Federal Trade Commission v. AWS, LLC et al

Filing 80

ORDER granting 78 Stipulation for Permanent Injunction and Monetary Judgment (see order for details); Signed by Judge James C. Mahan on 6/15/2018. (Copies have been distributed pursuant to the NEF - JM)

Download PDF
DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 1 of 30 1 2 3 4 5 6 7 8 9 10 11 Roberto Anguizola Illinois Bar # 6270874 (Admitted pursuant to LR IA 11-3) Tel. (202) 326-3284 Email: ranguizola@ftc.gov Miry Kim Washington Bar # 31456 (Admitted pursuant to LR IA 11-3) Tel. (202) 326-3622 Email: mkim@ftc.gov Gregory J. Evans DC Bar # 1033184 (Admitted pursuant to LR IA 11-3) Tel. (202) 326-3425 Email: gevans2@ftc.gov Federal Trade Commission 600 Pennsylvania Avenue, NW Mail Drop CC-8528 Washington, DC 20580 Attorneys for Plaintiff FEDERAL TRADE COMMISSION UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 12 13 14 15 16 17 18 19 20 21 22 23 FEDERAL TRADE COMMISSION, Plaintiff, CASE NO. 2:18-cv-00442-JCM-PAL v. AWS, LLC, a Nevada limited liability company; ADAMS CONSULTING, LLC, a California limited liability company; FBA DISTRIBUTORS, LLC, a Massachusetts limited liability company; FBA STORES, LLC, a Nevada limited liability company; GLOBAL MARKETING SERVICES L.L.C., a Nevada limited liability company; INFO PROS, LLC, a Nevada limited liability company; INFO SOLUTIONS, LLC, a Nevada limited liability company; ONLINE AUCTION LEARNING CENTER, INC., a Massachusetts corporation; ONLINE AUCTION LEARNING CENTER, INC., a Nevada corporation; CHRISTOPHER F. BOWSER; ADAM S. BOWSER; JODY L. MARSHALL; and JEFFREY A. GOMEZ, Defendants. 1 STIPULATED ORDER FOR PERMANENT INJUNCTION AND MONETARY JUDGMENT AS TO DEFENDANTS AWS, LLC, FBA DISTRIBUTORS, LLC, FBA STORES, LLC, INFO PROS, LLC, INFO SOLUTIONS, LLC, ONLINE AUCTION LEARNING CENTER, INC. (MASS. CORP.), ONLINE AUCTION LEARNING CENTER, INC. (NEV. CORP.), CHRISTOPHER F. BOWSER, ADAM S. BOWSER, AND JODY L. MARSHALL DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 2 of 30 1 Plaintiff, the Federal Trade Commission (“Commission” or “FTC”), filed its Complaint 2 for Permanent Injunction and Other Equitable Relief, as amended, (“Complaint”), in this matter, 3 pursuant to Sections 13(b) and 19 of the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. 4 §§ 53(b) and 57b. The Commission and Defendants AWS, LLC, FBA Distributors, LLC, FBA 5 Stores, LLC, Info Pros, LLC, Info Solutions, LLC, Online Auction Learning Center, Inc. (Mass. 6 Corp.), Online Auction Learning Center, Inc. (Nev. Corp.), Christopher F. Bowser, Adam S. 7 Bowser, and Jody Marshall (“Settling Defendants”) stipulate to the entry of this Stipulated Order 8 for Permanent Injunction and Monetary Judgment (“Order”) to resolve all matters in dispute in 9 this action between them. 10 THEREFORE, IT IS ORDERED as follows: 11 FINDINGS 12 1. This Court has jurisdiction over this matter. 13 2. The Complaint charges that Settling Defendants participated in deceptive and 14 unfair acts or practices in violation of Section 5 of the FTC Act, 15 U.S.C. § 45, and in violation 15 of the Business Opportunity Rule, 16 C.F.R. Part 437, in connection with the advertising, 16 marketing, distribution, promotion and sale of business opportunities to consumers throughout 17 the United States. 18 3. Settling Defendants neither admit nor deny any of the allegations in the 19 Complaint, except as specifically stated in this Order. Only for purposes of this action, Settling 20 Defendants admit the facts necessary to establish jurisdiction. 21 4. Settling Defendants waive and release any claims that they may have against the 22 Commission and the Receiver, including against any agent of the Commission or the Receiver, 23 that relate to this action. 2 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 3 of 30 1 2 5. Settling Defendants waive all rights to appeal or otherwise challenge or contest the validity of this Order. 3 6. Individual Defendant Jody Marshall filed a petition for relief under Chapter 13 of 4 the Bankruptcy Code on January 5, 2016. In re Jody L. Marshall, No. BKS-16-10016-MKN 5 (Bankr. D. Nev.) (“Marshall Bankruptcy Case”). The Commission’s prosecution of this action 6 and the Order are actions to enforce the Commission’s policy or regulatory power. As a result, if 7 the Marshall Bankruptcy Case is pending as of the date of entry of this Order, then these actions 8 are excepted from the automatic stay pursuant to 11 U.S.C. § 362(b)(4). 9 DEFINITIONS 10 For the purpose of this Order, the following definitions apply: 11 A. 12 those related to business opportunities, that is represented, expressly or by implication, to coach, 13 train or teach a participant or Purchaser how to establish, operate, or improve the Purchaser’s 14 business. 15 B. “Business Coaching Program” means any program, plan, good, or service, including “Business Opportunity” means a commercial arrangement in which: 16 1. A Seller solicits a prospective Purchaser to enter into a new business; and 17 2. The prospective Purchaser makes a required payment; and 18 3. The Seller, expressly or by implication, orally or in writing, represents that the 19 Seller or one or more Designated Persons will: 20 (i) 21 machines, or similar devices, owned, leased, controlled, or paid for by the 22 Purchaser; or Provide locations for the use or operation of equipment, displays, vending 23 3 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 4 of 30 1 (ii) 2 accounts, or customers, for the Purchaser’s goods or services; or 3 (iii) 4 produces, fabricates, grows, breeds, modifies, or provides, including providing 5 payment for such services as, for example, stuffing envelopes from the 6 Purchaser’s home. Provide outlets, accounts, or customers, including Internet outlets, Buy back any or all of the goods or services that the Purchaser makes, 7 C. 8 the Seller suggests, recommends, or requires that the Purchaser use in establishing or operating a 9 new business. “Designated Person” means any Person, other than