Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 1 of 62 Page ID #:889

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1 JONATHAN E. NUECHTERLEIN 

General Counsel 

2 CHARLES A. HARWOOD 

Regional Director 

3 LAURA M. SOLIS, W A State Bar No. 36005 

Email: lsolis(a),ftc.gov 

4 KATHRYN C. DECKER, WA State Bar No. 12389 

Email: kdecker(a),ftc.g<w 5 JULIE K. Ml\.YER, WA State Bar No. 34638 

Email: jmayer(a),ftc.gov 

6 Federal Trade Commission 

915 Second A venue, Suite 2896 

7 Seattle, WA 98174 

Phone: (206) 220-6350 

8 Facsimile: (206) 220-6366 

9 Local Counsel 

RAYMOND E. McKOWN, CA Bar No. 150975 

10 Email: rmckown@ftc .. gqv Federal Trade Comm1ss10n 

11 10877 Wilshire Blvd., Suite 700 

Los Angeles\ CA 90024 

12 Phone: (310} 824-4325 

Facsimile: (310) 824-4380 

13 

14 Attorneys for Plaintiff 

Federal Trade Commission 

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16 

17 

UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

18 FEDERAL TRADE COMMISSION, 

19 

20 

21 

Plaintiff, 

v. 

22 CREAM GROUP, INC., also d/b/a 

Terra Nova, TNT, Inc., and CRM, Inc., 

23 a California Corporation; 

r;t1~·- 8 8 4 J1h'V I 1?\h J 

· mm¥k'btAb~¥fRY 

SAMI CHARCHIAN, also d/b/a Oro 

24 Marketing, Inc., Modo, Modo Industry, 

25 Oro Max, Casa de Oro, Casa de Moda, 

Oro Mundo, and Nation/Modo, 

26 , .. individually and as an owner or director 

of Cream Group, Inc.; 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 1 
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1 JOHN CHARCHIAN, a/k/a Djahangir Charchian and J ahangir John Charcliian, 

2 also d/b/a Oro Marketing, Inc., Modo, 

Modo Industry, Oro Max, Cas a de Oro, 

3 Casa de Moda, Oro Mundo, and 

Nation/Modo, individually and as an 

4 owner or director of Cream Group, Inc.; 

and 

5 NORMA RAE RAMOS, individually 

6 and as officer and director of Cream 

Group, Inc.; 

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8 

9 

10 

11 

Defendants. 

Plaintiff Federal Trade Commission ("Commission" or "FTC"), pursuant to 

Sections 13(b) and 19 of the Federal Trade Commission Act ("FTC Act"), 15 

U.S.C. §§ 53(b) and 57b, and the Telemarketing and Consumer Fraud and Abuse 

12 Prevention Act ("Telemarketing Act"), 15 U.S.C. §§ 6101-6108, has filed a 

13 Complaint for Permanent Injunction and Other Equitable Relief, and has applied 

14 for a temporary restraining order, asset freeze, and other equitable relief, and an 

15 order to show cause why a preliminary injunction should not issue pursuant to 

16 Rule 65 of the Federal Rules of Civil Procedure, for Defendants' acts or practices 

17 in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), and the FTC's 

18 Telemarketing Sales Rule ("TSR"), 16 C.P.R. Part 310. 

19 FINDINGS OF FACT 

20 This Court, having considered the FTC's Complaint, Application for Ex 

21 Parte Temporary Restraining Order, Memorandum of Points and Authorities, 

22 declarations, exhibits, and all other papers filed in support of the FTC's 

application, finds that: 23 

24 1. This Court has jurisdiction over the subject matter of this case, and \ 

25 there is good cause to believe it will have jurisdiction over all the parties hereto, 

26 and that venue in this district is proper. 

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2. There is good cause to believe that Defendants CREAM GROUP, 

INC., also d/b/a Terra Nova, TNT, Inc., and CRM, Inc., a California corporation; 

its principal, SAMI CHARCHIAN, also d/b/a Oro Marketing, Inc., Modo, Modo 

Industry, Oro Max, Casa de Oro, Casa de Moda, Oro Mundo, and Nation/Modo; 

its principal, JOHN CP~CHIAN, afl.tda Djahangir Charchian and Jahangir John 

Charchian, also d/b/a Oro Marketing; Inc., Modo, Modo Industry, Oro Max, Casa 

de Oro, Casa de Moda, Oro Mundo, and Nation/Modo; and its principal NORMA 

RAE RAMOS have engaged in, and are likely to continue to engage in, acts and 

practices that violate Section 5(a) of the FTC Act and the TSR, and that the 

Commission is likely to prevail on the merits of this action. 

3. There is good cause to believe that consumers will suffer immediate 

and irreparable harm from Defendants' ongoing violations of Section 5(a) of the 

FTC Act and the TSR unless Defendants are restrained and enjoined by this 

Court's entry of a Temporary Restraining Order{"Order"). 

4. There is good cause to believe that immediate and irreparable 

damage to the Court's ability to grant effective final relief for consumers, 

including the refund of monies paid, restitution, or rescission of contracts, will 

occur from the sale, transfer, or other disposition, or concealment by Defendants 

of their assets or records unless they are immediately restrained and enjoined by 

order of this Court and that, in accordance with Fed. R. Civ. P. 65(b), the interest 

of justice requires that the FTC's Motion be heard ex parte without prior notice to 

Defendants. Thus, there is good cause for an asset freeze, the appointment of a 

temporary receiver, and for issuing this Order without prior notice to Defendants 

of the Commission's application, pursuant to Federal Rule of Civil Procedure 

65(b). 

28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 3 
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1 5. Considering the Commission's likelihood of ultimate success and 

2 weighing the equities, a temporary restraining order with an asset freeze, 

3 appointment of a temporary receiver, and other equitable relief is in the public 

4 interest. 

h. 5 v. No security is required of any agency of the United States for 

6 issuance of a restraining order. Fed. R. Civ. P. 65(c). 

7 ORDER 

8 Definitions 

9 For purposes of this Order, the following definitions shall apply: 

10 1. "Asset" or "Assets" means any legal or equitable interest in, right to, 

11 or claim to any real, personal, or intellectual property of any Defendant, or held 

12 for the benefit of any Defendant, wherever located, whether in the United States 

13 or abroad, including, but not limited to, chattel, goods, instruments, equipment, 

14 fixtures, general intangibles, effects, leaseholds, contracts, mail or other 

15 deliveries, shares of stock, commodities, futures, inventory, checks, notes, 

16 accounts, credits, receivables (as those terms are defined in the Uniform 

17 Commercial Code), cash and trusts including, but not limited to, any of the 

18 Individual Defendants' minor children or spouses, and shall include both existing 

19 assets and assets acquired after the date of entry of this Order. 

20 2. "Asset Freeze Defendants" means the Corporate Defendant, Sami 

21 Charchian, and John Charchian, individually, collectively, or in any combination, 

22 and each of them by whatever other names each might be known, and any 

23 fictitious business entities or business names created or used by any of them, 

24 including but not limited to, Oro Marketing, Inc., Modo, Modo Industry, Oro 

25 Max, Casa de Oro, Casa de Moda, Oro Mundo, and Nation/Modo. 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 4 
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C) 

3. "Assisting Others" includes, but is not limited to: (1) performing 

customer service functions, including, but riot limited to, receiving or responding 

to consumer complaints; (2) formulating or providing, or arranging for the 

formulation or provision of, any telephone script, direct mail solicitation, or other 

r1 ' f'' .[:' T 1 • '1 1 1 , • 

.... es1gn, text, or use 01. Images OJ. an.y .1ntemet weos1te, emau, or otner ewcuomc 

communication; (3) formulating or providing, or arranging for the formulation or 

7 provision of, any marketing support material or service, including, but not limited 

8 to, web or internet protocol addresses or domain name registration of any Internet 

9 websites, affiliate marketing services, or media placement services; ( 4) 

10 formulating or providing, or arranging for the formulation or provision of, any 

11 material sent. to consumers, including, but not limited to, any form, pamphlet, 

12 brochure, or software; (5) shipping, or arranging for the shipping of any material 

13 to consumers; ( 6) providing or arranging for the provision of mail drops; (7) 

14 providing names, or assisting in the generation of, potential customers; and (8) 

15 performing marketing, billing, or payment services of any kind. 

16 4. "Corporate .Defendant" means Cream Group, Inc., also d/b/a Terra 

17 Nova, TNT, Inc., and CRM, Inc., and its successors and assigns, as well as any 

18 subsidiaries, affiliates, and any fictitious business entities or business names 

19 created or used by this entity. 

20 5. "Defendants" means the Individual Defendants and the Corporate 

21 Defendant, individually, collectively, or in any combination, and each of them by 

22 whatever names each might be known. 

23 6. "Document" and "Electronically Stored Information" is 

24 synonymous in meaning and equal in scope to the usage of the terms in Federal 

25 Rule of Civil Procedure 34(a), and includes writings, drawings, graphs, charts, 

26 photographs, audio and video recordings, computer records, digital records, and 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 5 
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1 other data compilations from which information can be obtained and translated, if 

2 necessary, into reasonably usable form through detection devices. A draft or 

3 nonidentical copy is a separate Document or Electronically Stored Information 

4 within the meaning of the terms. 

5 7 

I • "Electronic Data Host" means any person or entity that stores, 

6 hosts, or otherwise maintains Electronically Stored Information. 

7 8. "Financial Institution" means any bank, savings and loan 

8 institution, credit union, or any financial depository of any kind, including, but 

9 not limited to, any brokerage house, trustee, broker-dealer, escrow agent, title 

10 company, commodity trading company, or precious metal dealer. 

11 9. "Individual Defendants" means Sami Charchian, also d/b/a Oro 

12 Marketing, Inc., Modo, Modo Industry, Oro M~x, Casa de Oro, Casa de Moda, 

13 Oro Mundo, and Nation/Modo; John Charchian, a/k/a Djahangir Charchian and 

14 Jahangir John Charchian, and also d/b/a Oro Marketing, Inc., Modo, Modo 

15 Industry, Oro Max, Casa de Oro, Casa de Moda, Oro Mundo, and Nation/Modo; 

16 and Norma Rae Ramos, by whatever other names each may be known. 

17 10. "Person" means a natural person, an organization or other legal 

18 entity, including a corporation, partnership, sole proprietorship, limited liability 

19 company, association, cooperative, or any other group or combination acting as 

20 an entity. 

21 11. "Receivership Defendant" means Cream Group, Inc., and its 

22 successors, assigns, affiliates, or subsidiaries and any related d/b/a used by any of 

23 the Individual Defendants, including, but not limited to, Oro Marketing, Inc., 

24 Modo, Modo Industry, Oro Max, Casa de Oro, Casa de Moda, Oro Mundo, and 

25 Nation/Modo, and each of them by whatever names each might be known. 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 6 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 7 of 62 Page ID #:895 1) 

1 12. "Temporary Receiver" means the temporary receiver appointed in 

2 this Order. The term "temporary receiver" also includes any deputy receivers as 

3 may be named by the temporary receiver. 

