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Shaklee Corporation
Traded as JASDAQ8205
Industry Wellness, Personal care,
Multi-level marketing
Founded 1956
Founder Forrest C. Shaklee
Headquarters Pleasanton, California
Key people
Roger Barnett, Chairman & CEO
Products Nutrition, Weight management, Beauty, Household
Revenue US$148.7 million (2007).[1]

Shaklee Corporation is an American manufacturer and distributor of natural nutrition supplements, weight-management products, beauty products, and household products. The company is based in Pleasanton, California with global operations in Canada, Japan, Malaysia, Mexico, Taiwan, China and Indonesia.



Forrest C. Shaklee created "Shaklee's Vitalized Minerals" in 1915. In 1956, Shaklee founded the Shaklee Corporation with his two sons to manufacture nutritional supplements.[2] Shaklee chose the multi-level marketing business model to market their product.[3] Starting in 1960, Shaklee began marketing organic, biodegradable cleaning products. He continually emphasized "natural" and "environmentally friendly" in his marketing messages.

Expansion, divestiture, changes of ownership[edit]

Shaklee headquarters in Pleasanton

Shaklee Corporation was a publicly traded company in the late 1970s and was listed on the New York Stock Exchange. The corporation began to diversify in November 1986 when it purchased the Bear Creek Corporation, a direct marketing company best known for its Harry and David Fruit-of-the-Month Club operation, from RJR Nabisco for $123 million.[4] In February 1989 Shaklee sold its 78 percent interest in Shaklee Japan to the Yamanouchi Pharmaceutical Company for $350 million, while maintaining its licensing agreement and continuing to collect royalty payments from the Japanese operations.[5] Then in March 1989, Shaklee Corporation received an unsolicited acquisition proposal from a group led by Irwin L. Jacobs, the Minneapolis financier known also by his nickname "Irv the Liquidator". Analysts placed the leveraged buyout value of Shaklee at $35 a share. The Jacobs group had been aggressively accumulating Shaklee shares, and disclosed it currently held a 14.98 percent stake in the San Francisco-based company. Shaklee immediately declared a special dividend of $20 a share, seen as a poison pill—a way to discourage takeover interest in Shaklee, though the company disputed that view. Shaklee's anti-takeover provisions came into play when an investor reached 15 percent.[6] After a few tense weeks, during which time Jacobs increased his stake in Shaklee,[7] Shaklee Corporation announced it was being acquired by Yamanouchi Pharmaceutical for $28 a share in cash, or about $395 million. Yamanouchi's partnership with Shaklee in Japan helped make the transaction possible, and cast Yamanouchi as a "white knight" in helping Shaklee fend off the hostile takeover bid by Jacobs.[8] Jacobs announced he would not challenge the Yamanouchi bid[9] and the deal with Yamanouchi was quickly finalized.[10] Shaklee became a privately held company.

In April 2004, Yamanouchi sold Shaklee Corporation to American billionaire Roger Barnett, managing partner of Activated Holdings LLC, for $310 million. Bear Creek and the Harry and David line was sold to Wasserstein Perella & Co. for $260 million.[11][12]

Shaklee promotes itself as a company committed to being green.[13][14][15][16][17][18]

FTC complaints[edit]

In 1974, Shaklee fell under scrutiny of the Federal Trade Commission, and was ordered to cease its marketing its product "Instant Protein" to infants, and to cease misrepresentation of the amount of protein in "Instant protein." [19] Shaklee was further sanctioned by the FTC in 1976 for "requiring, coercing, threatening, or otherwise exerting pressure" on its distributors to maintain or advertise suggested retail prices.[20][non-primary source needed]

Pyramid scheme convictions and accusations[edit]

New England distributor John "Jack" William Cranney is accused of using his 45-year affiliation with Shaklee to solicit investments from other Shaklee associates, his family and his friends, beginning in 2002.[21] In July 2012, the Massachusetts Securities Division charged Cranney of implementing a Ponzi scheme to defraud 36 victims in multiple states of about $10.4 million and for using the funds for personal gain.[22] In the summer of 2012, Shaklee suspended distributor payments to Cranney estimated at $45,000 per month.[23] Several victims sued Cranney to recover damages and he sought federal bankruptcy protection for his home, valued at $3 million.[22][24] Cranney lost the battle for his home and the proceeds from the sale were used to satisfy the claims of some of his alleged victims.[25] In September 2014, the FBI arrested Cranney in El Paso, Texas and charged him with four counts of wire fraud, 16 counts of mail fraud, and three counts of money laundering.[26]

