No. 22-55446 

IN THE UNITED STATES COURT OF APPEALS 

FOR THE NINTH CIRCUIT 

––––––––––––––––––––––––––––––––––––––––––––– 

FEDERAL TRADE COMMISSION, 

Plaintiff-Appellee, 

v. 

QYK BRANDS LLC, et al.,

Defendants-Appellants. 

––––––––––––––––––––––––––––––––––––––––––––– 

On Appeal from the United States District Court 

for the Central District of California, 

No. 8:20-cv-01431 (Hon. Philip S. Gutierrez) 

––––––––––––––––––––––––––––––––––––––––––––– 

BRIEF OF THE FEDERAL TRADE COMMISSION 

––––––––––––––––––––––––––––––––––––––––––––– 

ANISHA S. DASGUPTA

General Counsel 

JOEL MARCUS

Deputy General Counsel 

Of Counsel: MARIEL GOETZ

DOUGLAS V. WOLFE Attorney 

KATHERINE E. JOHNSON FEDERAL TRADE COMMISSION

CHRISTOPHER ERICKSON 600 Pennsylvania Avenue, N.W. Attorneys Washington, D.C. 20580 

FEDERAL TRADE COMMISSION mgoetz@ftc.gov 

Washington, D.C. 20580 (202) 326-2763 
i 

TABLE OF CONTENTS 

Table of Authorities ................................................................................................. iii

Introduction ................................................................................................................ 1

Jurisdiction ................................................................................................................. 2

Questions Presented ................................................................................................... 3

Relevant Statutes ........................................................................................................ 3

Statement of the Case ................................................................................................. 3

A. Appellants’ Deceptive Practices ................................................................. 3

B. The FTC’s Enforcement Lawsuit ............................................................... 8

Summary of Argument............................................................................................. 13

Standard of Review .................................................................................................. 16

Argument.................................................................................................................. 17

I. The District Court Properly Calculated Consumer Redress. ............................ 17

A. In FTC cases, courts may presume that consumers relied on and 

were harmed by widespread, material misrepresentations. ...................... 18

B. The district court properly applied the presumption of reliance. ............. 20

1. The FTC did not have to prove individualized injury. ..................... 21

2. Appellants’ misrepresentations were widely disseminated. ............. 24

3. Appellants failed to rebut the presumption with probative 

evidence showing any lesser injury. ................................................. 27

C. The district court was not required to order product returns or to 

incorporate credits for the sanitizer’s “value.” ......................................... 31

II. The Permanent Injunction Was Proper. ............................................................ 36

A. The district court properly determined that wrongdoing would 

likely recur. ............................................................................................... 37
ii 

B. The injunction is sufficiently tailored to appellants’ violations. .............. 41

III. Nguyen’s Unsupported, Self-Serving Interpretation Of Her Own 

Vietnamese-Language Broadcast Did Not Create A Disputed Issue 

Of Fact. ............................................................................................................. 46

IV. Appellants’ “Force Majeure” Defense Has No Merit. ..................................... 51

Conclusion ............................................................................................................... 53
iii 

TABLE OF AUTHORITIES 

CASES

AMG Capital Management, LLC v. FTC, 

 141 S. Ct. 1341 (2021) ............................................................................. 20, 29 

*Anderson v. Liberty Lobby, 

 477 U.S. 242 (1986) ...............................................................17, 28, 30, 49, 51 

*CFPB v. Gordon, 

 819 F.3d 1179 (9th Cir. 2016) ...................... 19, 20, 27, 29, 30, 35, 36, 40, 49 

Dietrich v. John Ascuaga’s Nugget, 

 548 F.3d 892 (9th Cir. 2008) ......................................................................... 16 

FTC v. Affordable Media, LLC, 

 179 F.3d 1228 (9th Cir. 1999) ....................................................................... 40 

FTC v. AMG Capital Mgmt., LLC, 

 910 F.3d 417 (9th Cir. 2018) ......................................................................... 29 

*FTC v. Blue Hippo Funding, 

 762 F.3d 238 (2d Cir. 2014) ............................................................... 19, 21, 26 

FTC v. Colgate-Palmolive Co., 

 380 U.S. 374 (1965) ...................................................................................... 42 

*FTC v. Commerce Planet, Inc., 

 815 F.3d 593 (9th Cir. 2016) ................................................20, 21, 26, 29, 31 

FTC v. Cyberspace.com, LLC, 

 453 F.3d 1196 (9th Cir. 2006) ...................................................................... 41 

*FTC v. Figgie Int’l, 

 994 F.2d 595 (9th Cir. 1993) ............. 10, 13, 14, 18, 19, 21-24, 31, 32, 34-36 

FTC v. Gill, 

 265 F.3d 944 (9th Cir. 2001) ............................................................... 9, 41, 43 
iv 

FTC v. Kuykendall, 

 371 F.3d 745 (10th Cir. 2004) .......................................................... 19, 34, 35 

FTC v. Moses, 

 913 F.3d 297 (2d Cir. 2019) ........................................................ 20, 31, 35, 36 

FTC v. Nat’l Lead Co., 

 352 U.S. 419 (1957) ....................................................................................... 42 

FTC v. Neovi, Inc., 

 604 F.3d 1150 (9th Cir. 2010) ...................................................................... 27 

FTC v. Network Servs. Depot, 

 617 F.3d 1127 (9th Cir. 2010) ....................................................................... 16 

FTC v. Noland, 

 No. CV-20-00047, 2021 U.S. Dist. LEXIS 226238 

 (D. Ariz. Nov. 23, 2021) ................................................................... 21, 22, 23 

FTC v. Publ’g Clearing House, Inc., 

 104 F.3d 1168 (9th Cir. 1997) ......................................................... 27, 30, 49 

FTC v. Sec. Rare Coin & Bullion Corp., 

 931 F.2d 1312 (8th Cir. 1991) ................................................... 18, 19, 20, 26 

FTC v. Stefanchik, 

 559 F.3d 924 (9th Cir. 2009) ....................................................................... 17 

FTC v. World Travel Vacation Brokers, Inc., 

 861 F.2d 1020 (7th Cir. 1988) ..................................................................... 26 

High Sierra Hikers Ass’n v. Blackwell, 

 390 F.3d 630 (9th Cir. 2004) ....................................................................... 41 

Lamb-Weston, Inc. v. McCain Foods, Ltd., 

 941 F.2d 970 (9th Cir. 1991) ....................................................................... 42 

Las Vegas Sands, LLC v. Nehme, 

 632 F.3d 526 (9th Cir. 2011) ...................................................................... 17 
v 

Litton Indus., Inc. v. FTC, 

 676 F.2d 364 (9th Cir. 1982) ...................................................................... 42 

McGregor v. Chierico, 

 206 F.3d 1378 (11th Cir. 2000) ................................................ 19, 20, 34, 35 

Oregon Nat. Res. Council v. Marsh, 

 52 F.3d 1485 (9th Cir. 1995) ...................................................................... 37 

Sandpiper Vil. Condo. Ass’n v. Louisiana-Pacific Corp., 

 428 F.3d 831 (9th Cir. 2005) ...................................................................... 17 

Scott v. Harris, 

 550 U.S. 372 (2007) ..................................................................................... 27 

Sears, Roebuck & Co. v. FTC, 

 676 F.2d 385 (9th Cir. 1982) ....................................................................... 42 

SEC v. Coldicutt, 

 258 F.3d 939 (9th Cir. 2001) ........................................................................ 37 

SEC v. Fehn, 

 97 F.3d 1276 (9th Cir. 1996) ........................................................................ 40 

SEC v. Murphy, 

 626 F.2d 633 (9th Cir. 1980) .................................................................. 37, 40 

T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 

 809 F.2d 626 (9th Cir. 1987) ......................................................................... 28 

United States v. W.T. Grant Co., 

 345 U.S. 629 (1953) ....................................................................................... 40 
vi 

STATUTES 

15 U.S.C. 45(a) (Section 5 of the FTC Act) ........................................................ 8, 41 

15 U.S.C. § 52 (Section 12 of the FTC Act) .............................................................. 9 

15 U.S.C. 53 (Section 13(b) of the FTC Act) .............................................. 11, 19, 20 

*15 U.S.C. 57b (Section 19 of the FTC Act) ..............................................10, 19, 36 

39 U.S.C. § 3009 (Unordered Merchandise Statute) ............................................... 36 

REGULATIONS AND OTHER AUTHORITIES 

*16 C.F.R. Part 435 (Mail, Internet, or Telephone Order Merchandise Rule) 

 (MITOR) ............................................................................. 9,10, 24, 36, 41, 52 

40 Fed. Reg. 51582 (1975) ...................................................................................... 41 

* Cases and other authorities principally relied upon are marked with asterisks
INTRODUCTION 

At the beginning of the COVID-19 pandemic, at the height of public fear of 

infection and shortages of safety equipment, appellants Rakesh Tammabattula, 

Jacqueline Thao Nguyen, and their companies exploited consumers’ fear for their 

own profit. They sold a product falsely claimed as FDA-approved to protect 

against COVID-19, but it was nothing more than a protein powder with no antiviral properties. Appellants also sold hand sanitizer to consumers with the promise 

that the product was “in stock” and “ships today,” but they lacked sufficient 

inventory to satisfy even a fraction of the orders they solicited. They nonetheless 

continued taking orders and making the same false promises of fast shipping speed. 

When consumers complained, appellants refused to cancel the orders or offer 

refunds, citing bogus excuses. Between March and August 2020, appellants reaped 

over $3 million from these sales. 

The Federal Trade Commission charged appellants with violating the FTC 

Act, which prohibits deceptive advertising, and the FTC’s Mail, Internet, or 

Telephone Order Merchandise Rule, which prohibits false shipping claims online. 