the Seller, whose goods or services 10 D. 11 and “electronically stored information” in Federal Rule of Civil Procedure 34(a), 12 Fed. R. Civ. P. 34(a), and includes writings, drawings, graphs, charts, photographs, sound and 13 video recordings, images, internet sites, web pages, websites, electronic correspondence, 14 including e-mail and instant messages, contracts, accounting data, advertisements (including 15 advertisements placed on the World Wide Web), FTP Logs, Server Access Logs, USENET 16 Newsgroup postings, books, written or printed records, handwritten notes, telephone logs, 17 telephone scripts, receipt books, ledgers, personal and business canceled checks and check 18 registers, bank statements, appointment books, computer records, customer or sales databases, 19 and any other electronically stored information, including Documents located on remote servers 20 or cloud computing systems, and other data or data compilations from which information can be 21 obtained directly or, if necessary, after translation into a reasonably usable form. A draft or non- 22 identical copy is a separate document within the meaning of the term. “Document” is synonymous in meaning and equal in scope to the usage of “document” 23 4 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 5 of 30 1 E. 2 prospective Purchaser or investor that conveys, expressly or by implication, a specific level or 3 range of actual or potential sales, or gross or net income or profits. Earnings claims include, but 4 are not limited to any: (1) chart, table, or mathematical calculation that demonstrates possible 5 results based upon a combination of variables; and (2) statements from which a consumer, 6 prospective Purchaser or investor can reasonably infer that he or she will earn a minimum level 7 of income (e.g., “earn enough to buy a Porsche,” “earn a six-figure income,” or “earn your 8 investment back within one year”). 9 F. “Earnings Claim” means any oral, written, or visual representation to a consumer, “Person” means a natural person, organization, or legal entity, including a corporation, 10 partnership, proprietorship, association, cooperative, government or governmental subdivision or 11 agency, or any other group or combination acting as an entity. 12 G. 13 prospective Purchaser with existing or potential locations, outlets, accounts, or customers; 14 requiring, recommending, or suggesting one or more locators or lead generating companies; 15 providing a list of locator or lead generating companies; collecting a fee on behalf of one or more 16 locators or lead generating companies; offering to furnish a list of locations; or otherwise 17 assisting the prospective Purchaser in obtaining his or her own locations, outlets, accounts, or 18 customers. 19 H. 20 Program. 21 I. 22 of the Temporary Restraining Order issued on March 14, 2018 [ECF No. 29], and whose “Providing locations, outlets, accounts, or customers” means furnishing the “Purchaser” means a Person who buys a Business Opportunity or Business Coaching “Receiver” means Robb Evans & Associates LLC, the receiver appointed in Section XI 23 5 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 6 of 30 1 appointment is continued in Section VI of this Order, and any deputy receivers that shall be 2 named by Robb Evans & Associates LLC. 3 J. 4 assets of the Settling Corporate Defendants, including: (a) any assets of the Settling Corporate 5 Defendants currently in the possession of the Receiver; (b) all the funds, property, premises, 6 accounts, documents, mail, and all other assets of, or in the possession or under the control of the 7 Settling Corporate Defendants, wherever situated, the income and profits therefrom, all sums of 8 money now or hereafter due or owing to the Settling Corporate Defendants, and any other assets 9 or property belonging or owed to the Settling Corporate Defendants; (c) any assets of the Settling “Receivership Estate” means the assets identified in Section III.C of this Order and all 10 Corporate Defendants held in asset protection trusts; (d) any reserve funds or other accounts 11 associated with any payments processed on behalf of any Settling Corporate Defendant, 12 including such reserve funds held by a payment processor, credit card processor, or bank; and (e) 13 all proceeds from the sale of such assets, except those assets the sale of which the Receiver 14 determines will not add appreciably to the value of the estate. 15 K. 16 Coaching Program. 17 L. 18 Stores, LLC, Info Pros, LLC, Info Solutions, LLC, Online Auction Learning Center, Inc. (Mass. 19 Corp.), Online Auction Learning Center, Inc. (Nev. Corp.), and any of their subsidiaries, 20 affiliates, successors, and assigns. 21 M. 22 Corporate Defendants, individually, collectively, or in any combination. “Seller” means a person who offers for sale or sells a Business Opportunity or Business “Settling Corporate Defendants” means AWS, LLC, FBA Distributors, LLC, FBA “Settling Defendants” means all of the Settling Individual Defendants and the Settling 23 6 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 7 of 30 1 N. 2 Jody L. Marshall, individually or collectively. “Settling Individual Defendants” means Christopher F. Bowser, Adam S. Bowser, and 3 ORDER 4 I. 5 BUSINESS OPPORTUNITY AND BUSINESS COACHING BAN IT IS ORDERED that Settling Defendants are permanently restrained and enjoined from 6 advertising, marketing, distributing, promoting, or offering for sale, or assisting in the 7 advertising, marketing, distributing, promoting, or offering for sale of, any Business Opportunity 8 or Business Coaching Program. 