4 13. "Telemarketing" means any plan, program, or campaign that is 

5 conducted to induce the purchase of goods or services by use of one or more 

6 telephones, and which involves a telephone call, whether or not covered by the 

7 TSR. 

8 I. PROHIBITED BUSINESS ACTIVITIES 

9 IT IS THEREFORE ORDERED that Defendants and their officers, 

1 0 agents, servants, employees, and attorneys, and all other Persons in active concert 

11 or participation with any of them, who receive actual notice of this Order, by 

12 personal service or otherwise, whether acting directly or through any corporation, 

13 subsidiary, division, or other device, in connection with the advertising, 

14 marketing, promotion, offering for sale, or the sale of goods or services, are 

15 hereby temporarily restrained and enjoined from: 

16 A. Misrepresenting, or Assisting Others, in misrepresenting, directly or 

17 indirectly, expressly or by implication, any material fact, including, but not 

18 limited to, the following: 

19 1. Consumers who purchase merchandise from Defendants will 

20 receive well-known, brand-name merchandise at low or wholesale prices; and 

21 2. Consumers who accept receipt of additional shipments from 

22 Defendants will receive the well-known, brand-name merchandise consumers 

23 ordered, along with a refund of the amount they paid to Defendants; 

24 B. Violating, or Assisting Others in violating, any provision of the TSR, 

25 including, but not limited to: 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 7 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 8 of 62 Page ID #:896

1 1. Section 310.3(a)(2)(iii) ofthe TSR, 16 C.F.R. 

2 § 310.3(a)(2)(iii), by misrepresenting, directly or by implication, any material 

3 aspect of the performance, efficacy, nature, or central characteristics of the goods 

4 or services that are the subject ofDefendants' sales offer; 

5 ~"'"t;"'""' '11 f\ 'lla\f4\ ~+' +t..~ rr0n 1 .c. r-. n n " ,., 1 A /'"" "/4" b-- U'-''-' .LVU • .l.l V.J\_ )\ } V.l LllC: b.J.I\.., 1 U \..., • .[' • .I\... ~ .J 1 U.~ (ij~ j, y 

6 making any false or misleading statement to induce consumers to pay for goods or 

7 servtces; 

8 3. Section 310.3(a)(2)(iv) ofthe TSR, 16 C.F.R. § 310.(a)(2)(iv), 

9 by misrepresenting, directly or by implication, any material aspect of the nature or 

1 0 terms of Defendants' refund, cancellation, exchange, or repurchase policies; 

11 4. Section 310.3(a)(l)(iii) ofthe TSR, 16 C.F.R. 

12 § 310.3(a)(1)(iii), by failing to disclose truthfully, in a clear and conspicuous 

13 manner, before a consumer consents to pay for goods or services offered, that 

14 Defendants have a policy of not making refunds or cancellations; and 

15 5. Section 310.4(a)(l) ofthe TSR, 16 C.F.R. § 310.4(a)(l), by 

16 using threats or intimidation to coerce consumers to pay Defendants, including, 

1 7 but not limited to, threatening consumers with false legal actions, fines, damage to 

18 consumers' credit history, garnishment of income and bank accounts, arrest, and 

19 reports to immigration authorities. 

20 II. PROHIBITION ON RELEASE OF CONSUMER INFORMATION 

21 IT IS FURTHER ORDERED that, except as required by a law 

22 enforcement agency, law, regulation, or court order, Defendants and their officers, 

23 agents, servants, employees, and attorneys, and all other Persons in active concert 

24 or participation with any of them, who receive actual notice of this Order, by 

25 personal service or otherwise, whether acting directly or through any corporation, c' 

26 subsidiary, division, or other device, are hereby temporarily restrained and 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 8 
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I enjoined from disclosing, using, sellin~, transferring, or benefitting from 

2 consumer information, including the name, address, telephone number, email 

3 address, social security number, other identifying information, or any data that 

4 enables access to a consumer's account (including a credit card, bank account, or 

5 other financial account), of any Person which any Defendant obtained prior to 

6 entry of this Order in connection with the advertising, marketing, promotion, 

7 offering for sale, or the sale of merchandise to consumers. 

8 III. PRESERVATION OF RECORDS AND TANGIBLE THINGS 

9 IT IS FURTHER ORDERED that Defendants and their officers, agents, 

I 0 servants, employees, and attorneys, and all other Persons in active concert or 

II participation with any of them, who receive actual notice of this Order, by 

I2 personal service or otherwise, whether acting directly or through any corporation, 

I3 subsidiary, division, or other device, are hereby temporarily restrained and 

I4 enjoined from: 

I5 A. Destroying, erasing, mutilating, concealing, altering, transferring, or 

I6 otherwise disposing of, in any manner, directly or indirectly, any Documents or 

I7 records that relate to the business practices, or business or personal finances, of 

I8 Defendants, or any entity directly or indirectly under the control of Defendants; 

I9 and 

20 B. Failing to create and maintain documents that, in reasonable detail, 

2I accurately, fairly, and completely reflect Defendants' incomes, disbursements, 

22 transactions, and use ofDefendants' Assets. 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 9 
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1 IV. ASSET FREEZE 

2 IT IS FURTHER ORDERED that Defendants and their officers, agents, 

.3 servants, employees, and attorneys, and all other Persons directly or indirectly 

4 under the control of any of them, including any Financial Institution, and all other 

5 Persons in active concert or participation with any of them who receive actual 

6 notice of this Order by personal service or otherwise, are hereby temporarily 

7 restrained and enjoined from, directly or indirectly: 

8 A. Selling, liquidating, assigning, transferring, converting, loaning, 

9 hypothecating, disbursing, gifting, conveying, encumbering, pledging, concealing, 

10 dissipating, spending, withdrawing, or otherwise disposing of any funds, real or 

11 personal property, or other Assets or any interest therein, wherever located, 

12 including any Assets outside the territorial United States, that are: (1) in the actual 

13 or constructive possession of any Asset Freeze Defendant; (2) owned or 

14 controlled by, or held, in whole or in part for the benefit of, or subject to access 

15 by, or belonging to, any Asset Freeze Defendant; or (3) in the actual or 

16 constructive possession of, or owned or controlled by, or subject to access by, or 

17 belonging to, any corporation, partnership, trust, or other entity directly or 

18 indirectly owned, managed, or under the control of any Asset Freeze Defendant; 

19 B. Opening, or causing to be opened, any safe deposit boxes titled in the 

20 name of, or subject to access by, any Asset Freeze Defendant; 

21 C. Incurring charges or cash advances on any credit card, stored value 

22 card, debit card, or charge card issued in the name, singly or jointly, of any Asset 

23 Freeze D_efendant or any corporation, partnership, or other entity directly or 

24 indirectly owned, managed, or controlled by any Asset Freeze Defendant; 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 10 
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1 D. Obtaining a personal or secured loan for or on behalf of any Asset 

2 Freeze Defendant, or any corporation, partnership, or other entity directly or 

3 indirectly owned, managed, or controlled by any Asset Freeze Defendant; 

4 E. Incurring liens or other encumbrances on real property, personal 

1-. A '1...1' h . 1 •• 1 {' A ,y, 5 property, or otuer r1.ssets tlt1eu m t1 e name, smg1y or JOHltiy, or any Assel: .rreeze 

6 Defendant, or any corporation, partnership, or other entity directly or indirectly 

7 owned, managed, or controlled by any Asset Freeze Defendant; and 

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F. Cashing any checks from consumers, clients, or customers of any of 

the Defendants. 

Notwithstanding the Asset freeze provisions of this Section, and subject to 

prior written agreement with the Commission, Individual Defendants Sami 

Charchian and John Charchian may, upon compliance with Section VI (Financial 

Disclosures), pay from their individual personal funds reasonable, usual, ordinary, 

and necessary living expenses. 

The funds, property, and Assets affected by this Section shall include both 

existing Assets and Assets acquired after the effective date of this Order. 

V. RETENTION OF ASSETS AND DOCUMENTS BY THIRD 

PARTIES 

IT IS FURTHER ORDERED that, pending determination of the FTC's 

request for a preliminary injunction, any Financial Institution, business entity, 

Electronic Data Host, or Person who has received actual notice of this Order, by 

personal service or otherwise, that holds, controls, or maintains custody of any 

account, Document, Electronically Stored Information, or Asset of, on behalf of, 

in the name of, for the benefit of, subject to withdrawal by, subject to access or 

use by, or under the signatory power of, any Asset Freeze Defendant or other 

party subject to Section IV above, or has held, controlled, or maintained any such 

28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 11 
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1 account, Document, Electronically Stored Information, or Asset at any time since 

2 January 1, 2009 shall: 

3 A. Hold and retain within its control and prohibit the withdrawal, 

4 removal, assignment, transfer, pledge, hypothecation, encumbrance, 

5 disbursement, dissipation, conversion, sale, liquidation, or other disposal of any of 

6 the Assets, funds, Documents or other property held by, or under its control: 

7 1. On behalf of, or for the benefit of, any Asset Freeze Defendant 

8 or any other party subject to Section IV above; 

9 2. In any account maintained in the name of, or for the benefit of, 

10 or subject to withdrawal by, any Asset Freeze Defendant or other party subject to 

11 Section IV above; and 

12 3. That are subject to access or use by, or under the signatory 

13 power of, any Asset Freeze Defendant or other party subject to Section IV above; 

14 B. Deny Asset Freeze Defendants access to any safe deposit boxes or 

15 storage facilities that are either: 

16 1. Titled in the name, individually or jointly, of any Asset Freeze 

17 Defendant, or other party subject to Section IV above; or 

18 2. Subject to access by any Asset Freeze Defendant or other 

19 party subject to Section IV above; 

20 C. Within five (5) days of the date of service of this Order, provide the 

21 FTC a sworn statement setting forth: 

22 1. The identification number of each account or Asset titled in 

23 the name, individually or jointly, of any Asset Freeze Defendant, or held on or 

24 behalf of, or for the benefit of, any Asset Freeze Defendant or other party subject 

25 to Section IV above, including all trust accounts managed on behalf of any Asset 

26 Freeze Defendant or subject to any Asset Freeze Defendant's control; 

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2. The balance of each such account, or a description of the 

nature and value of such Asset; 

3. The identification and location of any safe deposit box, 

commercial mail box, or storage facility that is either titled in the name, 

individually or jointly, of any Asset Freeze Defendant, or is otherwise subject to 

access or control by any Asset Freeze Defendant or other party subject to Section 

IV above, whether in whole or in part; and 

4. If the account, safe deposit box, storage facility, or other Asset 

has been closed or removed, the date closed or removed and the balance on said 

date; 

D. Within five ( 5) days of a request from the FTC, provide the FTC 

12 copies of all records or other documentation pertaining to each such account or 

13 Asset, including, but not limited to, originals or copies of account applications, 

14 account statements, corporate resolutions, signature cards, checks, drafts, deposit 

15 tickets, transfers to and from the accounts, all other debit and credit instruments or 

16 slips, currency transaction reports, 1099 forms, and safe deposit box logs; and 

17 E. This Section shall apply to existing accounts and Assets, Assets 

18 deposited or accounts opened after the effective date of this Order, and any 

19 accounts or Assets maintained, held, or controlled three years before the effective 

20 date of this Order. This Section shall not prohibit transfers in accordance with 

21 any provision of this Order, any further order of the Court, or by written 

22 agreement of the parties. 