The district court held that appellants violated both provisions and ordered 

appellants to refund the unlawful revenue. The court also permanently enjoined 

them from selling “protective goods and services” after finding that appellants had 

shown a pattern of deceitful conduct and would likely violate the law again. 
2 

Appellants claim that the redress order gives consumers a windfall, that the 

court improperly ignored evidence, and that the injunction is unwarranted and 

overbroad. But the district court’s rulings were well-grounded in both the facts and 

the law. Appellants exploited a public health crisis for their own profit, harming 

thousands of consumers in the process. The monetary redress ordered simply 

returns purchasers to the position they would be in had appellants not lured them in 

with deceptive claims; indeed, the district court limited refunds to only those 

customers who make an affirmative claim of injury. The disregarded “evidence” 

was mere conjecture or irrelevant to the issues at hand. 

The district court’s finding that appellants’ wrongdoing will likely recur and 

its choice of what injunction best protects consumers going forward are entitled to 

substantial deference. There is no reason to second guess the court’s careful 

consideration of appellants’ high degree of scienter and repeat violations. 

Moreover, the injunction is tailored to prevent future violations only in the 

“protective goods or services” sector in which appellants have proven themselves 

untrustworthy. Appellants have shown no abuse of the district court’s ample 

discretion or other reversible error. This Court should affirm. 

JURISDICTION 

The FTC agrees with appellants’ jurisdictional statement. 
3 

QUESTIONS PRESENTED 

1. Did the district court err in ordering consumer redress in an amount up 

to appellants’ total revenues for the products they deceptively advertised? 

2. Was the permanent injunction an abuse of discretion? 

3. Did appellant Nguyen’s unsupported declaration purporting to 

translate statements from a Vietnamese-language advertisement create a factual 

dispute that precludes summary judgment? 

4. Did supply chain problems and shipping delays that arose during the 

COVID-19 pandemic excuse appellants’ misrepresentations and other misconduct? 

RELEVANT STATUTES 

Relevant statutes and regulations are set forth in the addendum hereto. 

STATEMENT OF THE CASE 

A. Appellants’ Deceptive Practices 

Appellants Tammabattula and Nguyen own and operate several businesses, 

including appellants QYK Brands LLC (QYK), DRJSNATURAL LLC (DJN), 

EASII, Inc., and Theo Pharmaceuticals. Until 2020, their companies sold primarily 

beauty, health, and skin care products. When the COVID-19 pandemic hit in 

March 2020, appellants pivoted to capitalize on the swelling demand for products 

such as hand sanitizer, facemasks, and disinfecting wipes. That month, appellants 

began selling hand sanitizer online using an aggressive marketing campaign that 

claimed they had “Hand Sanitizer in Stock” that “Ships Today,” and that 
consumers could “Order online for fast shipping from California.” See 2-SER-289–

300 (¶¶ 58-76).1

 Appellants made similar “in stock” and “ships today” claims on 

social media, including Facebook, Instagram, Twitter, and Reddit. See 2-SER-299–

300, 397–98 (¶¶ 76, 265-67); 3-ER-179 (Instagram: “available for shipping”), 3-

ER-180 (Instagram: “fully stocked and ready to ship out”); 1-SER-38 (Twitter: “if 

ordered today we can ship today!”), 1-SER-39 (Twitter: “in-stock today”); 1-SER40 (Facebook: “available on our website right now!”); 2-SER-296 (¶ 68) (Reddit). 

And on their websites, appellants claimed sanitizer shipped in three to five days. 2-

SER-322, 343–44, 350 (¶¶ 120-21, 168-78, 185-87). 

At a time when consumers were desperate, store shelves were empty, and 

many retailers had run out of inventory, the “in stock” and fast-shipping claims 

were wildly successful. Within days, consumers ordered thousands of bottles of 

hand sanitizer from appellants’ sites; sales reached nearly 150,000 bottles by midMarch. From March through August 2020, appellants reaped more than $3 million 

in sanitizer sales. 1-SER-155 (¶ 58); 2-SER-462–65 (¶¶ 398-401). 

1

 “Dkt.” refers to district court docket number; “DE,” to appellate docket 

number; “Op.,” to the summary judgment order below (1-ER-2–17); “Stay Op.,” to 

the district court’s order denying a stay (2-SER-503–13); “SUF,” to the FTC’s 

Reply to Defendants’ Response to the FTC’s Statement of Undisputed Facts (2-

SER-271–494); “Br.,” to appellants’ brief (cites refer to the brief’s own numbering 

at the page bottom). 

4 
5 

Despite their successful sales pitch, appellants knew they did not have – and 

could not get – sufficient inventory to fulfill these orders on time. For example, at 

the same time appellants took consumers’ money for those 150,000 bottles of 

sanitizer (March 4-18), they had fewer than 9,000 bottles in stock – and knew 

additional inventory shipments would not be arriving for weeks. See 2-SER-287 

(¶ 53), 302 (¶ 80), 321 (¶ 116), 422–23 (¶ 316); see also 2-SER-335 (¶ 149). 

Indeed, in press interviews and news articles in March and April, appellants 

publicly acknowledged the major supply chain issues and delays they were facing.2

Yet they continued advertising that sanitizer was “In Stock & Ships Today,” or that 

it would ship within mere days – spurring even more orders and worsening the 

backlog. See 2-SER-290–91 (¶ 59), 293–94 (¶¶ 62-64) (Google ad: “In Stock & 

Ships Today”); 346 (¶ 175) (website: ships within three days); 345–46 (¶¶ 171, 

173, 176) (website: three to five days); 345–46 (¶¶ 172, 174, 177) (website: three 

to ten days). Almost no orders shipped within the promised timeframes; many 

shipped only weeks later. See 2-SER-355–58 (¶¶ 197-99); 1-SER-143–44 (¶ 27, 

Table 3); 1-SER-156. 

2

 2-SER-427–33, 442–43 (¶¶ 330-50, 369-71); 3-ER-127 (¶ 22) and 1-SER-2 

(Apr. 7, 2020 article); 3-ER-132 (¶ 46) and 3-ER-232 (March 26, 2020 article); 3-

ER-133 (¶ 47) and 3-ER-238 (Apr. 1, 2020 article); 3-ER-133 (¶ 48) and 3-ER-240 

(Apr. 8, 2020 article); 1-SER-180–81 (Resp. to RFA Nos. 57-58). 
6 

Appellants never stopped or paused the Google advertising campaigns 

making the most egregious claims, persisting with the ads despite knowing full 

well sanitizer was not “in stock” and would not “ship today.” 2-SER-350 (¶ 184). 

Indeed, on March 18, 2020, Google suspended appellants’ account for violating its 

advertising policies, but appellants circumvented that suspension by creating a new 

account under different credentials. 2-SER-351–52 (¶¶ 189-90); 1-SER-5-6. They 

continued to run ads claiming “Ships Fast from CA Today” throughout April and 

most of May 2020, until Google suspended that account, too. 2-SER-352–54 

(¶¶ 191-94); 1-SER-204–05, 206–12, 213–17. When their Facebook account was 

cut off for similar reasons, appellants likewise tried to hire a front man to advertise 

for them. 2-SER-488–90 (¶¶ 436-39); 1-SER-4, 200–03. Shopify, appellants’ 

online vendor, also became concerned about the mounting number of unfulfilled 

orders and placed multiple holds on their account. 2-SER-438–39 (¶¶ 354-58). 

Another search engine, Bing, disabled appellants’ ad account, too. 2-SER-423–24 

(¶ 317). 

Consumer complaints poured in. 2-SER-448 (¶ 381); 3-ER-134–50 (¶¶ 53-

79). For example, consumers reported receiving “[n]o response to my multiple 

inquiries when the item never shipped 5 weeks later,” 3-ER-143 (¶ 66); that “they 

keep telling me they are shipping it and they don’t,” 1-SER-13; being told “various 

excuses from the USPS being delayed to having too many orders but each time I’m 
7 

assured my order is ‘next to ship’ for 3 weeks,” 1-SER-16; and that the “company 

has lied and told me the product is shipping” when it was not, 1-SER-25. See also 

3-ER-247–80, 1-SER-7–27 (compiling complaints). But when consumers 

demanded refunds, appellants refused to cancel orders, falsely telling the victims 

that returns were impossible once shipping labels had been created – even though 

the products were not even in stock yet. See 2-SER-361–65 (¶¶ 203-09). In other 

instances, they told customers that to receive a refund, the customer herself would 

have to physically intercept the package when it was delivered by the shipping 

carrier. 2-SER-386 (¶ 246). 

Appellants also hawked a protein powder product, “Basic Immune IGG,” 

that they “guaranteed” would allow users to “stay safe” from COVID-19. 1-ER-6 

(Op. 5); 2-SER-504 (Stay Op. 2). They promoted Basic Immune IGG principally 

through television appearances and videos in which Nguyen plugged the product’s 

COVID-protecting benefits, including in a popular Vietnamese language broadcast 

that aired in April 2020.3

 2-SER-409–10 (¶ 292). As a certified translation of that 

broadcast showed (1-SER-114–34), Nguyen touted the product’s “FDA[] 

verification and approval” and clearly implied that the FDA had approved the 

3

 The broadcast was not in “late June or early July” as appellants claim, Br. 13. 
8 

product to prevent COVID-19.4

 1-SER-123–24, 127–33; 1-ER-6 (Op. 5). Basic 

Immune IGG, she claimed, would ensure antibodies “cling to and attack the 

coronavirus” and would allow other people to safely “get close” to the user without 

“be[ing] afraid.” 1-SER-132–33; 1-ER-6 (Op. 5). 

In other promotional videos – in English – Nguyen made similar claims. For 

example, she claimed that Basic Immune IGG could help users “fight back and 

destroy all of the coronavirus that is entering into your body.” 3-ER-212. She 

likewise asserted that the product was a “prevention” for COVID-19, had a 

“patent” from the FDA, and was formulated to be “especially” effective at 

targeting the coronavirus. 3-ER-218, 220. In truth, the product gives no proven 

protection against COVID-19 and was not approved by the FDA to treat or prevent 

COVID-19. 1-ER-10–11 (Op. 9-10); 2-ER-114 (Answer, ¶ 6); 2-SER-420–21, 

446–47 (¶¶ 309, 312-13, 377-78). 

