Federal Trade Commission v. Prime Legal Plans LLC et al

Filing 67

PRELIMINARY INJUNCTION and order continuing asset freeze and other provisions of the Temporary Restraining Order, appointing a permanent receiver, and permitting expedited discovery. Signed by Judge Robert N. Scola, Jr. on 10/12/2012. (rss) (Additional attachment(s) added on 10/12/2012: # 1 Attachment A, # 2 Attachment B, # 3 Attachment C) (wc).

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FEDERAL TRADE COMMISSION FINANCIAL STATEMENT OF CORPORATE DEFENDANT Instructions: 1. Complete all items. Enter “None” or "N/A" (“Not Applicable”) where appropriate. If you cannot fully answer a question, explain why. 2. The font size within each field will adjust automatically as you type to accommodate longer responses. 3. In completing this financial statement, “the corporation” refers not only to this corporation but also to each of its predecessors that are not named defendants in this action. 4. When an Item asks for information about assets or liabilities “held by the corporation,” include ALL such assets and liabilities, located within the United States or elsewhere, held by the corporation or held by others for the benefit of the corporation. 5. Attach continuation pages as needed. On the financial statement, state next to the Item number that the Item is being continued. On the continuation page(s), identify the Item number being continued. 6. Type or print legibly. 7. An officer of the corporation must sign and date the completed financial statement on the last page and initial each page in the space provided in the lower right corner. Penalty for False Information: Federal law provides that any person may be imprisoned for not more than five years, fined, or both, if such person: (1) “in any matter within the jurisdiction of any department or agency of the United States knowingly and willfully falsifies, conceals or covers up by any trick, scheme, or device a material fact, or makes any false, fictitious or fraudulent statements or representations, or makes or uses any false writing or document knowing the same to contain any false, fictitious or fraudulent statement or entry” (18 U.S.C. § 1001); (2) “in any . . . statement under penalty of perjury as permitted under section 1746 of title 28, United States Code, willfully subscribes as true any material matter which he does not believe to be true” (18 U.S.C. § 1621); or (3) “in any (. . . statement under penalty of perjury as permitted under section 1746 of title 28, United States Code) in any proceeding before or ancillary to any court or grand jury of the United States knowingly makes any false material declaration or makes or uses any other information . . . knowing the same to contain any false material declaration.” (18 U.S.C. § 1623) For a felony conviction under the provisions cited above, federal law provides that the fine may be not more than the greater of (i) $250,000 for an individual or $500,000 for a corporation, or (ii) if the felony results in pecuniary gain to any person or pecuniary loss to any person other than the defendant, the greater of twice the gross gain or twice the gross loss. 18 U.S.C. § 3571. Attachment B BACKGROUND INFORMATION Item 1. General Information Corporation’s Full Name ___________________________________________________________________________ Primary Business Address ______________________________________________________ From (Date) _________ Telephone No. _____________________________ Fax No. _____________________________ E-Mail Address________________________ Internet Home Page________________________ All other current addresses & previous addresses for past five years, including post office boxes and mail drops: Address____________________________________________________________ From/Until____________________ Address____________________________________________________________ From/Until____________________ Address____________________________________________________________ From/Until____________________ All predecessor companies for past five years: Name & Address _________________________________________________________ From/Until ______________ Name & Address _________________________________________________________ From/Until ______________ Name & Address _________________________________________________________ From/Until ______________ Item 2. Legal Information Federal Taxpayer ID No. _________________________ State & Date of Incorporation _________________________ State Tax ID No. ____________________ State ________________ Profit or Not For Profit _____________________ Corporation’s Present Status: Active ________________ Inactive _______________ Dissolved __________________ If Dissolved: Date dissolved _________________________ By Whom ______________________________________ Reasons _________________________________________________________________________________________ Fiscal Year-End (Mo./Day) ________________ Corporation’s Business Activities _____________________________ Item 3. Registered Agent Name of Registered Agent __________________________________________________________________________ Address __________________________________________________________ Telephone No. __________________ Page 2 Attachment B Initials __________ Item 4. Principal Stockholders List all persons and entities that own at least 5% of the corporation’s stock. % Owned Name & Address _________________________________________________________________________________ ______________ _________________________________________________________________________________ ______________ _________________________________________________________________________________ ______________ _________________________________________________________________________________ ______________ Item 5. Board Members List all members of the corporation’s Board of Directors. Name & Address % Owned Term (From/Until) ____________________________________________________________________ __________ _________________ ____________________________________________________________________ __________ _________________ ____________________________________________________________________ __________ _________________ ____________________________________________________________________ __________ _________________ ____________________________________________________________________ __________ _________________ Item 6. Officers List all of the corporation’s officers, including de facto officers (individuals with significant management responsibility whose titles do not reflect the nature of their positions). Name & Address % Owned _______________________________________________________________________________ ________________ _______________________________________________________________________________ ________________ _______________________________________________________________________________ ________________ _______________________________________________________________________________ ________________ _______________________________________________________________________________ ________________ Page 3 Attachment B Initials __________ Item 7. Businesses Related to the Corporation List all corporations, partnerships, and other business entities in which this corporation has an ownership interest. Business Activities Name & Address % Owned ___________________________________________________________________ ___________________ _________ ___________________________________________________________________ ___________________ _________ ___________________________________________________________________ ___________________ _________ State which of these businesses, if any, has ever transacted business with the corporation _______________________ ________________________________________________________________________________________________ Item 8. Businesses Related to Individuals List all corporations, partnerships, and other business entities in which the corporation’s principal stockholders, board members, or officers (i.e., the individuals listed in Items 4 - 6 above) have an ownership interest. Business Name & Address Individual’s Name Business Activities % Owned __________________ __________________________________________________ __________________ ________ __________________ __________________________________________________ __________________ ________ __________________ __________________________________________________ __________________ ________ State which of these businesses, if any, have ever transacted business with the corporation _______________________ ________________________________________________________________________________________________ Item 9. Related Individuals List all related individuals with whom the corporation has had any business transactions during the three previous fiscal years and current fiscal year-to-date. A “related individual” is a spouse, sibling, parent, or child of the principal stockholders, board members, and officers (i.e., the individuals listed in Items 4 - 6 above). Relationship Name and Address Business Activities _________________________________________________________ _________________ ______________________ _________________________________________________________ _________________ ______________________ _________________________________________________________ _________________ ______________________ Page 4 Attachment B Initials __________ Item 10. Outside Accountants List all outside accountants retained by the corporation during the last three years. Firm Name Name Address CPA/PA? ____________________ ______________________ ________________________________________ ____________ ____________________ ______________________ ________________________________________ ____________ ____________________ ______________________ ________________________________________ ____________ ____________________ ______________________ ________________________________________ ____________ ____________________ ______________________ ________________________________________ ____________ Item 11. Corporation’s Recordkeeping List all individuals within the corporation with responsibility for keeping the corporation’s financial books and records for the last three years. Position(s) Held Name, Address, & Telephone Number ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ Item 12. Attorneys List all attorneys retained by the corporation during the last three years. Name Firm Name Address ____________________ ___________________________ ________________________________________________ ____________________ ___________________________ ________________________________________________ ____________________ ___________________________ ________________________________________________ ____________________ ___________________________ ________________________________________________ ____________________ ___________________________ ________________________________________________ Page 5 Attachment B Initials __________ Item 13. Pending Lawsuits Filed by the Corporation List all pending lawsuits that have been filed by the corporation in court or before an administrative agency. (List lawsuits that resulted in final judgments or settlements in favor of the corporation in Item 25). Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Page 6 Attachment B Initials __________ Item 14. Current Lawsuits Filed Against the Corporation List all pending lawsuits that have been filed against the corporation in court or before an administrative agency. (List lawsuits that resulted in final judgments, settlements, or orders in Items 26 - 27). Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address___________________________________________________________________________ Docket No._________________ Relief Requested____________________ Nature of Lawsuit____________________ ____________________________________ Status______________________________________________________ Page 7 Attachment B Initials __________ Item 15. Bankruptcy Information List all state insolvency and federal bankruptcy proceedings involving the corporation. Commencement Date _________________ Termination Date _________________ Docket No. __________________ If State Court: Court & County _______________________ If Federal Court: District __________________________ Disposition ______________________________________________________________________________________ Item 16. Safe Deposit Boxes List all safe deposit boxes, located within the United States or elsewhere, held by the corporation, or held by others for the benefit of the corporation. On a separate page, describe the contents of each box. Owner’s Name Name & Address of Depository Institution Box No. __________________ ___________________________________________________________________ __________ __________________ ___________________________________________________________________ __________ __________________ ___________________________________________________________________ __________ __________________ ___________________________________________________________________ __________ __________________ ___________________________________________________________________ __________ FINANCIAL INFORMATION REMINDER: When an Item asks for information about assets or liabilities “held by the corporation,” include ALL such assets and liabilities, located within the United States or elsewhere, held by the corporation or held by others for the benefit of the corporation. Item 17. Tax Returns List all federal and state corporate tax returns filed for the last three complete fiscal years. Attach copies of all returns. Federal/ State/Both