-----

UNITED STATES DISTRICT COURT 

FOR THE SOUTHERN DISTRICT OF FLORIDA 

FEDERAL TRADE COMMISSION, 

Plaintiff, 

vs. 

SIMPLE HEALTH PLANS LLC, a Florida limited 

liability company; 

HEALTH BENEFITS ONE LLC, a Florida limited 

liability company, also d/b/a Health Benefits Center, 

Simple Health, Simple Health Plans, Simple 

Insurance, Simple Insurance Plans, Simple Auto, 

Simple Home, Simple Home Plans, Simple Care, 

Simple Life, and National Dental Savings; 

HEALTH CENTER MANAGEMENT LLC, a 

Florida limited liability company; 

INNOVATIVE CUSTOMER CARE LLC, a Florida 

limited liability company; 

SIMPLE INSURANCE LEADS LLC, a Florida 

limited liability company, also d/b/a Health 

Insurance Services; 

SENIOR BENEFITS ONE LLC, a Florida limited 

liability company; and 

STEVEN J. DORFMAN, individually and as an 

officer, member, or manager ofSIMPLE HEALTH 

PLANS LLC, HEAL TH BENEFITS ONE LLC, 

HEALTH CENTER MANAGEMENT LLC, 

INNOVATIVE CUSTOMER CARE LLC, SIMPLE 

INSURANCE LEADS LLC, and SENIOR 

BENEFITS ONE LLC; 

Defendants. 

Case No. 

[FILED UNDER SEAL] 

COMPLAINT FOR PERMANENT 

IN.TTJNCTION AND OTHER 

EQUITABLE RELIEF 

Plaintiff, the Federal Trade Commission ("FTC"), for its Complaint alleges: 

1. The FTC brings this action under Section 13(6) ofthe Federal Trade 
Commission Act ("FTC Act"), 15 U.S.C. § 53(b), and the Telemarketing and Consumer Fraud 

and Abuse Act ("Telemarketing Act"), 15 U.S.C. §§ 6101-6108, to obtain temporary, 

preliminary, and permanent injunctive relief, rescission or reformation of contracts, restitution, 

the refund of monies paid, disgorgement of ill-gotten monies, and other equitable relief for 

Defendants' acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), and 

in violation of the FTC's Telemarketing Sales Rule ("TSR"), 16 C.F.R. Part 310, as amended. 

JURISDICTION AND VENUE 

2. This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 133 I, 1337(a), 

and 1345, and 15 U.S.C. §§ 45(a), 53(6), 6102(c), and 6105(6). 

3. Venue is proper in this district under 28 U.S.C. § 1391(b)(1)-(3), (c)(l)-(2), and 

(d), and 15 U.S.C. § 53(6). 

PLAINTIFF 

4. The FTC is an independent agency of the United States Government created by 

statute. 15 U.S.C. §§ 41-58. The FTC enforces Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), 

which prohibits unfair or deceptive acts or practices in or affecting commerce. The FTC also 

enforces the Telemarketing Act, 15 U.S.C. §§ 6101-6 I 08, as amended. Pursuant to the 

Telemarketing Act, the FTC promulgated and enforces the TSR, I 6 C.F.R. Part 310, as amended, 

which prohibits deceptive and abusive telemarketing acts or practices. 

5. The FTC is authorized to initiate federal district court proceedings, by its own 

attorneys, to enjoin violations of the FTC Act and the TSR, and to secure such equitable relief as 

may be appropriate in each case, including rescission or reformation of contracts, restitution, the 

refund of monies paid, and the disgorgement of ill-gotten monies. 15 U .S.C. §§ 53(b ), 6102(c), 

and 6105(6). 

2 
DEFENDANTS 

Corporate Defendants 

6. Simple Health Plans LLC is a Florida limited liability company with its principal 

place of business at 2 Oakwood Boulevard, Suite 100, Hollywood, Florida 33020. Simple 

Health Plans transacts or has transacted business in this district and throughout the United States. 

At all times material to this Complaint, acting alone or in concert with others, Simple Health 

Plans has advertised, marketed, distributed, or sold limited benefit plans and medical discount 

memberships to consumers throughout the United States. 