23 VI. FINANCIAL DISCLOSURES 

24 IT IS FURTHER ORDERED that each Defendant, within three (3) business 

25 days of service of this Order, shall prepare and deliver to counsel for the FTC: 

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1 A. For each Individual Defendant, a completed financial statement 

2 accurate as of the date of service of this Order upon such Defendant on the form 

3 of Attachment A to this Order captioned "Financial Statement of Individual 

4 Defendant;" 

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6 accurate as of the date of service of this Order upon such Defendant in the form of 

7 Attachment B to this Order captioned "Financial Statement of Corporate 

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Defendant·" and ' 

C. For all Defendants, a list of all officers and directors of each 

10 Corporate Defendant and all other individuals or entities with authority to direct 

11 the operations of each Corporate Defendant or withdraw money from the account 

12 of each Corporate Defendant. 

13 VII. REPATRIATION OF FOREIGN ASSETS AND DOCUMENTS 

14 IT IS FURTHER ORDERED that within five (5) business days following 

15 the service of this Order, each of the Defendants shall: 

16 A. Provide counsel for the FTC and the Temporary Receiver with a full 

17 accounting of all Assets, accounts, funds, and Documents outside of the territory 

18 of the United States that are held either: (1) by any Asset Freeze Defendant; (2) 

19 for the benefit of any Asset Freeze Defendant; (3) in trust by or for any Asset 

20 Freeze Defendant, individually or jointly; or ( 4) under the direct or indirect 

21 control, individually or jointly of any Asset Freeze Defendant; 

22 B. Transfer to the territory of the United States and deliver to the 

23 Temporary Receiver all Assets, accounts, funds, and Documents in foreign 

24 countries held either: (1) by any Asset Freeze Defendant; (2) for the benefit of 

25 any Asset Freeze Defendant; (3) in trust by or for any Asset Freeze Defendant, 

26 individually or jointly; 

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1 C. Provide the FTC access to all records of accounts or Assets of any 

2 Asset Freeze Defendant held by Financial Institutions located outside the 

3 territorial United States by signing the Consent to Release of Financial Records 

4 appended to this Order as Attachment C; and 

5 D. .l\11 repatriated .i\ssets, accounts, fi1nds, and Documents are subject to 

6 Section IV of this Order. 

7 VIII. NONINTERFERENCE WITH REPATRIATION 

8 IT IS FURTHER ORDERED that Defendants and their officers, agents, 

9 servants, employees, and attorneys, and all other Persons in active concert or 

10 participation with any of them, who receive actual notice of this Order, by 

11 personal service or otherwise, whether acting directly or through any corporation, 

12 subsidiary, division, or other device, are hereby temporarily restrained and 

13 enjoined from taking any action, directly or indirectly, that may result in the 

14 encumbrance or dissipation of foreign Assets, or in the hindrance ofthe 

15 repatriation required by Section VII of this Order, including, but not limited to: 

16 A. Sending any statement, letter, facsimile transmission, email, or wire 

17 transmission, or telephoning or engaging in any other act, directly or indirectly, 

18 that results in a determination by a foreign trustee or other entity that a "duress" 

19 event has occurred under the terms of a foreign trust agreement until such time 

20 that all Assets have been fully repatriated pursuant to Section VII of this Order; 

21 and 

22 B. Notifying any trustee, protector, or other agent of any foreign trust or 

23 other related entities of either the existence of this Order, or of the fact that 

24 repatriation is required pursuant to a court order, until such time that all Assets 

25 have been fully repatriated pursuant to Section VII of this Order. 

26 

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/ / ) 

1 IX. CONSUMER CREDIT REPORTS 

2 IT IS FURTHER ORDERED that pursuant to Section 604(a)(l) of the 

3 Fair Credit Reporting Act, 15 U.S.C. § 1681 b(a)(l), any consumer reporting 

4 agency may furnish a consumer report as requested concerning any of the 

6 X. APPOINTMENT OF A TEMPORARY RECEIVER 

7 IT IS FURTHER ORDERED that Br,'vk tDJ1L is appointed 

8 Temporary Receiver for the Receivership Defendant with the full power of an 

9 equity receiver. The Temporary Receiver shall be an agent of this Court, and 

10 solely the agent of this Court, in acting as Temporary Receiver under this Order. 

11 The Temporary Receiver shall be accountable directly to this Court. The 

12 Temporary Receiver shall comply with all laws and Local Rules of this Court 

13 governing receivers, including, but not limited to, Local Rules 66-1 through 66-

14 5.1 and Local Rule 66-8. 

15 XI. DUTIES AND AUTHORITY OF TEMPORARY RECEIVER 

16 IT IS FURTHER ORDERED that the Temporary Receiver is authorized 

17 and directed to accomplish the following: 

18 A. Assume full control of the Receivership Defendant by removing, as 

19 the Temporary Receiver deems necessary or advisable, any director, officer, 

20 independent contractor, employee, or agent of any of the Receivership Defendant, 

21 including any Defendant, from control of, management of, or participation in, the 

22 affairs of the Receivership Defendant; 

23 B. Take exclusive custody, control, and possession of all Assets, 

24 Documents, and Electronically Stored Information of, or in the possession, 

25 custody, or under the control of, the Receivership Defendant, wherever situated. 

26 The Temporary Receiver shall have full power to divert mail and to sue for, 

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collect, receive, take in possession, hold, and manage all Assets and Documents 

of the Receivership Defendant and other Persons whose interests are now held by 

or under the direction, possession, custody, or control of, the Receivership 

Defendant. The Temporary Receiver shall assume control over the income and 

profits therefrom and all sums of money now or hereafter due or owing to the 

Receivership Defendant. Provided, however, that the Temporary Receiver shall ,,, 

not attempt to collect or receive any amount from a consumer if the Temporary 

Receiver believes the consumer was a victim of the unfair or deceptive acts or 

practices or other violations of law alleged in the Complaint in this matter; 

c. Take all steps necessary to secure the business premises of the 

11 Receivership Defendant. Such steps may include, but are not limited to, any of 

12 the following, as the Te~porary Receiver deems necessary or advisable: 

13 (1) serving and filing this Order; (2) completing a written inventory of all 

14 Receivership assets; (3) obtaining pertinent information from all employees and 

15 other agents of the Receivership Defendant, including, but not limited to, the 

16 name, home address, social security number, job description, method of 

17 compensation, and all accrued and unpaid commissions and compensation of each 

18 such employee or agent, and all computer hardware and software passwords; ( 4) 

19 photographing and/or videotaping any or all portions of the location; (5) securing 

20 the location by changing the locks and disconnecting any computer modems or 

21 other means of access to the computer or other records maintained at that 

22 location; ( 6) requiring any Persons present on the premises at the time this Order 

23 is served to leave the premises, to provide the Temporary Receiver with proof of 

24 identification, and to demonstrate to the satisfaction of the Temporary Receiver 

25 that such Persons are not removing from the premises Documents or Assets of the 

26 Receivership Defendant; and (7) requiring all employees, independent 

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Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 18 of 62 Page ID #:906

1 contractors, and consultants of the Receivership Defendant to complete a 

2 questionnaire s~bmitted by the Temporary Receiver. Law enforcement personnel, 

3 including, but not limited to, police or sheriffs, may assist the Temporary 

4 Receiver in implementing these provisions in order to keep the peace and 

5 maintain security. If requested by the Temporary Receiver, the United States 

6 Marshals Service will provide appropriate and necessary assistance to the 

7 Temporary Receiver to implement this Order and is authorized to use any 

8 necessary and reasonable force to do so; 

9 D. Conserve, hold, and manage all Receivership Assets, and perform all 

10 acts necessary or advisable to preserve the value of those Assets in order to 

11 prevent any irreparable loss, damage, or injury to consumers or creditors ofthe 

12 Receivership Defendant, including, but not limited to, obtaining an accounting of 

13 the Assets and preventing the transfer, withdrawal, or misapplication of Assets; 

14 E. Enter into contracts and purchase insurance as the Temporary 

15 Receiver deems to be advisable or necessary; 

16 F. Liquidate any and all securities or commodities owned by or for the 

17 benefit of the Receivership Defendant as the Temporary Receiver deems to be 

18 advisable or necessary; 

19 G. Prevent the inequitable distribution of Assets and determine, adjust, 

20 and protect the interests of consumers and creditors who have transacted business 

21 with the Receivership Defendant; 

22 H. Manage and administer the business of the Receivership Defendant 

23 until further order of this Court by performing all incidental acts that the 

24 Temporary Receiver deems to be advisable or necessary, which includes, but is 

25 not limited to, retaining, hiring, or dismissing any employees, independent 

26 contractors, or agents; 

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Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 19 of 62 Page ID #:907 ) 

1 I. Choose, engage, and employ attorneys, accountants, appraisers, and 

2 other independent contractors and technical specialists, as the Temporary 

3 Receiver deems advisable or necessary in the performance of duties and 

4 . responsibilities under the authority granted by this Order; 

5 T "• l\1ake payments &'1d disbursements from the receivership estate that 

6 are necessary or advisable for carrying out the directions of, or exercising the 

7 authority granted by, this Order. The Temporary Receiver shall apply to the 

8 Court for prior approval of any payment of any debt or obligation incurred by the 

9 Receivership Defendant prior to the date of entry of this Order, except payments 

10 that the Temporary Receiver deems necessary or advisable to secure Assets of the 

11 Receivership Defendant, such as rental payments; 

12 K. Determine and implement measures to ensure that the Receivership 

13 Defendant comply with, and prevent violations of, this Order and all other 

14 applicable laws; 

15 L. Institute, compromise, adjust, appear in, intervene in, or become 

16 party to such actions or proceedings in state, federal, or foreign courts or 

17 arbitration proceedings as the Temporary Receiver deems necessary and advisable 

18 to preserve or recover the Assets of the Receivership Defendant, or that the 

19 Temporary Receiver deems necessary and advisable to carry out the Temporary 

20 Receiver's mandate under this Order, including, but not limited to, actions 

21 challenging fraudulent or voidable transfers; 

22 M. Defend, compromise, adjust, or otherwise dispose of any or all 

23 actions or proceedings instituted in the past or in the future against the Temporary 

24 Receiver in his role as Temporary Receiver, or against the Receivership 

25 Defendant, as the Temporary Receiver deems necessary and advisable to preserve 

26 the Assets of the Receivership Defendant, or that the Temporary Receiver deems 

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Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 20 of 62 Page ID #:908 ) 

1 necessary and advisable to carry out the Temporary Receiver's mandate under 

2 this Order; 

3 N. Continue and conduct the business of the Receivership Defendant in 

4 such manner, to such extent, and for such duration as the Temporary Receiver 

5 may in good faith deem to be necessary or appropriate to operate the business 

6 profitably and lawfully, if at all; provided, however, that the continuation and 

7 conduct of the business shall be conditioned upon the Temporary Receiver's good I 

8 faith determination that the business can be lawfully operated at a profit using the 

9 Assets of the receivership estate; 

10 0. Take depositions and issue subpoenas to obtain Documents and 

11 records pertaining to the receivership estate and compliance with this Order. 

