Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 1 of 18 Page ID #:370

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CLE~K U,l:> 

FILED 

OISTRI~R: 

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AUG 6 2011 

UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

FEDERAL TRADE COMMISSION, 

Plaintiff, 

v. Case No. 

PHILLIP A. FLORA, SACVl1-00299-AG-(JEMx) 

n.k.a. "Phil P.,~) 

Defendant. STIPULATED 

PERMANENT INJUNCTION 

AND FINAL ORDER 

f • .... t1- _ 

Plaintiff, Federal Trade Commission ("FTC" or "Commission'» filed a 

Complaint for a Permanent Injunction and Other Relief, including redress to 

consumers and disgorgement ofill-gotten gains, pursuan't to Sections 13(b) and 19 

of the Federal Trade Commission Act ("FTC Act"). 15 U .S.C. 53(b) and 57b, and 

Section 1(a) oftlle Controlling the Assault of Non-Solicited Pornography and 

Marketing Actof2003 ("CAN-SPAM Ace'), 15 U.S.C. § 7706(a). Plaintiff and 

Defendant Flora, by and through their counsel, hereby stipulate to the entry of, and 

request the Court to enter, this Stipulated Permanent Injunction and Final Order 

(<<Orderj,), to resolve all matters of dispute between them in this action. 

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__ ... _. __ -=-, .- I I IIIJU UUI 1011 -} I 

CLE~K U,l:> 

FILED 

OISTRI~R: 

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UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

FEDERAL TRADE COMMISSION, 

Plaintiff, 

v. Case No. 

PHILLIP A. FLORA, SACVl1-00299-AG-(JEMx) 

n.k.a. "Phil P.,~) 

Defendant. STIPULATED 

PERMANENT INJUNCTION 

AND FINAL ORDER 

f • .... t1- _ 

Plaintiff, Federal Trade Commission ("FTC" or "Commission") filed a 

Complaint for a Permanent Injunction and Other Relief, including redress to 

consumers and disgorgement ofill-gotten gains, pursuan't to Sections 13(b) and 19 

of the Federal Trade Commission Act ("FTC Act"). 15 U .S.C. 53(b) and 57b, and 

Section 1(a) oftlle Controlling the Assault of Non-Solicited Pornography and 

Marketing Actof2003 ("CAN-SPAM Ace'), 15 U.S.C. § 7706(a). Plaintiff and 

Defendant Flora, by and through their counsel, hereby stipulate to the entry of, and 

request the Court to enter, this Stipulated Permanent Injunction and Final Order 

(<tOrder!'), to resolve all matters of dispute between them in this action. 

1 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 2 of 18 Page ID #:371

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r --v- - _0._ ........ ::1'1oJ I....., 

1 IT IS aEREBY STIPULATED, AGREED, AND ORDERED as follows: 

2 1. This is an action by the Commission instituted under Sections 

3 13(b) and 19 of the FTC Act, 15 U.S.C. §§ 53(b) and 57b, and the CAN-SPAM 

4 Act, 15 U.S.C. § 7706(a). The Commission has authority to seek the relief 

5 contained herein; . 

6 2. The Commission's Complaint states a claim upon which relief may be 

7 granted under Section 5(a) oftheFTC Act, 15 U.S.C. § 45(a), and Section 7(a) of 

8 the CAN-SPAM Act, 15 U.S.C. §-7706(a); 

9 3. This Court has subject matter jurisdiction pursuant to 

10 28 U.S.C. §§ 1331, 1337(a), and 1345, and 15 U.S.C. §§ 45(a). 53(b), and 7701; 

11 4. Venue is proper in this district under 28 U.S.C. § 1391(b) and 

12 15 U.S.C. § 53(b); 

13 5. The activities of Defendant Flora as alleged in the Commission's 

14 Complaint are in or affecting commerce. as "commerce" is defined in Section 4 of 

15 the FTC Act, 15 U.S.C. § 44; 

16 6. Defendant Flora has entered into this Order freely and without 

17 coercion, and Defendant Flora acknowledges that he has read the provisions of this 

18 Order, understands them, and is prepared to abide by them; 

19 7. Plaintiff and Defendant Flora, by and through tl1eir counsel, have 

20 agreed that the entry of this Order resolves all matters in dispute between them 

21 arising from the Complaint in this action, up to the date of entry of this Order; 

?') 8. This Order is for settlement purposes only, and does not constitute and 

23 shall not be interpreted to constitute an admission by Defendant Flora or a finding 

24 that the law has been violated as alleged in the Complaint, or the facts alleged in 

25 the Complaint, other than the jurisdictional facts are true, except as explicitly 

26 stipulated in Section V of this Order; 

27 9. Defendant Flora waives all rights to seek appeIlate review or 

28 otherwise challenge or contest the validity of this Order. Defendant Flora further 

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I 

_____ 11' j 

r --v- - _0._ ........ ::1'1oJ I....., 

1 IT IS aEREBY STIPULATED, AGREED, AND ORDERED as follows: 

2 1. This is an action by the Commission instituted under Sections 

3 13(b) and 19 of the FTC Act, 15 U.S.C. §§ 53(b) and 57b, and the CAN-SPAM 

4 Act, 15 U.S.C. § 7706(a). The Commission has authority to seek the relief 

5 contained herein; . 

6 2. The Commission's Complaint states a claim upon which relief may be 

7 granted under Section 5(a) oftheFTC Act, 15 U.S.C. § 45(a), and Section 7(a) of 

8 the CAN-SPAM Act, 15 U.S.C. §-7706(a); 

9 3. This Court has subject matter jurisdiction pursuant to 

10 28 U.S.C. §§ 1331, 1337(a), and 1345, and 15 U.S.C. §§ 45(a). 53(b), and 7701; 

11 4. Venue is proper in this district under 28 U.S.C. § 1391(b) and 

12 15 U.S.C. § 53(b); 

13 5. The activities of Defendant Flora as alleged in the Commission's 

14 Complaint are in or affecting commerce. as "commerce" is defined in Section 4 of 

15 the FTC Act, 15 U.S.C. § 44; 

16 6. Defendant Flora has entered into this Order freely and without 

17 coercion, and Defendant Flora acknowledges that he has read the provisions of this 

18 Order, understands them, and is prepared to abide by them; 

19 7. Plaintiff and Defendant Flora, by and through tl1eir counsel, have 

20 agreed that the entry of this Order resolves all matters in dispute between them 

21 arising from the Complaint in this action, up to the date of entry of this Order; 

?') 8. This Order is for settlement purposes only, and does not constitute and 

23 shall not be interpreted to constitute an admission by Defendant Flora or a finding 

24 that the law has been violated as alleged in the Complaint, or the facts alleged in 

25 the Complaint, other than the jurisdictional facts are true, except as explicitly 

26 stipulated in Section V of this Order; 

27 9. Defendant Flora waives all rights to seek appeIlate review or 

28 otherwise challenge or contest the validity of this Order. Defendant Flora further 

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1 waives and releases any claim he may have against the Plaintiff, its employees, 

2 representatives, or agents concerning the prosecution of this actioD to the date of 

3 this Order; 

4 10. Defendant Flora agrees that this Order does not entitle hjrn to seek or 

5 to obtain attorneys' fees as a prevailing party under the Equal Access to Justice 

6 Act, 28 U.S.C. § 2412, concerning the prosecution of this action to the date ofthis 

7 Order. Each settling party shall bear its own costs and attorneys fees; and 

8 11. Entry of this Order is in the public interest. 