7. Health Benefits One LLC, also doing business as Health Benefits Center, Simple 

Health, Simple Health Plans, Simple Insurance, Simple Insurance Plans, Simple Auto, Simple 

Home, Simple Home Plans, Simple Care, Simple Life, and National Dental Savings, is a Florida 

limited liability company with its principal place of business at 2 Oakwood Boulevard, Suite 

100, Hollywood, Florida 33020. Health Benefits One transacts or has transacted business in this 

district and throughout the United States. At all times material to this Complaint, acting alone or 

in concert with others, Health Benefits One has advertised, marketed, distributed, or sold limited 

benefit plans and medical discount memberships to consumers throughout the United States. 

8. Health Center Management LLC is a Florida limited liability company with its 

principal place of business at 2 Oakwood Boulevard, Suite I 00, Hollywood, Florida 33020. 

Health Center Management is a manager of Simple Health Plans LLC and Senior Benefits One 

LLC. Health Center Management transacts or has transacted business in this district and 

throughout the United States. At all times material to this Complaint, acting alone or in concert 

with others, Health Center Management has advertised, marketed, distributed, or sold limited 

benefit plans and medical discount memberships to consumers throughout the United States. 

3 
9. Innovative Customer Care LLC is a Florida limited liability company with its 

principal places of business at 3389 Sheridan Street #632, Hollywood, Florida 33021, and 2 

Oakwood Boulevard, Suite I 00, Hollywood, Florida 33020. Innovative Customer Care transacts 

or has transacted business in this district and throughout the United States. At all times material 

to this Complaint, acting alone or in concert with others, Innovative Customer Care has 

advertised, marketed, distributed, or sold limited benefit plans and medical discount 

memberships to consumers throughout the United States. 

I 0. Simple Insurance Leads LLC, also doing business as Health Insurance Services, is 

a Florida limited liability company with its principal place of business at 2 Oakwood Boulevard, 

Suite 100, Hollywood, Florida 33020. Simple Insurance Leads transacts or has transacted 

business in this district and throughout the United States. At all times material to this Complaint, 

acting alone or in concert with others, Simple Insurance Leads has advertised, marketed, 

distributed, or sold limited benefit plans and medical discount memberships to consumers 

throughout the United States. 

11. Senior Benefits One LLC is a Florida limited liability company with its principal 

place of business at 2 Oakwood Boulevard, Suite I 00, Hollywood, Florida 33020. Senior 

Benefits One transacts or has transacted business in this district and throughout the United 

States. At all times material to this Complaint, acting alone or in concert with others, Senior 

Benefits One has advertised, marketed, distributed, or sold limited benefit plans and medical 

discount memberships to consumers throughout the United States. 

Individual Defendant 

12. Defendant Steven J. Dorfman is an owner, officer, member, or manager of Simple 

Health Plans LLC, Health Benefits One LLC, Health Center Management LLC, Innovative 

4 
Customer Care LLC, Simple Insurance Leads LLC, and Senior Benefits One LLC. At all times 

material to this Complaint, acting alone or in concert with others, he has formulated, directed, 

controlled, had the authority to control, or participated in the acts and practices set forth in this 

Complaint. For example, Dorfman manages Defendants' operations, serves as an officer for 

several ofthe corporate defendants, and is a signatory on corporate bank accounts. Dorfman 

resides in this district and, in connection with the matters alleged herein, transacts or has 

transacted business in this district and throughout the United States. 

Common Enterprise 

l 3. Defendants Simple Health Plans LLC, Health Benefits One LLC, Health Center 

Management LLC, Innovative Customer Care LLC, Simple Insurance Leads LLC, and Senior 

Benefits One LLC, (collectively, "Corporate Defendants") have operated as a common enterprise 

while engaging in the deceptive acts and practices and other violations of law alleged below. 

Corporate Defendants have conducted the business practices described below through 

interrelated companies, which have common ownership, officers, managers, business functions, 

and office locations, which have commingled assets, and which hold themselves out as Simple 

Health. Because these Corporate Defendants have operated as a common enterprise, each of 

them is jointly and severally liable for the acts and practices alleged below. Defendant Dorfman 

has formulated, directed, controlled, had the authority to control, or participated in the acts and 

practices of the Corporate Defendants that constitute the common enterprise. 