12 Subpoenas may be served by agents or attorneys of the Temporary Receiver and 

13 by agents of any process server retained by the Temporary Receiver; 

14 P. Open one or more bank accounts in the Central or Southern District 

15 of California as designated depositories for funds of the Receivership Defendant. 

16 The Temporary Receiver shall deposit all funds of the Receivership Defendant in 

1 7 such a designated account and shall make all payments and disbursements from 

18 the receivership estate from such account(s); 

19 Q. Maintain accurate records of all receipts and expenditures incurred as 

20 Temporary Receiver; 

21 R. Cooperate with reasonable requests for information or assistance 

22 from any state or federal law enforcement agency; and 

23 S. Maintain the chain of custody of all of Defendants' records in his 

24 possession, pursuant to procedures to be established in writing with the approval 

25 of the FTC. 

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XII. TRANSFER OF RECEIVERSHIP PROPERTY TO TEMPORARY 

RECEIVER 

IT IS FURTHER ORDERED that: 

A. Immediately upon service of this Order upon them or upon their 

obtaining actual knowledge of this Order, by personal service or otherwise, or 

within a period permitted by the Temporary Receiver, Defendants and any other 

Person with possession, custody, or control of Assets or Documents relating to the 

Receivership Defendant, including, but not limited to, Financial Institutions and 

Electronic Data Hosts, shall transfer or deliver access to, or possession, custody, 

and control of, the following to the Temporary Receiver: 

1. All Assets of the Receivership Defendant; 

2. All Documents and Electronically Stored Information of the 

Receivership Defendant, including, but not limited to, books and records of 

accounts, all financial and accounting records, balance sheets, income statements, 

bank records (including monthly statements, canceled checks, records of wire 

transfers, records of ACH transfers, and check registers), client or customer lists, 

title documents, and other papers; 

3. All Assets belonging to other Persons whose interests are now 

under the direction, possession, custody, or control of the Receivership 

Defendant; 

4. All computers and data in whatever form used to conduct the 

business of the Receivership Defendant; 

5. All keys, computer and other passwords, usemames, entry 

codes, and combinations to locks necessary to gain or secure access to any Assets 

or Documents of the Receivership Defendant, wherever located, including, but 

not limited to, access to their business premises, means of communication, 

accounts, computer systems, or other property; 

28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 21 
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1 B. Information identifying the accounts, employees, properties, or other 

2 Assets or obligations of the Receivership Defendant; and 

3 C. In the event any Person or entity fails to deliver or transfer 

4 immediately any Asset or otherwise fails to comply with any provision of this 

5 Section, the Temper&')' Receiver may file ex parte with the Court an Affidavit of 

6 Non-Compliance regarding the failure. Upon filing of the affidavit, the Court 

7 may authorize, without additional process or demand, Writs ofPossession or 

8 Sequestration or other equitable writs requested by the Temporary Receiver. The 

9 writs shall authorize and direct the United States Marshals Service or any sheriff 

1 0 or deputy sheriff of any county to seize the Asset, Document, or other thing and to 

11 deliver it to the Temporary Receiver. 

12 XIII. COOPERATION WITH THE TEMPORARY RECEIVER 

13 IT IS FURTHER ORDERED that Defendants and their officers, agents, 

14 directors, servants, employees, salespersons, independent contractors, attorneys, 

15 and corporations, and all other Persons in active concert or participation with any 

16 of them, who receive actual notice of this Order, by personal service or otherwise, 

17 whether acting directly or through any corporation, subsidiary, division, or other 

18 device, are hereby temporarily restrained and enjoined from directly or indirectly: 

19 A. Failing to fully cooperate with and assist the Temporary Receiver. 

20 Defendants' cooperation and assistance shall include, but not be limited to: (1) 

21 providing any information to the Temporary Receiver that the Temporary 

22 Receiver deems necessary to exercising the authority and discharging the 

23 responsibilities of the Temporary Receiver under this Order, including, but not 

24 limited to, allowing the Temporary Receiver to inspect Documents and Assets 

25 and to partition office space; (2) providing any usemame or password and 

26 executing any Documents required to access any computer or electronic files in 

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Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 23 of 62 Page ID #:911 f) \ ) 

1 any medium, including, but not limited to, Electronically Stored Information 

2 stored, hosted, or otherwise maintained by an Electronic Data Host; and (3) 

3 advising all Persons who owe money to the Receivership Defendant that all debts 

4 should be paid directly to the Temporary Receiver; 

5 R 

.LJ. 

6 C. Destroying, secreting, erasing, mutilating, defacing, concealing, 

7 altering, transferring, or otherwise disposing of, in any manner, directly or 

8 indirectly, any Documents, Electronically Stored Information, or equipment of the 

9 Receivership Defendant, including, but not limited to, books, records, accounts, 

10 writings, drawings, graphs, charts, photographs, audio and video recordings, 

11 computer records, and other data compilations, electronically-stored records, or 

12 any other records of any kind or nature; 

13 D. Transferring, receiving, altering, selling, encumbering, pledging, 

14 assigning, liquidating, or otherwise disposing of any Assets owned, controlled, or 

·Is in the possession or custody of, or in which an interest is held or claimed by, the 

16 Receivership Defendant or the Temporary Receiver; 

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F. 

Excusing debts owed to the Receivership Defendant; 

Failing to notify the Temporary Receiver of any Asset, including 

19 accounts, of a Receivership Defendant held in any name other than the name of 

20 the Receivership Defendant, or by any Person other than the Receivership 

21 Defendant, or failing to provide any assistance or information requested by the 

22 Temporary Receiver in connection with obtaining possession, custody, or control 

23 of such Assets; 

24 G. Doing any act or refraining from any act whatsoever to interfere with 

25 the Temporary Receiver's taking custody, control, possession, or managing of the 

26 Assets or Documents subject to this Receivership; or to harass or to interfere with 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 23 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 24 of 62 Page ID #:912 ( ) ) 

1 the Temporary Receiver in any way; or to interfere in any manner with the 

2 exclusive jurisdiction of this Court over the Assets or Documents of the 

3 Receivership Defendant; or to refuse to cooperate with the Temporary Receiver or 

4 the Temporary Receiver's duly authorized agents in the exercise of their duties or 

6 H. Filing, or causing to be filed, any petition on behalf of the 

7 Receivership Defendant for relief under the United States Bankruptcy Code, 11 

8 U.S.C. § 101 et seq., without prior permission from this Court. 

9 XIV. STAYS OF ACTIONS AGAINST RECEIVERSHIP DEFENDANT 

10 IT IS FURTHER ORDERED that: 

11 A. Except by leave of this Court, during pendency of the Receivership 

12 ordered herein, Defendants and all other Persons be and hereby are stayed from 

13 taking any action to establish or enforce any claim, right, or interest for, against, 

14 on behalf of, in, or in the name of, the Receivership Defendant, any of their 

15 subsidiaries, affiliates, partnerships, Assets, Documents, or the Temporary 

16 Receiver or the Temporary Receiver's duly authorized agents acting in their 

17 capacities as such, including, but not limited to, the following actions: 

18 1. Petitioning, or assisting in the filing of a petition, that would 

19 cause any Receivership Defendant to be placed in bankruptcy; 

20 2. Commencing, prosecuting, continuing, entering, or enforcing 

21 any suit or proceeding, except that such actions may be commenced if necessary 

22 to toll any applicable statute of limitations; 

23 3. Accelerating the due date of any obligation or claimed 

24 obligation; filing or enforcing any lien; taking or attempting to take possession, 

25 custody, or control of any Asset; attempting to foreclose, forfeit, alter, or 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 24 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 25 of 62 Page ID #:913 I ) ) 

1 terminate any interest in any Asset, whether such acts are part of a judicial 

2 proceeding, are acts of self-help, or otherwise; 

3 4. Executing, issuing, serving, or causing the execution, issuance, 

4 or service of, any legal process, including, but not limited to, attachments, 

6 of process whether specified in this Order or not; or 

7 5. Doing any act or thing whatsoever to interfere with the 

8 Temporary Receiver taking custody, control, possession, or management of the 

9 Assets or Documents subject to this Receivership, or to harass or interfere with 

10 the Temporary Receiver in any way, or to interfere in any manner with the 

11 exclusive jurisdiction of this Court over the Assets or Documents of the 

12 Receivership Defendant; 

13 B. This Section does not stay (1) the commencement or continuation of 

14 a criminal action or proceeding; (2) the commencement or continuation of an 

15 action or proceeding by a governmental unit to enforce such governmental unit's 

16 police or regulatory power; (3) the enforcement of a judgment, other than a 

17 money judgment, obtained in an action or proceeding by a governmental unit to 

18 enforce such governmental unit's police or regulatory power; or (4) the issuance 

19 to a Receivership Defendant of a notice of tax deficiency; and 

20 c. Except as otherwise provided in this Order, all Persons in need of 

21 documentation from the Temporary Receiver shall in all instances first attempt to 

22 secure such information by submitting a formal written request to the Temporary 

23 Receiver, and, if such request has not been responded to within thirty (30) days of 

24· receipt by the Temporary Receiver, any such Person may thereafter seek an Order 

25 of this Court with regard to the relief requested. 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 25 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 26 of 62 Page ID #:914 ( ) 

1 XV. COMPENSATION FOR TEMPORARY RECEIVER 

2 IT IS FURTHER ORDERED that the Temporary Receiver and all 

3 personnel hired by the Temporary Receiver as herein authorized, including· 

4 counsel to the Temporary Receiver and accountants, are entitled to reasonable 

6 of actual out-of-pocket expenses incurred by them, from the Assets now held by 

7 or in the possession or control of, or which may be received by, the Receivership 

8 Defendant. The Temporary Receiver shall file with the Court and serve on the 

9 parties periodic requests for the payment of such reasonable compensation, with 

10 the first such request filed no more than sixty ( 60) days after the date of entry of 

11 this Order. The Temporary Receiver shall not increase the hourly rates used as 

12 the bases for such fee applications without prior approval of the Court. 

