Running on Fumes

Individually, the numbers would seem to indicate BioPerformance is a runaway success. Taken together, however, they mean a few people at the top make money while the rest of the massive "sales force" loses it. At least, that's the way Attorney General Abbott saw it last week. Abbott filed a lawsuit that branded BioPerformance an illegal pyramid scheme, landing a restraining order that shut the company down.

Tests commissioned by the state found the pill was not an "enzymatic catalyst" as claimed but rather the toxic coal tar derivative naphthalene, which until recently was the active ingredient in mothballs. Abbott mocked Mims' stated goal of creating "1,000 millionaires," saying, "You can't become a millionaire by selling a worthless product." But Abbott is suing under a Texas statute that Robert Fitzpatrick, a prominent critic of multilevel marketing, calls the worst in the nation. D. Jack Smith, a Memphis lawyer who helped set up BioPerformance, says he asked Abbott if there was anything wrong with the company in a March 3 letter. "I said, 'If you see anything you'd think should be changed or that we need to talk about, all you have to do is call me,'" Smith says indignantly. "And no one ever did."

There should be plenty for them to talk about in court. The pill isn't what BioPerformance says it is and can't do what it's supposed to. The "technical information" posted on the company's Web site is misleading and largely irrelevant. BioPerformance's "exclusive marketing rights" to the product turn out to be shared with a Maryland company called Bio Plus Fuel International.

Perhaps that explains why, at recruiting meetings like Super Saturday, it's clear that actually retailing the product is an afterthought at best. "Now if somebody wants to set up in a flea market or sit on the side of the road and sell it, they might be that kind of person," Chandler tells the crowd with a dismissive shrug, "but for most people, that is not the best way to get started in the business."

The best way, of course, is to buy into the company as a "manager" or "area manager" at a cost of $149 or $499. BioPerformance managers can turn around and recruit more managers, eliminating the tiresome necessity of convincing actual retail customers to shell out $40 for a bottle of 40 pills. Whenever someone buys in at the bottom level, those in their "upline" get a collective 65 percent of the action, all the way up to Chandler. It's a classic pyramid scheme, though industry advocates prefer to call it multilevel marketing, or better yet, network marketing. MLMs that sell legitimate products to real customers are not illegal; witness the success of Dallas-based cosmetics giant Mary Kay. On the other hand, if you're selling mothballs for a dollar each, odds are your company's business model doesn't count on wooing many real customers.

In Ed Biehl's SMU office a few days later, the same pungent smell that Steven Holland associates with money leads the Chemistry Department chair to quite a different conclusion. "Naphthalene," Biehl says as soon as he inhales the powerful aroma of sample pills provided by the Dallas Observer. "Mothballs!"

But just to be sure, Biehl runs the pills through five different processes, all aimed at determining their composition. He also runs one of the same tests on a known sample of pure naphthalene to compare the results. Every test points Biehl to the same conclusion: "The whole thing is about 99 percent naphthalene. There's a little dye in it, I'm sure, but it's almost pure naphthalene."

This is at serious odds with BioPerformance literature--which, in turn, is occasionally at odds with itself. One "technical information" document posted on the Web says the "main component" of the pill (also offered as a powder) is a single enzyme. The company's PowerPoint presentation that it distributes to its members says there are two enzymes, while many distributors insist there are three. Biehl is hard-pressed to find any. "If we had those enzymes we'd certainly see it, unless it's so small in quantity that you really can't," he says.

If the pills are naphthalene, BioPerformance is guilty of more than just deceptive trade practices. The EPA regulates naphthalene as a pesticide and has banned it from domestic use. Companies are prosecuted every year for illegally importing mothballs made of the chemical. If ingested or absorbed it attacks red blood cells, the kidneys and the liver. In 2004 it was also added to the EPA's list of possible carcinogens.

Yet BioPerformance bills its product as nontoxic, both on the bottle and on the material safety data sheet posted on its Web site. At the top of the sheet, under "Hazardous Ingredients," the entry reads "none." Paradoxically, at the bottom in the "First Aid Measures" section, the entry next to "Ingestion" reads, "Seek medical attention." In one case, a distributor contacted the company, worried that his "nontoxic" powder was eating its way through the plastic bottles.