9 II. PROHIBITED BUSINESS ACTIVITIES 10 IT IS FURTHER ORDERED that Settling Defendants, Settling Defendants’ officers, 11 agents, employees, and attorneys, and all other Persons in active concert or participation with 12 them, who receive actual notice of this Order, whether acting directly or indirectly, in connection 13 with promoting or offering for sale any good or service, are permanently restrained and enjoined 14 from: 15 A. making any Earnings Claim, unless the Earnings Claim is non-misleading, and, at 16 the time such claim is made, Settling Defendants: (1) have a reasonable basis for their claim; (2) 17 have in their possession written materials that substantiate the claim; and (3) make the written 18 substantiation available upon request to the consumer, potential Purchaser or investor, and to the 19 Commission; or 20 B. misrepresenting or assisting others in misrepresenting, expressly or by implication 21 any other fact material to consumers concerning any product or service, such as the total costs; 22 any material restrictions, limitations, or conditions; or any material aspect of its performance, 23 efficacy, nature, or central characteristics. 7 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 8 of 30 1 III. MONETARY JUDGMENT AND PARTIAL SUSPENSION 2 IT IS FURTHER ORDERED that: 3 A. Judgment in the amount of One Hundred Two Million, Four Hundred Eighty-One 4 Thousand, Five Hundred Ninety-Six Dollars ($102,481,596.00) is entered in favor of the 5 Commission against Settling Defendants, jointly and severally, as equitable monetary relief. 6 B. Settling Individual Defendants are ordered to make the following payments to the 7 Commission, which, as Settling Individual Defendants stipulate, their undersigned counsel holds 8 in escrow for no purpose other than payment to the Commission: 9 1. 10 11 Three Hundred, Twenty-Five Thousand Dollars ($325,000.00); 2. 12 13 Individual Defendant Christopher F. Bowser is ordered to pay to the Commission Individual Defendant Adam S. Bowser is ordered to pay to the Commission Three Hundred, Twenty-Five Thousand Dollars ($325,000.00); and 3. 14 Individual Defendant Jody Marshall is ordered to pay to the Commission Seventy-Five Thousand Dollars ($75,000.00). 15 Such payments must be made within 7 days of entry of this Order by electronic fund transfer in 16 accordance with instructions previously provided by a representative of the Commission. 17 C. In addition to the payments to the Commission specified in Subsection B above, 18 immediately upon entry of this Order, the Settling Defendants are ordered to surrender to the 19 Commission all control, title, dominion, and interest each has to the following assets: 20 1. All interest the Settling Defendants have in funds in any accounts in the name of 21 the Settling Corporate Defendants, eLearn Service, LLC, E-Learn Services, Ltd., 22 EMWW, LLC, Finn Rich Wireless, LLC, Plaza TowneHomes, LLC, Sell On 23 8 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 9 of 30 1 AMZ Inc., Surf Cellular Express, LLC, Vmerica, Inc., Buy Box Wholesale Inc., 2 Auction Profit Builders LLC, Insider Online Secrets LLC, or Sellers Hangout; 3 2. All cash held by the Receiver; 4 3. All assets owned by the Settling Corporate Defendants, eLearn Service, LLC, E- 5 Learn Services, Ltd., EMWW, LLC, Finn Rich Wireless, LLC, Plaza 6 TowneHomes, LLC, Sell On AMZ Inc., Surf Cellular Express, LLC, Vmerica, 7 Inc., Buy Box Wholesale Inc., Auction Profit Builders LLC, Insider Online 8 Secrets LLC, or Sellers Hangout, including any real, personal, or intellectual 9 property, chattel, goods, instruments, equipment, fixtures, general intangibles, 10 effects, leaseholds, contracts, mail, or other deliveries, shares or stock, securities, 11 inventory, checks, notes, accounts, credits, receivables, insurance policies, lines of 12 credit, cash, trusts (including asset protection trusts), lists of consumer names and 13 reserve funds or any other accounts associated with any payments processed by, 14 or on behalf of, any Settling Corporate Defendants, eLearn Service, LLC, E-Learn 15 Services, Ltd., EMWW, LLC, Finn Rich Wireless, LLC, Plaza TowneHomes, 16 LLC, Sell On AMZ Inc., Surf Cellular Express, LLC, Vmerica, Inc., Buy Box 17 Wholesale Inc., Auction Profit Builders LLC, Insider Online Secrets LLC, or 18 Sellers Hangout; 19 4. “Online Seller”, including the accounts ending in 1812 and 6059; 20 21 22 All funds held by Bank of America N.A., in the name of Info Pros LLC dba 5. All funds held by Bank of America N.A., in the name of FBA Stores LLC dba “AWS”, including the accounts ending in 6155 and 3425; 23 9 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 10 of 30 1 6. including the account ending in 2607; 2 3 7. 8. 9. 10. 11. 12. 13. 14. All funds held by Washington Federal Bank, in the name of EMWW, LLC, including the account ending in 8182; 18 19 All funds held by Washington Federal Bank, in the name of Info Pros LLC, including the account ending in 9156; 16 17 All funds held by America First Credit Union, in the name of Info Solutions LLC, including the account ending in 7992; 14 15 All funds held by Bank of America N.A., in the name of Vmerica Inc., including the account ending in 5607; 12 13 All funds held by Bank of America N.A., in the name of Finn Rich Wireless LLC, including the account ending in 2342; 10 11 All funds held by Bank of America N.A., in the name of Elearn Services LLC dba “Edominance”, including the account ending in 1867; 8 9 All funds held by Bank of America N.A., in the name of EMWW, LLC LLC, including the account ending in 8299; 6 7 All funds held by Bank of America N.A., in the name of FBA Distributors LLC, including the account ending in 5349; 4 5 All funds held by Bank of America N.A., in the name of FBA Stores LLC, 15. All funds held by Rockland Trust Company, in the name of Online Auction 20 Learning Center, Inc., including the Demand Deposit accounts ending in 1323 and 21 2412; 22 23 10 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 11 of 30 1 16. All funds held by Rockland Trust Company, in the name of Auction Profit 2 Builders LLC dba “Insider Online Secrets”, including the Demand Deposit 3 account ending in 1538; 4 17. LLC, including the Demand Deposit account ending in 6468; 5 6 18. 19. 