13 XVI. RECEIVER'S REPORTS 

14 IT IS FURTHER ORDERED that the Temporary Receiver shall report to 

15 this Court on or before the date set for the hearing to Show Cause regarding the 

16 Preliminary Injunction, regarding: (1) the steps taken by the Temporary Receiver 

17 to implement the terms of this Order; (2) the value of all liquidated and 

18 unliquidated Assets of the Receivership Defendant; (3) the sum of all liabilities of 

19 the Receivership Defendant; (4) the steps the Temporary Receiver intends to take 

20 in the future to: (a) prevent any diminution in the value of Assets of the 

21 Receivership Defendant, (b) pursue receivership Assets from third parties, and (c) 

22 adjust the liabilities of the Receivership Defendant, if appropriate; (5) the 

23 Temporary Receiver's assessment of whether the business can be operated in 

24 compliance with this Order; and (6) any other matters that the Tempontry 

25 Receiver believes should be brought to the Court's attention. Provided, however, 

26 if any of the required information would hinder the Temporary Receiver's ability 

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to pursue Receivership Assets, the portions of the Temporary Receiver's report 

containing such information may be filed under seal and not served on the parties. 

XVII. TEMPORARY RECEIVER'S BOND 

IT IS FURTHER ORDERED that no bond shall be required in 

conn.ection with the appointment of the Temporary Receiver. Except for an act of 

gross negligence, the Temporary Receiver and the professionals shall not be liable 

for any loss or damage incurred by any of the Defendants, their officers, agents, 

servants, employees, and attorneys or any other Person, by reason of any act 

performed or omitted to be performed by the Temporary Receiver and the 

professionals in connection with the discharge of his or her duties and 

responsibilities, including, but not limited to, their withdrawal from the case 

under Section XVIII. 

XVIII. IMMEDIATE ACCESS TO BUSINESS PREMISES AND 

DOCUMENTS 

IT IS FURTHER ORDERED that Defendants and their officers, 

directors, agents, servants, employees, attorneys, and all other Persons in active 

concert or participation with any of them who receive actual notice of this Order 

by personal service or otherwise, whether acting directly or through any 

corporation, subsidiary, division, or other device, shall allow the FTC's 

representatives, agents, and assistants, as well as Receivership Defendant's 

representatives, and the Individual Defendants themselves, reasonable access to: 

(1) all of the Defendants' business premises, including, but not limited to: 14037 

Vanowen St., Van Nuys, CA 91405, and such other business locations that are 

wholly or partially owned, rented, leased, or under the temporary or permanent 

control of any Defendant; (2) any other premises where the Defendants conduct 

business, sales operations, or customer service operations; (3) any premises where 

Documents related to the Defendants' businesses are stored or maintained; ( 4) any 

28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 27 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 28 of 62 Page ID #:916

) 

1 premises where Assets belonging to any Defendant are stored or maintained; and 

2 ( 5) any Documents located at any of the locations described in this Section; 

3 The purpose of this access shall be to inspect and copy any and all books, 

4 records, Documents, accounts, and other property owned by, or in the possession 

5 of, the Receivership Defendant or its agents. The Receiver shall have the 

6 discretion to determine the time, manner, and reasonable conditions of such 

7 access. The FTC may remove materials from the Receivership Defendant's 

8 business premises to inspect, inventory, and copy such materials. The FTC shall 

9 return materials so removed within five (5)business days of completing said 

10 inventory and copying. The FTC's access to the Defendants' Documents 

11 . pursuant to this Section shall not provide grounds for any Defendant to object to 

12 any subsequent request for Documents served by the FTC. 

13 XIX. LIMITED EXPEDITED DISCOVERY 

14 IT IS FURTHER ORDERED that the parties are granted leave to conduct 

15 certain expedited discovery, and that, commencing with the time and date of this 

16 Order, in lieu of the time periods, notice provisions, and other requirements of 

17 Rules 26, 30, 34, and 45 of the Federal Rules of Civil Procedure, and applicable 

18 Local Rules, the FTC is granted leave to: 

19 A. Take the deposition, on three (3) days' notice, of any Person, 

20 whether or not a party, for the purpose of discovering: (1) the nature, location, 

21 status, and extent of Assets of Defendants or their affiliates or subsidiaries; (2) the 

22 nature and location of Documents and business records of Defendants or their 

23. affiliates or subsidiaries; and (3) compliance with this Order. The limitations and 

24 conditions set forth in Fed. R. Civ. P. 30(a)(2)(B) and 31(a)(2)(B) regarding 

25 subsequent depositions shall not apply to depositions taken pursuant to this 

26 Section. In addition, any such depositions taken pursuant to this Secti9_!! shalL n_QL __ _ 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 28 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 29 of 62 Page ID #:917 ( ) 

1 be counted toward the ten-deposition limit set forth in Fed. R. Civ. P. 

2 30(a)(2)(A)(I) and 31(a)(2)(A)(I) and shall not preclude the FTC from 

3 subsequently deposing the same Person in accordance with the Federal Rules of 

4 Civil Procedure. Service of discovery upon a party, taken pursuant to this 

5 Section, shall be sufficient if made by facsimile, emajl, or by overnight delivery. 

6 Any deposition taken pursuant to this Subsection that has not been reviewed and 

7 signed by the deponent may be used by any party for purposes of the preliminary 

8 injunction hearing; :J 

9 B. Serve upon parties requests for production of documents or 

10 inspection that require production or inspection within three (3) calendar days of 

11 service, and may serve subpoenas upon non-parties that direct production or 

12 inspection within five ( 5) calendar days of service, for the purpose of discovering: 

13 ( 1) the nature, location, status, and extent of Assets of Defendants or their 

14 affiliates or subsidiaries; (2) the nature and location of Documents and business 

15 records of Defendants or their affiliates or subsidiaries; and (3) compliance with 

16 this Order,provided that twenty-four (24) hours' notice shall be deemed 

17 sufficient for the production of any such Documents that are maintained or stored 

18 only as electronic data; 

19 C. Serve deposition notices and other discoveryrequests upon the 

20 parties to this action by facsimile, email, or overnight delivery, and tlke 

21 depositions by telephone or other remote electronic mean~}md 

22 D. If a Defendant fails to appear for a properly-noticed deposition or 

23 fails to comply with a request for production or inspection, seek to prohibit that 

24 Defendant from introducing evidence at any subsequent hearing. 

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28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 29 
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XX. SERVICE OF PLEADINGS, MEMORANDA, AND OTHER 

EVIDENCE 

IT IS FURTHER ORDERED that Defendants shall file any answering 

affidavits, pleadings, or legal memoranda with the Court and serve the same on 

counsel for the FTC no later than five ( 5) business days prior to the preliminary 

injunction hearing in this matter. The FTC may file responsive or supplemental . I 

pleadings, materials, affidavits, or memoranda with the Court and serve the same 

on counsel for Defendants no later than one ( 1) business day prior to the 

preliminary injunction hearing in this matter. Provided that service shall be 

performed by personal or overnight delivery, facsimile, or email, and documents 

shall be delivered so that they shall be received by the other parties no later than 

4 p.m. (Pacific Time) on the appropriate dates listed in this Section. 

XXI. SERVICE OF THIS ORDER 

IT IS FURTHER ORDERED that: 

A. Copies of this Order may be served by facsimile transmission, email, 

personal or overnight delivery, or U.S. Mail, by agents and employees of the FTC 

or any state or federal law enforcement agency or by private process server, upon 

any Financial Institution or other Person that may have possession, custody, or 

control of any Documents or Assets of any Defendant, or that may otherwise be 

subject to any provision of this Order. Service upon any branch or office of any 

Financial Institution shall effect service upon the entire Financial Institution; and 

B. For purposes of service on anyone in possession of records, assets, 

property, or property rights, actual notice of this Order shall be deemed complete 

upon notification by any means including, but not limited to, notice by service by 

facsimile transmission of the first page, Sections IV, V, XII, and the last page of 

this Order, provided that notice is followed within five (5) business days by 

delivery of a complete copy of this Order. 

[PROPOSED] TEMPORARY RESTRAINING ORDER- 30 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 31 of 62 Page ID #:919

1,,_} 

( ) ) 

1 XXII. LIVE TESTIMONY; WITNESS IDENTIFICATION 

2 IT IS FURTHER ORDERED that the question of whether this Court 

3 should enter a preliminary injunction pursuant to Rule 65 of the Federal Rules of 

4 Civil Procedure enjoining the Defendants during the pendency of this action shall 

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be resolved on the pleadings, declarations, exhibits, and memoranda filed by, and 

oral argument of, the parties. Live testimony shall be heard only on further order 

of this Court on motion filed with the Court and served on counsel for the other 

parties at least five (5) business days prior to the preliminary injunction hearing in 

this matter. Such motion shall set forth the name, address, and telephone number 

of each proposed witness, a detailed summary or affidavit disclosing the 

substance of each proposed witness' expected testimony, and an explanation of 

why the taking of live testimony would be helpful to this Court. Any papers 

opposing a timely motion to present live testimony or to present live testimony in 

response to live testimony to be presented by another party shall be filed with this 

Court and served on the other parties at least three (3) business days prior to the 

preliminary injunction hearing in this matter. Provided that service shall be 

performed by personal or overnight delivery, facsimile, or email and documents 

shall be delivered so that they shall be received by the other parties no later than 

4 p.m. (Pacific Time) on the appropriate dates listed in this Section. Provided 

further, however, that an evidentiary hearing on the Commission's request for a 

preliminary injunction is not necessary unless Defendants demonstrate that they 

have, and intend to introduce, evidence that raises a genuine material factual 

Issue. 

XXIII. CORRESPONDENCE WITH PLAINTIFF 

25 IT IS FURTHER ORDERED that, for the purpose of this Order, because 

26 mail addressed to the FTC is subject to delay due to heightened security 

27 

28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 31 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 32 of 62 Page ID #:920

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

I J ) 

' 

screening, all correspondence and service of pleadings on the FTC shall be sent 

either via electronic submission or via Federal Express to: 

Laura M. Solis 

Kathryn C. Decker 

Federal Trade Commission 

915 Second Ave., Suite 2896 

Seattle, W A 9817 4 

Fax:206-220-6366 

Email: lsolis@ftc.gov , 

kdecker@ftc.gov 

with a copy to: 

Raymond E. ,McKown 

Federal Trade Commission 

10877 Wilshire Blvd., Suite 700 r 

Los Angeles, CA 90024 

Fax: (31 0) 824-4380 

Email: rmckown@ftc.gov 

XXIV. DEFENDANTS' DUTY TO DISTRIBUTE ORDER 

IT IS FURTHER ORDERED that Defendants shall immediately provide 

a copy of this Order to each of their affiliates, subsidiaries, divisions, sales 

entities, successors, assigns, officers, directors, employees, independent i 

contractors, client companies, Electronic Data Hosts, agents, attorneys, spouses, 

and representatives, and shall, within three (3) calendar days from the date of 

entry of this Order, provide counsel for the FTC with a sworn statement that: (1) 

confirms that Defendants have provided copies of the Order as required by this 

28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 32 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 33 of 62 Page ID #:921 ( ) ) ·I 

1 Section; and (2) lists the names and addresses of each Person to whom 

2 Defendants provided a copy of the Order. 

3 XXV. DURATION OF TEMPORARY RESTRAINING ORDER 

4 IT IS FURTHER ORDERED that the Temporary Restraining Order 

..,.;:-- ' 5 gra.11ted herein shall expire on the / 7'£--- day of :?~H'-c~!l.r¥. , 2013, at~;"@/:.) 