Iowa distributor, Elizabeth Dopf, publicly raised specific concerns about Shaklee in December 2013. The publication of her experience online[27] compelled 96 former Shaklee distributors to come forward, prompting regional media coverage in the US.[28] Dopf was recruited into "The Pinnacle Group" led by controversial former Amway promoter, Bo Short.[29] According to the former distributor, inventory loading was encouraged by "upline" supervisors who allegedly convinced the participant to join Shaklee by offering a lucrative income opportunity to sell high quality products. After paying the initial start up cost, Dopf was told to order monthly minimum product inventory shipments from Shaklee in order to qualify for commissions which would form the residual income she sought. According to her first hand experience published on a prominent Shaklee distributor website,[27] Dopf's "upline" superiors placed virtually all emphasis and time on motivational phone calls to promote the unlimited recruitment of friends and family members into Shaklee by using the suggestion of a lucrative "business opportunity selling products." When Elizabeth complained that none of her product inventory had been sold, her specific supervisors whose names are published on the Shaklee distributor website, told Dopf that it was essential to keep purchasing inventory even if it wasn't selling. The allegation is consistent with two of the Federal Trade Commission's hallmark traits of an illegal pyramid scheme called chain recruiting and inventory loading.[30]

Cycling team[edit]

From 1988 to 2000 Shaklee was the title sponsor of an American-based UCI professional cycling team managed by Frank Scioscia. In its final year of existence (2000) Team Shaklee was the top-ranked UCI tier III team in the world[31] and included United States Olympic Team members Jamie Carney, Jonas Carney, Adam Laurent, and Kent Bostick. There is no information listed as to whether or not the team members actually used Shaklee products.



Beginning in 1993 and through the end of the NASA shuttle program, Shaklee provided NASA with a customized version of its rehydration beverage, Performance, under the name Astroade for use by Shuttle astronauts.[32][33][34][35][36]

Olympic athletes[edit]

Some of the athletes that use Shaklee products are: Craig Blanchette, Laurie Brandt, Kent Bostick, Eli Bremer, Sandra Gal, Bill Demong, Kris Freeman, Zach Krych, Adam Moore, Reilley Rankin, Jennifer Rodriguez, Carl Rundell, Roz Savage, Darin Shapiro, and Ashley Wagner.[37]

Notes and references[edit]