B. The FTC’s Enforcement Lawsuit 

The Federal Trade Commission sued to stop further deception and to secure 

refunds to consumers under three provisions. Section 5 of the FTC Act prohibits 

“unfair or deceptive acts or practices in or affecting commerce.” 15 U.S.C. 

§ 45(a)(1). A statement is deceptive if it is likely to mislead reasonable consumers 

4

 The certified translation was prepared by a professional Vietnamese-English 

translator whose native language was Vietnamese. 1-SER-114. 
9 

in a way that will likely affect purchasing decisions. FTC v. Gill, 265 F.3d 944, 

950 (9th Cir. 2001). Section 12 of the FTC Act likewise prohibits false and 

misleading advertising, including claims the advertiser lacks a reasonable basis to 

make. 15 U.S.C. § 52(a). 

The FTC’s Mail, Internet, or Telephone Order Merchandise Rule (MITOR) 

prohibits sellers from soliciting online, phone, or mail order sales “unless, at the 

time of the solicitation, the seller has a reasonable basis to expect that it will be 

able to ship any ordered merchandise to the buyer” within the stated timeframe. 16 

C.F.R. § 435.2(a)(1). Under MITOR, sellers who cannot ship on time must 

promptly notify customers of the delay and allow them either to cancel and obtain 

a refund or consent to a later shipping date. 16 C.F.R. § 435.2(b)(1). MITOR also 

requires sellers to honor any refund demands made any time before products are in 

the possession of the shipping carrier. 16 C.F.R. § 435.2(c), § 435.1(e). 

The FTC charged appellants with violating those provisions. The district 

court granted summary judgment for the FTC, finding that appellants violated 

MITOR in three ways: (1) soliciting hand sanitizer orders without a reasonable 

basis to timely ship them; (2) failing to notify customers of delays; and (3) failing 

to issue prompt refunds. 1-ER-8–9 (Op. 7-8). The court further found that 

appellants violated the FTC Act by (1) making materially misleading shipping 

promises; (2) advertising their protein powder as a COVID-19 preventative; and 
10 

(3) indicating that the protein powder was FDA-approved to prevent COVID-19. 

1-ER-10–11 (Op. 9-10). 

The district court next assessed the amount of monetary relief appropriate 

for the MITOR violations under Section 19 of the Act. 15 U.S.C. 57b. When the 

FTC sues for violation of a rule such as MITOR, Section 19 empowers a court to 

“grant such relief as the court finds necessary to redress injury to consumers . . . 

resulting from the rule violation.” Id. § 57b(a)(2); (b). That relief may include “the 

refund of money or return of property,” among other forms of redress. Id. In 

making its determination, the court found that appellants’ misrepresentations were 

material to consumers’ purchasing decisions and widely disseminated. 1-ER-12–15 

(Op. 11-14). It therefore applied a well-established presumption of consumer 

reliance, under which widespread, material misrepresentations give rise to a 

presumption that consumers relied on them and were harmed. 1-ER-12–13 (Op. 

11-12) (citing FTC v. Figgie Int’l, 994 F.2d 595, 605-06 (9th Cir. 1993)). 

Appellants presented no evidence, such as declarations from consumers who 

did not rely on the claims, to rebut that presumption. 1-ER-13 (Op. 12). The 

district court therefore concluded that “injury to consumers has been established” 

for all sales. Id. The court ordered appellants to pay $3 million – the undisputed 

amount of total revenues during the relevant period – into a redress fund. 1-ER-14 

(Op. 13). The court did not order an automatic refund to every customer, but 
11 

required customers to make refund requests to the FTC. 1-ER-12–15 (Op. 11-14). 

This approach, the court explained, would ensure proper redress by excluding 

customers who were satisfied with their sanitizer orders despite the shipping 

delay.5

 1-ER-14–15 (Op. 13-14). 

The district court determined that appellants’ wrongdoing was likely to 

recur, and it therefore permanently enjoined similar conduct under Section 13(b) of 

the Act. 1-ER-15–17 (Op. 14-16). Examining the established factors for injunctive 

relief, the district court found that appellants had a “high degree of scienter,” 

having solicited orders and repeated false claims, and even circumvented 

suspensions of their Google and Facebook accounts, all while knowing they could 

not satisfy their promises. 1-ER-15–16 (Op. 14-15). The violations were frequent, 

inducing tens of thousands of hand sanitizer sales. 1-ER-16 (Op. 15). 

With respect to Nguyen, the hand sanitizer program was just the latest 

installment of a “streak of dishonesty and deceit.” 1-ER-16 (Op. 15). Earlier, her 

pharmacy license had been suspended for twelve counts of unprofessional conduct, 

including conduct “Involving Acts of Dishonesty, Fraud or Deceit.” Id.; 3-ER282–349 (license suspension documents). Among other misconduct, Nguyen 

excessively furnished controlled substances that lacked legitimate medical purpose, 

5

 Such customers were hypothetical: appellants presented no reliable evidence 

identifying anyone who received a delayed shipment but was nonetheless satisfied. 
12 

dispensing large quantities of oxycodone to cash-paying customers despite clear 

irregularities in the prescriptions. 3-ER-322–25, 338–39. She stole dangerous 

prescription drugs from her previous employer, stored them improperly such that 

they became adulterated (and thus should have been returned to the manufacturer), 

and then resold them months later to unsuspecting customers at another pharmacy. 

3-ER-313–22, 337–41. To cover up her theft, Nguyen impersonated a technician at 

her previous pharmacy to place a nonrefundable phone order for over $13,000 of 

prescription drugs to replace the ones she stole – all on the pharmacy’s expense 

account. 3-ER-314, 339. These repeated violations took place over a year-long 

period. 3-ER-337–41. 

Nguyen admitted all of these charges before the California Board of 

Pharmacy. 3-ER-286 (¶ 9). Her pharmacy license was suspended, her conduct was 

sharply restricted, and she was ordered to “obey all state and federal laws and 

regulations” going forward. 3-ER-289, 285–301. The district court found that 

Nguyen was “undeterred by this punishment” when she went on to mislead 

consumers about Basic Immune IGG’s ability to prevent or mitigate COVID-19 

infection. 1-ER-16 (Op. 15). 

The court further found that although appellants shifted their business model 

while the case was pending to focus on wholesale customers, they retained the 

ability to commit future violations because they still sold sanitizer, personal 
13 

protective equipment (PPE), and other health-related products. Id. Moreover, 

appellants refused to recognize their own culpability. Id. They continued to dispute 

“that any wrongdoing took place,” blaming the pandemic for their problems and 

claiming to be unaware of the law. Id. That failure to take responsibility for their 

actions made future violations more likely. Id.

To protect consumers from further harm, the court permanently enjoined 

appellants from (among other things) selling “protective goods and services,” 

defined as “any good or service designed, intended, or represented to detect, treat, 

prevent, mitigate, or cure COVID-19 or any other infection or disease.” 1-ER-24, 

26. We refer to that restriction as the “protective goods restriction.” 

This appeal followed. Both the district court and this Court declined to stay 

the injunction pending appeal. DE 9, 10, 15, 17. 

SUMMARY OF ARGUMENT 

1. The district court’s redress order was well within the court’s discretion to 

craft appropriate relief. The court properly applied a long-established presumption, 

first articulated by this Court in FTC v. Figgie Int’l, 994 F.2d 595 (9th Cir. 1993), 

that consumers rely on and are thus harmed by widely disseminated, material 

misrepresentations. Appellants’ advertisements of hand sanitizer “in stock” that 

would ship “today” were untrue; desperate consumers plainly relied on them in 

deciding to purchase from appellants; and the claims were widely disseminated to 
14 

millions of consumers through multiple online sources. This case is tailor-made for 

application of a presumption of consumer reliance. 

Appellants did nothing to rebut the presumption. They offered no evidence 

that consumers did not rely on the false claims or that some of their sales resulted 

from truthful ads. They are wrong that evidence showing a Google ad campaign 

accounted for only 11% of their sales proves that the remainder of sales cannot be 

presumed compensable. In fact, numerous other ads across multiple platforms 

contained similar misrepresentations, and appellants presented no evidence to 

counter that showing. 

The Figgie presumption of consumer reliance and harm has not been undone 

by a district court decision that assessed a different fact scenario. District courts 

cannot overrule Circuit precedent. No matter what, that case, unlike this one, did 

not involve the type of fraud in the inducement that the Court addressed in Figgie 

and that clearly warrants a presumption of reliance here. 

The court did not have to deduct the value of the sanitizer from the redress 

amount, or force customers to return the products. Customers were promised and 

paid for hand sanitizer now, not in weeks or months. They did not get the benefit of 

their bargain, making full refunds an appropriate remedy under Figgie. That is 

especially so since the cost of returning the product could well exceed its original 

sales price. Appellants did not show that the district court’s redress plan would 
15 

give consumers a windfall; indeed, the district court required consumers to apply 

for refunds, ensuring that only dissatisfied consumers would get their money back. 

2. The permanent injunction barring appellants from selling protective goods 

also was comfortably within the district court’s discretion. After weighing all 

pertinent factors, the court determined that appellants’ wrongdoing was both 

egregious and likely to recur. Appellants exploited consumer fear in the midst of a 

deadly pandemic. They sold a protein powder through blatantly false claims of 

immunity. They knowingly solicited tens of thousands of sanitizer orders on the 

promise of immediate shipping of products they did not have and knew they could 

not get. Even after Google and Facebook suspended their advertising accounts, 

appellants proceeded under other names and proxies. Nor was this case the first 

time appellants put the public at risk. As a pharmacist, Nguyen had engaged in 

serious, repeated misconduct involving dishonesty. Even suspension of her 

pharmacy license and an order to comply with all laws did not deter her. In short, 

appellants cannot be trusted, and the district court had ample justification for 

fencing in their future conduct to protect the public from further violations. 