6 -f-.m. (Pacific Time), unless within such time the Order, for good cause shown, is 

7 extended, or unless, as to any Defendant, the Defendant consents that it should be 

8 extended for a longer period of time. 

9 XXVI. ORDER TO SHOW CAUSE WHY PRELIMINARY INJUNCTION 

SHOULD NOT ISSUE 

10 IT IS FURTHER ORDERED that, pursuant to Federal Rule of Civil 

11 Procedure 65(b ), each of the Defendants shall appear before this Court on the 17 

12 day of~ ~ , 2013, at I i8<()_e_.m. (Pacific Time), to show cause, if there is any, 

13 why this Court should not enter a preliminary injunction, pending a formal ruling 

14 

on the Complaint, enjoining the violations of law alleged in the FTC's Complaint, 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

continuing the freeze of their Assets, and imposing such additional relief as may 

be appropriate. 

XXVII. RETENTION OF JURISDICTION 

IT IS FURTHER ORDERED that this Court shall retain jurisdiction of 

this matter for all purposes. 

SO ORDERED, this ]J.. day of 4'5-ec:.<.. ,f-/.,4 , 2013, at ~:n-o [.m. 

28 [PROPOSED] TEMPORARY RESTRAINING ORDER- 33 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 34 of 62 Page ID #:922

Definitions and Instructions: 

) 

FEDERAL TRADE COMMISSION 

FINANCIAL STATEMENT OF INDIVIDUAL DEFENDANT 

1. Complete all items. Enter "None" or "N/A" ("Not Applicable") in the first field only of any item that does not apply 

to you. If you cannot fully answer a question, explain why. 

2. "Dependents" include your spouse, live-in companion, dependent children, or any other person, whom you or your 

spouse (or your children's other parent) claimed or could have claimed as a dependent for tax purposes at any 

time during the past five years. 

3. "Assets" and "Liabilities" include ALL assets and liabilities, located within the United States or any foreign country 

or territory, whether held individually or jointly and whether held by you, your spouse, or your dependents, or held 

by others for the benefit of you, your spouse, or your dependents. 

4. 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(s) being continued. 

5. Type or print legibly. 

6. Initial each page in the space provided in the lower right corner. 

7. Sign and date the completed financial statement on the last page. 

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 the executive, legislative, or judicial branch of the Government of the 

United States, knowingly and willfully falsifies, conceals or covers up by any trick, scheme, or devise a material fact; 

makes any materially false, fictitious or fraudulent statement or representation; or makes or uses any false writing or 

document knowing the same to contain any materially 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 17 46 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. 

Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 35 of 62 Page ID #:923 () ) 

· BACKGROUND iNFORMATiON··. .• ' ,. '-'. · -- ·;;,> ,., '··.",:<' /, ,:'•,,,_,·" ',:•-., ·,;.·,,,'~'(~~··,• ,..-/~-,·c,;;·.·;'·· ·; .. • ·'. •. . .... ' .. Item 1. Information About You \ 

Full Name Social Security No. 

Current Address of Primary Residence Driver's License No. I State Issued 

Phone Numbers Date of Birth: I I 

Home: ( ) (mm/dd/vvvvl 

Fax: ( ) Place of Birth 

0Rent Down From (Date): I I E-Mail Address 

(mm/dd/yyyy) 

Internet Home Page 

Previous Addresses for past five years (if required, use additional pages at end of form) 

Address From: I I Until: I I 

(mm/dd/yyyy) (mm/dd/yyyy) 

DRent Down 

Address From: I I Until: I I 

DRent Down 

Address From: I I Until: I I 

DRent Down 

Identify any other name(s) and/or social security number(s) you have used, and the time period(s) during which they 

were used: 

ltem2. Information About Your Spouse or Live-In Companion 

Spouse/Companion's Name Social Security No. Date of Birth 

I I 

lmm/dd/wvvl 

Address (if different from yours) Phone Number Place of Birth 

( ) 

0Rent Down From (Date): I I 

(mm/dd/yyyy) 

Identify any other name(s) and/or social security number(s) you have used, and the time period(s) during which they were used: 

Employer's Name and Address Job Title 

' Years in Present Job Annual Gross Salary/Wages 

$ 

ltem3. Information About Your Previous Spouse 

Name and Address Social Security No. 

Date of Birth 

I I 

(mm/dd/yyyy) 

ltem4. Contact Information (name and address of closest living relative other than your spouse) 

Name and Address Phone Number 

( ) 

Initials: 

1 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 36 of 62 Page ID #:924 '\ 

I ) 

Item 5. Information About Dependents (whether or not they reside with you) 

Name and Address Social Security No. Date of Birth 

I I 

(mm/dd/yyyy) 

Relationship 

Name and Address Social Security No. Date of Birth 

I I 

_imm/dd/'j'f_y_yJ 

Relationship 

Name and Address Social Security No. I Date of Birth 

I I 

) (mm/dd/yyyy) 

Relationship 

Name and Address Social Security No. I Date of Birth 

I I 

(mm/dd/yyyy) 

Relationship 

Item 6. Employment Information/Employment Income 

Provide the following information for this year-to-date and for each of the previous five full years, for each business entity of which you were a director, 

officer, member, partner, employee (including self-employment), agent, owner, shareholder, contractor, participant or consultant at any time during that 

period. "Income" includes, but is not limited to, any salary, commissions, distributions, draws, consulting fees, loans, loan payments; dividends, 

royalties, and benefits for which you did not pay (e.g., health insurance premiums, automobile lease or loan payments) received by you or anyone else 

oh your behalf. 

Company Name and Address Dates Employed Income Received: This year to date 

Year Income 

From (Month/Year) To (Month/Year) 

I I 20 $ 

Ownership Interest? DYes D No $ 

Positions Held From (Month/Year) To (Month/Year) $ 

I I $ 

I I $ 

I I $ 

Company Name and Address Dates Employed Income Received: This year to date 

Year Income 

From (Month/Year) To (Month/Year) 

I I 20 $ 

Ownership Interest? DYes D No $ 

Positions Held From (Month/Year) To (Month/Year) $ 

I I $ 

I I $ 

I I $ 

Company Name and Address Dates Employed Income Received: This year to date 

Year Income 

From (Month/Year) To (Month/Year) 

I I 20 $ 

Ownership Interest? DYes D No $ 

Positions Held From (Month/Year) To (Month/Year) $ 

I I $ 

I I $ 

I I $ 

Initials: 

2 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 37 of 62 Page ID #:925

Item 7 .. Pending Lawsuits Filed By or Against You or Your Spouse 

List all pending lawsuits that have been filed by or against you or your spouse in any court or before an administrative agency. in the Uriite(j States or in 

any foreign country or territory. Note: At Hem 12, list lawsuits that resulted in finaljudgments.oi: settlements in your favor. At Item 21, list lawsuits that 

resulted in final judgments or settlements against you. . . 

Caption of Proceeding Court or Agency and Location Case No. Nature of Relief Requested Status or 

Proceeding Disposition 

' 

ItemS. Safe Deposit Boxes 

List all safe deposit boxes, located within the United States or in any foreign country or territory, whether held individually or jointly and whether held by 

you, your spouse, or any of your dependents, or held by others for the benefit of you, your spouse, or any of your dependents. 

Name of Owner(s) Name & Address of Depository Institution Box No. Contents 

Initials: 

3 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 38 of 62 Page ID #:926 'I 

) 

. ·.J .· . .·· . . . . . .· .. . ..• FINAN(:IAt·,INf(),~!Yi.~tl~N .. ·'> ... ·. • ... ·····.··. •··.· ... ·.· .· .. · 

REMINDER:.· When an item asks. for informS~ti6n:regarding y0or."assets•::'and'''liabiiitles'':lnpluqeALL as(:lets cmd !iabiliti~s; lociltE:ld within: 

• .. th(l LJnited' ~tates orin any.fotE)ign country orterritqcy; 0(, i,nstitQtiori;' ~bE)tJleFh~lg.ioqjylduplly prjoiritly! '~mcj WhetbE:lr held by you, your • 

wouse, qr any of your dependents, or held, .bY others .for t.he'benefit gfyoiJ; yc:M'spdusEi; .oraqy qfyciOr dependE~nts:ln adqition, provide 

all documents requested inltem··24 with your comoleted .. Finatu::iai.Sti:ltemenf.L': .·:·: ;· · · .. ' .·.· · · :_.• ,· .. · 

ASSETS 

Item .9. Cash, Bank, and Money.Market,Accounts 

List cash on hand (as opposed tocash in bank accounts orother financial accounts) and alll>ank accounts, money market accounts, or other financial 

accounts, including but not limited.to checking accounts, savings accounts, .and certificates of deposit. The term "cash on hand" includes but is not 

limited to cash in the form of currency, uncal'hed checks, and money orders. ' ,' ', ' 

a. Amount of Cash on Hand $ I Form of Cash on Hand 

b. Name on Account Name & Address of Financial Institution Account No. Current Balance 

$ 

$ 

$ 

$ 

$ 

Item 10. Publicly Traded Securities 

List all publiciy traded securities, including but not limited to, stocks, stock options, corporate bonds, mutual funds, U.S. government securities (including 

but not limited to treasury bills and treasury notes), and state and municipal bonds. Also list any U.S. savings bonds. 

Owner of Security Issuer I Type of Security I No. of Units Owned 

Broker House, Address 

Owner of Security 

Broker House, Address 

Owner of Security 

Broker House, Address 

4 of 10 

Broker Account No. 

~urrent Fair Market Value I ~oan(s) Against Security 

Issuer I Type of Security I No. of Units Owned 

Broker Account No. 

~urrent Fair Market Value I ~oan(s) Against Security 

Issuer I Type of Security J No. of Units Owned 

Broker Account No. 

