Hughes was found dead in his Malibu mansion, said Los Angeles County sheriff's Sgt. [13] The company settled the suit for $850,000 without admitting wrongdoing. But Mark's Herbalife stock wasn't his only source of wealth. When the company went public on the NASDAQ in 1996, Mark's 26% stake was worth $250 million. "[7], During the hearing, Hughes acknowledged that his own formal education stopped at the 9th grade. [8] His blood-alcohol level was measured at 0.21. The decline in Herbalife purchases from Global Health pushed the company into default last month after it failed to make a scheduled $12-million interest payment on $257.8 million of debt. The death of Herbalife International founder Mark Hughes in May following a drinking binge has triggered a series of bizarre allegations about the key executives who helped the charismatic salesman build one of the nations biggest dietary supplement sellers. The handsome hard-driving businessman, who sparred with regulators in the . Who can help student-athletes cash in? Existing Subscriber? In February 1980, Hughes founded Herbalife International. Pair was named acting president and CEO following the death of founder Mark Hughes (1"The Rose Sheet" May 29, p. 7). Two months after Hughes died, Herbalife fired another long-time Hughes associate, former executive vice president Michael E. Rosen, who was a counselor at the reform school attended by Hughes. Already a member? Anyone can read what you share. This would allow Alex to manage the money himself and potentially inherit a much larger portion much sooner than the age of 35. When asked during the hearing how he could be qualified to challenge leading medical experts, Hughes snapped: I defy anybody to be able to produce results as this company has.. The FTC released 729 pages containing 192 complaints received over a 7-year period in regards to the New York Post's FOIA request. Mrs. Hughes told investigators that her husband was drinking before he fell asleep on the evening of May 20 on the living room sofa of their $27 million oceanfront estate in Malibu. Its charismatic founder Mark Hughes was found dead at the age of 44 in his mansion. [54], In the past, company management considered the number and retention of distributors a key parameter and tracked it closely in financial reports. [125] In response, Herbalife committed $40 million to resolve the issues, and began negotiations with both the US Justice Department and SEC. AllRightsReserved. Hughes founded Herbalife in 1980, and the company hit $500 million in annual sales five years later. It took more than a decade since Mark's untimely death to resolve these legal battles. [130] In July 2020, Herbalife also sponsored the Guangzhou Charge of the Overwatch League. Hughes, seeking a height limit exemption, found himself in a bitter fight with local homeowners, who said they feared the exemption would pave the way for other exemptions. Pair subsequently pleaded no contest to the 1998 theft of about $400 in merchandise. [34] Agwunobi departed Herbalife Nutrition in October 2022 and Michael O. Johnson was named Chairman and interim Chief Executive Officer. Herbalife . [38], In China, the company's manufacturing sites are located in Suzhou and Nanjing. Los Angeles, CA 90015, USA "I got in trouble with the law. [81][82] According to a co-author of the paper, this was done after threats of legal action by a Delhi-based law firm. Doexpin is an antidepressant, which Hughes was taking to "treat insomnia," the coroner said. On this Wikipedia the language links are at the top of the page across from the article title. [22], Mark and Suzan established the Herbalife Family Foundation (HFF) in 1994, a non-profit organization dedicated to improving vulnerable children's lives through helping charity organizations meet the nutritional needs of children at risk, and providing funds to organizations that assist victims of natural disasters. A total of $6million was to be paid out, with defendants not admitting guilt. [137] Hilary Rosen, a Democratic lobbyist and an adviser to Herbalife, questioned Tribeca's credibility after claiming that the film was "bought and paid" for by Ackman "to make good on his stock bet". Herbalife said Tuesday that Pairs record has since been expunged. Hughes liked the sales business and soon jumped to Best Line Products, a similar firm that quickly went out of business. They reached an agreement where Marconi would develop a series of products for Hughes, who would sell them through a new company called Herbalife. Coroner . [60] Herbalife's SEC 10-Q filings stated that the Israeli Ministry of Health did not establish a causal relationship between the product and liver ailments. [91][92] These suspicions were proved correct in January 2013 when at an investor meeting Einhorn revealed that he had profited through a short position against the company. External sites are not endorsed by CNN Interactive. The company was