9 

10 

11 

ORDER 

DEFINITIONS 

12 For the purposes of this Order, the following defmitions shall apply: 

13 GENERAL DEFINITIONS 

14 1. "Asset" means any legal or equitable interest in, right to, or ' 

15 claim to, any real and personal property, wherever located. 

16 2. "Defendant" means Phillip A. Flora, a/kJa "Phil P." and any entity 

17 through which he does business. 

18 3. "Documenf'is synonymous in meaning and equal in scope to the 

19 usage of the terms "document)! and "electronically stored information)' in Federal 

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

2.1 photographs, sound recordings, images, and either data or data compilations from 

22 which information can be obtained or translated. A draft or non-identical copy is a 

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24 

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separate Document within the meaning of the term. 

4. "Material Fact" means any fact that is likely to affect a Person's 

choice of~ or conduct regarding, goods or services. 

26 5. "Person" means a natural person, organization, or other legal entity, 

27 including a corporation, partnership, proprietorship, association, cooperative, or 

28 any other group or combination acting as an entity. 

3 

uocumem £.1-': u 

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1 waives and releases any claim he may have against the Plaintiff, its employees, 

2 representatives, or agents concerning the prosecution of this actioD to the date of 

3 this Order; 

4 10. Defendant Flora agrees that this Order does not entitle hjrn to seek or 

5 to obtain attorneys' fees as a prevailing party under the Equal Access to Justice 

6 Act, 28 U.S.C. § 2412, concerning the prosecution of this action to the date ofthis 

7 Order. Each settling party shall bear its own costs and attorneys fees; and 

8 11. Entry of this Order is in the public interest. 

9 

10 

11 

ORDER 

DEFINITIONS 

12 For the purposes of this Order, the following defmitions shall apply: 

13 GENERAL DEFINITIONS 

14 1. "Asset" means any legal or equitable interest in, right to, or ' 

15 claim to, any real and personal property, wherever located. 

16 2. "Defendant" means Phillip A. Flora, a/kJa "Phil P." and any entity 

17 through which he does business. 

18 3. "Documenf'is synonymous in meaning and equal in scope to the 

19 usage of the terms "document)! and "electronically stored information)' in Federal 

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

2.1 photographs, sound recordings, images, and either data or data compilations from 

22 which information can be obtained or translated. A draft or non-identical copy is a 

23 

24 

25 

separate Document within the meaning of the term. 

4. "Material Fact" means any fact that is likely to affect a Person's 

choice of~ or conduct regarding, goods or services. 

26 5. "Person" means a natural person, organization, or other legal entity, 

27 including a corporation, partnership, proprietorship, association, cooperative, or 

28 any other group or combination acting as an entity. 

3 

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Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 4 of 18 Page ID #:373 \ 

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1 6. "Plaintiff," "FTC," or "the Commission" means the Federal Trade 

2 Commission. 

3 

4 

5 

6-

7 

7. 

8. 

"Representatives" means any Person who: 

a. is in active concert or participation with Defendant; and 

b. receives actual notice of this Order by personal service or 

otherwise. 

"Unauthorized or Unsolicited Commercial Electronic Text 

8 Message" means an unauthorized or unsolicited text message the primary purpose 

9 of which is a commercial advertisement or promotion of a commercial product or 

10 service (including the content on an Internet website operated for commercial 

11 purposes). 

12 9. The words "and~~ and "or" shall be understood to have both 

13 conjunctive and disjunctive meanings. 

14 CAN-SPAM ACT DEFINITIONS 

15 10. "Commercial Electronic Mail Message" means any electronic mail 

16 message the primary purpose of which is the commercial advertisement or 

17 promotion of a commercial product or service (including the content on an Internet 

18 website operated for commercial purposes). 15 U.S.C. § 7702(2). 

19 11. "Electronic Mail Address" means a destination, commonly 

20 expressed as a string of characters~ consisting of a unique user name or mailbox 

21 (commonly referred to as the "local part") and a reference to an Internet domain 

22 (commonly referred to as the "domain part"). whether or not displayed) to which 

23 an Electronic Mail Message can be sent or delivered. ] 5 U .s.C. § 7702(5). 

24 12. "Electronic Mail Message" (or "email"') means a message sent to a 

25 unique Electronic Mail Address. 15 U.S.C. § 7702(6). 

26 13. "Initiate" or "Initiation," when used with respect to a Commercial 

27 Electronic Mail Message, means to originate or transmit sllch message or to 

28 Procure the origination or transmission of such message. 15 U.S.C. § 7702(9). 

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1 6. "Plaintiff," "FTC," or "the Commission" means the Federal Trade 

2 Commission. 

3 

4 

5 

6-

7 

7. 

8. 

"Representatives" means any Person who: 

a. is in active concert or participation with Defendant; and 

b. receives actual notice of this Order by personal service or 

otherwise. 

"Unauthorized or Unsolicited Commercial Electronic Text 

8 Message" means an unauthorized or unsolicited text message the primary purpose 

9 of which is a commercial advertisement or promotion of a commercial product or 

10 service (including the content on an Internet website operated for commercial 

11 purposes). 

12 9. The words "and~~ and "or" shall be understood to have both 

13 conjunctive and disjunctive meanings. 

14 CAN-SPAM ACT DEFINITIONS 

15 10. "Commercial Electronic Mail Message" means any electronic mail 

16 message the primary purpose of which is the commercial advertisement or 

17 promotion of a commercial product or service (including the content on an Internet 

18 website operated for commercial purposes). 15 U.S.C. § 7702(2). 

19 11. "Electronic Mail Address" means a destination, commonly 

20 expressed as a string of characters~ consisting of a unique user name or mailbox 

21 (commonly referred to as the "local part") and a reference to an Internet domain 

22 (commonly referred to as the "domain part"). whether or not displayed) to which 

23 an Electronic Mail Message can be sent or delivered. ] 5 U .s.C. § 7702(5). 

24 12. "Electronic Mail Message" (or "email"') means a message sent to a 

25 unique Electronic Mail Address. 15 U.S.C. § 7702(6). 

26 13. "Initiate" or "Initiation," when used with respect to a Commercial 

27 Electronic Mail Message, means to originate or transmit sllch message or to 

28 Procure the origination or transmission of such message. 15 U.S.C. § 7702(9). 

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Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 5 of 18 Page ID #:374

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1 14. "ProcUl'e" or "Procurement," when used with respect to the 

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2 Initiation of a Commercial Electronic Mail Message, means intentionally to payor 

3 provide other consideration to. or induce, another Person to Initiate sllch a message 

4 on one's behalf. 15 U.S.C, § 7702(12). 

5 15. "Protected Computer" means a computer which is used in interstate 

6 or foreign commerce or communication. including a computer located outside the 

7 United States that is used in a manner iliat affects interstate or foreign commerce or 

8 communication of the United States. 15 U.S.C. § 7702(13). 

