Reporting: PRE-PAID LEGAL
HUG A PRE- PAID LEGAL REP – MLM INDUSTRY SAVED LEGAL GRIEF
22 Nov 2004 – A Class Action Suit in Wilkinson County, Mississippi against Pre-Paid Legal was in fact a suit against any company in the MLM Industry. The ambulance chasing trial lawyers, behind the class action suit, had their Fannies soundly whipped (and kicked) by a common sense jury. The Wilkinson County jury returned a unanimous verdict in favor of Pre-Paid on all claims, including fraud, civil conspiracy and violations of Mississippi unfair practices statutes. This action along with another class action suit (Against Pre-Paid Legal) was thrown out of Federal Court in Oklahoma. This more or less means that the MLM Industry is bullet proofed against ambulance chasing class action trial lawyers. The Basic premise by ambulance chasing trial lawyers, in both cases was (Watchdog Editorial):
CLASS ACTION LAWYERS BASICALLY SAID:
“MLM is evil…… all distributors that join an MLM company should
Make money even if they are lazy, unmotivated or love to watch TV.
PrePaid Legal (or any other MLM) should pay people who join
And don’t make money!
Well it is going to be a while, a long while before any of these bottom feeding, trial lawyers come back after our fine MLM industry! Read more about class action trial lawyers and their bottom feeding skuzzy tactics in the great reading book “King Of Torts” by John Grisham. You will also notice in the Grisham’s book that Mississippi is a favorite hunting grounds for these ambulance chasing trial lawyers because juries (normally) give big bucks to the scum sucking class action lawyers. Ha…ha hope they enjoyed eating all the money they spent in Mississippi suing Pre-Paid. Or were they financed by stock market short sellers (see previous article)! :>)
PRE PAID LEGAL BEATS CLASS ACTION LAWSUIT! GREAT!
7 Oct 2004 -- We have been waiting for a ruling from the United States District Court in Oklahoma on whether the lawsuit against PPL could be certified as a class action. Last month the Court issued its ruling denying class certification on multiple grounds. "Subject to plaintiffs' right to pursue an interim appeal, the ruling ends the case as a class action." Your Editor doubts if the Ambulance Chasing Lawyers behind this will keep pouring money into the chase for an appeal. This is good for the entire Industry!
28 Aug 2003 -- Pre Paid Reigns In Their Wild Horses!
Not A Bad Idea !
Directly from the CEO Harland Stonecipher's desk:
URGENT EMAIL - Policy Statement
USE OF SALES TOOLS & AIDS
Only corporate approved tools can be utilized by the sales force. More specifically, these tools must be purchased and fulfilled by an approved vendor. Any independent associate devising, utilizing, reproducing, selling or otherwise distributing unapproved pieces will be subject to disciplinary action up to termination. Furthermore, any independent associate utilizing unapproved pieces, regardless of their involvement or non-involvement in producing the piece, will be subject to disciplinary action up to termination. As a means of example, associates should purchase business cards from approved vendors.
WEEKLY MEETINGS
Guests should always be allowed to attend meetings at no charge. To help cover costs of meeting space, existing associates can be charged $5-10 to attend meetings. If it is necessary to charge a greater amount than $10, the meeting holder should contact the home office for approval.
IN-PERSON TRAININGS
The cost, per day, for any training conducted by an independent associate will be capped at $20. Under no circumstances should the daily cost for training exceed $20. Internet-based, i.e. video or audio streamed training, does not meet this same criteria. Any associate wishing to make available, at a charge, any form of internet-based training should seek approval from the home office before doing so.
PROFIT CENTERS
Directly from the CEO Harland Stonecipher's desk: "There is only one legal, legitimate and ethical way to earn money at Pre-Paid Legal Services, Inc. That is the sale of the Pre-Paid Legal membership!"
Associates are not to be directly or indirectly involved in any endeavor that necessitates collecting of funds from their sales organization, or other sales organizations. This includes, but is not limited to: autoresponders, websites, trainings (unless meeting requirements above), tools, communication platforms, etc.
Any associate found to be in violation of any of the points addressed above will have their account immediately placed "on hold" effective Sept. 28 (one month from today) until the matter is resolved and the final action, including possible termination, is determined.
PREPAID TO GO TO COURT
6 August 2003 - This court action has been wondering around for months (17) for the Federal Judge in Oklahoma to make a decision to try the case. Class Action Lawyers Lieff Cabraser Heimann & Bernstein accused Pre-Prepaid of enticing the public into putting their money into a business opportunity that did not return the money to people that they were promised. They accuse Prepaid of being a pyramid scheme and that very few people made money. The door is still open for Prepaid to reargue the charges before trial.
Ed. Note on "On The Street" Story (below) by Melissa Davis: LINK >> The following article is very BIASED and negative. Previously I wrote I almost thought the writer was in the employ of stock short sellers that stay after Prepaid stock. It quotes Robert Fitzpatrick, who wrote the book False Prophets, saying that it is a pyramid scheme. Fitzpatrick was a scam artist in airplane game years ago, supposedly got religion and now blasts anything MLM despite the fact he can't prove he was ever in one.
FROM PREPAID LEGAL HQ
22 September 02
According to the most recent information from the New York Stock Exchange, nearly 12 million shares of Pre-Paid stock have been sold short. This means someone has sold 12 million shares of our stock they didn't own. Sold stock they didn't own and received the money for the sale of Pre-Paid stock they did not own. They hope to profit by buying shares at a lower price to cover their short position. They have an interest in driving down the price of the stock.