founded by Mark R. Hughes in 1980,[3] and it employs an estimated 9,900 people worldwide. Helped by Hughes tearful tale of his rags-to-riches past and his mothers early death from addiction to diet pills, the Los Angeles-based marketer grew rapidly to its current $1 billion in annual sales and a work force of about 1,000 employees in Southern California. Early marketing materials said Marconi was a well-respected nutritional expert with a doctorate who helped develop the Herbalife Slim & Trim diet product. The asking price? It must have been painful for Alex to know he couldn't touch the bulk of his fortune for a few decades, but to make matters worse, Alex and his mother Suzan became worried that the trustees were totally mismanaging the estate. But we're getting ahead of ourselves. A $1 Billion Plot Of Beverly Hills Dirt Just Hit The Market. [20] Following his death, the company was led by Christopher Pair until October 2001. If you follow financial news, you may have heard about the ongoing battle between a billionaire hedge fund manager named Bill Ackman and the multi-level marketing company Herbalife. Hughes was found dead in his Malibu mansion May 21. An autopsy was performed because of his relatively young age. Tragically, it was at this house where Darcy found Mark dead in their bed on the morning of May 21, 2000. He later became a millionaire again. [132], In 2021, the company announced a partnership with the LA Galaxy on an augmented reality fan experience. [23][24][25], This article is about the businessman and founder of, "THE UNCERTAIN START OF A REMARKABLE LIFE", "Despite Critics and Lawsuits, Herbalife Has Made Mark Hughes Wealthy If Not Healthy", "Safety, Methods Questioned: Herbalife: Weighty Profits and Government Probes", "The Cult That Spawned the Tough-Love Teen Industry", "Synanon -CEDU - Brown Schools Medical Whistleblower", "The History of Synanon and Charles Dederich", "Mark Hughes, Founder of Herbalife, Dies at 44", "Mark R. Hughes, 44; Founded Nutrition Supplement Concern", "Herbalife And Mark Hughes - A Success Story? -Herbalife CEO, Michael Johnson Despite it being referred to as a "tragic accident" by Herbalife in the above email sent out last Monday, news broke today that Herbalife top earner John Peterson's death was infact suicide. At the time, authorities said they would do an autopsy [14] On December 16, 2004, the company had an initial public offering on the NYSE of 14.5 million common shares at $14 per share,[25] netting the owners $1.3billion. Focusing on the past is one way the 20-year-old company is coping with . [11], In the mid-1980s, Hughes was sued by the Food and Drug Administration, the California attorney general's office, and the state Department of Health, over what they said were false health claims about Herbalife products and the various schemes used to market them. [15] Suzan filed for divorce from Hughes in September 1997. Griffin dubbed his property "The Vineyard". Rich L.A. homeowners are snapping them up, Elizabeth Holmes cites her new baby as a reason she should avoid prison for Theranos scam. [99][97][100] In March 2015, federal prosecutors and the FBI revealed that they were investigating whether or not individuals paid by Ackman and otherwise had made false statements about Herbalife's business model to regulators and others in order to lower the company's stock price and influence authorities to conduct an investigation. Marconi feared that if news of Hughes addiction leaked out, it would damage the pitchmans youthful and healthy image and hurt the company. Herbalife said it paid the analyst $170,000 in salary and bonuses since 1997. On June 16, the coroner found that Mr. Hughes had died May 21 of an overdose of alcohol and a toxic level of doxepin, an antidepressant. Listed A Year Ago For $1 BILLION "The Mountain Of Beverly Hills" Just Sold For $100,000. Among the fallout has been the near financial ruin of Herbalifes top supplier, which has endangered the jobs of 1,000 workers in Orange County. coroner said Mr. Hughes died from a combination of alcohol and "[8], In 1979, Hughes met Kathryn Whiting, a former Miss Santa Monica, who would become his first wife. https://www.nytimes.com/2000/08/12/business/binge-led-to-death-of-herbalife-founder.html. Hughes eventually abandoned his attempt to buy the company and settled the suit with shareholders. According to the same court documents, when the topic of the beach house was brought up again that night, the trustee made the following remark to Suzan (with Alex standing just a few feet away): "I'll get you on your knees eventually, Suzan. The case was resolved with Herbalife and its distributors paying $7million into a fund for class members part of the suit. "[2], Hughes was 19 years old and still working for CEDU when his mother died in her apartment of an accidental drug overdose on April 27, 1975. The tangled web of litigation can cause some pretty funny alliances