Countersuit in Beauty Goods Charity Fiasco

PROVO, Utah (CN) - A former Miss Utah and her partner countersued a beauty supply company, claiming it defamed them in a lawsuit that wrongfully accused them of selling "stolen" cosmetics that Nu Skin Enterprises thought it had donated to a charity "to benefit impoverished people in Third World countries."

In the original lawsuit, as Courthouse News reportedon Sept. 7, Nu Skin Enterprises sued Scott Lazerson and Nu Lite Sales.

Last week, Elizabeth Craig and Brady Harper countersued four Nu Skin entities, also in Utah County Court.

Nu Skin claimed it had donated vitamins, exfoliating scrub, toothbrushes and shampoo to Lazerson's Interface Foundation, a purported charity for poor women in the Third World. Lazerson formerly worked for Nu Skin.

But Lazerson did not donate the donations, Nu Skin claimed; he allegedly enlisted Craig and Harper, owners of Nu Lite Sales, to sell the stuff online.

In the new complaint, Craig and Harper say Nu Skin "wrongfully used the criminal justice system to cause severe financial and emotional injury" to them, "who were each entirely innocent of any wrongdoing."

According to the countersuit, Nu Skin gave Lazerson/Interface "truckloads" of "dump product" - overstocked, returned, mislabeled and damaged items - in 2009 and 2010. But rather than donate the "very expensive, high-end cosmetic and beauty products," Lazerson asked Nu Lite to help make profits for his charity, Craig and Harper say.

"In order to provide those in impoverished conditions a far greater benefit than high-end cosmetic and beauty products would provide, Mr. Lazerson and Interface sought to turn such products into cash, which Interface could use for charitable purposes, including paying the administrative and operative expenses of Interface," according to the new complaint.

The Nu Lite partners say they sold the items on eBay and other auction sites, which "alarmed" Nu Skin, which triggered a response from its loss prevention investigator and led to Craig and Harper's arrest.

"With knowledge it had donated the products to a charitable foundation, Nu Skin falsely accused Nu Lite's owners, Ms. Craig and Mr. Harper, of selling stolen property, leading to their arrest and causing extreme damage to their reputations, humiliation, embarrassment, and severe emotional distress," according to the complaint.

Craig and Harper say Nu Skin arranged surveillance of Nu Lite storage units in Orem, and Provo City Police arrested then after raiding the units, which were used to store and prepare the donated products for sale.

After "a lengthy preliminary hearing," Craig and Harper say, a state judge "refused to bind [them] over for trial, finding there was 'not one bit of evidence' that the property Nu Lite sold had been stolen." Citing that court appearance, "The plaintiffs assert claims for malicious prosecution, abuse of criminal process, defamation, civil conspiracy, and intentional infliction of emotional distress."

Craig, a former Miss Utah and a motivational speaker, says Brigham Young University canceled her speaking appearances after she was arrested, and the Latter-day Saints bookstore Deseret Book stopped selling her products.

Throughout their 17-page complaint, Craig and Harper say that neither they nor Nu Skin knew at the times of the online auctions, "or ever since, that any of the Nu Lite property that Nu Lite was selling through online auction sites had been stolen."

In suing Nu Lite and Lazerson in late August, Nu Skin sought punitive damages for fraud, conversion, negligent misrepresentation and unjust enrichment. Nu Skin claimed that Lazerson's charity was a scam and that he used some of the money that Nu Lite helped him make to fly to Guatemala with Paris Hilton.

Craig and Harper claim Nu Skin got the Provo police involved in investigating sale of allegedly "stolen property," without telling the police that the property had not been stolen, but donated.

They seek more than $11 million for wrongful prosecution, abuse of criminal process, defamation and emotional distress, and $50 million in punitive damages.

They are represented by Mark Stubbs with Fillmore Spencer of Provo.

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