What are some of the things "shorts" do to drive down the price of the stock? One of the most effective is negative press on television, radio, magazine and newspapers and the Internet. What is a "short squeeze?" A short squeeze occurs when short sellers seek to buy shares to cover their short position and there are not enough shares available for sale. In Pre-Paid's case, I believe that situation may exist, because we know how many shares are owned by management and certain institutional investors (who are supportive of management), leaving less than 10 million shares available for purchase in the public float. So if the short sellers try to buy shares to cover the entire short position, they may not be able to do so. This information is publicly available, so the short sellers are aware of these circumstances. If they have to buy shares to cover the short positions, it is possible the price of our stock will increase.
The point is this. These short sellers have a keen interest in keeping the price of our stock low. Contrary to the normal investor who profits when stock prices increase, the short sellers suffer losses. Therefore, there will likely continue to be negative press about Pre-Paid until this situation is resolved.
How do we resolve it? We continue to do what we have been successfully doing. Growing our business successfully by providing a product that meets the need of millions of people. We do not control the stock market, but we can all work hard continue to build a strong company with continuing positive cash flow. Ultimately, I am confident these efforts will be rewarded.
Harland Stonecipher
CEO Prepaid Legal
FORBES MAGAZINE "TAKE A HIKE"?
It seems PPL has taken a "The Numbers Speak Lounder Than Words" route to refute the negative blast published in the the Forbes online artice! (see watchdog article)
Pre-Paid Legal
2002 Second Quarter Results
Net Income Up 81%, EPS Up 91% and Six-Month Cash Flow Up 71%
ADA, OK, July 22, 2002 - Pre-Paid Legal Services, Inc. (NYSE:PPD), today announced results for the second quarter and for the six months ended June 30, 2002. Net income for the second quarter of 2002 increased 81 percent to $8.5 million from $4.7 million for the prior year's second quarter. Membership revenues increased 16 percent to $77.6 million from $67.1 million for the same period last year. Diluted earnings per share increased 91 percent to 42 cents per share from 22 cents per share for the prior year's comparable quarter due to increased net income of 81 percent and an approximate six percent decrease in the number of outstanding shares.
Net income for the first six months of 2002 increased 40 percent to $17.4 million from $12.4 million for the first six months of 2001. Diluted earnings per share for the 2002 six-month period increased 51 percent to 86 cents per share from 57 cents per share for the prior year's comparable period. Membership revenues for the first six months of 2002 were up 18 percent to $149.5 million from $126.4 million for the prior year period.
Net cash provided from operating activities for the six months ended June 30, 2002 increased 71 percent to $23.5 million from $13.8 million for the comparable period of 2001. At June 30,
2002, the Company had cash and investment balances exceeding $34 million after spending $20.4 million during the first quarter of 2002 to repurchase 862,800 shares of its stock at an average share price of $23.59, and $4.7 million during the second quarter of 2002 to repurchase 238,500 shares at an average share cost of $19.74. Subsequent to June 30, 2002, the Company has purchased an additional 541,700 shares at a cost of $10.0 million, or an average share price of $18.53, bringing year-to-date 2002 stock purchases to 1.6 million shares at a cost of $35.1 million, or an average share price of $21.36. Since April 1999, the Company has purchased 4.8 million shares at a cost of $110.1 million, or an average share cost of $22.76. The stock buyback initiative has reduced the number of outstanding shares by approximately 20 percent to approximately 19.4 million shares outstanding. Subsequent to June 30, the Company accessed $1 million of the $30 million available to it under previously announced lines of credit and may access the credit line for additional advances in the future.
WatchDog: note the almost 5:1 ratio of customers to distributors
For the second quarter of 2002, the Company added 206,195 new members and 45,962 new sales associates compared to 188,120 new members and 26,905 new sales associates added during the same period of 2001. For the six months ended June 30, 2002, the Company added 406,975 new members and 79,455 new sales associates compared to 371,832 new members and 61,191 new sales associates added during the same period of 2001. Active memberships as of June 30, 2002, increased 15 percent to 1,360,502 from 1,179,705 at June 30, 2001.
The Company expects to file its quarterly report on Form 10-Q for
the three months ended June 30, 2002 later this week.
About Pre-Paid Legal Services
Pre-Paid Legal Services develops and markets legal service plans across North America. The More information can be located at the Company's homepage on the worldwide web at
Forward-Looking Statements
Statements in this press release, other than purely historical
information, including those contained in the comments above by
Harland Stonecipher and the comments regarding the Company's
financial statements and statements relating to estimates,
projections and the Company's future plans and objectives and
expected operating results, and statements of the assumptions
underlying such statements, constitute forward-looking statements
within the meaning of Section 21E of the Securities Exchange Act
of 1934.
I guess I wasn't the only one blown away by the PPL earnings. The WatchDog thinks the rating below is a little strong but see this:
Check out the "Warren Buffet Way" by Hagstrom - his strategy list of "Strong Interest
Stocks" is at Quicken.com:
PPL is the leading stock in the list of "Warren Buffet's Way" strategy newsletter by
Hagstrom. The Watchdog thinks he is a little wild on Pre-Paid Legal's INTRINSIC value!!! Currently, the stock is trading at $17.73/share. The Warren Buffet Strategy Newsletter says the Intrinsic Value is like $953.28/share!
No, I don't own any stock, maybe I should!
Rod
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