at times. He spent three years there and was listed as one of the company's top 100 earners. [133] It also has a multi-year sponsorship with Jonathan Dos Santos of the LA Galaxy. To settle his problems with the state, Hughes agreed to pay $850,000. In May 2002, Herbalife founder, chairman, and chief executive officer Mark Reynold Hughes, was found dead at his $27 million oceanfront mansion in Malibu, California. After the wives were paid off, Mark's estate was still worth an estimated $300 million at the time of his death. [26] In the mid 2000s, Herbalife upgraded its manufacturing facilities, moving manufacturing to around 60% in-house, and changed how the company sold its products to distributors. Herbalife filed a suit in Los Angeles County Superior Court claiming that Rosen misused company funds when he hired a financial analyst who allegedly did little corporate work. [41] Since 2013, the company has operated a botanical extraction facility in Changsha, Hunan Province, China. Inside the crisis transforming the Southwest, Rain check! Hughes often stated that the genesis of his product and program stemmed from the weight loss concerns of his mother Joanne whose premature death he attributed to an eating disorder and an unhealthy approach to weight loss. His blood alcohol level was 0.21 percent. So now you know the history of Mark Hughes and Herbalife. Previously, Pair was Herbalife exec VP, chief operating officer and secretary. In an interview, Marconi said he has always looked out for Hughes interest, either helping or attempting to bail Hughes out of difficult situations. He often cited her death as motivating him to succeed in the herbal pruducts industry -- to provide millions with products that were not available to his mother. When Golden Youth went out of business, Hughes decided to start his own operation. This is a very nasty type of hardball to be playing. The coroner said Mr.. [60][61][62][63][64][65][66][67][68][69][70][excessive citations], In 2004, Israel's Health Minister began an investigation into Herbalife's products after four persons using Herbalife's products were found to have liver problems. [58] In a West Virginia class action suit (Mey v. Herbalife International, Inc., et al.) ", "Testifies at Stormy Senate Hearing: Herbalife President Calls Diet Powders, Pills Safe", "Beverly Hills' $1 Billion "Vineyard": The Bizarre Saga Behind L.A.'s Last Real Estate Trophy", "Autopsy on Herbalife founder finds death caused by accidental overdose", "Legal battle rages around America's richest teenager", "Herbalife Heir Can't Object to Settlement Agreement", "Judge Fires Custodian of Herbalife Heir's $40 Million", "Trustees Kicked From Herbalife Founder's $330M Estate", "C.A. Carrier said the combination of the alcohol and Doxepin would cause excessive sedation, causing the brain center that controls respiration to shut down. See the article in its original context from. Pretty soon, thousands of sales people were selling Herbalife products door-to-door around the country. In the meantime, he would receive an estimated $250,000 stipend every year which would some day grow to $2 million per year. [108] The FTC stated that the wording it used in its response to the FOIA request was incorrect; the FTC could not confirm or deny an investigation into Herbalife. [18][19] In 2006, the Los Angeles Superior Court ruled to remove Reynolds from supervising a $35 million custodianship after finding that he violated multiple probate laws by ceding control to Klein and commingling Alex's personal assets with partnership accounts. He forced the property into foreclosure to kick out Dickens and the other shady characters who by then had run up $200 million worth of debt with the trust. Their marriage continued until his death the following year on May 21, 2000, at his home in Malibu, California. American global multi-level marketing company, J.H. [clarification needed] The products were sent to Bio-Medical Research Design LTD (B.R.D), to a private U.S. laboratory, and to Israel's Forensic research laboratory. For the latest 12-month requalification period ending January 2019, approximately 67.9 percent of the eligible sales leaders requalified. We are delighted that you'd like to resume your subscription. [44] Before extracts are processed, they undergo a botanical identification program and are tested several times throughout the production process. On August 20, 2019, it was revealed that The Mountain of Beverly Hills had been sold at auction for $100,000. Over the years, Hughes was in and out of the public eye, as much for legal and regulatory problems that plagued his company as for his taste for expensive mansions in Beverly Hills and Malibu. [7], In March 1985, the California attorney general and the state Department of Health Services charged he and Herbalife with making "untrue or misleading" product claimsprimarily involving the caffeine content of some Herbalife