COMMERCE 

14. At all times material to this Complaint, Defendants have maintained a substantial 

course of trade in or affecting commerce, as "commerce" is defined in Section 4 ofthe FTC Act, 

15 u.s.c. § 44. 

5 
DEFENDANTS' BUSINESS PRACTICES 

Overview 

15. Since at least October 2013, online and primarily through outbound telemarketing 

calls, Defendants claim to offer consumers comprehensive health insurance or its equivalent. 

Defendants lead consumers to believe that they will receive a "PPO" health insurance policy 

that, for a nominal copay, will cover preexisting medical conditions, prescription drug 

medications, primary and specialty care treatment, inpatient and emergency hospital care, 

surgical procedures, and medical and laboratory testing. 

I 6. The products sold by Defendants to consumers are not, in fact, comprehensive 

health insurance and do not provide consumers with the benefits promised by Defendants. 

Instead, Defendants typically enroll consumers in an assortment of different programs, including: 

(1) limited benefit plans, also known as limited benefit indemnity plans and hospital indemnity 

plans; and (2) medical discount and wellness program memberships. 

17. Comprehensive health insurance plans generally involve an arrangement between 

an insurance company and a consumer in which the company agrees to pay a substantial portion 

ofthe healthcare expenses that the consumer might incur in exchange for consumers' premium 

payments. This has the effect oftransferring some ofthe policyholder's risk to the insurance 

company. 

18. A PPO plan, also known as a preferred provider organization plan, is a type of 

comprehensive health insurance consisting ofmedical doctors, hospitals, and other health care 

providers who have agreed with an insurer or a third-party administrator to provide health care at 

reduced rates to the insurer's or the administrator's clients. 

6 
19. Limited benefit plans, by contrast, provide non-comprehensive coverage capped 

at a specific amount for a specific service, treatment, condition, or disease. Limited benefit plans 

do not have the effect oftransferring enrollees' risk to a third party. Instead, Defendants incur 

no risk whatsoever when a customer enrolls in one oftheir limited benefit plans. 

20. In the past three years alone, Defendants' scheme has generated over $100 million 

in revenue. Unfortunately, Defendants' scheme also has left tens ofthousands ofconsumers who 

thought they had purchased comprehensive health insurance without such coverage. In addition 

to paying monthly "premiums" for Defendants' limited benefit plans and medical discount 

memberships, many ofthese consumers have incurred substantial medical expenses under the 

mistaken beliefthat these expenses would be covered by the health insurance they thought they 

had obtained from Defendants. 

Defendants Target Consumers In Need ofHealth Insurance 

21. Defendants prey on consumers who are seeking comprehensive health insurance. 

These consumers typically either do not have health insurance or pay high premiums for their 

insurance because they have lost their jobs, are unemployed or self-employed, or have lost their 

group or individual health insurance. 

22. In their advertising and promotional materials, including on their websites, 

Defendants falsely claim to offer a vast selection of comprehensive health care insurance policies 

from "the top carriers in every state." On their primary consumer-facing website, 

www.simplehealthplans.com, Defendants falsely claim to have "assembled a diverse portfolio of 

superior health insurance products from leading health insurance carriers, each carefully selected 

based on its ability to provide exceptional value and coverage to our customers." 

7 
23. Defendants also falsely hold themselves out as experts on, and providers of, 

government-sponsored health insurance policies, such as those offered pursuant to Medicare and 

the Patient Protection and Affordable Care Act ("ACA" or "Affordable Care Act"), 42 U.S.C. § 

1800 I et seq. 

24. Defendants tout their purported ACA expertise in their marketing materials and in 

statements promoting their business. On their main website, for example, Defendants falsely 

claim that their "one objective" is to "help consumers through the complexities ofthe Affordable 

Care Act." In a newspaper interview, a company spokesperson stated that Defendants could 

provide better advice to consumers about health insurance options than an A CA-certified 

"navigator" because Defendants "have the freedom to help the consumer figure out what's in 

their best interest." An ACA navigator is an individual or organization trained to help consumers 

look for health coverage options available through the ACA. Navigators are required to be 

unbiased, and their services are free to consumers. 