9 16. "Sender" IIleans a Person who Initiates a Commercial Electronic Mail 

10 Message and whose product, service, or Internet Web site is adveliised or 

11 promoted by the message. 15 U.S.C. § 7702(16). 

12 

13 CONDUCT PROHIBITIONS 

14 I. 

15 IT IS HEREBY ORDERED that Defendant, whether acting directly 01" 

16 through a trust, corporation, subsidiary, division, or other device, is hereby 

17 permanently enjoined from sending, or assisting others in the sending of 

18 Unauthorized or Unsolicited Commercial Electronic Text Messages to mobile 

19 telephones or other wireless devices. 

20 li. 

21 IT IS FURTHER ORDERED that Defendant and his Representatives, 

22 whether acting directly or through a trust, corporation, subsidiary, division, or 

23 other device, are hereby permanently enjoined from making, or assisting others in 

24 making, any false or misleading oral or written statement or representation of 

25 Material Fact when advertising, promoting, or selling any good or service, 

26 including, but not limited to any false or misleading statement or representation 

27 that Defendant, his Representatives, or any other Person is affiliated or associated 

28 with, under contract with, acting in partnership with, endorsed or approved by, or 

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1 14. "ProcUl'e" or "Procurement," when used with respect to the 

,u ri:lyt:: IU 

2 Initiation of a Commercial Electronic Mail Message, means intentionally to payor 

3 provide other consideration to. or induce, another Person to Initiate sllch a message 

4 on one's behalf. 15 U.S.C, § 7702(12). 

5 15. "Protected Computer" means a computer which is used in interstate 

6 or foreign commerce or communication. including a computer located outside the 

7 United States that is used in a manner iliat affects interstate or foreign commerce or 

8 communication of the United States. 15 U.S.C. § 7702(13). 

9 16. "Sender" IIleans a Person who Initiates a Commercial Electronic Mail 

10 Message and whose product, service, or Internet Web site is adveliised or 

11 promoted by the message. 15 U.S.C. § 7702(16). 

12 

13 CONDUCT PROHIBITIONS 

14 I. 

15 IT IS HEREBY ORDERED that Defendant, whether acting directly 01" 

16 through a trust, corporation, subsidiary, division, or other device, is hereby 

17 permanently enjoined from sending, or assisting others in the sending of 

18 Unauthorized or Unsolicited Commercial Electronic Text Messages to mobile 

19 telephones or other wireless devices. 

20 li. 

21 IT IS FURTHER ORDERED that Defendant and his Representatives, 

22 whether acting directly or through a trust, corporation, subsidiary, division, or 

23 other device, are hereby permanently enjoined from making, or assisting others in 

24 making, any false or misleading oral or written statement or representation of 

25 Material Fact when advertising, promoting, or selling any good or service, 

26 including, but not limited to any false or misleading statement or representation 

27 that Defendant, his Representatives, or any other Person is affiliated or associated 

28 with, under contract with, acting in partnership with, endorsed or approved by, or 

5 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 6 of 18 Page ID #:375

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1 otherWise connected to the United States government or any government agency, 

2 unit) or department. 

3 III. 

4 IT IS FURTHER ORDERED that Defendant and his Representatives, 

5 whether acting directly or through a trust, corporation, subsidiary, division, or 

(i other device, are hereby permanently enjoined from violating the CAN-SP AM Actj 

7 15 U.S.C. §§ 7701-7713, jncluding butnotlimlted to, Initiating, Procuring" or 

8 transmitting a Commercial Electronic Mail Message, or assisting others in tbe 

9 Initiation, Procurement, or transmission of a Commercial Electronic Mail Message, 

10 to a Protected Computer. that: 

11 A. Does not include a clear and conspicuous notice of the recipient's 

12 opportunity to decline to receive further Commercial Electronic Mail Messages 

l3 from the Sender at the recipient's ElectTonic Mail Address and describes the means 

14 by which the recipient can decline to receive future Commercial Electronic Mail 

15 Messages from the Sender; and 

16 B. Does not include the Sender's valid physical postal address. 

17 COOPERATION PROVISION 

18 

19 

IV. 

IT IS FURTHER ORDERED that Defendant shall, in connection 

20 with this action or any subsequent investigations related to, or associated with, the 

21 transactions or the occurrences that are the subject of the Plaintiff's Complaint, 

22 cooperate in good faith with the Plaintiff and any other gqvernmental agency or 

23 entity, and appear at such places and times as tbe Plaintiff or any other 

24 governmental agency or entity shall reasonably request, after written notice, for 

25 interviews, conferences, pretrial discovery, review of documents, and for such 

26 other matters as may be reasonably requested by the Plaintiff or any other 

27 governmental agency or entity. If requested in writing by the Plaintiff or any other 

28 governmental agency or entity, Defendant shall appear and provide truthful 

6 

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_ u. I l-cv-00298-A\.:I ~_ ... r!J .- p--

1 otherWise connected to the United States government or any government agency, 

2 unit) or department. 

3 III. 

4 IT IS FURTHER ORDERED that Defendant and his Representatives, 

5 whether acting directly or through a trust, corporation, subsidiary, division, or 

(i other device, are hereby permanently enjoined from violating the CAN-SP AM Actj 

7 15 U.S.C. §§ 7701-7713, jncluding butnotlimlted to, Initiating, Procuring" or 

8 transmitting a Commercial Electronic Mail Message, or assisting others in tbe 

9 Initiation, Procurement, or transmission of a Commercial Electronic Mail Message, 

10 to a Protected Computer. that: 

11 A. Does not include a clear and conspicuous notice of the recipient's 

12 opportunity to decline to receive further Commercial Electronic Mail Messages 

l3 from the Sender at the recipient's ElectTonic Mail Address and describes the means 

14 by which the recipient can decline to receive future Commercial Electronic Mail 

15 Messages from the Sender; and 

16 B. Does not include the Sender's valid physical postal address. 

17 COOPERATION PROVISION 

18 

19 

IV. 

IT IS FURTHER ORDERED that Defendant shall, in connection 

20 with this action or any subsequent investigations related to, or associated with, the 

21 transactions or the occurrences that are the subject of the Plaintiff's Complaint, 

22 cooperate in good faith with the Plaintiff and any other gqvernmental agency or 

23 entity, and appear at such places and times as tbe Plaintiff or any other 

24 governmental agency or entity shall reasonably request, after written notice, for 

25 interviews, conferences, pretrial discovery, review of documents, and for such 

26 other matters as may be reasonably requested by the Plaintiff or any other 

27 governmental agency or entity. If requested in writing by the Plaintiff or any other 

28 governmental agency or entity, Defendant shall appear and provide truthful 

6 
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1 testimony in any trial, deposition, or other proceeding related to, or associated 

2 with, the transactions or the occurrences that are the subject of the Complaint, 

3 without the service of a subpoena upon him. 

4 MONETARY RELIEF 

5 ~ 

6 IT IS FURTHER ORDERED that judgment is hereby entered in favor of 

7 the Commission and against Defendant in the amount of $.58,946.90, as 

8 disgorgement; provided, however, subject to the provisions of Section VI below. 

