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US: Mannatech Settles Holder Suits


by SUZANNE SATALINEWall Street Journal
June 13th, 2008

Dietary-supplements maker Mannatech Inc. said it settled several lawsuits with shareholders who accused the company of using improper sales tactics to boost the value of the stock.

The company, based in Coppell, Texas, said it had agreed to make or has already made "certain corporate governance changes," which it did not specify. It also agreed to pay $850,000 in attorney's fees to the plaintiffs' counsel in the five shareholder cases.

The company said in a statement that it admitted no fault. Jeffrey Fink, a San Diego attorney who represented one of the shareholders, said the lawsuits forced Mannatech to "make significant changes to their compliance.''

The cases, filed in federal and district courts, accused the company's corporate leadership, as well as some members of its freelance sales force, of promoting the supplements as cures and treatments for disease. The U.S. Food and Drug Administration bars supplements and dietary aids to be sold as treatments and cures since the government does not verify their efficacy.

The company has said it has done nothing illegal.

Write to Suzanne Sataline at suzanne.sataline@wsj.com





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