25. Defendants also use the ACA as an employee recruitment tool, promising that 

prospective employees "WILL HAVE MONEY THROWN AT YOU" during "open 

enrollment." Beneath an image of a cigar-smoking individual tossing a wad of cash, one of 

Defendants' job postings states: "If you are not making money hand over first [sic] this open 

enrollment you are not making the most ofyour time left on this earth. Well guess what. .. here 

is your golden opportunity to MAKE THAT MONEY!" See Image A below. Under the ACA, 

"open enrollment" is a window during which individuals or employees may add or drop their 

health insurance, or make changes to their coverage. This term has no applicability to the limited 

benefit plans and medical discount memberships sold by Defendants. 

8 
Hiring A.gems for Open Enrollment- Acr :Xow CALL 561 288-5785! 

Re ference Cc.de· Open Enrollment 

SIMPLE HEALTH IS HIRING I ACT NOW CALL 

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HEALTH INSURANCE SALES AGENTS - - 5785

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26. In fact, Defendants are not experts on, and do not provide, government-sponsored, 

A CA-compliant health insurance policies. 

27. In some oftheir advertising materials and campaigns, Defendants falsely claim to 

be affiliated with AARP and the Blue Cross Blue Shield Association. Defendants are not 

affiliated with AARP or the Blue Cross Blue Shield Association. 

9 
28. Defendants advertise their limited benefit plans and discount memberships 

primarily through a network of lead generation websites. Defendants own some ofthese sites 

themselves, and also pay lead generators for leads generated on third-party sites. Consumers 

typically find these websites by conducting internet searches for health insurance. 

29. The third-party lead generation sites typically claim to provide information about 

obtaining comprehensive health insurance, including insurance available through the 

marketplaces established pursuant to the ACA. In many cases, the sites refer to the ACA and 

Medicare and use terms associated with the ACA, such as "Obamacare" and the "Obamacare 

Marketplace." The sites also feature the branded logos of well-known insurance carriers, such as 

Blue Cross Blue Shield. See Images B and C below. 

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11 
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www.obamacare-plans.com 

30. Many consumers who submit their names and telephone numbers to the thirdparty lead generation sites believe that they will receive information about comprehensive health 

insurance plans, including government-sponsored policies like those offered pursuant to the 

ACA. Defendants then purchase this consumer information from the operators ofthe third-party 

lead generation websites such as those described above in Paragraph 29. 

31. Defendants also operate their own lead generation websites on which they 

promise to connect consumers with licensed insurance agents who purportedly will provide 

consumers with information about health insurance plans. For example, one of Defendants' lead 

generation websites, www.trumpcarequotes.com, claims to offer "Health Insurance for Smart 

People" from "the Nation's Leading Carriers" at "Low Affordable Premiums" with 

12 
"Prescription Drug Coverage." The site features the branded logos of several major health 

insurance carriers, including Anthem BlueCross. See Image D below. 

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www.trumpcarequotes.com 

32. Another one ofDefendants' lead generation websites warns that consumers who 

0 

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do not have health insurance will "[f]ace a substantial tax penalty." This site claims that 

13 
uninsured consumers "will pay an average Obamacare penalty of almost $1000," cautions that 

this amount " is likely to increase in the coming year," and advises consumers to " [a]void these 

penalties by getting insured today." See Image E below. 

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14 
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33. Under the ACA, individuals who can afford health insurance, but choose not to 

buy it, are required to pay a fee. Because Defendants' limited benefit plans and discount 

memberships do not qualify as health insurance under the ACA, consumers who participate in 

Defendants' plans will still be subject to this ACA fee. 

34. Defendants also operate multiple lead generation websites on which they falsely 

claim to sell Medicare health insurance policies. These sites include www.simplemedicare.com, 

which promotes "Medicare Health Plans for Your Needs and Budget" and invites consumers to 

"Learn about Medicare and Choose a Plan with Confidence." See Image F below. Defendants 

also operate www.usamedsupp.org, which features the AARP logo and encourages consumers to 

"Compare Medicare Quotes ...in three simple steps." See Image G below. 

