Imergent's Wild Ride

It's not hard to see why some people think Imergent sells business opportunities.

Potential customers are generally contacted by mail and invited to 90-minute seminars, usually at hotels, where they listen to a pitch and eat a free lunch. If they show interest, they're invited to a second seminar, where they can buy Imergent's software. The price varies, but a spokesman for the company said the basic charge is $2,500 for each Web site a customer builds and operates using Imergent's Web-based software tools.

Imergent's legal problems go beyond a regulatory issue, however. The state of Texas sued Imergent in 2005, alleging that customers fall victim to "deceptive" business practices: "Once they have bought these packages, they are basically left with worthless software which does not work and for which they are asked to pay still more money for more assistance which is of little or no value," the suit alleged.

Although Imergent has yet to actually lose a suit brought by a state, the bad publicity has been devastating. Shares were trading as high as $25 in early February 2005. After Abbott filed suit that month, they plunged, dipping below $4 in early November of that year.