3. The district court correctly determined that undisputed facts showed that 

appellants deceptively marketed a protein powder product as an FDA-approved 

COVID-19 preventative. A certified, professional translation of a Vietnamese 

language broadcast featuring Nguyen showed that she told viewers that the product 
16 

could prevent or mitigate COVID-19 and was FDA approved for that purpose. The 

district court properly rejected a declaration supplied by Nguyen, presenting a 

different translation of a few sentences of the lengthy broadcast, on the ground that 

Nguyen did not show that she was a competent translator. Even if her declaration 

were credited, the undisputed portions of the broadcast plainly show Nguyen 

claiming that the product protected against COVID-19 and was approved by the 

FDA. Other videos, in English, show Nguyen making similar false claims. 

4. Pandemic supply chain disruptions do not excuse appellants’ misconduct. 

They knew full well at the time they made their “in stock” and fast shipping claims 

that they could not timely fulfill the orders that predictably resulted. Appellants 

were not innocent victims of unforeseen circumstances; they purposefully 

exploited consumer fear to line their own pockets. 

STANDARD OF REVIEW 

The Court reviews a district court’s grant of summary judgment de novo to 

determine “whether, viewing the evidence in the light most favorable to the nonmoving party, there are genuine issues of material fact and whether the lower court 

correctly applied the relevant substantive law.” FTC v. Network Servs. Depot, 617 

F.3d 1127, 1138 (9th Cir. 2010). The judgment may be affirmed on any ground 

supported by the record. Dietrich v. John Ascuaga’s Nugget, 548 F.3d 892, 896 

(9th Cir. 2008). 
17 

“[T]he mere existence of some alleged factual dispute between the parties 

will not defeat an otherwise properly supported motion for summary judgment; the 

requirement is that there be no genuine issue of material fact.” Anderson v. Liberty 

Lobby, 477 U.S. 242, 247-248 (1986). Moreover, “bald assertions or a mere 

scintilla of evidence in [a party’s] favor are both insufficient to withstand summary 

judgment.” FTC v. Stefanchik, 559 F.3d 924, 929 (9th Cir. 2009). Rather, the party 

opposing summary judgment “must show a genuine issue of material fact by 

presenting affirmative evidence from which a jury could find in [the party’s] 

favor.” Id. (citing Anderson, 477 U.S. at 257).

The grant of injunctive and monetary relief is reviewed for abuse of 

discretion. Sandpiper Vil. Condo. Ass’n v. Louisiana-Pacific Corp., 428 F.3d 831, 

840 (9th Cir. 2005) (injunction); Stefanchik, 559 F.3d at 931 (monetary relief). The 

same goes for evidentiary rulings. Las Vegas Sands, LLC v. Nehme, 632 F.3d 526, 

532 (9th Cir. 2011). 

ARGUMENT 

I. THE DISTRICT COURT PROPERLY CALCULATED CONSUMER 

REDRESS. 

Appellants do not dispute the district court’s finding that their claims of 

immediate shipping were false. The district court presumed that consumers who 

bought appellants’ hand sanitizers had relied on those false promises, and it 

directed the establishment of a redress fund to allow dissatisfied consumers to seek 
18 

refunds of their purchase price, up to appellants’ total revenue of $3 million. 

Appellants challenge the monetary judgment on two main grounds. First, they 

contend that the ordinary presumption of reliance does not apply here. Br. 26-39. 

Second, they claim that the district court should have either required customers to 

return the product before qualifying for a refund, or it should have reduced the 

redress by the sanitizer’s “value.” Br. 21-26. Neither argument has merit. 

A. In FTC cases, courts may presume that consumers relied on 

and were harmed by widespread, material 

misrepresentations. 

In FTC cases where large groups of consumers are deceived by widespread 

false advertisements, “proof of individual reliance by each purchasing consumer is 

not needed.” FTC v. Figgie Int’l, 994 F.2d 595, 605-06 (9th Cir. 1993). Rather, the 

FTC need only show that “the defendant made material misrepresentations, that 

they were widely disseminated, and that consumers purchased the defendant’s 

product,” which gives rise to “a presumption of actual reliance.” Id.; accord FTC v. 

Sec. Rare Coin & Bullion Corp., 931 F.2d 1312, 1316 (8th Cir. 1991). This 

approach stands in contrast to traditional fraud cases, where private plaintiffs must 

prove reliance upon a defendant’s misrepresentations in order to recover money. 

See Figgie, 994 F.2d at 605; Rare Coin, 931 F.2d at 1316. 

Courts have established such a presumption because the FTC Act “serves a 

public purpose by authorizing the Commission to seek redress on behalf of injured 
19 

consumers,” and “[r]equiring proof of subjective reliance by each individual 

consumer would thwart effective prosecutions of large consumer redress actions 

and frustrate the statutory goals” of the Act. Figgie, 994 F.2d at 605-09; see also 

Rare Coin, 931 F.2d at 1316. The Second Circuit has similarly recognized the 

“inherent difficulty of demonstrating individual harm in FTC cases,” which would 

be “an onerous task with the potential to frustrate the purpose of the FTC’s 

statutory mandate.” FTC v. Blue Hippo Funding, 762 F.3d 238, 243-46 (2d Cir. 

2014). 

Courts have applied this presumption in a variety of FTC cases to determine 

what compensation is due to large numbers of harmed consumers. This Court first 

relied on the presumption in a case, like this one, brought under Section 19 of the 

FTC Act. Figgie, 994 F.2d at 606. Other courts have invoked the same 

presumption in calculating compensatory monetary contempt remedies. See, e.g., 

McGregor v. Chierico, 206 F.3d 1378, 1388 (11th Cir. 2000); FTC v. Kuykendall, 

371 F.3d 745, 765-66 (10th Cir. 2004); Blue Hippo, 762 F.3d at 243-46. Courts 

apply a similar presumption under other statutes meant to redress harms to large 

numbers of consumers. See, e.g., CFPB v. Gordon, 819 F.3d 1179, 1196 (9th Cir. 

2016) (presuming that those who used defendant’s services did so in reliance on 

his misrepresentations). And many courts, including this one, had for years 

invoked the presumption of consumer reliance in cases brought under Section 
20 

13(b) of the FTC Act.6 See, e.g., FTC v. Commerce Planet, Inc., 815 F.3d 593, 

603-05 (9th Cir. 2016); Rare Coin, 931 F.2d at 1316; FTC v. Moses, 913 F.3d 297, 

310-11 (2d Cir. 2019). In all cases, the underlying rationale remains the same: that 

requiring the agency to prove harm as to individual victims would thwart its ability 

to fulfill its public law enforcement mission. See, e.g., Gordon, 819 F.3d at 1196;

McGregor, 206 F.3d at 1388. 

B. The district court properly applied the presumption of 

reliance. 

The district court found that appellants made repeated material 

misrepresentations about their hand sanitizer products, including that the products 

were in stock and would ship immediately. 1-ER-4–5, 8–9 (Op. 3-4, 7-8). 

Appellants did not seriously dispute that the false statements were disseminated to 

hundreds of thousands of consumers through internet search engine advertisements 

and appellants’ own websites; they likewise did not dispute that tens of thousands 

of consumers purchased the products. See 1-ER-4–5 (Op. 3-4); 2-SER-300-01, 354 

(¶¶ 78, 195). On that record, the district court correctly determined that “the FTC is 

entitled to a presumption of actual reliance in this case” and that proof of injury by 

each consumer was not necessary. 1-ER-13 (Op. 12). 

6

 While the Supreme Court held in AMG Capital Management, LLC v. FTC, 141 

S. Ct. 1341 (2021), that Section 13(b) does not authorize equitable monetary relief, 

AMG did not affect the presumption of reliance, which is not tied to Section 13(b) 

but rather – as discussed – is a tool courts use in myriad contexts. 
21 

A defendant may rebut the presumption by presenting evidence showing that 

consumers did not in fact rely on the misrepresentations or were not actually 

injured. See Figgie, 994 F.2d at 605-06; Commerce Planet, 815 F.3d at 603-05; 

Blue Hippo, 762 F.3d at 243-46. Appellants could have come forward with such 

evidence, but they did not. 1-ER-13 (Op. 12). Indeed, appellants cited almost no 

facts at all in their briefing on redress below. See 1-SER-254–63 (QYK Opp. to 

FTC SJ Mot.). The district court unsurprisingly concluded that appellants 

“‘presented no evidence to rebut the presumption of reliance, [so] injury to 

consumers has been established.’” 1-ER-13 (Op. 12) (quoting Figgie, 994 F.2d at 

606). 

Appellants therefore are wrong that the district court ordered redress 

“without analyzing” consumer injury, Br. 26. The district court faithfully applied 

this Court’s precedent to presume consumer reliance, and “injury to consumers [is] 

established” where that presumption is unrebutted – as it was here. Figgie, 994 

F.2d at 606. 

1. The FTC did not have to prove individualized injury. 

Relying on a single district court decision, FTC v. Noland, No. CV-20-

00047, 2021 U.S. Dist. LEXIS 226238 (D. Ariz. Nov. 23, 2021), appellants argue 

that the presumption of consumer reliance reflects an improper “all-or-nothing” 

methodology for assessing redress. Br. 29-37. They contend that Noland
22 

establishes the FTC must prove individualized injury for each consumer harmed by 

their practices. Br. 32, 29-37; see also, e.g., 3-ER-368. 

The principal problem with this argument is that this Court flatly rejected it 

nearly 30 years ago in Figgie. There, the defendant argued – just as appellants do 

here – that “only those consumers that can prove” that they relied on the 

misrepresentations in purchasing the products “should be entitled to redress.” 994 

F.2d at 605. But the Court found that contention “incorrect as a matter of law.” Id. 

As discussed, it explained that where the Commission seeks redress for large 

groups of harmed consumers, requiring proof of individual reliance is 

impracticable and would interfere with the effective enforcement of the law. Id.

The Court therefore held that presuming consumer reliance when certain 

prerequisites are met – where the misrepresentations are material and widely 

disseminated, and consumers purchased the product – is an appropriate way to 

establish injury and determine redress in these cases. Id. at 605-06. 

Appellants ignore Figgie’s holding on this point, instead relying on Noland, 

where – on different facts – a district court required more specific proof of 

consumer injury. Br. 29-37; see Noland, 2021 U.S. Dist. LEXIS 226238 at *11-15. 