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15 
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Image G (Defendants' site) 

www.usamedsupp.org 

35. Some consumers learn about Defendants' lead generation websites through email 

and text message solicitations containing links to these sites. Defendants pay third parties to 

disseminate these emails and text messages. One such message encourages consumers to "[t]ake 

advantage ofopen enrollment and find a carrier near you." As noted above in Paragraph 25, 

"open enrollment" is a term associated with the A CA that does not apply to the type ofproducts 

sold by Defendants. 

Defendants Claim to Sell Comprehensive Health Insurance 

36. Defendants engage in both outbound and inbound telemarketing with potential 

customers. Consumers who submit their contact information to one of Defendants' lead 

16 
generation websites subsequently receive a call from one ofDefendants' telemarketers. 

Consumers also may contact Defendants directly by calling one ofthe toll-free numbers 

displayed on Defendants' lead generation websites. In both cases, consumers speak to one of 

Defendants' telemarketers, who typically identify themselves as an insurance agent licensed in 

the consumer's state. In some instances, consumers first speak to a pre-qualification 

representative, who gathers personal background information about the consumer before 

transferring the call to another telemarketer purportedly licensed to sell insurance. In many 

instances, these telemarketers are not, in fact, properly licensed insurance agents. 

37. Defendants record sales and customer service calls with consumers, and they save 

these recordings. To mislead regulatory authorities, however, Defendants claim that such 

recordings either do not exist or are not maintained. 

38. In calls with consumers, Defendants' telemarketers claim that for a one-time 

enrollment fee ranging from approximately $60 to $175 and a monthly payment ranging from 

approximately $40 to $500, Defendants can provide consumers with a "PPO" health insurance 

plan. Defendants claim that, like comprehensive health insurance, their plan will cover 

preexisting medical conditions, prescription medication, hospitalization, lab work and access to 

primary care physicians, specialists, and other healthcare providers for a nominal copayment. 

39. In many instances, Defendants' telemarketers have referred to the monthly 

payments consumers must make as "premiums" and have used other insurance terms of art in 

their sales pitches, such as "PPO," "copay," "deductible," "coverage," and "preexisting 

condition." These terms have no relevance to the limited benefit plans and discount 

memberships sold by Defendants. 

17 
40. Defendants often tell consumers that the purported "PPO" health insurance plan is 

widely accepted by doctors in the consumers' geographical areas or that it is accepted by 

virtually all, or the vast majority of, doctors in the country. However, when consumers look for 

a covered provider after purchasing what they believe to be a "PPO" health insurance plan, many 

discover that the limited benefit plan is not accepted by their providers or that the available 

discounts are negligible. 

41. In some instances, Defendants' telemarketers falsely claim that their "PPO" 

health insurance plan is a qualified health plan under the ACA. A "qualified health plan" 

provides essential health benefits, follows established limits on cost-sharing (like deductibles, 

copayments, and out-of-pocket maximum amounts), and meets other requirements under the 

ACA. All qualified health plans meet the ACA requirement for having health coverage, known 

as "minimum essential coverage." 

42. Ifconsumers ask for written information about Defendants' plan before buying it, 

telemarketers often refuse to provide it, stating that they either are not allowed to provide such 

information or are not capable ofproviding it. 

43. Defendants often claim that their "PPO" health insurance plan is at least as good 

as comprehensive health insurance because it offers comparable coverage at a lower price, and 

without deductibles. 

44. Once consumers express interest in purchasing Defendants' "PPO" health 

insurance plan - believing it to be, based on the telemarketers' misrepresentations, actual 

comprehensive health insurance- Defendants' telemarketers arrange for payment by asking for 

the consumers' debit card or credit card information. 

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45. After taking consumers' payment information, Defendants' telemarketers transfer 

consumers to a different employee, who guides consumers through a "verification" process. 

Before transferring them, however, Defendants' telemarketers often instruct consumers to 

disregard any statements in the post-sale "verification" process that indicate that consumers will 

not be receiving comprehensive health insurance that covers preexisting medical conditions. 

46. During verification, consumers are asked to confirm a series ofcomplex, lengthy 

statements that are either read by the verification employee or transmitted electronically by email 

or text message. Consumers are cautioned not to ask any questions during verification or they 

will be transferred back to the sales representative, where the entire sales process will start over 

again. Telemarketers frequently instruct consumers to disregard verification statements that are 

inconsistent with Defendants' sales pitch. For these reasons, consumers often feel pressured to 

agree with all ofthe verification statements, even ifthey conflict with representations made by 

the sales representative or if the consumers do not understand or actually agree with the 

verification statements. Moreover, consumers who choose to receive the disclosures 

electronically must review and "e-sign" them on their devices prior to completing verification. 

