LuLaRoe Exposed: Inside an Alleged Billion-Dollar “Pyramid Scheme” (2024)

DeAnne Stidham is a Mormon mother of 14 with Barbie-blonde hair, studded designer stilettos, and a cozy Kris Jenner charm who, with her husband Mark, founded the billion-dollar company LuLaRoe. (You’ve probably seen their leggings, available in loud cat and pizza prints, peddled in your Facebook feed.)

According to a 2019 suit filed by theWashington state attorney general, their multilevel-marketing company is also a pyramid scheme that bilked thousands of people out of millions of dollars. According to the attorney general’s office, LuLaRoe made some of their retailers believe that if they invested between$500 and $5,000in startup costs, theycould“rescu[e] their families during financial crisis.” (The suit was settled in 2021.)

When Oscar-nominated filmmaker Cori Shepherd Stern first started hearing these stories, after falling down the LuLaRoe rabbit hole on her own social media accounts, she felt a familiar pang of heartbreak. While growing up in Panama City, Florida, her mother had also fallen prey to a multilevel-marketing company she believed could save her family’s finances. That background inspired her to produce LuLaRich, an Amazon docuseries about LuLaRoe’s rise and fall, premiering September 10.

“I grew up with a single mom who borrowed money to buy a giant makeup kit,” says Stern. “And she’s not a saleswoman. She didn’t have a background in business. She thought she was going to make thousands of dollars a month to keep giving us cereal and haircuts…and that it was going to let her stay at home with us so she did not have to pay for child care. That’s how this is often sold—‘You’re going to get to stay home with your family. You’re going to get to participate in the American dream.’”

“It was devastating to her when she didn’t sell what she thought,” says Stern. “It was a huge blow to her self-esteem. She saw women succeeding and was like, ‘Why am I failing at this? Why can’t I do this?’ It’s because the system—the whole multilevel marketing system—is flawed. I saw it firsthand.”

After the Stidhams founded LuLaRoe in 2013, they boosted their company by encouraging retailers to barrage social media with posts that rippled envy and intrigue across exponential contacts. Their early retailers boasted of outsize bonus earnings. The phenomenon felt reminiscent of the cultural co*cktail that fueled the doomed luxury music festival Fyre Festival—the topic of dueling 2019 documentaries, one of which was made by codirectors Jenner Furst and Julia Willoughby Nason. So with her filmmaking partner, Oscar-winning Spotlight producer Blye Faust, Stern asked Furst and Nason if they would be interested in making a LuLaRoe doc.

Like Fyre Fraud, the four-part LuLaRich is a fantasia of seemingly deceptive social media marketing, colorful characters, and stranger-than-fiction details. “We like to go underneath the hood of the zeitgeist of American culture,” says Nason. “This story in particular had such a bubblegum feel that it was fun to highlight the corrosion of systems in general.”

The filmmakers spoke to former LuLaRoe employees and independent retailers who claim they were duped out of money and gaslighted by the company when they started asking questions. Incredulously, in spite of the lawsuits against and controversy surrounding their business, the Stidhams also agreed to sit down for a five-hour interview with the filmmakers.

“I think they were incentivized to get ahead of the story and be able to promote what they were doing,”says Furst—noting that LuLaRoe is, nominally at least, still in business after agreeing to pay $4.75 million to resolve the Washington state attorney general lawsuit. (In a statement, LuLaRoe’s founders maintained that they thought they would have eventually won the case, but “the expense would be enormous and the amount of time senior management would have had to devote to the litigation during the trial would have been a distraction from our business.”)

LuLaRoe Exposed: Inside an Alleged Billion-Dollar “Pyramid Scheme” (2024)

FAQs

LuLaRoe Exposed: Inside an Alleged Billion-Dollar “Pyramid Scheme”? ›

(You've probably seen their leggings, available in loud cat and pizza prints, peddled in your Facebook feed.) According to a 2019 suit filed by the Washington state attorney general, their multilevel-marketing company is also a pyramid scheme that bilked thousands of people out of millions of dollars.

What was the LuLaRoe scandal? ›

What is the LuLaRoe scandal? The company basically ran a pyramid scheme selling leggings. The technically multilevel marketing scheme bankrupt numerous participants and allegedly sold defective leggings, as well.

Is lululemon related to LuLaRoe? ›

The Short Answer: Nope, They're Not Related!

Lululemon and Lularoe are two entirely separate entities in the realm of activewear. Though their names might sound similar, their stories, products, and visions are distinct.

What caused the fall of LuLaRoe? ›

Plaintiffs in the suit allege the company engaged in "misconduct, including unfair business practices, misleading advertising, and breach of contract." According to the $1 billion lawsuit, which LuLaRoe argues is baseless and inaccurate, the company allegedly advised its distributors "to borrow money [...]

What is the LuLaRoe documentary on Netflix? ›

"LuLaRich" chronicles the rise and fall of the LuLaRoe leggings multi-level marketing company.

Does anyone sell LuLaRoe anymore? ›

The clothing brand at the center of Prime Video's LuLaRich is still kicking, though some retailers aren't happy with the buzzy new docuseries.

Is LuLaRoe a Mormon company? ›

Very early on we learn that LuLaRoe's founders, Mark and DeAnne Stidham, are LDS members. Although the company was secular, the founders' religious identity was also central to its operation.

When did LuLaRoe go out of business? ›

IsLuLaRoe still in business today? Yes. They are still attempting to make their business work in a more positive light. As of May 2022, LuLaRoe has managed to get its rating up to a “C” by the BBB.

What is the sister brand to Lululemon? ›

Lululemon (Vancouver, British Columbia) has launched a sister brand dubbed Kit and Ace, the brainchild of Lululemon founder Chip Wilson's wife — former Lululemon lead designer Shannon Wilson — and son J.J.

What country owns Lululemon? ›

Lululemon athletica inc., commonly known as lululemon (/ˌluːluˈlɛmən/ loo-loo-LEM-ən; styled in all lowercase), is a Canadian multinational athletic apparel retailer headquartered in British Columbia and incorporated in Delaware, United States.

What was the empty dream that LuLaRoe sold? ›

Mixing go-girl empowerment with rank misogyny is hardly new. LuLaRoe wasn't the first to do it, and will hardly be the last. But as LuLaRich shows, the identity LuLaRoe sold to its closest devotees was an empty dream — wrapped in garishly patterned fabric, stretchy, comfy, and always buttery-soft.

Does Meri from Sister Wives still sell LuLaRoe? ›

Even though Christine has left the LuLaRoe family, Mykelti and Meri Brown still are large parts of the organization. Meri has been with the clothing company since 2016 and has done exceptionally well for herself.

What is the crime of LuLaRoe? ›

Now, the company, plagued by lawsuits, has been accused of running an illegal pyramid scheme, among other allegations. It has also been accused of cult-like behavior by its former retailers and selling faulty products.

What is LuLaRoe doing now? ›

LuLaRoe settled with the state in February 2021 for 4.75 million dollars. Today, the company remains in business, although according to the docuseries, many “LuLa-famous” independent retailers have closed up shop.

What is LuLaRoe most known for? ›

If you haven't yet received a Facebook invite to one of their online “parties,” LuLaRoe is a women's fashion company founded in 2012 by DeAnne Stidham. LuLaRoe offers skirts, tops, and dresses in sizes ranging from XXS to 3XL, but it's the wildly printed leggings that are the brand's calling card.

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