20. All funds held by JP Morgan Chase & Co., in the name of Plaza TowneHomes, LLC, including the account ending in 3929; 11 12 All funds held by JP Morgan Chase & Co., in the name of Info Pros LLC, including the account ending in 3922; 9 10 All funds held by Rockland Trust Company, in the name of Surf Cellular Express LLC, including the Demand Deposit account ending in 7031; 7 8 All funds held by Rockland Trust Company, in the name of Finn Rich Wireless 21. All reserve funds or any other accounts held, controlled, or serviced by Stripe, 13 Inc. and associated with any payments processed by, or on behalf of FBA 14 Distributors LLC, including the merchant account with the merchant 15 identification number (“MID”) ending in uiJvd; 16 22. All reserve funds or any other accounts held, controlled, or serviced by Stripe, 17 Inc. and associated with any payments processed by, or on behalf of Adam 18 Bowser dba “AWS”, including the merchant account with the MID ending in 19 K9Yc2; 20 23. All reserve funds or any other accounts held, controlled, or serviced by Electronic 21 Merchant Systems and associated with any payments processed by, or on behalf 22 of FBA Stores LLC, including the merchant account with the MID ending in 23 0179; 11 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 12 of 30 1 24. All reserve funds or any other accounts held, controlled, or serviced by Electronic 2 Merchant Systems and associated with any payments processed by, or on behalf 3 of Online Auction Learning Center, Inc., including the merchant accounts with 4 the MID ending in 0908; 5 25. All reserve funds or any other accounts held, controlled, or serviced by EVO 6 Payments International, LLC and associated with any payments processed by, or 7 on behalf of FBA Stores LLC, including the merchant account with the MID 8 ending in 4353; 9 26. All reserve funds or any other accounts held, controlled, or serviced by EVO 10 Payments International, LLC and associated with any payments processed by, or 11 on behalf of Online Auction Learning Center, Inc., including the merchant 12 accounts with the MIDs ending in 2829 and 7498; 13 27. All reserve funds or any other accounts held, controlled, or serviced by PayPal, 14 Inc. and associated with any payments processed by, or on behalf of FBA Stores, 15 LLC, including the merchant account with the MID ending in 3735; 16 28. All reserve funds or any other accounts held, controlled, or serviced by PayPal, 17 Inc. and associated with any payments processed by, or on behalf of Info Pros 18 LLC, including the merchant account with the MID ending in 4079; 19 29. All reserve funds or any other accounts held, controlled, or serviced by PayPal, 20 Inc. and associated with any payments processed by, or on behalf of Info 21 Solutions, LLC, including the merchant account with the MID ending in 0073; 22 23 30. All reserve funds or any other accounts held, controlled, or serviced by PayPal, Inc. and associated with any payments processed by, or on behalf of Online 12 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 13 of 30 1 Auction Learning Center, Inc., including the merchant accounts with the MIDs 2 ending in 8564 and 1083; 3 31. All reserve funds or any other accounts held, controlled, or serviced by Qualpay 4 and associated with any payments processed by, or on behalf of FBA Stores LLC, 5 including the merchant account with the MID ending in 0602; and 6 32. All reserve funds or any other accounts held, controlled, or serviced by Global 7 Payments, Inc. and associated with any payments processed by, or on behalf of 8 Info Pros LLC dba “On Line Seller” or “Online Seller”, including the merchant 9 account with the MID ending in 3060. 10 D. To the extent they are not already in the possession of the Receiver, Settling 11 Defendants shall deliver the assets identified in Subsection C above to the Receiver’s possession 12 within 7 days of the entry of this Order. 13 E. The Receiver shall, as soon as practicable, commence the sale of the unliquidated 14 assets identified in Subsection C above and surrendered pursuant to this Order using a 15 commercially reasonable procedure. The Receiver shall hold the surrendered assets, and the 16 proceeds from the sale of the unliquidated assets, for future transfer in accordance with further 17 instructions from the Court. 18 F. Upon delivery of the payments specified in Subsection B above to the 19 Commission, and of all the assets specified in Subsection C above to the Receiver, the remainder 20 of the judgment is suspended, subject to Subsections G-O below. 21 22 G. The Commission’s agreement to the suspension of part of the judgment is expressly premised upon the truthfulness, accuracy, and completeness of Settling Defendants’ 23 13 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 14 of 30 1 sworn financial statements and related Documents (collectively, “financial representations”) 2 submitted to the Commission, namely: 3 1. 4 5 March 21, 2018, including the attachments; 2. 6 7 the Financial Statement of Individual Defendant Adam S. Bowser signed on March 27, 2018, including the attachments; 3. 8 9 the Financial Statement of Individual Defendant Christopher F. Bowser signed on the Financial Statement of Individual Defendant Jody Marshall, signed on March 28, 2018, including the attachments; 4. the Financial Statement of Corporate Defendant FBA Stores, LLC signed by 10 Alma Kelly, Internal Accountant, on March 21, 2018, including the attachments; 11 and 12 5. the Financial Statement of Corporate Defendant Online Auction Learning Center, 13 Inc. (Mass. Corp.), signed by Christopher F. Bowser, Owner, on March 21, 2018, 14 including the attachments. 15 H. The suspension of the judgment will be lifted as to any Settling Defendant if, 16 upon motion by the Commission, the Court finds that Settling Defendant failed to disclose any 17 material asset, materially misstated the value of any asset, or made any other material 18 misstatement or omission in the financial representations identified above. 