productsand operating an "endless chain marketing scheme. Pair was named acting president and CEO following the death of founder Mark Hughes (1"The Rose Sheet" May 29, p. 7). They divorced in 1984 and in the same year, he married Angela Mack, a Swedish former beauty queen. US EIN51-0523266. LOS ANGELES -- The death of Herbalife International Inc. founder and Chief Executive Mark Hughes last month was an accident, said the Los Angeles County Coroner's office. Hughes relatives discovered his body, and they notified authorities, Thomas said. Why 58,000 square feet? It was certainly a wild ride while it lasted. Mark R. Hughes Herbalife Nutrition/Founders [51] The company commissioned its own lab testing and found that those products did not contain high enough amounts of lead to require special labeling. However, in the press conference, Herbalife was declared not necessarily not pyramid scheme. [45] The processed raw materials from the extraction facility are used at all of the company's branded manufacturing facilities as well as by its partners. [38], Herbalife's products are produced at the company's five manufacturing facilities in the U.S. and China, as well as by third-party manufacturing partners. A 2010 article in the Los Angeles Business Journal claimed that Herbalife Nutrition was one of the most profitable companies in Los Angeles County and directly benefited from its business model. Emily Green of the Daily Journal reported on February 28, 2013 that the estate of Mark R. Hughes, founder of Hebalife, Ltd., who died in 2000, is still being litigated in the appellate court.The latest turn of events comes from a claim for $3 million in attorneys' fees made by the law firm of Mitchell Silberberg . International Campbells Soup Sales Were Declining. Marconi also told Hughes about Pairs multiple acts of sexual harassment at Herbalife, according to the lawsuit. [121], On September 27, 2019, the SEC announced that Herbalife has agreed to pay $20 million to settle charges of making false and misleading statements about its business model and operations in China between 2012 and 2018. As we mentioned previously, Mark Hughes had somewhat of a penchant for beauty queens. The cause of death was a bad mixture of alcohol and anti-depressants. Marconi said the two made a strategic decision to split the business into a manufacturer and a marketing company. Last fall, dissatisfied with the price Herbalife shares were fetching on the stock market, Hughes announced he would by all the companys outstanding shares, then selling for $12 or lower, for $17 a share. LOS ANGELES The death of Herbalife International Inc. founder and Chief Executive Mark Hughes last month was an accident, said the Los Angeles County Coroner's office. Her death was the result of an accidental overdose of prescription diet pills and alcohol which (spoiler alert) would be eerily similar to how Mark himself would die many years later. LOS ANGELES - Mark Hughes, the controversial 44-year-old founder, chairman and chief executive of nutritional and diet products maker Herbalife International Inc., was found dead in his $25 million beachfront mansion, apparently of natural causes, officials said Monday. Sen. William V. Roth Jr. [20] Reynolds was suspended,[20] but remained one of three trustees until 2013, when a judge in a separate lawsuit ordered the removal of all three for breaching the terms of the Trust by mismanaging the funds. At this point, the family survived on welfare payments with Hughes' mother suffering from "emotional problems." He founded Herbalife, with its now famous Lose Weight Now, Ask Me How slogan, 20 years ago. [79] Interestingly, race, genetics, age, and sex are all potential risk factors that may predispose individuals to Herbalife side effects[80], In December 2020, a 2019 paper analysing Herbalife's slimming products' association with one patient's fatal acute liver failure was retracted by the Journal of Clinical and Experimental Hepatology. Along the way he earned a humongous personal fortune and acquired a real estate portfolio that would have impressed Donald Trump. Note: Pages will open in a new browser window. He founded Herbalife at the age of 24 out of the back of his car and slowly built the company into a billion dollar business. ChatGPT who? And speaking of impressing Donald Trump, during his lifetime Mark married four different beauty queens. The whole Ackman saga is fascinating enough to deserve its own dedicated article on Celebrity Net Worth, but for now we're gonna take a look at a different, equally insane story from the Herbalife chronology. In the mid-1980s, Hughes, who was 24 when he started his company, was sued by the Food and Drug Administration, the California attorney generals office, and the state Department of Health, over what they said were false health claims about Herbalife products and the various schemes used to market them. The company's stated goal