Of course, to the extent there is any conflict between Figgie and Noland, Figgie 

plainly controls. But Noland is inapposite because the FTC’s summary judgment 

case there “d[id] not turn on the presence of material misrepresentations” that were 
23 

widely disseminated, as that court acknowledged in distinguishing Figgie. See 

2021 U.S. Dist. LEXIS 226238 at *23-24. The rule violations addressed in Noland

involved the failures to notify customers of shipping delays, to offer refunds, and 

to inform consumers of their right to cancellation. See id. Those violations by 

definition took place after the initial representations; there was nothing for the 

court to presume that consumers relied on when they agreed to purchase the goods, 

so the traditional presumption of reliance did not apply.7

 The district court here 

correctly distinguished Noland on that very basis. 1-ER-13–14 (Op. 12-13). 

 While we believe Noland was wrongly decided, the district court’s 

distinction was not “meaningless,” as appellants improperly claim. Br. 34. Rather, 

it goes to the heart of the rationale behind the typical presumption of reliance: that 

where sellers make widespread false claims about important aspects of their 

products, and consumers then buy the products, it is safe to presume that 

consumers relied on those claims in making their purchases. See, e.g., Figgie, 994 

F.2d at 605. On that reasoning, the district court properly found that individualized 

injury was not required. See 1-ER-12–14 (Op. 11-13). 

7

 The Noland court did not consider whether reliance may be presumed under an 

alternative theory that those victims should be presumed to have relied on later 

misrepresentations about their refund rights – an issue to be tried before that court. 

Here, though, the facts fit the classic presumption scenario: widespread false 

claims that induced purchases. 
24 

2. Appellants’ misrepresentations were widely disseminated. 

The district court also correctly determined that appellants’ 

misrepresentations were widely disseminated, triggering the presumption of 

reliance. Appellants cannot dispute that millions of consumers viewed the ads that 

the district court found violated MITOR. See 2-SER-300–01 (¶ 78); 2-SER-354 

(¶ 195); 1-SER-197 (third row). Rather, appellants contend that the refund of all 

sales was not justified because the Google ads that made the most egregious claims 

(“In Stock & Ships Today” and “Ships Fast from CA Today”) resulted in only 11% 

of their total sales. This statistic, they claim, means the ads were not “widely 

disseminated” and thus that the presumption of reliance could not apply.8

 Br. 29. 

The argument fails. 

To begin, it ignores that the Google campaigns were not appellants’ only 

means of deceptive advertising. Their false shipping claims were rampant, 

spanning numerous online platforms (including appellants’ own websites), and 

were made throughout the relevant time period. See 1-ER-4–5, 8–10 (Op. 3-4, 7-9). 

For example, appellants made false “in stock” and “ships today” claims on social 

8

 The 11% number likely is a significant underestimate of the sales resulting 

from the Google ads. It includes only those consumers who clicked on the ad’s link 

to make their purchase; many more people likely viewed the ad and later purchased 

through appellants’ websites. 
25 

media platforms including Facebook, Instagram, Twitter, and Reddit.9

 Appellants’ 

websites admittedly claimed sanitizer shipment in one to two days, three to five 

days, and three to seven days. 2-SER-322, 343–44, 350 (¶¶ 120-21, 168-78, 185-

87). All these claims were false: appellants admitted that no orders were shipped in 

seven days or less. 2-SER-347–48 (¶ 180), 1-ER-119–20 (Answer ¶¶ 77-78). And 

the district court found that appellants had no reasonable basis to advertise 

shipping times of ten days or less, given their lack of inventory and that appellants 

“knew that the COVID-19 pandemic had disrupted the global supply chain.” 1-ER9 (Op. 8). On that record, appellants’ claim that only 11% of their sales could be 

linked to deceptive advertising is simply wrong. 

In any event, the Google ads sufficed on their own to meet the “widely 

disseminated” requirement. The “In Stock & Ships Today” Google ad was viewed 

by 395,865 consumers (as measured by impressions), and directly led to at least 

15,469 visits to appellants’ website. 2-SER-300–01 (¶ 78) (Google metrics). The 

“Ships Fast From CA Today” Google ad was viewed 8,067,289 times and resulted 

in 124,588 website visits. 2-SER-354 (explaining numbers in SUF ¶¶ 78 and 195). 

Consumers driven to appellants’ website were then exposed to the similarly false 

9 See 2-SER-299–300, 397–98 (¶¶ 76, 265-67); 3-ER-189 (Instagram: “available 

for shipping”), 3-ER-190 (Instagram: “fully stocked and ready to ship out”); 1-

SER-38 (Twitter: “if ordered today we can ship today!”), 39 (Twitter: “in-stock 

today”); 1-SER-40 (Facebook); 2-SER-296 (¶ 68) (Reddit). 
26 

claims there. Displaying a false advertisement to millions of consumers plainly 

counts as “widely disseminated” as this Court and other courts of appeals have 

applied that test. See, e.g., Rare Coin, 931 F.2d at 1316 (ads distributed to 32,000 

newspaper subscribers held “widely disseminated”); FTC v. World Travel 

Vacation Brokers, Inc., 861 F.2d 1020, 1030 (7th Cir. 1988) (ads leading to 

hundreds of thousands of sales held widely disseminated). 

There is no authority, and appellants cite none, for the idea that 

misrepresentations need to account for all of a defendant’s sales to trigger the 

presumption. If appellants believed some of their sales resulted from perfectly 

lawful advertisements, they could have put forward evidence of such advertising – 

and any connected sales – to reduce the presumed redress amount. That is the very 

purpose of the rebuttal step once the FTC shows the presumption is triggered. See 

Figgie, 994 F.2d at 605-06; Commerce Planet, 815 F.3d at 603-05; Blue Hippo, 

762 F.3d at 242-46. Instead, appellants essentially asked the court to assume that 

all sales not specifically linked to the Google ads resulted from unspecified truthful 

advertising they never documented or identified to the court. Br. 28. In any event, 

as discussed, the record refuted this theoretical idea, showing that appellants’ 

misrepresentations spanned multiple platforms and were pervasive. 

Appellants assert that none of their other ads contained shipping claims, but 

they cite only to Tammabattula’s declaration for this point. Br. 28. Significant 
27 

record evidence, including appellants’ own admissions discussed above, showed 

that the other ads in fact contained shipping claims. See supra, at 24-25. In 

response, Tammabattula’s declaration makes the bare-bones claim that that “to 

[his] knowledge,” the ads on other platforms “made no shipping claims at all.” 3-

ER-388 (¶ 12). But unsupported, conclusory statements in an affidavit are 

insufficient to create a dispute of material fact in the face of substantial contrary 

evidence. Gordon, 819 F.3d at 1194 (defendant’s declaration was “insufficient to 

raise a triable issue of fact” because it lacked “‘detailed facts and any supporting 

evidence’”); FTC v. Publ’g Clearing House, Inc., 104 F.3d 1168, 1171 (9th Cir. 

1997); FTC v. Neovi, Inc., 604 F.3d 1150, 1159 (9th Cir. 2010) (declaration that 

“put forward nothing more than a few bald, uncorroborated, and conclusory 

assertions rather than evidence” did not defeat summary judgment). 

Tammabattula’s assertion was “utterly discredited by the record,” and the district 

court properly disregarded it. Scott v. Harris, 550 U.S. 372, 380-81 (2007).

3. Appellants failed to rebut the presumption with probative 

evidence showing any lesser injury. 

The district court properly found that because appellants did not present any 

evidence rebutting the presumption that consumers relied on their false claims, the 

court could properly presume that all consumers were harmed. Appellants now 

contend that the district court ignored evidence that supposedly raises a triable 

issue of fact as to the amount of consumer injury. Br. 37-39. But appellants’ 
28 

argument fails because the “evidence” appellants identify is nothing more than 

conjecture; consists of appellants’ own conclusory, unsupported statements; or 

simply does not show an absence of injury. At summary judgment, appellants 

could not “proceed in the hope that something can be developed at trial in the way 

of evidence to support [their] claim”; they had the burden to set forth “specific 

facts” that a rational factfinder could rely on to return a verdict in their favor. T.W. 

Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d 626, 630-31 (9th Cir. 

1987); Anderson, 477 U.S. at 252. Appellants utterly failed to meet this test, and 

none of their arguments show otherwise. 

Appellants miss the mark in asserting that the unlawful Google ads only 

accounted for 11% of sales and that this means “the other 89% did not rely on the 

ad.” Br. 38. As shown above, undisputed evidence showed that appellants’ false 

shipping claims pervaded their advertising and extended beyond the Google ads. 

See supra, at 24-25. The 11% argument assumes, rather than proves, that all 

remaining sales were the product of lawful advertising, when the record forecloses 

that conclusion. See id. This kind of theoretical rebuttal – ungrounded in actual 

evidence – is insufficient to defeat summary judgment. See Anderson, 477 U.S. at 

252; T.W. Elec., 809 F.2d at 630-31. 

Nor does the claim of “hundreds of repeat customers,” Br. 38, show any 

error by the district court. “Repeat customers” apparently refers to customers who 
29 

placed multiple orders, potentially on the same day. That does not mean the 

customers received their order, were satisfied with their purchases, and ordered 

again, and thus were unharmed by appellants’ practices. See FTC v. AMG Capital 

Mgmt., LLC, 910 F.3d 417, 427-28 (9th Cir. 2018) (rejecting argument that 

revenue from repeat customers should be excluded from a monetary judgment in 

the absence of “specific evidence that indicates one way or another whether repeat 

customers were actually deceived”), reversed on other grounds, 141 S. Ct. 1341 

(2021). For example, given the frenzied demand at that point in the pandemic, 

repeat orders may have been placed before the purchasers could have known that 

shipment of their first order would not be made as promised. Appellants’ claim 

boils down to the very one the Court has rejected: a rule presuming that repeat 

customers are not injured. See AMG, 910 F.3d at 427-28; see also Commerce 

Planet, 815 F.3d at 603-05 (holding that defendants failed to sufficiently support 

their claim that “not all” customers were deceived). 