19 I. If the suspension of the judgment is lifted, the judgment becomes immediately 20 due as to that Settling Defendant in the amount specified in Subsection A above (which the 21 parties stipulate only for purposes of this Section represents the consumer injury and unjust 22 enrichment alleged in the Complaint), less any payments previously made pursuant to this 23 Section, plus interest computed from the date of entry of this Order. 14 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 15 of 30 J. 1 Settling Defendants relinquish dominion and all legal and equitable right, title, 2 and interest in all assets transferred pursuant to this Order and may not seek the return of any 3 assets. 4 K. The facts alleged in the Complaint will be taken as true, without further proof, in 5 any subsequent civil litigation by or on behalf of the Commission, including in a proceeding to 6 enforce its rights to any payment or monetary judgment pursuant to this Order, such as a 7 nondischargeability complaint in any bankruptcy case. 8 9 10 11 L. The facts alleged in the Complaint establish all elements necessary to sustain an action by the Commission pursuant to Section 523(a)(2)(A) of the Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), and this Order will have collateral estoppel effect for such purposes. M. Settling Defendants acknowledge that their Taxpayer Identification Numbers 12 (Social Security Numbers or Employer Identification Numbers), which Settling Defendants 13 previously submitted to the Commission, may be used for collecting and reporting on any 14 delinquent amount arising out of this Order, in accordance with 31 U.S.C. §7701. 15 N. All money paid to the Commission or assets ultimately surrendered to the 16 Commission pursuant to this Order (or any subsequent Court order issued in this matter) and 17 further instructions from the Court may be deposited into a fund administered by the 18 Commission or its designee to be used for equitable relief, including consumer redress and any 19 attendant expenses for the administration of any redress fund. If a representative of the 20 Commission decides that direct redress to consumers is wholly or partially impracticable or 21 money remains after redress is completed, the Commission may apply any remaining money for 22 such other equitable relief (including consumer information remedies) as it determines to be 23 reasonably related to Settling Defendants’ practices alleged in the Complaint. Any money not 15 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 16 of 30 1 used for such equitable relief is to be deposited to the U.S. Treasury as disgorgement. Settling 2 Defendants have no right to challenge any actions the Commission or its representatives may 3 take pursuant to this Subsection. 4 O. The asset freeze imposed by the March 14, 2018 Temporary Restraining Order 5 [ECF No. 29], is modified to permit the payment and transfers identified in Subsections B and C 6 above. Upon completion of those payment and transfers, the asset freeze as to Settling 7 Defendants is dissolved. Any existing asset freeze as to the remaining non-settling Defendants 8 shall remain in full force and effect. 9 10 IV. CUSTOMER INFORMATION IT IS FURTHER ORDERED that Settling Defendants, and their representatives, agents, 11 employees, and attorneys, and all other persons in active concert or participation with any of 12 them, who receive actual notice of this Order, are permanently restrained and enjoined from 13 directly or indirectly: 14 A. failing to provide sufficient customer information to enable the Commission to 15 efficiently administer consumer redress. Settling Defendants represent that they have provided 16 this redress information to the Commission. If a representative of the Commission requests in 17 writing any information related to redress, Settling Defendants must provide it, in the form 18 prescribed by the Commission, within 14 days. 19 B. disclosing, using, or benefitting from customer information, including the name, 20 address, telephone number, email address, social security number, other identifying information, 21 or any data that enables access to a customer’s account (including a credit card, bank account, or 22 other financial account), that any Settling Defendant obtained prior to entry of this Order in 23 16 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 17 of 30 1 connection with the advertising, marketing, distribution, promotion and sale of business 2 opportunities to consumers throughout the United States; and 3 C. failing to destroy such customer information in all forms in their possession, 4 custody, or control within 30 days after receipt of written direction to do so from a representative 5 of the Commission. 6 Provided, however, that customer information need not be disposed of, and may be 7 disclosed, to the extent requested by a government agency or required by law, regulation, or 8 court order. 9 V. COOPERATION 10 IT IS FURTHER ORDERED that Settling Defendants must fully cooperate with 11 representatives of the Commission in this case and in any investigation related to or associated 12 with the transactions or the occurrences that are the subject of the Complaint. Settling 13 Defendants must provide truthful and complete information, evidence, and testimony. Settling 14 Individual Defendants must appear and Settling Corporate Defendants must cause Settling 15 Corporate Defendants’ officers, employees, representatives, or agents to appear for interviews, 16 discovery, hearings, trials, and any other proceedings that a Commission representative may 17 reasonably request upon 5 days written notice, or other reasonable notice, at such places and 18 times as a Commission representative may designate, without the service of a subpoena. 