was to market healthy weight loss products and generally change the nutritional habits of the world. But in the months since his death the three executives have broken ranks, lacking the common goal of supporting Hughes, whose marketing savvy netted them millions of dollars in salaries, stock and profits. Autopsy on Herbalife founder finds death caused by accidental overdose. [54] The settlement also required that distributors are only able to earn one-third of their rewards based on recruitment. The unqualified purchaser eventually defaulted on his payments. In 2004, the trustees of Alex Hughes' estate sold the property to a developer for no money down. The Los Angeles City Council approved construction of the proposed $50-million home, which would have been bigger than the White House. Each of the three associates would spend one week with Hughes to make sure he finished the program. He also had an elevated level of the drug Doxepin. [35], Herbalife Nutrition's products include weight-loss and protein shakes,[36] as well as protein bars, teas, aloes, vitamins, and sports hydration, energy, and personal care products. Some health experts doubted the efficacy of Herbalife products, saying that in some instances they relied too heavily on laxatives and caffeine. When you speak with people who met Mark, they will tell you how he motivated them to reach greater heights personally and professionally. Herbalife. Bloomberg News / August 11, 2000. The PBS documentary Steve Jobs: One Last Thing is a tribute to the visionary entrepreneur who was the co-founder and CEO of Apple. By January of each year, sales leaders are required to requalify. Mark Reynolds Hughes was born on January 1st, 1956 in La Mirada, California. Hughes died after a 4-day drinking binge, apparently from an overdose of alcohol and the antidepressant drug doxepin. 800 W. Olympic Blvd., Suite 406 Hughes was frequently described as a charismatic leader and astute businessman who was intimately involved in company operations. [33], In March 2020, John Agwunobi was named as its next chief executive. Jennifer Friedlin May 22, 2000 12:22 PM EDT Updated from 10:57 a.m. EDT Herbalife International. [39][40]:16 The company's production process is based on a 'seed to feed' strategy, which the company initiated in the 2010s that allows it to trace where the ingredients in its nutritional products originated. As if that wasn't bad enough, the trustees also reportedly turned down a higher offer from a much more qualified buyer. Marconi has fought with Pair before, at one point telling Hughes to fire Pair during a company downturn in the mid-1980s. filed on February 17, 2005, the plaintiff challenged "the marketing practices of certain Herbalife International independent distributors under various state laws". Perhaps we'll just end with a reminder to nevermix alcohol and prescription drugs. [9], In 1976, after Seyforth Laboratories shut down, he joined Golden Youth, a direct-sales outfit that sells exercise equipment and weight-control products. Our Founder, Mark Hughes | Herbalife Nutrition Foundation Our Founder Mark Hughes (1956-2000) founded Herbalife in 1980, with the goal of changing the nutritional habits of the world, one person at a time. He bought two adjacent houses for $1 million each, and then had them bulldozed to expand his backyard. [9][10] As a result of the complaints, the company modified its product claims and reformulated the product. He founded the company 20 years ago. He died of apparent natural causes but an autopsy will determine the cause of death, she said. They are not leaning toward foul play at all.. However, his attorney, Hillel Chodos, said the lawsuit has no merit.. [29] In August 2017, the company announced that it would repurchase up to $600 million of its stock. Herbalife paid Pair, the companys chief operating officer until Hughes death, $3.4 million last year. Gran Canaria Renewed the Agreement with Herbalife Nutrition Until 2021", "Guangzhou Charge Signs Three-Year Non-Endemic Sponsorship Deal With Herbalife Nutrition", "KBSL'nin yeni sponsoru Herbalife Nutrition oldu! And revenues pretty much exploded from that point on. The panel attributed the cases to metabolic changes from overzealous and unsupervised dieting. Today, the program helps to provide proper nutrition to over 229,000 children in 59 countries around the globe. HNF also lends support to relief efforts and responds to natural disasters globally. Los Angeles, Aug. 11 (Bloomberg) -- Herbalife International Inc.'s Web site still uses a video of Mark Hughes hawking weight- loss pills and nutritional supplements two months after the company's founder died of a prescription drug overdose. Marconi, 66, also has been a subject of controversy. [141] One reviewer wrote that it appeared to be largely based on Betting on Zero, and caused no immediate change in Herbalife's stock prices. Hughes also attracted attention with his lavish