Paul Orberson, ex-coach who made millions in network marketing, dies at 56

lblackford@herald-leader.comDecember 5, 2013 

Paul Orberson, the charismatic founder of one of the country's largest network marketing companies, one that later came under federal scrutiny, died Thursday. He was 56.

State Sen. Alice Forgy Kerr said Mr. Orberson died of cancer, which he had suffered from a decade earlier.

"He was an outstanding man, and so generous," said Kerr, who attended Calvary Baptist Church with Mr. Orberson for many years. "He really was an amazing man. He had so much success in different areas, but he was so fun and folksy, he made everyone around him have fun."

University of Kentucky men's basketball coach John Calipari visited him at the hospital in October as Mr. Orberson entered hospice care, and he wrote on his blog about being inspired by Mr. Orberson.

"Paul told me it's not about money, cars, fame or material possessions — that's all just stuff, he said," Calipari wrote. "Paul told me it's about your relationship with God, your relationship with your family and the impact you have on other people.

"Like any other coach or businessman, there have been ups and downs in Paul's career, but throughout it all he never changed who he was, what he was about, how he treated people, how he treated his family, and how he was as a father and grandfather."

Mr. Orberson was a legend in the multi-level marketing world, a high school basketball coach from Danville turned multimillionaire, a man who flew to marketing conferences in a private jet and once bid $100,000 in a fundraiser to dine with Calipari and actress Ashley Judd.

In January, the Federal Trade Commission obtained an injunction to shut down Mr. Orberson's company, Fortune Hi-Tech Marketing, on charges that it was an illegal pyramid scheme. That case is in settlement talks.

He grew up in Danville, earned a baseball scholarship to Western Kentucky University, then eventually returned to Boyle County as a teacher and high school basketball coach.

Mr. Orberson started working on the side for Excel Communications, an emerging phone services company that used multi-level marketing for its sales. Mr. Orberson recruited many of his coaching friends to sell. Each recruit brought him a little more money. In his self-published autobiography, Something Good's Gonna Happen, he said that after four years of working for Excel, he had made more than $1 million. By 1996, he had retired to Florida as a newly minted millionaire.

In a 2010 interview with the Herald-Leader, Mr. Orberson said he found retirement boring and returned to Lexington to found Fortune Hi-Tech Marketing. He used Excel's model of direct sales to sell services and products. He signed up Cingular, GE Security and Lamas Beauty. Twelve people paid the $299 initiation fee. In one month, Mr. Orberson said, 1,200 people signed up.

The company grew across the United States, Canada and Great Britain. Mr. Orberson estimated that the company had more than 150,000 associates.

In 2003, Mr. Orberson was diagnosed with an advanced case of kidney cancer. He attributed his recovery to the doctors at UK and a healthier lifestyle. He later developed a line of vitamins sold through Fortune Hi-Tech.

Over the years, though, Fortune Hi-Tech faced charges of operating a pyramid scheme in Montana, North Carolina and Texas. The company settled some of those charges by paying fines.

In January, the Federal Trade Commission, along with the attorneys general of Kentucky, North Carolina and Illinois, were granted an injunction to shut down the company. On Jan. 29, federal and state officials raided the Corporate Drive headquarters, sending employees home and carting off boxes of documents. All the company's assets were put into receivership.

The case was moved to federal court in Illinois, where subsequent documents said that Mr. Orberson and his top lieutenants made nearly $40 million in recent years, even as 98 percent of the Lexington-based company's independent representatives made less than $1,000 apiece in annual commissions.

The two sides are working out a settlement agreement, according to the most recent documents filed in the federal case. The two parties are to make their next progress report on Dec. 10. The company also was the subject of a class-action lawsuit filed in Lexington. The lawsuit is now part of the federal negotiations.

Mr. Orberson is survived by his wife, Sheryl, and two children. Visitation is to be held from 2 to 4 p.m. and 6 to 8 p.m. Sunday at Calvary Baptist Church, 150 East High Street, and on Monday from noon until a service at 2 p.m. Burial will follow at Lexington Cemetery. Memorial donations can be made to Calvary Baptist Church.

Linda Blackford: (859) 231-1359. Twitter: @lbblackford.

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