19 VI. RECEIVERSHIP 20 IT IS FURTHER ORDERED that Robb Evans & Associates LLC is hereby appointed 21 equity Receiver for the Settling Corporate Defendants for the purpose of taking the necessary 22 steps to wind down the businesses of the Settling Corporate Defendants, liquidate assets, and pay 23 any net proceeds to the Commission to satisfy the monetary judgment in this Order. In carrying 17 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 18 of 30 1 out these duties, the Receiver shall be the agent of this Court, shall be accountable directly to this 2 Court, and is authorized and directed to: 3 4 5 A. Take any and all steps that the Receiver concludes are appropriate to wind down the affairs of the Settling Corporate Defendants. B. Continue to exercise full control over the Settling Corporate Defendants and 6 continue to collect, marshal, and take custody, control, and possession of all the funds, property, 7 premises, accounts, documents, mail, and other assets of, or in the possession or under the 8 control of the Settling Corporate Defendants, wherever situated, the income and profits 9 therefrom, and all sums of money now or hereafter due or owing to the Settling Corporate 10 11 12 13 Defendants. C. Continue to have full control over the management and personnel of the Settling Corporate Defendants. D. Take all steps necessary or advisable, including issuing subpoenas, to locate and 14 liquidate all other assets of the Settling Corporate Defendants, cancel the Settling Corporate 15 Defendants’ contracts, collect on amounts owed to the Settling Corporate Defendants, and take 16 such other steps as may be necessary to wind-down the Settling Corporate Defendants 17 efficiently. 18 E. To the extent not already completed, the Receiver shall as soon as practicable 19 after the entry of this Order, take exclusive custody, control, and possession of all assets 20 identified in Section III.C of this Order. 21 22 F. The Receiver shall give reasonable notice to the Commission of any settlements or compromises by the Receiver concerning the Receivership Estate, before the settlement or 23 18 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 19 of 30 1 compromise is consummated. Within 20 days of this notice, the Commission shall have the 2 opportunity to object to any such settlement, by filing a motion with the Court. 3 G. Make payments and disbursements from the Receivership Estate that are 4 necessary or advisable for carrying out the directions of, or exercising the authority granted by, 5 this Order. The Receiver shall apply to the Court for prior approval of any payment of any debt 6 or obligation incurred by the Settling Corporate Defendants prior to the date of entry of the 7 temporary restraining order in this action, except payments that the Receiver deems necessary or 8 advisable to ensure assets of the Settling Corporate Defendants are not lost, stolen, or dissipated. 9 H. Institute actions or proceedings in state, federal, or foreign courts as the Receiver 10 deems necessary and advisable to preserve or recover the assets of the Settling Corporate 11 Defendants, or that the Receiver deems necessary and advisable to carry out the Receiver’s 12 mandate under this Order, including actions challenging fraudulent or voidable transfers. 13 I. Defend any or all actions or proceedings instituted against the Settling Corporate 14 Defendants, as the Receiver deems necessary and advisable to preserve the assets of the Settling 15 Corporate Defendants. 16 17 18 J. Continue to maintain accurate records of all receipts and expenditures incurred as the Receiver. K. Perform all acts necessary or advisable to complete an accurate accounting of 19 assets of the Receivership Estate, and prevent unauthorized transfer, withdrawal, or 20 misapplication of said assets. 21 L. Continue to be entitled to reasonable compensation for the performance of the 22 Receiver’s duties pursuant to this Order, including duties performed by the Receiver’s agents, 23 including accountants and lawyers, and for the cost of actual out-of-pocket expenses incurred by 19 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 20 of 30 1 them, from the assets of the Receivership Estate, at the hourly rate previously agreed to by the 2 Receiver and used as the bases for prior fee applications approved by the Court. 3 VII. ORDER ACKNOWLEDGMENTS 4 IT IS FURTHER ORDERED that Settling Defendants obtain acknowledgments of 5 6 7 8 9 receipt of this Order: A. Each Settling Defendant, within 7 days of entry of this Order, must submit to the Commission an acknowledgment of receipt of this Order sworn under penalty of perjury. B. For 10 years after entry of this Order, each Settling Individual Defendant for any business that such Settling Defendant, individually or collectively with any other Settling 10 Defendants, is the majority owner or controls directly or indirectly, and each Settling Corporate 11 Defendant, must deliver a copy of this Order to: (1) all principals, partners, officers, directors, 12 and LLC managers and members; (2) all employees, agents, and representatives who participate 13 in conduct related to the subject matter of the Order; and (3) any business entity resulting from 14 any change in structure as set forth in the Section titled Compliance Reporting. Delivery must 15 occur within 7 days of entry of this Order for current personnel. For all others, delivery must 16 occur before they assume their responsibilities. 17 C. From each individual or entity to which a Settling Defendant delivered a copy of 18 this Order, that Settling Defendant must obtain, within 30 days, a signed and dated 19 acknowledgment of receipt of this Order. 