9 judgment shall be suspended upon Defendant's completion of the requirements 

10 stated in Subsections A & B of this Section. 

11 A. Within ten (10) days of the entry of this Order, Defendant shall pay 

12 the Commission $32,000 by wire transfer in accordance with directions provided 

13 by counsel forthe Commission. 

14 B. Defendant relinquishes all dominion, contmI, and title to the funds 

15 paid to the fullest extent permitted by law. Defendant shall make no claim to or 

16 demand return of these funds, directly or indirectly! through counselor otherwise. 

17 C. Defendant agrees that the facts as alleged in the Complaint filed in 

18 this action shall be taken as true without ftniher proof in any bankruptcy case or 

19 subsequent civil litigation pursued by th.e Commission to enforce its rights to any 

20 payment or money judgment pursuant to this Order, including but not limited to a 

21 nondischargeability complaint in any bankruptcy case. Defendant further 

22 stipulates and agrees that the facts alleged in the Complaint establish all e1ements 

23 necessary to sustain an action pursuant to, and that this Order shall have collateral 

24 estoppel effect for purposes of, Section 523 (a)(2)(A) of the Banlcruptcy Code, 11 

25 U.S.C. § 523(a)(2)(A). 

26 D. In accordance with 31 U.S.C. § 7701, Defendant is hereby required, 

27 unless he has done so already, to furnish to the Commission his taxpayer 

28 identification number (Social Security number), which shall be used for purposes 

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1 testimony in any trial, deposition, or other proceeding related to, or associated 

2 with, the transactions or the occurrences that are the subject of the Complaint, 

3 without the service of a subpoena upon him. 

4 MONETARY RELIEF 

5 ~ 

6 IT IS FURTHER ORDERED that judgment is hereby entered in favor of 

7 the Commission and against Defendant in the amount of $.58,946.90, as 

8 disgorgement; provided, however, subject to the provisions of Section VI below. 

9 judgment shall be suspended upon Defendant's completion of the requirements 

10 stated in Subsections A & B of this Section. 

11 A. Within ten (10) days of the entry of this Order, Defendant shall pay 

12 the Commission $32,000 by wire transfer in accordance with directions provided 

13 by counsel forthe Commission. 

14 B. Defendant relinquishes all dominion, contmI, and title to the funds 

15 paid to the fullest extent permitted by law. Defendant shall make no claim to or 

16 demand return of these funds, directly or indirectly! through counselor otherwise. 

17 C. Defendant agrees that the facts as alleged in the Complaint filed in 

18 this action shall be taken as true without ftniher proof in any bankruptcy case or 

19 subsequent civil litigation pursued by th.e Commission to enforce its rights to any 

20 payment or money judgment pursuant to this Order, including but not limited to a 

21 nondischargeability complaint in any bankruptcy case. Defendant further 

22 stipulates and agrees that the facts alleged in the Complaint establish all e1ements 

23 necessary to sustain an action pursuant to, and that this Order shall have collateral 

24 estoppel effect for purposes of, Section 523 (a)(2)(A) of the Banlcruptcy Code, 11 

25 U.S.C. § 523(a)(2)(A). 

26 D. In accordance with 31 U.S.C. § 7701, Defendant is hereby required, 

27 unless he has done so already, to furnish to the Commission his taxpayer 

28 identification number (Social Security number), which shall be used for purposes 

7 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 8 of 18 Page ID #:377 " \ 

_ _ ,",U II lCi, lL IC-I - I 

of collecting and reporting on any delinquent amountadsing out of Defendant's 

2 relationship with the government. 

3 RIGHT TO REOPEN 

4 VI. 

5 IT IS FURTHER ORDERED that: 

6 A. The Commission ~s agreement to and the COl,lrt's approval of this 

7 Order are expressly premised upon the truthfulness, accuracy, and completeness of 

8 Defendant's Financial Statements, all of which Defendant asserts are truthful, 

9 accurate, and complete. Defendant and the Commission stipulate that Defendant's 

10 Financial Statements provide the basis for the monetary judgment in Section V of 

11 this Order and that the Commission has relied on the truthfulness, accuracy, and 

12 completeness of Defendant's Financial Statements. 

13 B. If, upon motion by the Commission, this Court fmds that Defendant 

14 has (1) materially misstated in Defendant's Financial Statements, the value of any 

15 asset, (2) made any material misrepresentation or omitted material information 

16 concerning his financial condition by failing to disclose any asset that should have 

17 been disclosed in Defendant's Financial Statements, or (3) made any other material 

18 misstatement or omission in Defendant's Financial Statements, the Court shall 

19 terminate the suspension of the monetary judgment entered in Section V. The 

20 Court, without further adjudication, shall enter a modified judgment holding the 

21 Defendant liable to the Commission in the amount of$58,946.90 for disgorgement, 

22 less any amounts turned over to the FTC pursuant to Section V of this Order. 

23 Upon such reinstatement of the monetary judgment, the Court sball make an 

24 express determination that the judgment shall become immediately due and 

25 payable by the Defendant and the Commission shall be entitled to interest 

26 computed from the day of entry of this Order at the rate prescribed under 28 U.S.C. 

27 § 1961, as amended, on the unpaid balance. The Commission shall be pennitted to 

28 execute on the judgment immediately after the suspension is lifted and engage in 

8 

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of collecting and reporting on any delinquent amountadsing out of Defendant's 

2 relationship with the government. 

3 RIGHT TO REOPEN 

4 VI. 

5 IT IS FURTHER ORDERED that: 

6 A. The Commission ~s agreement to and the COl,lrt's approval of this 

7 Order are expressly premised upon the truthfulness, accuracy, and completeness of 

8 Defendant's Financial Statements, all of which Defendant asserts are truthful, 

9 accurate, and complete. Defendant and the Commission stipulate that Defendant's 

10 Financial Statements provide the basis for the monetary judgment in Section V of 

11 this Order and that the Commission has relied on the truthfulness, accuracy, and 

12 completeness of Defendant's Financial Statements. 

13 B. If, upon motion by the Commission, this Court fmds that Defendant 

14 has (1) materially misstated in Defendant's Financial Statements, the value of any 

15 asset, (2) made any material misrepresentation or omitted material information 

16 concerning his financial condition by failing to disclose any asset that should have 

17 been disclosed in Defendant's Financial Statements, or (3) made any other material 

18 misstatement or omission in Defendant's Financial Statements, the Court shall 

19 terminate the suspension of the monetary judgment entered in Section V. The 

20 Court, without further adjudication, shall enter a modified judgment holding the 

21 Defendant liable to the Commission in the amount of$58,946.90 for disgorgement, 

22 less any amounts turned over to the FTC pursuant to Section V of this Order. 

23 Upon such reinstatement of the monetary judgment, the Court sball make an 

24 express determination that the judgment shall become immediately due and 

25 payable by the Defendant and the Commission shall be entitled to interest 

26 computed from the day of entry of this Order at the rate prescribed under 28 U.S.C. 