On mobile devices, these disclosures are rendered in pages ofsmall, barely legible text. See 

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47. Many of Defendants' deceptive sales tactics are evident in recorded undercover 

transactions conducted by Plaintiff. In one such transaction, an FTC investigator stated clearly 

that he wanted to obtain major medical insurance, had no interest in purchasing a medical 

discount membership, and claimed to have three preexisting medical conditions, including 

diabetes. Defendants' telemarketer informed the FTC's investigator that he qualified for a 

"PPO" health insurance plan that provided coverage for preexisting medical conditions, had no 

20 
"deductibles," and included prescription drug coverage. Under this plan, according to the 

telemarketer, the investigator would pay no more than $25 to see his physicians and $4 to $12 to 

fill a prescription for a specific diabetes medication. As discussed below, the limited benefit 

plans actually sold by Defendants do not provide any ofthe promised benefits. 

Defendants Actually Sell Limited Benefit Plans and Medical Discount Memberships 

48. As noted above, Defendants' limited benefit plans and medical discount 

memberships are not, in fact, comprehensive health insurance and do not provide consumers 

with the benefits promised in Defendants' sales pitch. For example, a typical limited benefit 

plan sold by Defendants to consumers pays only $50 toward physician visits - capped at three 

visits per calendar year - and a maximum of$I 00 per day for hospitalization. Moreover, despite 

assurances to the contrary made by Defendants' telemarketers, these plans provide no coverage 

for preexisting medical conditions or prescription medications. 

49. In addition, the medical discount and wellness memberships sold by Defendants 

at best merely provide consumers with access to various pre-negotiated discounts from third 

parties, only some ofwhich relate to healthcare. In addition to prescription medications, for 

example, these discounts allegedly also apply to identity theft protection, cell phone service, 

flowers, vitamins, travel, car rental and purchase, diet and exercise programs, magazine 

subscriptions, pet insurance and medications, dining, and movie tickets. Other membership 

programs allegedly offer thousands of dollars' worth of benefits consisting of access to " wellness 

specialists," "life extension naturopaths," and "comprehensive education lifestyle coaching." 

50. There is a vast difference between what Defendants promise consumers and what 

consumers actually get. For example, in the undercover transaction described in Paragraph 47 

above, Defendants sold the FTC investigator a limited benefit plan rather than the promised 

21 
comprehensive health insurance. This plan would not have paid any ofthe costs associated with 

a routine office visit for the physicians identified by the investigator as his primary care doctors. 

It also would have required the investigator to pay $850-$900 to fill a prescription for a diabetes 

drug that the telemarketer claimed would cost $4 to $12. 

Tens of Thousands of Consumers Have Been Harmed by Defendants' Practices 

51. Many consumers purchase Defendants' plans believing them to be comprehensive 

medical insurance. Consumers report that Defendants' telemarketers specifically claim to offer 

"PPO" health insurance plans or qualified health plans under the ACA. Consumers rely on these 

representations in agreeing to purchase Defendants' limited benefit plans and medical discount 

memberships. 

52. Many consumers pay Defendants enrollment fees and substantial monthly 

payments for what they believe to be comprehensive health insurance. Consumers have reported 

paying $500 or more per month for Defendants' plans, which do not provide the promised 

insurance. 

53. Many consumers have been unable to use the limited benefit plans and discount 

memberships for healthcare services typically covered by health insurance. Consumers 

frequently do not realize they are uninsured until after incurring substantial medical expenses, 

often under the mistaken belief that these expenses will be covered by the insurance they thought 

they had purchased from Defendants. For example, one consumer received $61,000 in hospital 

bills, none of which were covered by the policy that Defendants sold to her, despite assurances to 

the contrary by Defendants' telemarketer. 

54. When consumers have contacted Defendants to complain, cancel their plans or 

memberships, and seek refunds, Defendants have routinely ignored their requests. Some 

22 
consumers have received refunds only after directly requesting them from the third-party 

administrator ofthe plans and memberships or after seeking the assistance ofthe Better Business 

Bureau or law enforcement agencies. Many ofthe consumers have received only partial refunds. 

