Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: Settlement resolves FTC charges over phototherapy patch MLM scheme, (Apr 27, 2026)

By Jody Coultas, J.D.

The health and wellness product sellers will be barred from making deceptive earning claims.

The FTC announced that it has reached a settlement with high-level participants in a multilevel marketing (MLM) company over allegations they used false or baseless earning claims to recruit workers. The participants will be barred from making unsupported earnings claims in the future (FTC v. Merritt, Case No. 9:26-cv-80485-DMM, (S.D. Fla. Apr. 27, 2026)).

LifeWave, Inc. is a multi-level marketing business that specializes in “phototherapy patches,” small patches to be worn on the body. LifeWave sells its products through a network of participants—called Brand Partners or BPs—who can purportedly earn compensation by selling LifeWave products to consumers and by recruiting new participants into their “downline,” who will themselves sell LifeWave products to consumers and recruit new participants. Steven and Gina Merritt, both senior-level participants, promoted the LifeWave MLM opportunity through numerous means, including through their websites and social media accounts (including the This is It YouTube page), on Zoom calls, and during in-person seminars.

The FTC alleged that the Merritts repeatedly claimed people could earn substantial income from selling LifeWave products and recruiting new members. For example, in a video posted to their YouTube page in May 2025 from a recruiting meeting, Gina Merritt said, “We’re going to make you a – can I say buttload – a buttload of money…I cannot wait to help you guys get to the top rank and make $25,000 or more a week.” Steven Merritt also said at that same meeting, “The money keeps coming, even if you don’t show up, and you can’t stop it. It’s like a spigot of water but a spigot full of $100 bills throwing at you, coming at you. You can’t stop it. Anybody want that?”

Contrary to those claims, LifeWave’s income disclosure statements show that most people make little or no money. In 2024, 79% of active participants earned nothing in commission payments. At most, only 0.035% of active participants earned more than $25,000 a week in 2024. Based on the companies disclosures, the FTC filed suit alleging violations of the FTC Act.

In order to settle the FTC’s allegations, the Merritts have agreed to a proposed stipulated order that will prohibit them from misrepresenting or assisting others in misrepresenting how much money others can earn from various business ventures. This includes prohibiting them from misrepresenting:

• Expressly or by implication, including through images of homes, vehicles, purchases, or travel, earnings that participants will or are likely to make;

• The amount of earnings that they or other participants have actually earned;

• The reason participants do not earn substantial compensation; and

• Any other fact material to consumers concerning the business venture.

In addition, they are prohibited from making any representation, expressly or by implication, regarding the amount of earnings that a participant can expect to earn unless: it is not misleading, they can substantiate in writing the earnings claim when it is made, and they provide evidence upon request to any individual who expresses an interest in becoming a participant. The Merritts also will be required to notify their downline participants about the FTC’s allegations and the order’s prohibition on making deceptive and unsubstantiated earning claims.

This is the second case in the past month where the Commission has taken action against high-level MLM participants for making deceptive earnings claims.

Companies: LiveWave

News: ConsumerProtection FederalTradeCommissionNews FloridaNews