27 § 1961, as amended, on the unpaid balance. The Commission shall be pennitted to 

28 execute on the judgment immediately after the suspension is lifted and engage in 

8 
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discovery in aid of execution. 

2 c. Defendant acknowledges and agrees that (1) this monetary judgment 

3 is equitable monetary relief, solely remedial in nature. and not a fine, penalty, 

4 punitive assessment, or forfeiture; (2) any proceedings instituted under this Section 

5 would be in addition to. and not in lieu of, any other civil or criminal remedies as 

6 may be provided by law, includin"g any other proceedings that the FTC may initiate 

7 to enforce this Order; and (3) all money paid to satisfy the monetary judg'ment:js 

8 irrevocably paid for purposes of settlement between the parties. 

9 D. Should this Order be modified pUTsuant to this Section, this Order, in 

10 all other respects, shall remain in full force and effect unless otherwise ordered by 

11 the Court. 

12 

13 PROHIBITION ON RELEASE OF CUSTOMER INFORMATION OR 

14 CUSTOMER LISTS 

15 VII. 

16 IT IS FURTHER ORDERED that Defendant and his Representatives, 

17 whether acting directly or through a trust~ corporation, subsidiary, division, or 

18 other device, are hereby permanently restrained and enjoined from: 

19 A. Selling, renting, leasing, transferring. or otherwise disclosing the 

20 name, address, telephone number. credit card number, bank account number, 

21 Electronic Mail Address, or other identifying information obtained from any 

22 Person who: 

23 1. Provided the identifying information in response to any 

24 commercial electronic text message that was sent by Defendant or his 

25 Representatives prior to the date of this Order or any Commercial Electronic Mail 

26 Message that was sent, Initiated, Procured. or transmitted by Defendant or his 

27 Representatives prior to the date of this Order; 

28 2. Provided the identifying information prior to the date of this 

9 

2 

(. \ 

, ) , n~"·· _ • VY ·vv£.oo-J-\\::J -

discovery in aid of execution. 

( \ \ ) 

\. ~,.._ r'\ -

11"'.vUV 

c. Defendant acknowledges and agrees that (1) this monetary judgment 

3 is equitable monetary relief, solely remedial in nature. and not a fine, penalty, 

4 punitive assessment, or forfeiture; (2) any proceedings instituted under this Section 

5 would be in addition to. and not in lieu of, any other civil or criminal remedies as 

6 may be provided by law, includin'g any other proceedings that the FTC may initiate 

7 to enforce this Order; and (3) all money paid to satisfy the monetary judg'ment:js 

8 irrevocably paid for purposes of settlement between the parties. 

9 D. Should this Order be modified pUTsuant to this Section, this Order, in 

10 all other respects, shall remain in full force and effect unless otherwise ordered by 

11 the Court. 

12 

13 PROHIBITION ON RELEASE OF CUSTOMER INFORMATION OR 

14 CUSTOMER LISTS 

15 VII. 

16 IT IS FURTHER ORDERED that Defendant and his Representatives, 

17 whether acting directly or through a trust~ corporation, subsidiary, division, or 

18 other device, are hereby permanently restrained and enjoined from: 

19 A. Selling, renting, leasing, transferring. or otherwise disclosing the 

20 name, address, telephone number. credit card number, bank account number, 

21 Electronic Mail Address, or other identifying information obtained from any 

22 Person who: 

23 1. Provided the identifying information in response to any 

24 commercial electronic text message that was sent by Defendant or his 

25 Representatives prior to the date of this Order or any Commercial Electronic Mail 

26 Message that was sent, Initiated, Procured. or transmitted by Defendant or his 

27 Representatives prior to the date of this Order; 

28 2. Provided the identifying information prior to the date of this 

9 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 10 of 18 Page ID

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1 Order via any website or web page that is owned, operated, controlled, or 

2 registered in whole or in part by Defendant or his Representatives, on behalf of 

3 Defendant or his Representatives, or for tIle benefit of Defendant and his 

4 Representatives; or 

5 3. Provided the identifying information prior to the date of this 

6 Order via any website or web page that was adverti?ed in any commercial 

7 electronic text message that was sent by Defendant or his Representatives or 

8 Commercial Electronic Mail Message that was sent, Initiated, Procured, or 

9 transmitted by Defendant or his Representatives; and 

10 B. Failing to dispose of such customer information in all forms in their 

11 possession, custody, or control within thirty (30) days after entry of this Order. 

12 Disposal shall be by means that protect against unauthorized access to the customer 

13 information, such as by burning, pulverizing, or shredding any papers, and by 

14 erasing 01' destroying any electronic media, to ensure that the customer infonnation 

15 cannot practicably be read or reconstructed. 

16 Provided, that customer information need not be disposed of, and may be 

17 disclosed, to the extent requested by a government agency or required by a taw, 

18 regulation, or court order. 

19 

20 COlVIPLIANCE MONITORING 

21 VIII. 

22 IT IS FURTHER ORDERED that, for the purpose of monitoring and 

23 investigating compliance with any provision of this Order: 

24 A. Within ten (IO) days of receipt of written notice from a representative 

25 of the C~mmission, Defendant shall submit additional written reports, which are 

26 true and accurate and sworn to under penalty of perjury; produce documents for 

27 inspection and copying; appear for deposition; and provide entry during normal 

28 business hours to any business location in Defendant's possession or direct or 

10 

· - -- - - - ..;J - • v VI I V I ....... t1~ 11...1 

1 Order via any website or web page that is owned, operated, controlled, or 

2 registered in whole or in part by Defendant or his Representatives, on behalf of 

3 Defendant or his Representatives, or for tIle benefit of Defendant and his 

4 Representatives; or 

5 3. Provided the identifying information prior to the date of this 

6 Order via any website or web page that was adverti?ed in any commercial 

7 electronic text message that was sent by Defendant or his Representatives or 

8 Commercial Electronic Mail Message that was sent, Initiated, Procured, or 

9 transmitted by Defendant or his Representatives; and 

10 B. Failing to dispose of such customer information in all forms in their 

11 possession, custody, or control within thirty (30) days after entry of this Order. 

12 Disposal shall be by means that protect against unauthorized access to the customer 

13 information, such as by burning, pulverizing, or shredding any papers, and by 

14 erasing 01' destroying any electronic media, to ensure that the customer infonnation 

15 cannot practicably be read or reconstructed. 

16 Provided, that customer information need not be disposed of, and may be 

17 disclosed, to the extent requested by a government agency or required by a taw, 

18 regulation, or court order. 