VIOLATIONS OF THE ITC ACT 

55. Section 5(a) ofthe FTC Act, 15 U.S.C. § 45(a), prohibits "unfair or deceptive acts 

· or practices in or affecting commerce." 

56. Misrepresentations or deceptive omissions ofmaterial fact constitute deceptive 

acts or practices prohibited by Section S(a) ofthe FTC Act. 

Count I 

Misrepresentations in Violation of the ITC Act 

57. In numerous instances, in connection with the advertising, marketing, promoting, 

offering for sale, or sale of limited benefit plans and medical discount memberships, Defendants 

represent, directly or indirectly, expressly or by implication, that: 

a. Defendants' limited benefit plans and medical discount memberships are 

comprehensive health insurance, or the equivalent ofsuch insurance; 

b. Defendants' limited benefit plans and medical discount memberships are 

qualified health plans under the Affordable Care Act; 

c. Defendants are experts on, or providers of, government-sponsored health 

insurance policies, such as those offered pursuant to Medicare and the 

Affordable Care Act; or 

d. Defendants are affiliated with AARP or the Blue Cross Blue Shield 

Association. 

58. In truth and in fact: 

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a. Defendants' limited benefit plans and medical discount memberships are not 

comprehensive health insurance, or the equivalent of such insurance; 

b. Defendants' limited benefit plans and medical discount memberships are not 

qualified health plans under the Affordable Care Act; 

c. Defendants are not experts on, or providers of, government-sponsored health 

insurance policies, including policies offered under Medicare or the 

Affordable Care Act; or 

d. Defendants are not affiliated with AARP or the Blue Cross Blue Shield 

Association. 

59. Therefore, Defendants' representations, as set forth in Paragraph 57, above, are 

false and misleading and constitute deceptive acts or practices in violation of Section 5(a) of the 

FTC Act, 15 U.S.C. § 45(a). 

THE TELEMARKETING SALES RULE 

60. Congress directed the FTC to prescribe rules prohibiting abusive and deceptive 

telemarketing acts or practices pursuant to the Telemarketing Act, 15 U .S.C. §§ 6101 -6108. The 

FTC adopted the original TSR in 1995, extensively amended it in 2003, and amended certain 

provisions thereafter. 16 C.F .R. Part 310. 

61. Defendants are ''seller[s]" or "telemarketer(s]" engaged in "telemarketing" as 

defined by the TSR, 16 C.F .R. § 310.2( dd), (ff), (gg). A "seller" means any person who, in 

connection with a telemarketing transaction, provides, offers to provide, or arranges for others to 

provide goods or services to a customer in exchange for consideration. l 6 C.F .R. § 310 .2( dd). 

A "telemarketer" means any person who, in connection with telemarketing, initiates or receives 

telephone calls to or from a customer or donor. 16 C.F.R. § 310.2(ff). "Telemarketing" means a 

24 
plan, program, or campaign which is conducted to induce the purchase of goods or services or a 

charitable contribution, by use of one or more telephones and which involves more than one 

interstate telephone call. 16 C.F.R. § 3 l 0.2(gg). 

62. The TSR prohibits sellers and telemarketers from misrepresenting, directly or by 

implication, in the sale of goods or services, any material aspect of the performance, efficacy, 

nature, or central characteristics ofthe goods or services that are the subject ofa sales offer. 

16 C.F.R. § 310.3(a)(2)(iii). The TSR also prohibits sellers and telemarketers from 

misrepresenting, directly or by implication, a seller's or telemarketer's affiliation with, or 

endorsement or sponsorship by, any person or government entity. 16 C.F.R. § 310.3(a)(2)(vii). 

Likewise, the TSR prohibits sellers and telemarketers from making any false or misleading 

statements to induce a person to pay for goods or services. 16 C.F .R. § 310.3(a)( 4 ). 

63. Pursuant to Section 3(c) ofthe Telemarketing Act, 15 U .S.C. § 6102(c ), and 

Section I8(d)(3) ofthe FTC Act, 15 U.S.C. § 57a(d)(3), a violation of the TSR constitutes an 

unfair or deceptive act or practice in or affecting commerce, in violation ofSection 5(a) of the 

FTC Act, 15 U.S.C. § 45(a). 

