California Civil Code

§ 1812.204

CIV § 1812.204Div. 3 · Title 2.7 · Part 4

Statute text

In selling, leasing, or offering to sell or lease a seller assisted marketing plan in this state, sellers shall not:

(a)Use the phrase “buy-back” or “secured investment” or similar phrase orally or in writing when soliciting, offering, leasing, or selling a seller assisted marketing plan if the “security” is the value of the equipment, supplies, products or services supplied by the seller to the purchaser.

(b)Use the phrase “buy-back” or “secured investment” or similar phrase orally or in writing when soliciting, offering, leasing, or selling a seller assisted marketing plan unless there are no restrictions or qualifications whatsoever preventing or limiting a purchaser from being able to invoke the “buy-back” or “secured” portion of the seller assisted marketing plan contract at any time the purchaser desires during the one-year period following the contract date. Upon invocation of the “buy-back” or “security” provision, the minimum amount a purchaser shall be entitled to have returned to him is the full amount of his initial payment, less the amount actually received by him from the operation of the seller assisted marketing plan. The “amount actually received” means either the amount the purchaser actually obtained from the seller for any product resold to the seller or the amount of money the purchaser received for use of the purchaser’s product, equipment, supplies or services, less any amount: (1) the purchaser has paid the owner or manager of the location at which the purchaser’s products, equipment, supplies or services are placed; and (2) the purchaser has paid to obtain other items needed in order to sell, make, produce, fabricate, grow, breed, modify, or develop the item which the seller assisted marketing plan purchaser intends to sell, lease, distribute, or otherwise dispose of.

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Legislative history

Amended by Stats. 1981, Ch. 258, Sec. 2.