  1. ^ "Yahoo Finance: Industry Center > Personal Products > Shaklee Corporation Company Profile". Yahoo Finance. Retrieved 2009-06-21. 
  2. ^ "Dr. Forrest Shaklee; Founded Corporation". New York Times. 17 December 1985. Retrieved 2009-06-21. 
  3. ^ "The History of MLM". First Class MLM. 11 November 2007. Retrieved 2009-06-21. 
  4. ^ "Shaklee to Buy RJR Nabisco Unit". New York Times. 4 November 1986. Retrieved 2009-06-21. 
  5. ^ "Shaklee to Sell Japanese Stake". New York Times. 3 February 1989. Retrieved 2009-06-21. 
  6. ^ Fisher, Lawrence M. (4 March 1989). "Shaklee Gets Takeover Offer From Jacobs". New York Times. Retrieved 2009-06-21. 
  7. ^ "Jacobs Increases Stake in Shaklee". New York Times. 25 February 1989. Retrieved 2009-06-21. 
  8. ^ Fisher, Lawrence M. (15 March 1989). "Japan Drug Maker to Buy Shaklee". New York Times. Retrieved 2009-06-21. 
  9. ^ "Jacobs Cuts Stake In Shaklee to 10.5%". New York Times. 15 March 1989. Retrieved 2009-06-21. 
  10. ^ "Shaklee Offer Done". New York Times. 18 April 1989. Retrieved 2009-06-21. 
  11. ^ "Japanese Drug Company To Sell 4 Units, Including Shaklee". New York Times. 3 April 2004. Retrieved 2009-06-21. 
  12. ^ "Wasserstein Haunts Harry & David in Buyout Doomed to Bankruptcy". Bloomberg Markets Magazine. Oct 11, 2011. 
  13. ^ "Shaklee U.S. leads the way on global climate change issue". Shaklee, Inc. Retrieved 2012-01-26. 
  14. ^ "Eco-Socialites Make Cleaning Green a Priority". Shaklee, Inc. 
  15. ^ "Shaklee wins 2009 Green Power Leadership Award". Shaklee, Inc. 
  16. ^ "Shaklee wins 2009 Business Environmental Awards". Shaklee, Inc. 
  17. ^ "Shaklee is on Top 20 Retail Partner List with the US Environmental Protection Agency's (EPA) Green Power Partnership". Shaklee, Inc. 
  18. ^ "Shaklee wins 2008 Stevie Award". Shaklee, Inc. 
  19. ^ Federal Trade Commission. "In the matter of Shaklee Corporation consent order, etc. in regard to alleged violation of the Federal Trade Commission Act" (PDF). FTC. Retrieved 11 January 2015. 
  21. ^ Healy, Beth. "Friends fight to recover money from Belmont businessman". Boston Globe. Retrieved March 23, 2015. 
  23. ^ Healy, Beth. "Belmont businessman pressed on funds in court: Jack Cranney says FBI seized records of losses". Boston Globe. Retrieved March 31, 2015. 
  24. ^ Barrett, Stephan. "Prominent Shaklee Distributor Accused of Operating Ponzi Scheme". The Skeptical Guide to Multilevel Marketing. Retrieved March 23, 2015. 
  25. ^ Healy, Beth. "Ex-Belmont businessman arrested on fraud charges". Boston Globe. Retrieved March 31, 2015. 
  26. ^ Department of Justice, U.S. Attorney’s Office, District of Massachusetts. "Former Belmont Resident Charged With $6 Million Investment Fraud Scheme". United States Department of Justice. Retrieved March 31, 2015. 
  27. ^ a b Moore, Janet. "Shaklee Victims United". Information on Shaklee Pyramid Scheme and Bo Short. Shaklee Victims United. Retrieved 27 March 2015. 
  28. ^ Fredrickson, Paul. "Shaklee Distributor Coverage". Distributors Experienced Shaklee as Pyramid Scheme. Shaklee Pyramid Scheme Victims United. Retrieved 27 March 2015. [dead link]
  29. ^ Jackson, Allen. "Understanding Bo Short". Bo Short, American Con Artist. Mr. Allen Jackson II. Retrieved 27 March 2015. 
  30. ^ US Government Authored, Federal Trade Commission. "Tell-Tale Signs of a Pyramid Scheme". Federal Trade Commission Website. Retrieved 27 March 2015. 
  31. ^ "Shaklee Achievements and Milestones". Shaklee, Inc. 
  32. ^ Wong, L. G. (December 1994). "Hypervolemia in Men from Drinking Hyperhydration Fluids at Rest and During Exercise" (PDF). NASA. Retrieved December 28, 2012. 
  33. ^ Whittam, Ph.D., James H. (April 3, 1995). "Hypervolemia from Drinking Hyperhydration Solutions at Rest and Exercise" (PDF). NASA. Retrieved December 28, 2012. 
  34. ^ Fortney, Ph.D., Suzanne M. (January 1994). "Fluid-Loading Solutions and Plasma Volume: Astro-Ade and Salt Tablets With Water" (PDF). NASA. Retrieved December 28, 2012. 
  35. ^ Wong, L. G. (December 1994). "Drink Composition and CycleErgometer Endurance in Men: Carbohydrate, Na+, Osmolality" (PDF). NASA. Retrieved December 28, 2012. 
  36. ^ "Shaklee Milestones". Shaklee, Inc. Retrieved December 28, 2012. 
  37. ^ "Shaklee Pure Performance Team". Shaklee, Inc. 

External links[edit]