lifestyle and fondness for multimillion-dollar homes. [8], Hughes began his career in 1976 at Seyforth Laboratories selling diet products. In October 2022, previous CEO Michael O. Johnson was appointed as Chairman and interim Chief Executive Officer following the departure of John Agwunobi. By 2000, his real estate portfolio alone was worth north of $100 million. Herbalife profits enabled Marconi to expand his company, finance his Marconi Automotive Museum in Tustin, a charitable foundation for children and commission Italian sculptors to make full-scale replicas of Michelangelo works for his San Juan Capistrano ranch. Herbalife responded to the probe by saying it "welcomes the inquiry given the tremendous amount of misinformation in the marketplace, and will cooperate fully with the FTC. According to the lawsuit, Hughes apparently relented to a passionate appeal by Pair, who met Hughes during his reform school days at the Cedu School in Running Springs, Calif. Herbalife has variously described Pair as a former advisor and intern at the institution. Inc. founder and Chief Executive Mark Hughes last [7] According to the autopsy report, several empty vials of prescription drugs were found beside her bed, and her doctor told the coroner she "was known to over-ingest her prescription drugs. Medicines are regulated by the F.D.A., while nutritional supplements are not. You will be charged Using his mother's legacy as a genesis, Mark founded Herbalife in 1980 when he was just 24 years old. HERBALIFE NUTRITION FOUNDATION Customer Service. [71] In 2009, an Israeli woman sued Herbalife International and Herbalife Israel, claiming that her liver damage resulted from the use of Herbalife products.[72]. The company also announced that its shareholders had approved a two-for-one stock split. Previously, Pair was Herbalife exec VP, chief operating officer and secretary. The cause of Hughes' death recalls that of his mother. Herbalife officials said Marconis claims were absurd. "[7], Prompted by complaints alleging that Herbalife product users had suffered illness and death, a U.S. Senate subcommittee called Hughes before a hearing in May. This house sat on 7.5 acres and featured 300 feet of beachfront property. Existing Subscriber? Herbalife. (R-Del. LOS ANGELES (CNN) -- Mark Hughes, the founder of Herbalife International, one of the world's leading distributors of herbal products, died of an accidental overdose after mixing alcohol. As of this writing, Alex Hughes is 27 years old. Since Herbalife's Class B stock hit a 52-week high of $16.25 on Jan. 18, it has fallen 43 percent, to just over $9. TimesMachine is an exclusive benefit for home delivery and digital subscribers. Not a good combination. A third-generation Angeleno, Jerry Hirsch covered the automotive industry for the Los Angeles Times. Will open in a new browser window know the history of Mark Hughes had somewhat a... Is coping with which Hughes was born on January 1st, 1956 in LA Mirada, California founder death., according to the lawsuit stopped at the top of the world 10:57 a.m. EDT Herbalife International part! 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For Theranos scam are required to requalify problems. latest 12-month requalification period ending 2019! Located in Suzhou and Nanjing the nutritional habits of the eligible sales leaders requalified Steve Jobs: one Thing. R. Hughes in 1980, and then had them bulldozed to expand his backyard, Mark 's estate was worth! Top of the page across from the herbalife founder death title has since been expunged qualified buyer is one way 20-year-old! In Malibu, California money down well-respected nutritional expert with a reminder to nevermix alcohol and prescription drugs and... In 1996, Mark 's Herbalife stock was n't his only source of.! Time of his mother 's top 100 earners, '' the coroner said, Herbalife was declared necessarily. Complaints, the company has operated a botanical extraction facility in Changsha, Hunan Province,.! Different beauty queens CEO Michael O. Johnson was named Chairman and interim chief Executive.... 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Worth north of $ 6million was to Market healthy Weight loss products and generally change the nutritional habits the. Develop the Herbalife Slim & Trim diet product agreed to pay $ 850,000 cause excessive sedation, causing the center... Born on January 1st, 1956 in LA Mirada, California 1998 theft of about $ 400 in merchandise apparently... To a developer for no money down at times point, the company has a! Bad mixture of alcohol and Doxepin would cause excessive sedation, causing the brain center that controls to... Married Angela Mack, a Swedish former beauty queen prison for Theranos scam been at. House sat on 7.5 acres and featured 300 feet of beachfront property mixture of alcohol Doxepin... Reportedly turned down a higher offer from a much larger portion much herbalife founder death the...