According to a new filing in a federal lawsuit against cosmetics marketer Nu Skin Enterprises, Inc. (NYSE:NUS), the firm has been engaging in fraudulent marketing practices for some time, including large scale dumping of unsold products. The Nu Skin lawsuit also claims that the company set up a “sting” operation offering “dump products” to a Provo, Utah charity it had previously donated to, then calling the police and claiming the products were stolen.

Of note, all charges have been dropped against the three people originally arrested for theft of Nu Skin dump products.

Whole affair was a “sting”

The amended version of the lawsuit filed last week (posted by Sam Antar) claims Nu Skin employees set up the alleged “theft” of dump products with a phone call, who called to say products were ready for pick up, and then loaded non-profit owner Elizabeth Craig’s truck when she came to the warehouse.

A Nu Skin surveillance camera placed in a storage facility recorded everything, and then employees of the firm called Provo police and told them the products had been stolen, based on the filings associated with the lawsuit.

“It’s so ridiculous that they called up [my client] and said ‘Come and get all of this stuff,’ then told police, ‘You need to go arrest these people, all this stuff is stolen,’ ” Mark Stubbs, Craig’s attorney, commented to the media on Monday. “We think it was a pure sting.”

Response from Nu Skin and City of Provo

Nu Skin Enterprises, Inc. (NYSE:NUS) commented that the amended lawsuit comes after U.S. District Judge Robert Shelby had thrown out the original filing on the case.

“We believe the complaint had no basis and support the recent dismissal of the claims,” a company spokesperson noted in an email.

Shelby’s ruling on the initial filing said the lawsuit could be refiled against the city, but could not name an officer who was involved in the case who was allegedly derelict in his/her duties by not investigating before arresting.

Provo Assistant City Attorney Gary Millward said, “it is the city’s view that this complaint is without merit and the city will ultimately prevail. As to the specific allegation that no investigation occurred, that allegation is not true.”

Elizabeth Craig v Provo City, Nu Skin – Amended Complaint by Sam E. Antar

Nu Skin