Current Fair Market Value 

$ 

I ~oan(s) Against Security 

Initials: 

Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 

,' 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 39 of 62 Page ID #:927

Item 11. Non-Public Business and Financial Inter-ests 

List all non-public business and financial interests, including but not limited to any interest in apon~public corporation, subchapter-S corporation, limited 

liability.corporation ("LLC"), general or limited partnership, joint venture, sole proprietorship, international business corporation or personal investment 

corporation, and oil or mineral lease. · 

Entity's Name & Address Type of Business or Financial Owner Ownership If Officer, Director, Member 

Interest (e.g., LLC, partnership) (e.g., self, spouse) % or Partner, Exact Title 

Item 12. Amounts Owed to You, Your Spouse, or Yol.lr Dependents 

Debtor's Name & Address Date Obligation Original Amount Owed Nature of Obligation (if the result of a final court 

Incurred (Month/Year) $ judgment or settlement, provide court name 

I and docket number) 

Current Amount Owed Payment Schedule 

$ $ 

Debtor's Telephone Debtor's Relationship to You 

Debtor's Name & Address Date Obligation Original Amount Owed Nature of Obligation (if the result of a final court 

Incurred (Month/Year) $ judgment or settlement, provide court name 

I and docket number) 

Current Amount Owed Payment Schedule 

$ $ 

Debtor's Telephone Debtor's Relationship to You 

Item 13. Life Insurance Policies 

List all life insurance policies (including endowment policies) with any cash surrender value. 

Insurance Company's Name, Address, & Telephone No. Beneficiary Policy No. Face Value 

$ 

Insured Loans Against Policy Surrender Value 

$ $ 

Insurance Company's Name, Address, & Telephone No. Beneficiary Policy No. Face Value 

$ 

Insured Loans Against Policy Surrender Value 

$ $ 

ltelil14. Deferred Income Arrangements 

List all deferred income arrangements, including but not limited to, deferred annuities, pensions plans, profit-sharing plans, 401(k) plans, IRAs, Keoghs, 

other retirement accounts, and college savings plans (e.g., 529 Plans). 

Trustee or Administrator's Name, Address & Telephone No. Name on Account I Account No. 

Date Established Type of Plan Surrender Value before 

I I Taxes and Penalties 

(mmlddlyyyy) $ 

Trustee or Administrator's Name, Address & Telephone No. Name on Account I Account No. 

Date Established Type of Plan Surrender Value before 

I I Taxes and Penalties 

$ 

Initials: 

5 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 40 of 62 Page ID #:928

Item 15. Pending Insurance Payments or Inheritances ' 

List any pending insurance payments or inheritances owed to you. 

Type Amount Expected Date Expected (mmlddlyyyy) 

$ I I 

$ I I 

$ I I 

Item 16. Vehicles . 

List all cars, trucks, motorcycles, boats, airplanes, and other.vehicles: i 

Vehicle Type I Year Registered Owner's Name Purchase Price Original Loan Amount Current Balance 

$ $ ·. $ 

Make Registration State & No. Account/Loan No. Current Value Monthly Payment 

$ $ 

Model Address of Vehicle's Location Lender's Name and Address 

Vehicle Type I Year Registered Owner's Name Purchase Price Original Loan Amount Current Balance 

$ $ $ 

Make Registration State & No. Account/Loan No. Current Value Monthly Payment 

$ $ 

Model Address of Vehicle's Location Lender's Name and Address 

Vehicle Type I Year Registered Owner's Name Purchase Price Original Loan Amount Current Balance 

$ $ $ 

Make Registration State & No. Account/Loan No. Current Value Monthly Payment 

"' $ $ 

Model Address of Vehicle's Location Lender's Name and Address 

Vehicle Type I Year Registered Owner's Name Purchase Price Original Loan Amount Current Balance 

$ $ $ 

Make Registration State & No. Account/Loan No. Current Value Monthly Payment 

$ $ 

Model Address of Vehicle's Location Lender's Name and Address 

Item 17. Other PersonaiProperty 

List all other personal property not listed in Items 9-16 by category, whether held for personal use, investment or any other reason, including but not 

limited to. coins, stamps, artwork, gemstones, jewelry, bullion, other collectibles, copyrights, patents, and other intellectual property. 

Property Category Name of Owner Property Location Acquisition Cost Current Value (e.g., artwork, jewelry) 

' $ $ 

$ $ 

$ $ 

Initials: 

6 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 41 of 62 Page ID #:929 ) 

Item 18. Real Property 

List all real property interests (including any land contract) 

Property's Location Type of Property Name(s) on Title or Contract and Ownership Percentages 

Acquisition Date (mm/ddlyyyy) I ;urchase Price I ~urrent Value Basis of Valuation 

I I 

Lender's Name and Address Loan or Account No. Current Balance On First Mortgage or 

Contract 

$ 

Monthly Payment 

$ 

Other Mortgage Loan(s) (describe) Monthly Payment 0 Rental Unit 

$ 

Current Balance Monthly Rent Received 

$ $ 

Property's Location Type of Property Name(s) cin Title or Contract and Ownership Percentages 

Acquisition Date (mm/ddlyyyy) I ;urchase Price I ~urrent Value Basis of Valuation 

I I 

Lender's Name and Address Loan or Account No. Current Balance On First Mortgage or 

Contract 

$ 

Monthly Payment 

$ 

Other Mortgage Loan(s) (describe) Monthly Payment 0 Rental Unit 

$ 

Current Balance Monthly Rent Received 

$ $ 

LIABILITIES 

Item 19. Credit Cards 

List each credit card account held by you, your spouse, or your dependents, and any other credit cards that you, your spouse, or your dependents use, 

whether issued by a United States or foreign financial institution. 

Name of Credit Card (e.g., Visa, Account No. Name(s) on Account Current Balance MasterCard, Der:>_artment Store)_ 

$ 

$ 

$ 

$ 

$ 

Item 20. Taxes Payable 

List all taxes, such as income taxes or real estate taxes, owed by you, your spouse, or your dependents. 

Type ofT ax Amount Owed Year Incurred 

$ 

$ 

$ 

Initials: 

7 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 42 of 62 Page ID #:930 ) 

Item 21. Other Amounts Owed by You, Your Spouse, or Your Oependents 

List all other amounts, not listed elsewhere in this financial statement, owed by you, ym.ir spouse, or your dependents. 

Lender/Creditor's Name, Address, and Telephone No. Nature of Debt (if the result of a court judgment or settlement, provide court name and docket 

number) 

Lender/Creditor's Relationship to You 

Date Liability Was Incurred I ~riginal Amount Owed I ~urrent Amount Owed I Payment Schedule I I 

(mm/dd/yyyy) 

Lender/Creditor's Name, Address, and Telephone No. Nature of Debt (if the result of a court judgment or settlement, provide court name and docket 

number) 

Lender/Creditor's Relationship to You 

Date Liability Was Incurred I ~riginal Amount Owed I ~urrent Amount Owed I Payment Schedule I I 

(mm/dd/yyyy) 

OTHER FINANCIAL INFORMATION 

Item 22. Trusts and Escrows 

List all funds and other assets that are being held in trust or escrow by any person or entity for you, your spouse, or your dependents. Include any legal 

retainers being held on your behalf by legal counsel. Also list all funds or other assets that are being held in trust or escrow by you, your spouse, or your 

dependents, for any person or entity. I 

Trustee or Escrow Agent's Name & Address Date Established Grantor Beneficiaries Present Market Value of Assets* (mm/dd/yyyy) 

I I $ 

I I $ 

I I $ 

*If the market value of any asset is unknown, describe the asset and state its cost, if you know it. 

Item 23. Transfers of Assets 

List each person or entity to whom you have transferred, in the aggregate, more than $5,000 in funds or other assets during the previous five years by 

loan, gift, sale, or other transfer (exclude ordinary and necessary living and business expenses paid to unrelated third parties). For each such person or 

entity, state the total amount transferred during that period. -

Transferee's Name, Address, & Relationship Property Transferred Aggregate Value* Transfer Date Type ofTransfer 

(mm/dd/yyyy) (e.g., Loan, Gift) 

$ I I 

$ I I 

$ I I 

*If the market value of any asset is unknown, describe the asset and state its cost, if you know it. 

Initials: 

8 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 43 of 62 Page ID #:931

Item 24. Document Requests 

Provide copies of the following documents with your completed Financial Statement. 

Federal tax returns filed during the last three years by or on behalf of you, your spouse, or your dependents. 

All applications for bank loans or other extensions of credit (other than credit cards} that you, your spouse, or your 

dependents have submitted within the last two years, including by obtaining copies from lenders if necessary. 

Item 9 For each bank account listed in Item 9, all account statements for the past 3 years, 

For each business entity listed in Item 11, provide (including by causing to be generated from accounting records) the 

Item 11 most recent balance sheet, tax return, annual income statement, the most recent year-to-date income statement, and all 

general ledger files from account records. 

A!! appraisals that have been prepared for any property listed in !tem 17, including appraisals done for insurance 

Item 17 purposes. You may exclude any category of property where the total appraised value of all property in that category is 

less than $2,000. 

Item 18 All appraisals that have been prepared for real property listed in Item 18. 

Item 21 Documentation for all debts listed in Item 21. 

Item 24 All executed documents for any trust or escrow listed in Item 22. Also provide any appraisals, including insurance 

appraisals that have been done for any assets held by any such trust or in any such escrow. 

: .. SUMMARY FINANCIAL ~CHEI)lJLES 

Item 25. Combined Balance Sheet for You, Your Spouse, and Your Dependents 

Assets Liabilities 

Cash on Hand (Item 9) $ Loans Against Publicly Traded Securities (Item 10) $ 

Funds Held in Financial Institutions (Item 9) $ Vehicles- Liens (Item 16) $ 

U.S. Government Securities (Item 1 0) $ Real Property - Encumbrances (Item 18) $ 

Publicly Traded Securities (Item 1 0) $ Credit Cards (Item 19) $ 

Non-Public Business and Financial Interests (Item 11) $ Taxes Payable (Item 20) $ 

Amounts Owed to You (Item 12) $ Amounts Owed by You (Item 21) $ 

Life Insurance Policies (Item 13) $ Other Liabilities (Itemize) 

Deferred Income Arrangements (Item 14) $ $ 

Vehicles (Item 16) $ $ 

Other Personal Property (Item 17) $ $ 

Real Property (Item 18) $ $ 

Other Assets (Itemize) $ 

$ $ 

$ $ 

$ $ 

Total Assets $ Total Liabilities $ 

Item 26. Combined Current Monthly Income and Expenses for You, Your Spouse, and Your Dependents 

Provide the current monthly income and expenses for you, your spouse, and your dependents. Do not include credit card payments separately; rather, 

include credit card expenditures in the appropriate categories. 