20 21 22 VIII. COMPLIANCE REPORTING IT IS FURTHER ORDERED that Settling Defendants make timely submissions to the Commission: 23 20 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 21 of 30 1 2 3 A. One year after entry of this Order, each Settling Defendant must submit a compliance report, sworn under penalty of perjury: 1. Each Settling Defendant must: (a) identify the primary physical, postal, and email 4 address and telephone number, as designated points of contact, which 5 representatives of the Commission may use to communicate with Settling 6 Defendant; (b) identify all of that Settling Defendant’s businesses by all of their 7 names, telephone numbers, and physical, postal, email, and Internet addresses; (c) 8 describe the activities of each business, including the goods and services offered, 9 the means of advertising, marketing, and sales, and the involvement of any other 10 Settling Defendant (which Settling Individual Defendants must describe if they 11 know or should know due to their own involvement); (d) describe in detail 12 whether and how that Settling Defendant is in compliance with each Section of 13 this Order; and (e) provide a copy of each Order Acknowledgment obtained 14 pursuant to this Order, unless previously submitted to the Commission. 15 2. Additionally, each Settling Individual Defendant must: (a) identify all telephone 16 numbers and all physical, postal, email and Internet addresses, including all 17 residences; (b) identify all business activities, including any business for which 18 such Settling Defendant performs services whether as an employee or otherwise 19 and any entity in which such Settling Defendant has any ownership interest; and 20 (c) describe in detail such Settling Defendant’s involvement in each such 21 business, including title, role, responsibilities, participation, authority, control, 22 and any ownership. 23 21 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 22 of 30 1 B. For 20 years after entry of this Order, each Settling Defendant must submit a 2 compliance notice, sworn under penalty of perjury, within 14 days of any change in the 3 following: 4 1. Each Settling Defendant must report any change in: (a) any designated point of 5 contact; or (b) the structure of any Settling Corporate Defendant or any entity that 6 Settling Defendant has any ownership interest in or controls directly or indirectly 7 that may affect compliance obligations arising under this Order, including: 8 creation, merger, sale, or dissolution of the entity or any subsidiary, parent, or 9 affiliate that engages in any acts or practices subject to this Order. 10 2. Additionally, each Settling Individual Defendant must report any change in: (a) 11 name, including aliases or fictitious name, or residence address; or (b) title or role 12 in any business activity, including any business for which such Settling Defendant 13 performs services whether as an employee or otherwise and any entity in which 14 such Settling Defendant has any ownership interest, and identify the name, 15 physical address, and any Internet address of the business or entity. 16 C. Each Settling Defendant must submit to the Commission notice of the filing of 17 any bankruptcy petition, insolvency proceeding, or similar proceeding by or against such Settling 18 Defendant within 14 days of its filing. 19 D. Any submission to the Commission required by this Order to be sworn under 20 penalty of perjury must be true and accurate and comply with 28 U.S.C. § 1746, such as by 21 concluding: “I declare under penalty of perjury under the laws of the United States of America 22 that the foregoing is true and correct. Executed on: _____” and supplying the date, signatory’s 23 full name, title (if applicable), and signature. 22 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 23 of 30 1 E. Unless otherwise directed by a Commission representative in writing, all 2 submissions to the Commission pursuant to this Order must be emailed to DEbrief@ftc.gov or 3 sent by overnight courier (not the U.S. Postal Service) to: Associate Director for Enforcement, 4 Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, 5 Washington, DC 20580. The subject line must begin: FTC v. AWS, LLC et al., X180026. 6 7 IX. RECORDKEEPING IT IS FURTHER ORDERED that Settling Defendants must create certain records for 20 8 years after entry of the Order, and retain each such record for 5 years. Specifically, Settling 9 Corporate Defendants and each Settling Individual Defendant for any business that such Settling 10 Defendant, individually or collectively with any other Settling Defendants, is a majority owner 11 or controls directly or indirectly, must create and retain the following records: 12 A. accounting records showing the revenues from all goods or services sold; 13 B. personnel records showing, for each person providing services, whether as an 14 employee or otherwise, that person’s: name; addresses; telephone numbers; job title or position; 15 dates of service; and (if applicable) the reason for termination; 16 17 18 19 20 C. records of all consumer complaints and refund requests, whether received directly or indirectly, such as through a third party, and any response; D. all records necessary to demonstrate full compliance with each provision of this Order, including all submissions to the Commission; and E. a copy of each unique advertisement or other marketing material. 21 22 23 23 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 24 of 30 1 X. COMPLIANCE MONITORING 2 IT IS FURTHER ORDERED that, for the purpose of monitoring Settling Defendants’ 3 compliance with this Order, including the financial representations upon which part of the 4 judgment was suspended and any failure to transfer any assets as required by this Order: 5 A. Within 14 days of receipt of a written request from a representative of the 6 Commission, each Settling Defendant must: submit additional compliance reports or other 7 requested information, which must be sworn under penalty of perjury; appear for depositions; 8 and produce Documents for inspection and copying. The Commission is also authorized to 9 obtain discovery, without further leave of court, using any of the procedures prescribed by 10 Federal Rules of Civil Procedure 29, 30 (including telephonic depositions), 31, 33, 34, 36, 45, 11 and 69. 12 B. For matters concerning this Order, the Commission is authorized to communicate 13 directly with each Settling Defendant. Settling Defendant must permit representatives of the 14 Commission to interview any employee or other person affiliated with any Settling Defendant 15 who has agreed to such an interview. The person interviewed may have counsel present. 