19 

20 COlVIPLIANCE MONITORING 

21 VIII. 

22 IT IS FURTHER ORDERED that, for the purpose of monitoring and 

23 investigating compliance with any provision of this Order: 

24 A. Within ten (IO) days of receipt of written notice from a representative 

25 of the C~mmission, Defendant shall submit additional written reports, which are 

26 true and accurate and sworn to under penalty of perjury; produce documents for 

27 inspection and copying; appear for deposition; and provide entry during normal 

28 business hours to any business location in Defendant's possession or direct or 

10 
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indirect control to inspect the business operation; 

2 B. In addition, the Commission is authorized to use all other lawful 

3 means, including but not limited to: 

4 1. obtaining discovery from any person, without further leave of 

5 court, using the procedures prescribed by Fed. R. Civ. p .. 30, 3 1,33,34,36,45, and 

6 69; 

7 2. having its representatives pose as consumers and suppliers to 

8 theDefendant, his employees, or any other entity managed or controlled in whole 

9 or in part by the Defendant, without the necessity of identification or prior notice; 

10 and 

11 c. Defendant shall permit representatives of the Commission to 

12 interview any employer, consultant, independent contractor, representative, agent, 

13 ot employee wbo has agreed to such an interview, relating in any way to any 

14 conduct subject to this Order. The person interviewed may have counsel present. 

15 Provided however, that nothing in this Order shall limit the Commission's lawful 

16 use of compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 

17 U;S.C. §§ 49, 57b-l, to obtain any documentary material, tangible things, 

18 testimony, or information relevant to unfair or deceptive acts or practices in or 

19 affecting commerce (within the meaning of 15 U.S.C. § 45(a)(1)). 

20 COMPLIANCE REPORTING 

21 IX. 

22 IT IS FURTHER ORDERED that, in order that compliance with the 

23 provisions of this Order may be monitored: 

24 A. For a period of five (5) years from the date of entry of this Order, 

25 1. Defendant shall notify the Commission of the following: 

26 a. Any changes in Defendant's residence, mailing 

27 

28 

addresses, and telephone numbers, within ten (l0) days 

ofthe date of such change; 

11 

( ~} 

.• uv-uuL::J::J-AI..:J -JC.IVI -, I~ I '-'::;J_.-

~u - --

indirect control to inspect the business operation; 

2 B. In addition, the Commission is authorized to use all other lawful 

3 means, including but not limited to: 

4 1. obtaining discovery from any person, without further leave of 

5 court, using the procedures prescribed by Fed. R. Civ. p .. 30, 3 1,33,34,36,45, and 

6 69; 

7 2. having its representatives pose as consumers and suppliers to 

8 theDefendant, his employees, or any other entity managed or controlled in whole 

9 or in part by the Defendant, without the necessity of identification or prior notice; 

10 and 

11 c. Defendant shall permit representatives of the Commission to 

12 interview any employer, consultant, independent contractor, representative, agent, 

13 ot employee wbo has agreed to such an interview, relating in any way to any 

14 conduct subject to this Order. The person interviewed may have counsel present. 

15 Provided however, that nothing in this Order shall limit the Commission's lawful 

16 use of compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 

17 U;S.C. §§ 49, 57b-l, to obtain any documentary material, tangible things, 

18 testimony, or information relevant to unfair or deceptive acts or practices in or 

19 affecting commerce (within the meaning of 15 U.S.C. § 45(a)(1)). 

20 COMPLIANCE REPORTING 

21 IX. 

22 IT IS FURTHER ORDERED that, in order that compliance with the 

23 provisions of this Order may be monitored: 

24 A. For a period of five (5) years from the date of entry of this Order, 

25 1. Defendant shall notify the Commission of the following: 

26 a. Any changes in Defendant's residence, mailing 

27 

28 

addresses, and telephone numbers, within ten (l0) days 

ofthe date of such change; 

11 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 12 of 18 Page ID

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1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

:' ) _ ..• ~v -vu£..:n:l-roG ':'.IC~· -

b. 

c. 

Any changes in Defendant's employment status 

(including self-employment), and any change in 

Defendant's ownership in any business entity, within ten 

(10) days of the date of such change. Such notice shall 

illlaude the name and address of each business that 

Defendant is affiliated with, employed by, creates or 

forms, or performs services for; a detailed description of 

the nature of the business; and a detailed description of 

Defendant's duties and responsibilities in connection 

with the business or employment; and 

Any changes in Defendant's name or use of any aliases 

or fictitious names within ten (10) days of the date of 

such change; 

Defendant shall notify the Commission of any changes in 

15 structure of any business entity that Defendant directly or indirectly controls, or 

16 has an ownership interest in, that may affect compliance obligations arising under 

17 this Order, including but not limited to: incorporation or other organization; a 

18 dissolution, assignment, sale, merger, or other action; the creation Of dissolution of 

19 a subsidiary, parent, or affiliate that engages in any acts or practices subject to this 

20 Order; or a change in the business name or address, at least thirty (30) days prior to 

21 such change, provided tl1at, with respect to any such change in the business entity 

22 about which Defendant learns less than thirty (30) days prior to the date such 

23 action is to take place, Defendant shall notify the Commission as soon as is 

24 practicable after obtaining such knowledge. 

25 B. One hundred eighty (180) days after the date of-entry of this Order 

26 and annually thereafter for a period of five (5) years, Defendant shall provide a 

27 written report to the FTC, which is true and accurate and sworn to under penalty of 

28 perjury, setting forth in detail the manner and farm in which they have complied 

12 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

:' ) _ ..• ~v -vu£..:n:l-roG ':'.IC~· -

b. 

c. 

Any changes in Defendant's employment status 

(including self-employment), and any change in 

Defendant's ownership in any business entity, within ten 

(10) days of the date of such change. Such notice shall 

illlaude the name and address of each business that 

Defendant is affiliated with, employed by, creates or 

forms, or performs services for; a detailed description of 

the nature of the business; and a detailed description of 

Defendant's duties and responsibilities in connection 

with the business or employment; and 

Any changes in Defendant's name or use of any aliases 

or fictitious names within ten (10) days of the date of 

such change; 

Defendant shall notify the Commission of any changes in 

15 structure of any business entity that Defendant directly or indirectly controls, or 

16 has an ownership interest in, that may affect compliance obligations arising under 

17 this Order, including but not limited to: incorporation or other organization; a 

18 dissolution, assignment, sale, merger, or other action; the creation Of dissolution of 

19 a subsidiary, parent, or affiliate that engages in any acts or practices subject to this 

20 Order; or a change in the business name or address, at least thirty (30) days prior to 

21 such change, provided tl1at, with respect to any such change in the business entity 

22 about which Defendant learns less than thirty (30) days prior to the date such 

23 action is to take place, Defendant shall notify the Commission as soon as is 

24 practicable after obtaining such knowledge. 

25 B. One hundred eighty (180) days after the date of-entry of this Order 

26 and annually thereafter for a period of five (5) years, Defendant shall provide a 

27 written report to the FTC, which is true and accurate and sworn to under penalty of 

28 perjury, setting forth in detail the manner and farm in which they have complied 

12 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 13 of 18 Page ID

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( ') / ''\ , J 

,_, 111' 

1 and are complying with this Order. This report shall include, but not be limited to: 

2 1. Defendant's then-current residence address, mailing addresses. 

3 and telephone numbers; 

4 2. Defendant's then-current employment status (including self5 employment), including the name, addresses, and telephone numbers of each 

6 business that such Defendant is affiliated with. employed by. or performs services 

7 for; a detailed description of the nature of the business; and a detailed description 

8 of such Defendant's duties and responsibilities in connection with the business or 

9 employment; 

10 3. Any other changes required to be reported under Subsection A 

11 of this Section; and 

12 4. A copy of each ,ac1cnowledgment of receipt of this Order. 