Tammabattula’s speculation that some customers might have been satisfied 

with their purchase notwithstanding the false shipping claims, Br. 38, likewise 

does not raise a triable issue of fact. Appellants offered no customer declarations or 

other probative evidence showing “which or how many consumers were 

‘satisfied.’” Gordon, 819 F.3d at 1196. By contrast, the FTC submitted extensive 

undisputed evidence, including consumer declarations and hundreds of consumer 
30 

complaints, showing that appellants’ customers were harmed by their deceptive 

shipping claims. See, e.g., 2-SER-448 (¶ 381); 3-ER-134–150 (¶¶ 53-79), 3-ER247–80, 1-SER-7–27. Appellants’ contrary “evidence” boils down to 

Tammabattula’s own say-so, 5-ER-886 (¶¶ 19-20), 3-ER-354–55 (¶¶ 15-16), which 

is insufficient to create a dispute of material fact.10 See, e.g., Gordon, 819 F.3d at 

1194; Publ’g Clearing House, 104 F.3d at 1171. In any event, the district court 

addressed appellants’ concern about satisfied customers in the redress program, 

which requires consumers to submit claims to receive refunds rather than directing 

refunds to every purchaser. See 1-ER-14-15 (Op. 13-14). That approach, the court 

explained, will ensure that satisfied consumers do not automatically receive 

refunds. Id.

Appellants also offered no evidence to back up their contention that many 

orders “received timely shipment.” Br. 27. As the district court found, appellants 

failed to maintain adequate records indicating when orders were actually shipped, 

and what shipping times had been promised for those orders. See 1-ER-9 (Op. 8) 

n.5; 2-SER-466–69 (¶¶ 405-10). They likewise submitted no consumer 

declarations at all (including from anyone who received a timely order), instead 

10 That a handful of customers complimented the company in customer service 

messages, 5-ER-885, does not constitute the significant probative evidence needed 

to raise a triable issue of fact. See Anderson, 477 U.S. at 257. 
31 

relying on a few conclusory statements by their own executive. See Br. 27; 3-ER392 (Tammabattula Decl. ¶ 30). By contrast, relying on the FTC’s evidence, the 

district court found that the vast majority of orders – 30,000 out of 43,633 orders – 

took more than ten days to ship, and more than 10,000 orders took more than 30 

days to ship.11 1-ER-4–5, 9 (Op. 3-4, 8); 2-SER-347 (¶ 179) (more than ten days), 

455–60 (¶¶ 389-91, 394) (more than 30 days); 1-SER-170–71 (QYK RFA Resp. 

No. 117). 

C. The district court was not required to order product returns 

or to incorporate credits for the sanitizer’s “value.” 

The district court allowed any consumer who purchased hand sanitizer from 

appellants to apply for a full refund of the purchase price, ordering appellants to 

pay an overall amount up to their net revenues. 1-ER-13–14 (Op. 12-13). Given the 

dearth of rebuttal evidence, that ruling was proper. This Court did the same in 

Figgie, approving redress up to the defendant’s total revenue where the 

presumption of reliance went unrebutted. 994 F.2d at 606-08. So did the Second 

Circuit in Moses, holding that when the FTC establishes a presumption of reliance, 

a court can use “gross receipts as a baseline for calculating damages.” 913 F.3d at 

310-11; see also Commerce Planet, 815 F.3d at 605 (noting “court could simply 

11 These estimates were based on appellants’ Shopify records combined with 

UPS and USPS data. 1-SER-135–47 (Gieran Decl. ¶¶ 8-35) (explaining 

methodology). 
32 

have awarded [total revenues] and been done with it” given defendant’s failure to 

rebut the presumption). 

Appellants contend that the district court should have either required 

consumers to return the sanitizer products to QYK before receiving money back or 

reduced any refund by the products’ “value.” Br. 21-26. They contend that the 

court’s approach resulted in an improper “windfall” to customers and made the 

redress order “punitive.” Br. 24. The argument has no basis in law or fact. 

For starters, the law is clear that where unlawful or fraudulent conduct 

“taint[s] the customers’ purchasing decisions,” courts need not deduct the value of 

products consumers received in calculating a compensatory award. Figgie, 994 

F.2d at 606. Thus, the Court explained in Figgie, where a dishonest merchant 

falsely sells rhinestones as diamonds, the victims’ recovery is not limited “to the 

difference between what they paid and a fair price for rhinestones.” Id. That is 

because the misrepresentations “tainted the customers’ purchasing decisions”: “[i]f 

they had been told the truth, perhaps they would not have bought rhinestones at 

all.” Id. Because the fraud was “in the selling, not the value of the thing sold,” 

customers would be entitled to full refunds – regardless of any “value” the 

rhinestones might have. Id. 

That logic applies foursquare here. At a time of unprecedented, emergency 

demand for hand sanitizer, when many retailers had run out of inventory or were 
33 

facing shipping delays, appellants promised consumers they had sanitizer in stock 

ready to ship immediately. It is obvious from the overwhelming response to 

appellants’ advertisements that these claims were important to consumers’ 

purchasing decisions, especially in the early months of the pandemic – as the 

record amply demonstrates (contrary to appellants’ claim that there is “[n]o such 

evidence,” Br. 36). Appellants’ own marketing director testified that consumers’ 

purchasing decisions turned on whether sanitizer was actually in stock. 1-ER-10 

(Op. 9); 1-SER-220 (Paulo Dep. Tr. 88:9-19). Four consumers testified via 

declaration that they ordered from appellants “only . . . because it had advertised 

that it had hand sanitizer in stock.” 1-SER-76–77 (Kalmeta Decl. ¶ 2, 7); accord 1-

SER-66 (LeSage Decl. ¶¶ 2-3); 1-SER-41–42 (Breier Decl. ¶¶ 2, 9); 1-SER-90 

(Askins Decl. ¶¶ 2-4); 1-SER-112. Tammabattula himself told customer service 

representatives that “90%” of people will want to know “if product is available.” 1-

SER-195. Consumer complaints likewise show that customers relied on the ad 

claims, ordering from appellants because they believed products were in stock and 

would be shipped within a specific period. 3-ER-135–6 (¶ 56) (eleven complaints 

to FTC stating as much), 3-ER-140 (¶ 62) (twenty TrustPilot complaints), 3-ER147 (¶ 71) (nine Better Business Bureau complaints), 3-ER-150 (¶ 77) (fourteen 

Shopify complaints); 2-SER-449 (¶ 382). 
34 

In other words, what consumers wanted and what they ordered was hand 

sanitizer now, as promised. When appellants sold hand sanitizer later, consumers 

did not get the benefit of their bargain; the purchasing decision was tainted from 

the get-go. Even if consumers ultimately received sanitizer (the rhinestone), they 

did not receive what they were promised – sanitizer shipped quickly (the diamond). 

As in Figgie, the fraud was “in the selling, not the value of the thing sold.” 994 

F.2d at 606. The district court thus properly recognized that full refunds were 

appropriate “because Defendants’ deception induced the sale in the first place.” 1-

ER-14 (Op. 13). 

The same reasoning has led other courts of appeals to reject the idea that 

compensatory awards must be reduced by the value of the products received. The 

Tenth Circuit held that in calculating contempt sanctions for magazine sales that 

violated an injunction, “the district court need not offset the value of any product 

the defrauded consumers received.” FTC v. Kuykendall, 371 F.3d 745, 766 (10th 

Cir. 2004). The Eleventh Circuit likewise affirmed a compensatory contempt 

award for fraudulent print toner sales in the amount of gross revenue without 

deducting the value of the toner. McGregor, 206 F.3d at 1388-89. 

Moreover, it is not clear that the sanitizer had meaningful value by the time 

of the district court’s April 2022 order, which was entered roughly two years after 

most of the original sales. Sanitizer is a consumable product with a limited shelf 
35 

life, and appellants’ sanitizer typically expired in two years.12 Requiring consumers 

to return the likely expired, two-year-old sanitizer products would have been a 

burdensome exercise with little practical purpose. Appellants do not assert they 

could or would have resold the sanitizer, or that it had any monetary value by that 

point. It was appellants’ burden to demonstrate the value of any deductions to net 

revenues, and they failed to meet it. See Moses, 913 F.3d at 310-11; Gordon, 819 

F.3d at 1194. The district court was well within its discretion when it declined to 

require defrauded customers to jump through further hoops to get refunds. See 

Kuykendall, 371 F.3d at 766-67 (not requiring return of magazines); McGregor, 

206 F.3d at 1388-89 (not requiring return of printer toner). 

In Figgie, the Court required customers to return the products at issue, but 

that fact-bound determination does not affect the analysis here. Figgie involved 

heat-detection devices that sold for $170 apiece and had significant residual value. 

That situation bears little resemblance to small bottles of hand sanitizer, which sold 

between $5.99 and $12.99 and had looming (or passed) expiration dates. Indeed, 

the cost of shipping the product back could easily exceed the original price of the 

product itself. Furthermore, in Figgie the Commission had determined as fact that 

the heat detectors retained meaningful value, 994 F.2d at 606, whereas here the 

12 See 1-SER-37 (showing expiration date of April 4, 2022, for sanitizer 

produced April 5, 2020); 1-SER-194 (Tammabattula: “expiration is 2 years”). 
36 

record is devoid of such evidence and there is considerable cause for doubt. See 

Moses, 913 F.3d at 310-11; see also Gordon, 819 F.3d at 1194 (defendant failed to 

meet burden to show value of any deductions to presumed award). 

Nor was there any windfall as a matter of law. Under MITOR and the 

Unordered Merchandise Statute, 39 U.S.C. § 3009, merchandise (like the hand 

sanitizer here) shipped after a seller fails to provide the required notices of 

shipping delays and the option to cancel for a refund is deemed a gift. See 39 

U.S.C. § 3009; 16 C.F.R. § 435.2 (b)(1). Recipients may keep the merchandise and 

“have the right to retain, use, discard, or dispose of it in any manner [they see] fit 

without any obligation whatsoever to the sender.” 39 U.S.C. § 3009(b). In that 

situation, a full refund awarded under Section 19 need not take into account the 

value of the gift, since the appellants relinquished any entitlement to it when they 

violated MITOR. 

