VanderSloot sponsored billboards around Idaho asking "Should public television promote the homosexual lifestyle to your children? Think about it!” in reference to It's Elementary, a 1999 PBS documentary exploring how four schools dealt with homosexuality. VanderSloot's wife donated $100,000 to the Proposition 8 initiative to rescind gay marriage in California, and volunteers used Melaleuca's call center after hours to persuade California voters to pass the initiative. VanderSloot's efforts and his wife's donation drew criticism from the Human Rights Campaign.

In 2006, VanderSloot issued critical statements regarding a series of investigative articles by journalist Peter Zuckerman in the Idaho Falls Post Register about incidents of child molestation by a Boy Scout director in the Grand Teton Council. VanderSloot took out full-page advertisements in the Post Register in which he challenged aspects of Zuckerman's stories and devoted several paragraphs to establishing that Zuckerman was gay. One of the advertisements stated that "the Boy Scout’s position of not letting gay men be scout leaders, and the LDS Church’s position that marriage should be between a man and a woman may have caused [the reporter] [sic] to attack the scouts and the LDS Church through his journalism. We think it would be very unfair for anyone to conclude that is what is behind Zuckerman’s motives."

Another advertisement said that:

there is nothing wrong with having homosexual reporters, but since the Boy Scouts’ policy of not allowing homosexual men to be scout leaders has produced so much anger against the scouts from the homosexual community, it seems that if the Post Register had wanted a fair and balanced story on the Boy Scouts, they would have assigned a reporter who did not have a personal ax to grind.

Various sources reported that VanderSloot outed Zuckerman, including journalist Jody May-Chang, Mother Jones magazine, television host and political commentator Rachel Maddow, Salon magazine, the editors of the Boise Weekly, and Zuckerman himself. VanderSloot denied the charge, saying that he had attempted to defend Zuckerman's motives, that Zuckerman had already posted his sexual orientation on a public website, and that a local radio show and the community had been discussing the fact; Post Register editor Dean Miller, however, wrote later that Zuckerman's sexual orientation had been known only by Zuckerman's family and a few of his close friends and colleagues.

In 2012, VanderSloot stated that "gay people should have the same freedoms and rights as any other individual."

Defamation lawsuit threats

According to Rachel Maddow and other sources, VanderSloot has threatened defamation lawsuits, copyright infringement and other legal action against critics and outlets that have published adversely critical views, including Maddow, Forbes magazine, lawyer Glenn Greenwald, Mother Jones Magazine, and Idaho journalist Jody May-Chang.

Philanthropy

VanderSloot founded the Melaleuca Foundation, a private 501(c)(3) non-profit corporation that was incorporated and granted non-profit status in 2003. The Melaleuca Foundation has been a financial contributor to the Santa Lucia Children's Home (Hogar Santa Lucia), an orphanage in Quito, Ecuador. In 2007, VanderSloot's company Melaleuca received the Salvation Army Others Award for helping with relief efforts following Hurricane Katrina.

Each year since 1992, Melaleuca has organized the Melaleuca Freedom Celebration, in Idaho Falls. The event is billed as the largest Independence Day fireworks display west of the Mississippi.

In 2005, VanderSloot flew to Baton Rouge to deliver supplies to shelters after Hurricane Katrina. He transported three displaced families to Salt Lake City, San Diego, and Idaho Falls. The family brought to Idaho Falls stayed in VanderSloot's home.

In 2012, it was announced that VanderSloot would be funding, via the VanderSloot Foundation, the new American Heritage Charter School, a K-12 charter school scheduled to open in Idaho Falls in 2013.

Awards

VanderSloot has received numerous awards for his professional and philanthropic activities. In 1998, VanderSloot received the Idaho Business Leader of the Year award from Idaho State University. In 2001, he was awarded the Ernst & Young Entrepreneur of the Year Award for the U.S. Northwestern region. He was inducted into the Idaho Hall of Fame in 2007 and received the Idaho Hometown Hero medal in 2011.

Personal life

VanderSloot lives in Idaho Falls, Idaho with his wife of 17 years, Belinda VanderSloot (née Boyock). Together they have fourteen children: six from Frank VanderSloot’s two prior marriages, and eight from Belinda VanderSloot’s first marriage. VanderSloot was previously married to Kathleen VanderSloot (née Zundel), his first wife, and Vivian VanderSloot, his third wife.

See also

• Melaleuca, Inc. v. Hansen— Melaleuca was found by a court not to be an "Internet access provider".