13 obtained pursuant to the Section titled "Distribution of Order." 

14 C. Defendant shall notify the .commission of the filing of a bankruptcy 

15 petition by Defendant within fifteen (15) days of filing. 

16 D. For the purposes of this Order. Defendant shall, unless otherwise 

17 directed by the Commjssion's authorized representatives, send by overnight 

18 courier (not the U.S. Postal Service) all reports and notifications to the 

19 Commission that are required by this Order to: 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Associate Director for Enforcement 

Bureau of Consumer Protection 

Federal Trade Commission 

600 Pennsylvania Avenue, N.W. 

Washington, D.C. 20580 

RE: FTC v. Flora. 

Provided that, in lieu of overnight cDurier, Defendant may send such reports 

or notifications by first-class mail, but only if Defendant contemporaneously sends 

an electronic version of such report or notification to the Commisslon at 

DEbrief@ftc.gov. 

E. For purposes of the cOInpliance reporting and monitoring required by 

13 

( ') / ''\ , J 

,_, 111' 

1 and are complying with this Order. This report shall include, but not be limited to: 

2 1. Defendant's then-current residence address, mailing addresses. 

3 and telephone numbers; 

4 2. Defendant's then-current employment status (including self5 employment), including the name, addresses, and telephone numbers of each 

6 business that such Defendant is affiliated with. employed by. or performs services 

7 for; a detailed description of the nature of the business; and a detailed description 

8 of such Defendant's duties and responsibilities in connection with the business or 

9 employment; 

10 3. Any other changes required to be reported under Subsection A 

11 of this Section; and 

12 4. A copy of each ,ac1cnowledgment of receipt of this Order. 

13 obtained pursuant to the Section titled "Distribution of Order." 

14 C. Defendant shall notify the .commission of the filing of a bankruptcy 

15 petition by Defendant within fifteen (15) days of filing. 

16 D. For the purposes of this Order. Defendant shall, unless otherwise 

17 directed by the Commjssion's authorized representatives, send by overnight 

18 courier (not the U.S. Postal Service) all reports and notifications to the 

19 Commission that are required by this Order to: 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Associate Director for Enforcement 

Bureau of Consumer Protection 

Federal Trade Commission 

600 Pennsylvania Avenue, N.W. 

Washington, D.C. 20580 

RE: FTC v. Flora. 

Provided that, in lieu of overnight cDurier, Defendant may send such reports 

or notifications by first-class mail, but only if Defendant contemporaneously sends 

an electronic version of such report or notification to the Commisslon at 

DEbrief@ftc.gov. 

E. For purposes of the cOInpliance reporting and monitoring required by 

13 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 14 of 18 Page ID

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1 this Order, the Commissjon is authorized to communicate directly with the 

2 Defendant 

3 

4 

RECORDKEEPING 

X. 

5 IT IS FURTHER ORDERED that, for a period of eight (8) years from the 

6 date of entry of this Order, Defendant is hereby restrained and enjoined from 

7 failing to create and retain the following records for any business for which he is 

8 the majority owner or directly or indirectly controls: 

9 A. Accounting records that reflect the cost of goods or services sold, 

10 revenues generated. and the disbursement of such revenues; 

11 B. Personnel records accurately reflecting: the name. address, and 

12 telepho~e number of each person employed in any capacity by such business, 

13 including as an independent contractor; that person's job title or position; the date 

14 upon which the person commenced work; and the date and reason for the person's 

15 termination, if applicable; 

16 C. Customer files containing the names, -addresses, phone numbers, 

17 dollar amounts paid, quantity of items or services purchased, and description of 

18 items or services purchased, to the extent such information is obtained in the 

19 ordhlary course of business; 

20 D. Complaints and refund requests (whether received directly or 

21 indirectly, such as through a third party,) and any responses to those complaints or 

22 requests; 

23 E. Copies of all sales scripts, training materials, advertisements, or other 

24 marketing materials; and 

25 F. All records and documents necessary to demonstrate fun compliance 

26 with each provision of this Order, including but not limited to, copies of 

27 acknowledgments of receipt of this Order required by the Sections titled 

28 "Distribution of Order" and ;<Acknow ledgment of Reoeipt of Order" and all reports 

14 

f"'--

( ) ___ ~~ . \G -JEM n~--

1 this Order, the Commissjon is authorized to communicate directly with the 

2 Defendant 

3 

4 

RECORDKEEPING 

X. 

5 IT IS FURTHER ORDERED that, for a period of eight (8) years from the 

6 date of entry of this Order, Defendant is hereby restrained and enjoined from 

7 failing to create and retain the following records for any business for which he is 

8 the majority owner or directly or indirectly controls: 

9 A. Accounting records that reflect the cost of goods or services sold, 

10 revenues generated. and the disbursement of such revenues; 

11 B. Personnel records accurately reflecting: the name, address, and 

12 telepho~e number of each person employed in any capacity by such business, 

13 including as an independent contractor; that person's job title or position; the date 

14 upon which the person commenced work; and the date and reason for the person's 

15 termination, if applicable; 

16 c. Customer files containing the names. -addresses, phone numbers, 

17 dollar amounts paid, quantity of items or services purchased, and description of 

18 items or services purchased, to the extent such information is obtained in the 

19 ordhlary course of business; 

20 D. Complaints and refund requests (whether received directly or 

21 indirectly, such as through a third party.) and any responses to those complaints or 

22 requests; 

23 E. Copies of all sales scripts, training materials, advertisements, or other 

24 marketing materials; and 

25 F. All records and documents necessary to demonstrate fun compliance 

26 with each provision of this Order, including but not limited to, copies of 

27 acknowledgments of receipt of this Order required by the Sections titled 

28 "Distribution of Order" and ;<Acknow ledgment of Reoeipt of Order" and all reports 

14 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 15 of 18 Page ID

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1 submitted to the FTC pursuant to the Section titled ·'Compliance Reporting." 

2 

3 DISTRIBUTION OF ORDER 

4 XI. 

5 IT IS FURTHER ORDERED that) for a period offive (5) years from the 

6 date of entry of this Order, Defendant shall deliver copies of the Order as directed 

7 below: 

8 A. Defendant as control person: For any business that Defendant 

9 controls, directly or indirectly, or in which Defendant has a majority ownership 

10 interest} Defendant must deliver a copy of this Order to: (1) all principals, officers, 

11 directors, and managers of that business; (2) all employees, agents, and 

12 representatives of that business who engage in conduct related to the subject matter 

13 of the Order; and (3) any business entity resulting from any change in structure set 

14 forth in Subsection A.2 of the Section titled "Compliance Reporting." For current 

15 personnel, delivery shall be within five (5) days of service of this Order upon 

16 Defendant. For new personnel, delivery shall occur prior to them assuming th,eir 

17 responsibilities. For any business entity resulting from any change in structure set 

18 forth in Subsection A.2 ofthe Section titled "Compliance Reporting," delivery 

19 shall be at least ten (10) days prior to the change in structure. 