II. THE PERMANENT INJUNCTION WAS PROPER. 

Appellants concede that the district court applied the correct legal standards 

in deciding to enter a permanent injunction. They assert, however, that the district 

court erred in finding that wrongdoing is likely to recur, Br. 43-46, and they 

contend that the protective goods restriction is overbroad and violates the 

requirement that an injunction be “tailored” such that it bears “a reasonable 

relationship” to the violation, Br. 46-51. Neither argument has merit. 
37 

A. The district court properly determined that wrongdoing 

would likely recur. 

Appellants have a high hurdle for their claim that the district court abused its 

discretion when it determined that appellants’ wrongdoing was likely to recur. Br. 

43-46. A reviewing court will reverse only if it has a definite and firm conviction 

that the district court’s conclusion reflects a clear error of judgment, SEC v. 

Coldicutt, 258 F.3d 939, 941 (9th Cir. 2001), such as “when the record contains no 

evidence on which [the court] rationally could have based [its] decision,” Oregon 

Nat. Res. Council v. Marsh, 52 F.3d 1485, 1492 (9th Cir. 1995). 

Appellants cannot come close to meeting this high bar. To determine 

whether wrongdoing is likely to recur, courts consider five core factors: the degree 

of scienter, frequency of violations, ability to commit future violations, degree of 

harm suffered, and defendants’ recognition of their own culpability. SEC v. 

Murphy, 626 F.2d 633, 654-56 (9th Cir. 1980) (affirming permanent injunction 

where factors were mixed). The district court carefully analyzed all five factors and 

determined that four showed a likelihood of recurrence and one was neutral. 1-ER15–17 (Op. 14-16); 2-SER-506–09 (Stay Op. 4-7). It therefore determined that a 

permanent injunction was necessary to protect consumers from future harm.

The record firmly supported that conclusion. Appellants admitted they knew 

they could not ship product as promised, yet continued soliciting orders using “in 

stock” and “ships today” claims. 1-ER-4 (Op. 3). Worse yet, after their Google and 
38 

Facebook accounts were suspended for problematic practices, they tried to hire a 

third-party advertiser and set up a different account to “circumvent the 

suspension.” 1-ER-15–16 (Op. 14-15); 1-SER-4, 5–6, 200–03; 2-SER-351–52 

(¶ 189-90), 488–90 (¶¶ 436-39). Similarly, Nguyen blatantly misrepresented that 

appellants’ protein powder could prevent or mitigate COVID-19, knowing it had 

no such effect. 1-ER-6, 16 (Op. 5, 15). 

Nor was such dishonest conduct unprecedented. Nguyen’s pharmacy license 

had been suspended for repeated violations of California law, including 

“Unprofessional Conduct Involving Acts of Dishonesty, Fraud or Deceit.” 1-ER-16 

(Op. 15). Her misconduct went well beyond “a single incident,” Br. 49: Nguyen 

engaged in a series of violations that took place over the course of a year, included 

stealing dangerous drugs from her previous employer; impersonating a pharmacy 

technician to order replacement drugs to cover up her theft; selling the stolen drugs 

to customers of her new pharmacy, in violation of storage, recall, and labeling 

requirements; and dispensing large quantities of oxycodone that lacked legitimate 

medical purpose, despite ample red flags. 3-ER-313–25, 337–41. 

The district court properly concluded that together, these facts showed a 

“high degree of scienter,” suggesting that “wrongdoing is likely to recur.” 1-ER15–16 (Op. 14-15). The high frequency and volume of violative sanitizer sales, and 

appellants’ remaining in the PPE business, compounded this likelihood. 1-ER-16 
39 

(Op. 15). The risk of recidivism was high given appellants’ refusal to acknowledge 

their own culpability and complete “lack of remorse.” Id.; see also 2-SER-507–09 

(Stay Op. 5-7). 

Appellants claim that in considering scienter, the district court 

misinterpreted an April 2020 podcast in which Tammabattula admitted to lacking 

supplies to keep up with customers’ demand for sanitizer. Br. 45. According to 

appellants, Tammabattula was discussing “the industry in general” and not QYK in 

particular. Id. But that is not a plausible interpretation of his plain words in context. 

Responding to questions about “any of your brands,” Tammabattula admitted to 

“major issues in the supply chain for the hand sanitizers” and “obvious challenges 

in importing” the bottles needed. See Daily Caller interview, https://youtu.be/

ulsq18k8whM, at 6:19-7:35. Apart from the podcast, Tammabattula admitted in 

discovery that he knew throughout April 2020 that QYK was facing severe 

shortages of critical supplies, and that there were “major issues” in the supply 

chain. 1-SER-180–86 (Resp. to RFA Nos. 57-72). He likewise admitted that he 

was aware of the “full gravity of the situation” regarding shipping delays by March 

12th or 13th, 2020. 2-SER-427–28 (¶ 331). Ample other undisputed evidence 

confirmed that appellants knew full well that it was impossible to live up to their 

advertising promises, but continued making them anyway. See, e.g., 2-SER-320, 
40 

327–30, 428, 431–35 (¶¶ 113-14, 126-30, 333, 341-51). All of this evidence 

supported the district court’s scienter determination. 1-ER-5, 8–9 (Op. 4, 7-8). 

Appellants also are not correct that the court should have ignored their past 

conduct and examined only whether their current business model allows them to 

commit future violations. Br. 44, 49-50. That is not the law. Past violations may 

give rise to an inference of future violations, Murphy, 626 F.2d at 655, and 

appellants’ record supports such a prediction. Courts often reject even “‘sincere 

assurances’ against future violations” when a defendant’s past conduct shows “an 

ongoing risk to consumers.” Gordon, 819 F.3d at 1197; accord SEC v. Fehn, 97 

F.3d 1276, 1295-96 (9th Cir. 1996); Murphy, 626 F.2d at 655-56. 

For similar reasons, “mere voluntary cessation of allegedly illegal conduct” 

does not moot the need for an injunction, because “the defendant could simply 

begin the wrongful activity again.” FTC v. Affordable Media, LLC, 179 F.3d 1228, 

1238 (9th Cir. 1999); see also United States v. W.T. Grant Co., 345 U.S. 629, 633 

(1953) (“[T]he court’s power to grant injunctive relief survives discontinuance of 

the illegal conduct.”). The district court found that going forward appellants retain 

the ability to violate the FTC Act in similar ways and that their track record made 

recidivism likely. 1-ER-15-16 (Op. 14-16). That determination rested on sound 

evidence and was well within the court’s discretion. See W.T. Grant, 345 U.S. at 

633 (need only “some cognizable danger of recurrent violation”). 
41 

Appellants’ shift to a different business model – selling to governments and 

businesses rather than to individuals – does not make future violations impossible 

as they wrongly claim. Br. 44, 49-50. The FTC Act applies to all behavior “in or 

affecting commerce.” 15 U.S.C. § 45(a)(1); see also, e.g., FTC v. Cyberspace.com, 

LLC, 453 F.3d 1196, 1198-99 (9th Cir. 2006) (deceptive practices aimed at 

businesses violated the FTC Act). And when it promulgated MITOR, the FTC saw 

“no compelling reason to treat [businesspeople] differently from other members of 

the consuming public.” 40 Fed. Reg. 51582, 51594 (1975). The district court was 

well within its discretion to determine that giving appellants another chance to 

deceive would be unwise.13 See Gill, 265 F.3d at 957. 

B. The injunction is sufficiently tailored to appellants’ violations. 

The district court properly restricted appellants from selling protective goods 

in the future. District courts enjoy “broad latitude” in determining an injunction’s 

scope. High Sierra Hikers Ass’n v. Blackwell, 390 F.3d 630, 641 (9th Cir. 2004). 

When it comes to enforcement of the FTC Act, “those caught violating the Act 

must expect some fencing in,” so injunctions may prohibit conduct that goes 

beyond the specific wrongdoing in the case. FTC v. Nat’l Lead Co., 352 U.S. 419, 

13 That payment occurs after delivery, Br. 44, does not affect appellants’ ability 

to violate the FTC Act in myriad other ways. And appellants’ recent conduct is 

hardly reassuring: they admit that their performance under a major retail contract 

has been “a complete debacle,” because of QYK’s apparent knowing shipment of 

defective products. See 2-SER-517 (Balaji Tammabattula Decl. ¶ 18). 
42 

431 (1957). Injunctions in FTC cases may be framed “broadly enough to prevent 

respondents from engaging in similarly illegal practices.” FTC v. ColgatePalmolive Co., 380 U.S. 374, 394-95 (1965). “Appellate review of [an 

injunction’s] terms is correspondingly narrow.” Lamb-Weston, Inc. v. McCain 

Foods, Ltd., 941 F.2d 970, 973-74 (9th Cir. 1991) (cleaned up). The injunction 

need only “bear a ‘reasonable relation to the unlawful practices found to exist.’” 

Litton Indus., Inc. v. FTC, 676 F.2d 364, 370-71 (9th Cir. 1982). 

To determine the scope of an injunction, courts consider (1) the seriousness 

and deliberateness of the violation; (2) the ease with which the violation could be 

transferred to other products; and (3) any history of past violations. See Litton, 676 

F.2d at 370-71. “Where a fair assessment of [a defendant’s] conduct shows a ready 

willingness to flout the law, sufficient cause for concern regarding further, 

additional violations exists.” Sears, Roebuck & Co. v. FTC, 676 F.2d 385, 391-92 

(9th Cir. 1982); Lamb-Weston, 941 F.2d at 973-74 (affirming worldwide injunction 

even though misconduct took place only in the United States). 

