The California-based multi-level marketing business LuLaRoe is paying $4.75 million to settle allegations from the Washington state Attorney General's Office that it's a pyramid scheme.
The company denied wrongdoing in a consent decree filed late Monday in King County Superior Court in Seattle. LuLaRoe sells leggings and other clothing to a network of independent retailers, who recruit other retailers to sell the company's products.
Attorney General Bob Ferguson sued the company and its executives two years ago, saying they deceived people about how profitable it was to be a LuLaRoe retailer. Ferguson said that $4 million of the settlement will be distributed to about 3,000 Washington residents who were recruited to the company.