Judge finds Young Living acted in ‘bad faith,’ orders it to pay doTERRA $1.8 million

A Utah judge has ordered the therapeutic oils company Young Living Essential Oils LC to pay competitor doTERRA Inc. about $1.8 million in attorney fees and other costs related to a long-running lawsuit over executives who left the former company to start the latter.

Young Living lost that lawsuit last year; doTERRA argued the suit never had merit and Young Living should pay its legal fees.

Fourth District Judge Christine Johnson, on Tuesday, ordered the fees be paid. In her written ruling, Johnson agreed with doTERRA that Young Living pursued its lawsuit in “bad faith.”

Mark Wolfert, general counsel for doTERRA, said in a news release that he was glad Johnson found Young Living filed an ill-advised lawsuit.

“Nevertheless,” Wolfert said, “we look forward to a less contentious relationship with Young Living and a time where both companies may now focus on their respective missions and sharing essential oils.”

In its own news release, Young Living focused on how a statute of limitations prevented a jury from hearing some of its assertions and arguments.

“Young Living appealed the verdict of the case, as we fervently desire the full truth of our story — and doTERRA’s — to still be told,” the statement said.

Besides assertions that the doTERRA founders violated their employment contracts and ran off with Young Living’s trade secrets, there were cross-claims that the rival companies contaminated their products with chemicals. Young Living once sought $12 million in damages.

By the time the lawsuit reached trial in June 2017, the only remaining claim was the breach of contract. Young Living reduced its request for damages to a token $1.

After an 18-day trial in Provo, a jury found that doTERRA executives did not breach the terms of their employment with Young Living.

In her ruling in doTERRA’s favor, Johnson wrote Young Living was wrong to even file the lawsuit. There is a three-year statute of limitations on claims of stolen trade secrets (doTERRA was founded in 2008; the lawsuit was filed in 2012).

Johnson found that Young Living tampered with a computer to mislead her about when the company discovered a business plan had been accessed. That extended the case — and doTERRA’s legal fees — for years, Johnson wrote.