Federal Trade Commission v. The Cuban Exchange, Inc. et al

Filing 23

ORDER ADOPTING REPORT AND RECOMMENDATIONS of Magistrate Judge Levy. The court GRANTS plaintiff's motion and the TRO issued by Judge Mauskopf is hereby converted into a preliminary injunction. So Ordered by Judge Nicholas G. Garaufis on 1/4/2013. (Lee, Tiffeny)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

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FEDERAL TRADE COMMISSION,
Plaintiff,

ORDER

12-CV-5890 (NGG) (RML)

-againstTHE CUBAN E)( CHANGE, INC., also d/b/a
CreditSure America and also d/b/a
MyiPad.us, a corporation, and SUHA YLEE
RIVERA, individually and as an officer or
director of The Cuban Exchange, Inc.,
Defendants.

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NICHOLAS G. GARAUFIS, United States District Judge.

On November 28, 2012, Plaintiff Federal Trade Commission ("FTC") filed this suit alleging that
Defendants violated the Federal Trade Commission Act, as amended, 15 U.S.C. § 41, et seq. ("FTC
Act"), and the Telemarketing Sales Rule, 16 C.F.R. Part 310, by orchestrating a scam in which
Defendants duped consumers into providing their bank account information. (Compl. (Dkt. I).)
Specifically, Plaintiff alleges that Defendants made illegal "robocalls" to consumers that displayed caller
identification information that falsely indicated that the calls originated from the FTC. (Id.

~

3.) These

messages allegedly directed consumers to http://www.ftcrefund.com, which solicited their bank account
information to facilitate payments supposedly owed to them by the FTC. (Id.) Plaintiff alleges,
however, that it has no relationship with Defendants and that the entire story was a ruse. (!d.

~~

3-4.)

Also on November 28,2012, Plaintiff moved for a temporary restraining order ("TRO") and
preliminary injunction shutting down Defendants' websites, enjoining them from engaging in certain
telemarking conduct, requiring the preservation of evidence, and providing expedited discovery. (See
Mot. for TRO (Dkt. 2).) On November 30, 2012, the Honorable Roslynn R. Mauskopf of the Eastern

District of New York held a hearing on Plaintiffs request for a TRO. (See Nov. 29,2012, Order to
Show Cause (Dkt. 8); Nov. 30,2012, Order (Dkt. 14).) Defendants did not appear at this hearing.
Later on November 30,2012, Judge Mauskopf granted Plaintiffs motion and issued the TRO,
which was to expire after fourteen days. (See Nov. 30, 2012, Order at 20.) Judge Mauskopffurther
ordered Defendants to appear before Magistrate Judge Robert M. Levy on December 12,2012, to show
cause why a report and recommendation ("R&R") should not issue to this court recommending the entry
of a preliminary junction against them. (See id. at 18.)
On December 12, 2012, Judge Levy conducted the hearing ordered by Judge Mauskopf;
Defendants again did not appear. (See Dec. 12, 2012, Order.) At the hearing, Plaintiff detailed its
evidence in support of its motion for a preliminary injunction and orally moved to extend the TRO. (ld.)
In a subsequent order, Judge Mauskopf invited any papers in support of or in opposition to this motion
to extend to be submitted by December 14,2012. (ld.) Defendants did not submit any opposition.
On December 14, 2012, Judge Mauskopfheld a hearing on the motion to extend. (See Dec. 14,
2012, Minute Entry (Dkt. 20).) Defendants did not appear. (l.Q) That day, Judge Mauskopf granted
Plaintiffs motion and extended the TRO until January 25,2013. (Dec. 14,2012, Order (Dkt. 21).)
On December 19, 2012, Judge Levy issued his R&R, which recommended that this court grant
Plaintiffs motion for a preliminary injunction. (See R&R (Dkt. 22).) Judge Levy concluded that based
on the documentary evidence, Plaintiff satisfied the standard articulated in the FTC Act, which
authorizes the FTC to obtain a preliminary injunction "[ u]pon a proper showing that, weighing the
equities and considering the Commission's likelihood'ofultimate success, such action would be in the
public interest."' (!d. at 3 (quoting 15 U.S.C. § 53(b)) (alteration in original).) Judge Levy ordered that
any objections to the R&R were to be submitted within fourteen days, or by January 2, 2013. (See id. at
5-6.)

2

No party has objected to Judge Levy's R&R, and the time to do so has passed. See Fed. R. Civ.
P. 72(b)(2). (See also R&R at 5-6.) Therefore, the court reviews the R&R for clear error. See Gesualdi
v. Mack Excavation & Trailer Serv., Inc., No. 09-CV-2502 (KAM) (JO), 2010 WL 985294, at *I
(E.D.N.Y. Mar. 15, 2010); La Torres v. Walker, 216 F. Supp. 2d 157, 159 (S.D.N.Y. 2000); cf. 28
U.S.C. § 636(b)(l). Finding no clear error, the court ADOPTS the R&R in its entirety. See Porter v.
Potter, 219 F. App'x 112 (2d Cir. 2007). Accordingly, the court GRANTS Plaintiffs motion and the
TRO issued by Judge Mauskopf is hereby converted into a preliminary injunction. See Barturen v. Wild
Edibles, Inc., No. 07-CV-8127 (LLS), 2007 WL 4468656, at *6 (S.D.N.Y. Dec. 18, 2007) (converting a
TRO into a preliminary injunction).
SO ORDERED.

s/Nicholas G. Garaufis
!NICHOLAS G. GARAUFIS
United States District Judge

Dated: Brookly2J New York
January+-· 2013

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