Tax Year Tax Due Federal Tax Paid Federal Tax Due State Tax Paid State Preparer’s Name ___________ __________ $_________ $_________ $__________ $__________ ______________________________ ___________ __________ $_________ $_________ $__________ $__________ ______________________________ ___________ __________ $_________ $_________ $__________ $__________ ______________________________ Page 8 Attachment B Initials __________ Item 18. Financial Statements List all financial statements that were prepared for the corporation’s last three complete fiscal years and for the current fiscal year-to-date. Attach copies of all statements, providing audited statements if available. Year Balance Sheet Profit & Loss Statement Cash Flow Statement Changes in Owner’s Equity Audited? _________ _____________ ______________________ __________________ _______________________ ________ _________ _____________ ______________________ __________________ _______________________ ________ _________ _____________ ______________________ __________________ _______________________ ________ _________ _____________ ______________________ __________________ _______________________ ________ Item 19. Financial Summary For each of the last three complete fiscal years and for the current fiscal year-to-date for which the corporation has not provided a profit and loss statement in accordance with Item 18 above, provide the following summary financial information. Current Year-to-Date 1 Year Ago 2 Years Ago 3 Years Ago Gross Revenue $_________________ $_______________ $_______________ $_______________ Expenses $_________________ $_______________ $_______________ $_______________ Net Profit After Taxes $_________________ $_______________ $_______________ $_______________ Payables $_________________ Receivables $_________________ Item 20. Cash, Bank, and Money Market Accounts List cash and all bank and money market accounts, including but not limited to, checking accounts, savings accounts, and certificates of deposit, held by the corporation. The term “cash” includes currency and uncashed checks. Cash on Hand $_________________________ Cash Held for the Corporation’s Benefit $_______________________ Current Balance _____________________________________ _______________________________ ______________ $___________ Name & Address of Financial Institution Signator(s) on Account Account No. _____________________________________ _______________________________ ______________ $___________ _____________________________________ _______________________________ ______________ $___________ _____________________________________ _______________________________ ______________ $___________ Page 9 Attachment B Initials __________ Item 21. Government Obligations and Publicly Traded Securities List all U.S. Government obligations, including but not limited to, savings bonds, treasury bills, or treasury notes, held by the corporation. Also list all publicly traded securities, including but not limited to, stocks, stock options, registered and bearer bonds, state and municipal bonds, and mutual funds, held by the corporation. Issuer _________________________________ Type of Security/Obligation __________________________________ No. of Units Owned __________ Current Fair Market Value $__________________ Maturity Date _______________ Issuer _________________________________ Type of Security/Obligation __________________________________ No. of Units Owned __________ Current Fair Market Value $__________________ Maturity Date _______________ Item 22. Real Estate List all real estate, including leaseholds in excess of five years, held by the corporation. Type of Property________________________________ Property’s Location__________________________________ Name(s) on Title and Ownership Percentages___________________________________________________________ Current Value $____________________ Loan or Account No. __________________________ Lender’s Name and Address_________________________________________________________________________ Current Balance On First Mortgage $_______________ Monthly Payment $______________ Other Loan(s) (describe)____________________________________________ Current Balance $_________________ Monthly Payment $__________________ Rental Unit?_________________ Monthly Rent Received $_____________ Type of Property________________________________ Property’s Location__________________________________ Name(s) on Title and Ownership Percentages___________________________________________________________ Current Value $____________________ Loan or Account No. __________________________ Lender’s Name and Address_________________________________________________________________________ Current Balance On First Mortgage $_______________ Monthly Payment $______________ Other Loan(s) (describe)____________________________________________ Current Balance $_________________ Monthly Payment $__________________ Rental Unit?_________________ Monthly Rent Received $_____________ Page 10 Attachment B Initials __________ Item 23. Other Assets List all other property, by category, with an estimated value of $2,500 or more, held by the corporation, including but not limited to, inventory, machinery, equipment, furniture, vehicles, customer lists, computer software, patents, and other intellectual property. Property Category Property Location Acquisition Cost Current Value ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ ____________________________ _____________________________________________ $__________ $_________ Item 24. Trusts and Escrows List all persons and other entities holding funds or other assets that are in escrow or in trust for the corporation. Trustee or Escrow Agent’s Name & Address Description and Location of Assets Present Market Value of Assets ______________________________________ _______________________________________ $_________________ ______________________________________ _______________________________________ $_________________ ______________________________________ _______________________________________ $_________________ ______________________________________ _______________________________________ $_________________ ______________________________________ _______________________________________ $_________________ ______________________________________ _______________________________________ $_________________ ______________________________________ _______________________________________ $_________________ Page 11 Attachment B Initials __________ Item 25. Monetary Judgments and Settlements Owed To the Corporation List all monetary judgments and settlements, recorded and unrecorded, owed to the corporation. Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address____________________________________________________ Docket No._____________ Nature of Lawsuit______________________________ Date of Judgment________________ Amount $____________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address____________________________________________________ Docket No._____________ Nature of Lawsuit______________________________ Date of Judgment________________ Amount $____________ Item 26. Monetary Judgments and Settlements Owed By the Corporation List all monetary judgments and settlements, recorded and unrecorded, owed by the corporation. Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address____________________________________________________ Docket No._____________ Nature of Lawsuit_______________________________________ Date______________ Amount $______________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address____________________________________________________ Docket No._____________ Nature of Lawsuit______________________________ Date of Judgment________________ Amount $____________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address____________________________________________________ Docket No._____________ Nature of Lawsuit______________________________ Date of Judgment________________ Amount $____________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address____________________________________________________ Docket No._____________ Nature of Lawsuit______________________________ Date of Judgment________________ Amount $____________ Opposing Party’s Name & Address___________________________________________________________________ Court’s Name & Address____________________________________________________ Docket No._____________ Nature of Lawsuit______________________________ Date of Judgment________________ Amount $____________ Page 12 Attachment B Initials __________ Item 27. Government Orders and Settlements List all existing orders and settlements between the corporation and any federal or state government entities. Name of Agency ___________________________________________ Contact Person __________________________ Address _____________________________________________________________ Telephone No. _______________ Agreement Date ______________ Nature of Agreement __________________________________________________ Item 28. Credit Cards List all of the corporation’s credit cards and store charge accounts and the individuals authorized to use them. Names of Authorized Users and Positions Held Name of Credit Card or Store __________________________________________ _____________________________________________________ __________________________________________ _____________________________________________________ __________________________________________ _____________________________________________________ __________________________________________ _____________________________________________________ __________________________________________ _____________________________________________________ Item 29. Compensation of Employees List all compensation and other benefits received from the corporation by the five most highly compensated employees, independent contractors, and consultants (other than those individuals listed in Items 5 and 6 above), for the two previous fiscal years and current fiscal year-to-date. “Compensation” includes, but is not limited to, salaries, commissions, consulting fees, bonuses, dividends, distributions, royalties, pensions, and profit sharing plans. “Other benefits” include, but are not limited to, loans, loan payments, rent, car payments, and insurance premiums, whether paid directly to the individuals, or paid to others on their behalf. Name/Position Current Fiscal Year-to-Date 1 Year Ago 2 Years Ago Compensation or Type of Benefits _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ Page 13 Attachment B Initials __________ Item 30. Compensation of Board Members and Officers List all compensation and other benefits received from the corporation by each person listed in Items 5 and 6, for the current fiscal year-to-date and the two previous fiscal years. “Compensation” includes, but is not limited to, salaries, commissions, consulting fees, dividends, distributions, royalties, pensions, and profit sharing plans. “Other benefits” include, but are not limited to, loans, loan payments, rent, car payments, and insurance premiums, whether paid directly to the individuals, or paid to others on their behalf. Name/Position Current Fiscal Year-to-Date 1 Year Ago 2 Years Ago Compensation or Type of Benefits _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ _____________________________ $____________ $___________ $____________ ___________________________ Item 31. Transfers of Assets Including Cash and Property List all transfers of assets over $2,500 made by the corporation, other than in the ordinary course of business, during the previous three years, by loan, gift, sale, or other transfer. Transferee’s Name, Address, & Relationship Property Transferred Aggregate Value Transfer Date Type of Transfer (e.g., Loan, Gift) ______________________________________ ________________ $____________ __________ _________________ ______________________________________ ________________ $____________ __________ _________________ ______________________________________ ________________ $____________ __________ _________________ ______________________________________ ________________ $____________ __________ _________________ ______________________________________ ________________ $____________ __________ _________________ Page 14 Attachment B Initials __________ Item 32. Documents Attached to the Financial Statement List all documents that are being submitted with the financial statement. Item No. Document Relates To Description of Document ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ ___________________ ____________________________________________________________________________ I am submitting this financial statement with the understanding that it may affect action by the Federal Trade Commission or a federal court. I have used my best efforts to obtain the information requested in this statement. The responses I have provided to the items above are true and contain all the requested facts and information of which I have notice or knowledge. I have provided all requested documents in my custody, possession, or control. I know of the penalties for false statements under 18 U.S.C. § 1001, 18 U.S.C. § 1621, and 18 U.S.C. § 1623 (five years imprisonment and/or fines). I certify under penalty of perjury under the laws of the United States that the foregoing is true and correct. Executed on: ______________________________ (Date) _____________________________________________________ Signature _____________________________________________________ Corporate Position Page 15 Attachment B Initials __________

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