Count II 

Deceptive Telemarketing Calls in Violation of the TSR 

64. In numerous instances, in connection with the advertising, telemarketing, 

promoting, offering for sale, or sale of limited benefit plans and medical discount memberships, 

Defendants misrepresent, directly or. indirectly, expressly or by implication, that: 

a. Defendants' limited benefit plans and medical discount memberships are 

comprehensive health insurance, or the equivalent ofsuch insurance; 

b. Defendants' limited benefit plans and medical discount memberships are 

qualified health plans under the Affordable Care Act; 

25 
c. Defendants are experts on, or providers of, government-sponsored health 

insurance policies, such as those offered pursuant to Medicare and the 

Affordable Care Act; or 

d. Defendants are affiliated with AARP or the Blue Cross Blue Shield 

Association. 

65. The acts or practices ofDefendants as described in Paragraph 64, above, are 

deceptive telemarketing acts or practices that violate the TSR, 16 C.F.R. §§ 310.3(a)(2)(iii), 

(a)(2)(vii) & (a)(4). 

CONSUMER INJURY 

66. Consumers have suffered and will continue to suffer substantial injury as a result 

ofDefendants' violations ofthe FTC Act and the TSR. In addition, Defendants have been 

unjustly enriched as a result of their unlawful acts or practices. Absent injunctive relief by this 

Court, Defendants are likely to continue to injure consumers, reap unjust enrichment, and harm 

the public interest. 

THIS COURT'S POWER TO GRANT RELIEF 

67. Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), empowers this Court to grant 

injunctive and such other relief as the Court may deem appropriate to halt and redress violations 

of any provision oflaw enforced by the FTC. The Court, in the exercise ofits equitable 

jurisdiction, may award ancillary relief, including rescission or reformation of contracts, 

restitution, the refund ofmonies paid, and the disgorgement ofill-gotten monies, to prevent and 

remedy any violation of any provision of law enforced by the FTC. 

68. Section 6(b) ofthe Telemarketing Act, 15 U.S.C. § 6105(b), authorizes this Court 

to grant such relief as the Court finds necessary to redress injury to consumers resulting from 

26 
Defendants' violations of the TSR, including the rescission or reformation of contracts, and the 

refund ofmoney. 

PRAYER FOR RELIEF 

69. Wherefore, Plaintiff, pursuant to Section 13(b) ofthe FTC Act, I 5 U.S.C. ~ 53(6), 

and the Court's own equitable powers, requests that the Court: 

A. Award Plaintiff such preliminary injunctive and ancillary relief as may be 

necessary to avert the likelihood of consumer injury during the pendency ofthis action and to 

preserve the possibility ofeffective final relief, including but not limited to, a temporary and 

preliminary injunction, asset freeze, appointment of a receiver, an evidence preservation order, 

and expedited discovery; 

B. Enter a permanent injunction to prevent future violations ofthe FTC Act and the 

TSR; 

C. Award such relief as the Court finds necessary to redress injury to consumers 

resulting from Defendants' violations ofthe FTC Act and the TSR, including but not limited to, 

rescission or reformation of contracts, restitution, the refund ofmonies paid, and the 

disgorgement of ill-gotten monies; and 

27 
D. Award Plaintiff the costs of bringing this action, as well as such other and 

additional reliefas the Court may determine to be just and proper. 

Dated : October 29, 2018. Respectfully submitted, 

ALDEN F. ABBOTT 

General Counsel 

ELIZABETH C. SCOTT, Special Bar No. A5501502 

escott@ftc.gov; (312) 960-5609 

JAMES H. DAVIS, Special Bar No. A5502004 

jdavis@ftc.gov; (312) 960-5611 

JOANNIE WEI, Special Bar No. A5502492 

jwei@ftc.gov; (312) 960-5607 

Federal Trade Commission 

230 S. Dearborn Street, Suite 3030 

Chicago, Tllinois 60604 

Telephone: (312) 960-5634 

Facsimile: (312) 960-5600 

Attorneys for Plaintiff 

FEDERAL TRADE COMMISSION 

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