Income (State source of each item) Expenses 

Salary - After Taxes $ Mortgage or Rental Payments for Residence(s) $ Source: 

Fees, Commissions, and Royalties $ Property Taxes for Residence(s) $ Source: 

Interest $ Rental Property Expenses, Including Mortgage Payments, Taxes, $ Source: and Insurance 

Dividends and Capital Gains $ Car or Other Vehicle Lease or Loan Payments $ Source: 

Gross Rental Income $ Food Expenses $ Source: 

Profits from Sole Proprietorships $ Clothing Expenses $ Source: 

Distributions from Partnerships, S-Corporations, Utilities 

and LLCs $ $ 

Source: 

Initials: 

9 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 44 of 62 Page ID #:932

Item 27. Combined Current Monthly Income andExpenses fo~Y()~;,'f~l,lr Spouse, an,dYour Dependehts'(cont) 

Distributions from Trusts and Estates 

Source: 

Distributions from Deferred Income Arrangements 

Source: 

Social Security Payments 

Alimony/Child Support Received 

Gambling Income 

Other Income (Itemize) 

$ 

$ 

$ 

$ 

$ 

$ 

$ 

$ 

Totallncome. $ 

... 

Medical Expenses, Including Insurance 

Other Insurance Premiums 

Other Transportation Expenses 

Other Expenses (Itemize) 

Total Expenses 

Item 28. Documents Attached to this Financial Statement 

List all documents that are being submitted with this 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 

10 of 10 Federal Trade Commission Financial Statement of Individual Defendant 

ATTACHMENT A 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 45 of 62 Page ID #:933 ) 

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 comer. 

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 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 46 of 62 Page ID #:934

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 ------

Reasons ---------------------------------------

Fiscal Year-End (Mo./Day) _______ Corporation's Business Activities ____________ _ 

Item 3. Registered Agent 

Name of Registered Agent--------------------------------

Address _________________________ Telephone No. _______ _ 

Page 2 Initials ___ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 47 of 62 Page ID #:935

Item 4. Principal Stockholders 

List all persons and entities that own at least 5% of the corporation's stock. 

N arne & Address %Owned 

Item 5. Board Members 

List all members ofthe 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 d. ties do not reflect the nature of their positions). 

Name & Address %Owned 

Page 3 Initials ___ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 48 of 62 Page ID #:936 () 

Item 7. Businesses Related to the Corporation 

List all corporations, partnerships, and other business entities in which this corporation has an ownership interest. 

Name & Address Business Activities % 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. 

Individual's Name Business Name & Address 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., theindividuals listed in Items 4- 6 above). 

Name and Address Relationship Business Activities 

Page 4 Initials ___ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 49 of 62 Page ID #:937 () 

Item 10. Outside Accountants 

List all outside accountants retained by the corporation during the last three years. 

Firm Name Address CPAIPA? 

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. 

Name, Address. & Telephone Number Position(s) Held 

Item 12. Attorneys 

List all attorneys retained by the corporation during the last three years. 

Firm Name Address 

Page 5 Initials ___ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 50 of 62 Page ID #:938 ) 

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 ________ _ 

-------------~--Stams _______ ~-----------------

Opposing Party's Name & Address. ___________________________ _ 

Court's Name & Address ----------------------------------

Docket No. ________ Relief Requested. ___ ~'------- Nature of Lawsuit. ________ _ 

Stams ---------------- ------------------------

Opposing Party's Name & Address _____________ __;_ ______________ _ 

Court's Name & Address _______________________________ _ 

Docket No. ________ ReliefRequest~d _________ Nature of Lawsuit ________ _ 

________________ Stams ______________________ ___ 

Opposing Party's Name & Address ____________________________ _ 

Court's Name & Address ------------------------------~--

Docket No. Relief Requested Nature of Lawsuit -------- ~---------- ---------

________________ Stams ______________________ ~ 

Opposing Party's Name & Address ____________________________ _ 

Court's Name & Address ________________________________ _ 

Docket No. ________ Relief Requested _________ Nature of Lawsuit ________ _ 

________________ Stams ______________________ _ 

Opposing Party's Name & Address ___________________________ _ 

Court's Name & Address ---------------------------------

Docket No. Relief Requested Namre of Lawsuit ----~--- ----------- ---------

________________ Stams ______________________ ___ 

Page 6 Initials ---- ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 51 of 62 Page ID #:939 () 

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. __________ _ 

__________________ Starns _______________________ ___ 

Page 7 Initials ______ __ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 52 of 62 Page ID #:940 ) 

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/ Tax Year Tax Due Tax Paid Tax Due Tax Paid Preparer's Name 

State/Both Federal Federal State State 

$ $ $ $ 

$ $ $ $ 

$ $ $ $ 

Page 8 Initials ___ _ ATTACHMENT 8 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 53 of 62 Page ID #:941

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$ _________ _ 

Name & Address of Financial Institution Signator(s) on Account Account No. Current 

Balance 

-----------------------------------------------$ ______ _ 

----------------------------------------------$ ______ _ 

----------------------------------------$ _______ _ 

-------------------------------------------------$ ________ _ 

Page 9 Initials ______ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 54 of 62 Page ID #:942

(.) 

/ 

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 anc;l 

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 Vaiue $ 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 offive 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 Initials ______ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 55 of 62 Page ID #:943 () 

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 Acguisition Current 

Cost 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 

___________________________________________________________________ $ ____________ __ 

______________________________________________________________ $ ____________ _ 

--------------~---------------------------------------------------$ ____________ __ 

______________________________________________________________ $ __________ ~_ 

----------------------------------~-----------------------------$ ____________ __ 

______________________________________________________________________ $ ______________ _ 

______________________________________________________________ $ ____________ _ 

Initials -------- Page 11 

ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 56 of 62 Page ID #:944

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 ofLawsuit 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 Initials ___ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 57 of 62 Page ID #:945 () ') 

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. 

Name of Credit Card or Store Names of Authorized Users and Positions Held 

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. 

N arne/Position Current Fiscal 1 Year Ago 2 Years Ago Comnensation or 

Year-to-Date Tvoe of Benefits 

$ $ $ 

$ $ $ 

$ $ $ 

$ $ $ 

$ $ $ 

Page 13 Initials ---- ATTACHMENT 8 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 58 of 62 Page ID #:946

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 1 Year Ago 2 Years Ago 

Year-to-Date 

$ $ $ 

$ $ $ 

$ $ $ 

$ $ $ 

$ $ $ 

$ $ $ 

$ $ $ 

$ $ $ 

Item 31. Transfers of Assets Including Cash and Property 

Compensation or 

Type of Benefits 

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 ofTransfer 

(e.g., Loan, Gift) 

---------------------------------------~--------$ ________________________________ __ 

_________________________________________________ $ ________________________________ __ 

_________________________________________________ $ ________________________________ __ 

_________________________________________________ $ __________________________________ _ 

_________________________________________________ $ __________________________________ _ 

Initials -------- Page 14 

ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 59 of 62 Page ID #:947

Item 32. Documents Attached to the Financial Statement 

List all documents that are being submitted with the financial statement. 

Item No. Document Description of Document 

Relates To 

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 Initials ___ _ ATTACHMENT B 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 60 of 62 Page ID #:948 ( ) 

1 JONATHAN E. NUECHTERLEIN 

General Counsel 

2 CHARLES A. HARWOOD 

Regipnal Director 

3 LA1JRA M. SOLIS, W A State Bar No. 36005 

Email: lsolis(a2ftc~ov 

4 KATHRYN C. DECKER, WA State BarNo. 12389 

5 f3elk ~~1~~\~ft~·~~A State Bar No. 34638 

Email: jmayer@ftc.gov Federal Trade Commission 

6 915 Second Avenue, Suite 2896 

Seattle, W A 9817 4 

7 Phone: (206) 220-6350 

Facsimile: (206) 220-6366 

8 

Local Counsel 

9 RAYMOND E. McKOWN, CA Bar No. 150975 

Email: rmckown@ftc.gov 10 Federal Trade Commission 

10877 Wilshire Blvd.,. Suite 700 

11 Los Angeles CA 90024 

Phone: (316) 824-4325 

12 Facsimile: (3'10) 824-4380 

13 AttorneY§ for Plaintiff 

14 Federal Trade Commission 

15 

16 

17 

UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

FEDERAL TRADE COMMISSION, 

18 

19 

20 

21 

Plaintiff, 

v. 

CREAM GROUP, INC., also d/b/a 

22 Terra Nova, TNT, Inc., and CRM, Inc., 

a California Corporation; 23 

SAMI CHARCHIAN, also d/b/a Oro 

24 Marketing, Inc., Modo, Modo Industry, 

Oro Max, Casa de Oro, Casa de Moda, 

25 Oro Mundo, and Natioi1/Modo, 

individually and as an owner or director 

26 of Cream Group, Inc.; 

27 

Case No. _______ _ 

CONSENT TO RELEASE OF 

FINANCIAL INFORMATION 

28 CONSENT TO RELEASE OF FINANCIAL INFORMATION - 1 

ATTACHMENT C 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 61 of 62 Page ID #:949 ( ) 

1 

JOHN CHARCHIAN, a/k/a Djahangir 

2 Charchian and J ahangir John Charcliian, 

also d/b/a Oro Marketing, Inc., Modo, 

3 Modo Industry, Oro Max, Casa de Oro, 

Casa de Moda, Oro Mundo, and 

4 Nation/Modo, individually and as an 

owner or director of Cream Group; Inc.; 

5 and 

6 NORMA RAE RAMOS, individually 

and as officer and director of Cream 

7 Group, Inc., 

8 Defendants. 

9 

10 I, _____________ , of ______ (city or province 

11 and country), do hereby direct any person, bank, savings and loan association, 

12 credit union, depository institution, finance company, commercial lending 

13 company, payment processor, payment processing entity, common carrier, 

14 customs broker, commercial mail receiving agency, mail holding and/or 

15 forwarding company, brokerage house, escrow agent, money market or mutual 

16 fund, title company, commodity trading company, or trustee, that holds, controls 

17 or maintains custody of assets, wherever located, that are owned or controlled by 

18 me, or any of the above Defendants, in whole or in part, or at which I, or any of 

19 the above Defendants, have an account of any kind upon which I am authorized to 

20 draw, and its officers, employees, and agents, to disclose all information and 

21 deliver copies of all documents of every nature in its possession or control which 

22 relate to the said accounts to any attorney for Plaintiff, and to give evidence 

23 relevant thereto, in the above-captioned matter, FTC v. Cream Group, Inc., et al., 

24 now pending in the United States District Court for the Central District of 

25 California, and this shall be irrevocable authority for so doing. This direction is 

26 intended to apply to the laws of countries other than the United States of America 

27 

28 CONSENT TO RELEASE OF FINANCIAL INFORMATION - 2 

ATTACHMENT C 
Case 2:13-cv-08843-JFW-PLA Document 20 Filed 12/03/13 Page 62 of 62 Page ID #:950 () ) 

1 which restrict or prohibit the disclosure of bank or other financial information 

2 without the consent of the holder of the account, and shall be construed as consent 

3 with respect thereto, and the same shall apply to any of the accounts for which I 

4 may be the relevant principal. 

5 

6 Dated: ________ ,, 2013. 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

'25 

26 

27 

[Signature] 

[Print N arne] 

28 CONSENT TO RELEASE OF FINANCIAL INFORMATION- 3 

ATTACHMENT C