20 B. Defendant as employee or non-control person: For any business 

21 where Defendant is not a controlling person of a business but otherwise engages in 

22 conduct related to the subject matter of this Order, Defendant must deliver a copy 

23 of this Order to all principals and managers of such business before engaging in 

24 such conduct. 

25 C. Defendant must secure a signed and dated statement acknowledging 

26 receipt of the Order, within thirty (30) days of delivery) from all persons receiving 

27 a copy of the Order pursuant to this Section. 

28 

15 

,10 

() __ ~ .... u. I 1-t;V-\J\J~_ _ .G ~J _ ... ( J 1 .--

1 submitted to the FTC pursuant to the Section titled ·'Compliance Reporting." 

2 

3 DISTRIBUTION OF ORDER 

4 XI. 

5 IT IS FURTHER ORDERED that) for a period offive (5) years from the 

6 date of entry of this Order, Defendant shall deliver copies of the Order as directed 

7 below: 

8 A. Defendant as control person: For any business that Defendant 

9 controls, directly or indirectly, or in which Defendant has a majority ownership 

10 interest} Defendant must deliver a copy of this Order to: (1) all principals, officers, 

11 directors, and managers of that business; (2) all employees, agents, and 

12 representatives of that business who engage in conduct related to the subject matter 

13 of the Order; and (3) any business entity resulting from any change in structure set 

14 forth in Subsection A.2 of the Section titled "Compliance Reporting." For current 

15 personnel, delivery shall be within five (5) days of service of this Order upon 

16 Defendant. For new personnel, delivery shall occur prior to them assuming th,eir 

17 responsibilities. For any business entity resulting from any change in structure set 

18 forth in Subsection A.2 ofthe Section titled "Compliance Reporting," delivery 

19 shall be at least ten (10) days prior to the change in structure. 

20 B. Defendant as employee or non-control person: For any business 

21 where Defendant is not a controlling person of a business but otherwise engages in 

22 conduct related to the subject matter of this Order, Defendant must deliver a copy 

23 of this Order to all principals and managers of such business before engaging in 

24 such conduct. 

25 C. Defendant must secure a signed and dated statement acknowledging 

26 receipt of the Order, within thirty (30) days of delivery) from all persons receiving 

27 a copy of the Order pursuant to this Section. 

28 

15 

,10 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 16 of 18 Page ID

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1 ACKNO\VLEDGMENT OF RECEIPT OF ORDER 

2 XII. 

3 IT IS FURTHER ORDERED that Defendant, within five (5) business days 

4 of receipt of this Order as entered by the Court, must submit to the Commission a 

5 truthful sworn statement acknowledging receipt of this Order. 

6 

7 RETENTION OF JURISDICTION 

8 XIII. 

9 IT IS FURTHER ORDERED that this Court shall retain jurisdiction of 

10 this matter for purposes of construction, modification, and enforcement of this 

11 Order. 

12 

13 -rV\ 

14 IT IS SO ORDERED, this ~ \ 2 day of 1\0 C5 2011, at 

15 '2'.2.0 rm. 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

16 

() / \ 

.\ .J~- .. _ -.J. I 1-L'V-UUL::Ith'-\v _ )::r-.II r- _" ....... , I 

1 ACKNO\VLEDGMENT OF RECEIPT OF ORDER 

2 XII. 

3 IT IS FURTHER ORDERED that Defendant, within five (5) business days 

4 of receipt of this Order as entered by the Court, must submit to the Commission a 

5 truthful sworn statement acknowledging receipt of this Order. 

6 

7 RETENTION OF JURISDICTION 

8 XIII. 

9 IT IS FURTHER ORDERED that this Court shall retain jurisdiction of 

10 this matter for purposes of construction, modification, and enforcement of this 

11 Order. 

12 

13 

14 IT IS SO ORDERED, this ~ \ 2 -rV\ day of 1\0 C5 2011, at 

15 '2'.2.0 rm. 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

16 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 17 of 18 Page ID

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1 The parties consent to the terms and conditions set forth above and consent to 

2 entry of this Stipulated Permanent Injunction and Final Order at the Court's 

3 convenience and without further notice to the parties. 

4 

5 PLAINTIFF: 

8 Robert G. Schoshmsld, DC # 429736 

rschoshinski{a}ftc.gov 

9 Christine M.l"odaro, OH # 0084976 

ctodaro(Gllftc.gov 

10 Federal "Trade Commission 

600 P~nnsylvania Avenue, N. W. 

11 Washmgton, DC 20580 

i

202j3.16-32191· S.choshinski) 12 202 326-3711 Todaro) 

202 326.,3395 acsimile 

13 

Local Counsel 

14 Raymond McKown 

rmckown@ftc.gov 

15 CA Bar No. 150975 

Federal Trade Commission 

16 10877 Wilshire Boulevard, Suite 700 

Los Angeles, CA 90024 

17 3 I 0~824-4325 

310-824-4380 faCSimile 

18 

Attorneys for Plaintiff 

19 FEDERAL TRADE COMMISSION 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Dated: 

17 

10 

( ) / \ 

\ '. " ' _. I ,-vV-VV.<...vu .\G -JL... LJu\,;ument L7-1 ~ .. __ ~_, . _. .. o':;.,...",,~ j 

1 The parties consent to the terms and conditions set forth above and consent to 

2 entry of this Stipulated Permanent Injunction and Final Order at the Court's 

3 convenience and without further notice to the parties. 

4 

5 PLAINTIFF: 

8 Robert G. Schoshmsld, DC # 429736 

rschoshinski{a}ftc.gov 

9 Christine M.l"odaro, OH # 0084976 

ctodaro(Gllftc.gov 

10 Federal "Trade Commission 

600 P~nnsylvania Avenue, N. W. 

11 Washmgton, DC 20580 

!

202j3.16-3219J,· S.choshinski) 12 202 326-3711 Todaro) 

202 326.,3395 acsimile 

13 

Local Counsel 

14 Raymond McKown 

rmckown@ftc.gov 

15 CA Bar No. 150975 

Federal Trade Commission 

16 10877 Wilshire Boulevard, Suite 700 

Los Angeles, CA 90024 

17 3 I 0~824-4325 

310-824-4380 faCSimile 

18 

Attorneys for Plaintiff 

19 FEDERAL TRADE COMMISSION 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Dated: 

17 

10 
Case 8:11-cv-00299-AG -JEM Document 28 Filed 08/16/11 Page 18 of 18 Page ID

 #:387

DEFENDANT/ / . '-"I)' ~ ,.//-/ 

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:; 'PhHlip A. Flora L' 

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7 

Michael A. Thumlan 

8 nllhl,l.n:nan@lol.!bxorn 

CA Bar No~ 123303 

9 Loeb &- Locb 

10 J 00 Santa Monica l3oull!vnrd, Sllit~ 220() 

10 Los An¥t!lt::s, CA 90067 

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Michael A. Thumlan 

8 nllhl,l.n:nan@lol.!bxorn 

CA Bar No, 123303 

9 Loeb &- Locb 

10 J 00 Santa Monica l3oull!vnrd, Sllit~ 220() 

10 Los An¥t!lt::s, CA 90067 

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