16 C. The Commission may use all other lawful means, including posing, through its 17 representatives, as consumers, suppliers, or other individuals or entities, to Settling Defendants 18 or any individual or entity affiliated with Settling Defendants, without the necessity of 19 identification or prior notice. Nothing in this Order limits the Commission’s lawful use of 20 compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 U.S.C. §§ 49, 57b-1. 21 D. Upon written request from a representative of the Commission, any consumer 22 reporting agency must furnish consumer reports concerning Settling Individual Defendants, 23 pursuant to Section 604(1) of the Fair Credit Reporting Act, 15 U.S.C. §1681b(a)(1). 24 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 25 of 30 1 XI. RETENTION OF JURISDICTION 2 IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for 3 purposes of construction, modification, and enforcement of this Order. 4 June day of SO ORDERED this 15, 2018. , 2018. 5 ______________________________ United States District Judge 6 7 8 9 10 11 STIPULATED AND AGREED TO BY: 12 FOR SETTLING DEFENDANTS: 13 14 15 16 17 _________________________________ Suzette Michele M. Moore Shumaker Bank of America Plaza, Suite 2800 101 East Kennedy Boulevard Tampa, FL 33602 Tel. (813) 227-2272 Email: smoore@slk-law.com Date:_________________________ 18 19 20 21 Attorney for defendants AWS, LLC, FBA Distributors, LLC, FBA Stores, LLC, Info Pros, LLC, Info Solutions, LLC, Online Auction Learning Center, Inc. (Mass. Corp.), Online Auction Learning Center, Inc. (Nev. Corp.), Christopher F. Bowser, Adam S. Bowser, and Jody L. Marshall 22 23 25 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 26 of 30 1 DEFENDANTS: 2 ________________________________ Christopher F. Bowser, Individually and as Vice President and Manager of FBA Distributors, LLC; Vice President of FBA Stores, LLC, Managing Member of Info Solutions, LLC; President of Online Auction Learning Center (Mass. Corp.) and Online Auction Learning Center (Nev. Corp.) Date:_____________________________ ____________________________________ Adam S. Bowser, Individually and as Manager of AWS, LLC; Manager and President of FBA Distributors, LLC; Managing Member of Info Solutions, LLC; Officer of Online Auction Learning Center (Mass. Corp.) and Online Auction Learning Center (Nev. Corp.) Date:______________________________ ____________________________________ Jody L. Marshall, Individually and as Manager of Info Pros, LLC; Managing Member of Info Solutions, LLC; Owner of FBA Distributors, LLC 04/23/2018 Date: ______________________________ 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 FOR FEDERAL TRADE COMMISSION: 18 19 20 21 22 23 6/12/2018 Date: ______________________________ Roberto Anguizola Illinois Bar # 6270874 (Admitted pursuant to LR IA 11-3) Tel. (202) 326-3284 Email: ranguizola@ftc.gov 26 DocuSign Envelope ID: 5813994A-78FC-4D90-A3D7-32FFD1B8A6BF Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 27 of 30 1 2 3 4 5 6 7 8 Miry Kim Washington Bar # 31456 (Admitted pursuant to LR IA 11-3) Tel. (202) 326-3622 Email: mkim@ftc.gov Gregory J. Evans DC Bar # 1033184 (Admitted pursuant to LR IA 11-3) Tel. (202) 326-3425 Email: gevans2@ftc.gov Federal Trade Commission 600 Pennsylvania Avenue, N.W. Mail Drop CC-8528 Washington, D.C. 20580 9 10 Attorneys for Plaintiff FEDERAL TRADE COMMISSION 11 12 13 14 15 16 17 18 19 20 21 22 23 27 Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 28 of 30 1 CERTIFICATE OF SERVICE 2 I hereby certify that on June 12, 2018, I caused the foregoing document to be filed with 3 the Clerk of the Court via the Court’s CM/ECF electronic filing system. Additionally, I served 4 all of the counsel and parties listed on the attached Service List by the methods indicated therein. 5 6 7 /s/ Roberto Anguizola Roberto Anguizola Attorney for Plaintiff FEDERAL TRADE COMMISSION 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 1 Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 29 of 30 1 2 3 4 5 6 7 8 9 SERVICE LIST Suzette Michele M. Moore S. Moore Law 4720 Cleveland Heights Blvd. Suite 201 Lakeland, FL 33813 Tel. (863) 229-2140 Email: s.moore@smoorelaw.com Ronald D. Green (NV Bar No. 7360) LaTeigra C. Cahill (NV Bar No. 14352) Randazza Legal Group, PLLC 4035 S. El Capitan Way Las Vegas, NV 89147 Tel. (702) 420 2001 Email: lcc@randazza.com, rdg@randazza.com Attorney for defendants AWS, LLC, FBA Distributors, LLC, FBA Stores, LLC, Info Pros, LLC, Online Auction Learning Center, Inc. (Mass. Corp.), Online Auction Learning Center, Inc. (Nev. Corp.), Christopher F. Bowser, Adam S. Bowser, and Jody Marshall 10 Seeking admission Pro Hac Vice 11 Served via email 12 Attorney for defendants AWS, LLC, FBA Distributors, LLC, FBA Stores, LLC, Info Pros, LLC, Online Auction Learning Center, Inc. (Mass. Corp.), Online Auction Learning Center, Inc. (Nev. Corp.), Christopher F. Bowser, Adam S. Bowser, and Jody Marshall Brick Kane President Robb Evans & Associates LLC 11450 Sheldon Street Sun Valley, California 91352-1121 Tel: (818) 768-8100 Fax: (818) 768-8802 Email: bkane@robbevans.com Served via email 13 14 15 Gary Owen Caris Barnes & Thornburg LLP 2029 Century Park E., Suite 300 Los Angeles, California 90067-2904 Tel. (424) 363-2920 Email: gcaris@btlaw.com Court Appointed Receiver Attorney for the Court Appointed Receiver Robb Evans & Associates LLC Served via email Served via email 16 17 18 19 20 21 22 23 2 Case 2:18-cv-00442-JCM-PAL Document 78 Filed 06/12/18 Page 30 of 30 1 2 3 James C. Bastian, Jr. Shulman Hodges & Bastian LLP 100 Spectrum Center Drive, Suite 600 Irvine, CA 92618 Tel. (949) 340-3400 Email: jbastian@shbllp.com 4 5 Attorney for defendants Adams Consulting, LLC, Global Marketing Services L.L.C, and Jeffery A. Gomez 6 Served via email 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 3

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.


Why Is My Information Online?