On that test, the protective goods restriction fell comfortably within the 

district court’s discretion. Appellants may not evade the consequences of their 

illegality because their unlawful practices allegedly lasted only a few months, their 

protein powder product purportedly resulted in minimal sales “before it was 

pulled,” or they changed their business model. Br. 47, 49-50. As the district court 
43 

emphasized, this framing “eschews essential context”: that appellants’ “unfair and 

deceptive sales practices took advantage of consumers during an unprecedented 

public health crisis.” 2-SER-510 (Stay Op. 8). Preying on vulnerable consumers in 

the midst of a deadly pandemic was sufficiently egregious to demonstrate a general 

disregard for legal guardrails, and called for especially rigorous fencing-in. The 

same goes for claims that a protein powder would protect against a deadly virus, 

which gave the illusion of “false safety ‘guarantees’” that “could have had fatal or 

life-altering consequences for consumers,” 2-SER-509 (Stay Op. 7), no matter how 

short-lived the sales campaign. And all this misconduct followed the “streak of 

dishonesty and deceit” shown by Nguyen’s serious and repeated violations of state 

law, which resulted in the suspension of her pharmacy license. 1-ER-16 (Op. 15). 

The record therefore showed “a real likelihood of recurring violation,” and 

there is “no basis for disturbing the district court’s prudent assessment that giving 

[appellants] another chance might prove to be unwise.” Gill, 265 F.3d at 957. In 

the absence of any remorse, behavioral restrictions were plainly required. 1-ER-16 

(Op. 15); 2-SER-509 (Stay Op. 7). Appellants appear to contend that broad relief is 

appropriate only where misconduct occurred over a longer time period, Br. 48, 50, 

but duration is only one consideration. Other factors – including the pandemic 

context, appellants’ scienter, and the potentially life-altering impact of some 

deceptive claims – justify the restriction here. The district court correctly 
44 

determined that a “prophylactic measure is necessary to prevent [appellants] from 

exploiting customers now and during any future public health crisis.” 2-SER-510 

(Stay Op. 8). The injunction “does just that” by preventing appellants from selling 

products to prevent, detect, or mitigate COVID-19 or other conditions. Id. 

Appellants remain free to participate in many other industries and to sell a wide 

variety of products – including beauty products, the cornerstone of their prepandemic business. 

Rather than showing future violations are unlikely (Br. 44, 49-50), 

appellants’ activities during this litigation confirm their disregard for responsible 

business practices and fair dealing. Appellants finalized a $2.2 million government 

contract to supply protective goods the day after the district court issued its 

summary judgment decision against them. See 2-SER-520–21 (Letter from U.S. 

Department of Veterans Affairs). By that time, they knew full well that the district 

court might ban them from such business, yet they proceeded anyway. See 1-SER227–28; 1-SER-268; DE 15 at 17-19 (FTC Stay Opp.). Even after the injunction 

issued, appellants apparently did not tell their contracting partner about it, instead 

asking this Court to stay the injunction and allow them to fulfill the contract. See 

DE 9 (QYK Stay Mot.), 10 (QYK Em. Stay Mot.). Appellants also exaggerate their 

compliance with the preliminary injunction (Br. 43-44, 49): the FTC received 
45 

multiple complaints about deceptive practices surrounding their wipes products. 

See 2-SER-479–85 (¶¶ 428-30). 

Nor was it error for the district court to enjoin the conduct of all appellants 

even though only Nguyen is a proven recidivist with a propensity for violative 

conduct. Br. 20, 46-47, 49. Tammabattula and Nguyen are a married couple who 

admit to working together closely in numerous business ventures, including those 

here. See SUF ¶¶ 32. The parties agreed that the corporate appellants operated as a 

“common enterprise” such that each is jointly and severally liable for the actions of 

the others. 1-ER-3 (Op. 2) n.3; 2-SER-281–2 (¶¶ 40-42); 1-SER-224 (¶¶ 16-17). 

And appellants did not ask for different treatment for different appellants when the 

district court was considering the scope of the injunction. See 1-SER-264–69 

(QYK Opp. to FTC SJ Mot.). On that record, the district court did not abuse its 

discretion in making all appellants subject to the injunction. 

Finally, appellants get no help from their contention that they lacked 

sufficient notice that the court might enter an injunction like the one it did. Br. 47-

48. For one thing, even if the claim were factually true, it would present no reason 

to reverse an appropriate injunction grounded in the record. The claim is false 

anyway. 

The Complaint and Amended Complaint both sought “a permanent 

injunction to prevent future violations of the FTC Act,” and all “such other and 
46 

additional” proper relief. 2-ER-62, 102. In May 2021 FTC staff specifically told 

appellants’ counsel that in keeping with the requested relief the Commission would 

seek a permanent industry ban going forward, including “business to business 

sales.” 2-SER-497 (¶ 6). Appellants’ lawyer admitted as much below, noting that 

he “recall[ed] some discussion regarding a potential permanent ban that occurred 

in May of 2021.” 2-SER-501 (Defendants’ Reply ISO Mot. for Partial Stay). In 

February 2022, the FTC formally requested the protective goods restriction in its 

summary judgment motion, including the provision in the accompanying draft 

proposed order, 1-SER-226–28; in response, appellants recognized that “the FTC 

wants to ban the defendants from an entire industry.” 1-SER-268; see also 4-ER396 (Tammabattula Decl. ¶ 46). Appellants had plenty of notice that their ability to 

sell protective goods in the future might be restricted. 

III. NGUYEN’S UNSUPPORTED, SELF-SERVING INTERPRETATION OF HER 

OWN VIETNAMESE-LANGUAGE BROADCAST DID NOT CREATE A

DISPUTED ISSUE OF FACT. 

The district court found as undisputed fact that a Vietnamese-language 

broadcast interview featuring appellant Nguyen told listeners that her proteinpowder product could prevent and mitigate COVID-19 and was FDA approved for 

that purpose. 1-ER-11 (Op. 10). The court relied on a translation of the broadcast 

provided by the FTC from a certified Vietnamese-English translator, and found 

that when assessed in “context with the entire broadcast,” there was no doubt about 
47 

what Nguyen was conveying. Id. The court rejected a declaration supplied by 

Nguyen herself purporting to translate a few specific sentences of the broadcast as 

having a different, and more innocent, meaning from the certified translation. 

Appellants are incorrect that the Nguyen declaration created a dispute of material 

fact regarding the proper translation of Nguyen’s statements and that the court 

therefore erred in granted summary judgment to the FTC on the point. Br. 39-42. 

Nguyen’s declaration does not dispute the translation of the broadcast 

beyond a few specific sentences, and as the district court found she clearly 

conveyed throughout the broadcast that the product – Basic Immune IGG – would 

protect users from COVID-19 and that it was FDA approved. There is no dispute, 

for example, about the meaning of a lengthy discussion between Nguyen and the 

interviewer about the “Covid-19 pandemic” that “has been raging in the United 

States,” 1-SER-117, during which Nguyen claimed that Basic Immune IGG could 

ward off COVID-19 infections even if the user were sitting next to an infected 

person. 1-SER-124. Nguyen stated, again without dispute, that users of the 

supplement will have more antibodies that “cling to and attack the coronavirus.” 

Id. After that background, Nguyen then launched into a specific discussion of the 

product, again disputed neither below nor before this Court. She stated, “For this 

product, I must say that, first, it was FDA registered and approved via Company 

[Entera] Health that makes this product.” 1-SER-127 (emphasis added). She later 
48 

said that because she had taken Basic Immune IGG, people did not “have to be 

afraid of [her] anymore” and could “get close to” her. 1-SER-130–31. 

The disputed exchange took place in the middle of that discussion. 

According to the FTC’s certified translator, Nguyen and her questioner stated: 

Do Dung [Host]: And we should still wash our hands for two Happy 

Birthday songs’ time, and use this product for a month as well. Is it 

guaranteed that we will stay safe? Guaranteed? 

Thu Thao [Nguyen]: It’s guaranteed, because there is FDA’s verification and 

approval. 

1-SER-130–31. 

According to Nguyen, the exchange was: 

Host: We tried our best to avoid and wash your hands often via singing the 

“Happy Birthday song” in addition, add on to take this bottle supplement for 

1 month to guarantee something? Does it guarantee for better health? 

Nguyen: This bottle supplement is guarantee [sic] to make in FDA facility 

and it has all the certifications 

5-ER-677 (¶17). Appellants are mistaken in two respects in their argument that 

Nguyen’s translation creates a dispute of fact regarding whether she claimed that 

the product was FDA-approved to prevent COVID-19. 

First, no matter what the meaning of the disputed sentences, there is no 

dispute as to the remainder of the discussion, which plainly supports the district 

court’s conclusion that “the clear ‘net impression’” was that “Basic Immune IGG 

users would stay safe from COVID-19 and that it was FDA approved for that 
49 

purpose.” 1-ER-11 (Op. 10). Indeed, Tammabattula admitted that Nguyen claimed 

that the product was FDA-approved to treat, prevent, or reduce the risk of COVID19. 1-SER-191 (Resp. to RFA No. 87); 2-SER-407 (¶ 291), 446–47 (¶¶ 377-78). 

Thus, any dispute over these few sentences is immaterial because Nguyen’s 

translation of them does not change the unmistakable thrust of the entire 

discussion. 

Second, the district court acted within its discretion in rejecting Nguyen’s 

translation. Nguyen did not claim to be a certified translator or even fluent in the 

language, but simply “of Vietnamese descent.” 5-ER-676. The district court 

properly determined that the declaration was “not enough to create a genuine 

factual dispute” because it lacked any foundation establishing “her competence to 

testify as a Vietnamese to English translator.” 1-ER-11 (Op. 10) n.6. A 

“conclusory, self-serving affidavit, lacking detailed facts and any supporting 

evidence, is insufficient to create a genuine issue of material fact.” Publ’g Clearing 

House, 104 F.3d at 1171; Anderson, 477 U.S. at 248; Gordon, 819 F.3d at 1193-94 

(holding conclusory affidavit did not raise a triable issue because it lacked 

supporting evidence). Nguyen’s say-so about the meaning of her words did not 

create a factual dispute that can defeat summary judgment. 

Finally, appellants get no help from their claim that “the FTC’s translator 

imputed the word ‘Covid’ into the passage when it was never used.” Br. 40; see 5-
50 

ER-676–77 (Nguyen Decl. ¶¶ 16-17). For one thing, the claim is not true. The 

FTC’s certified translation of the contested passage did not use the word “Covid” 

at all. See 1-SER-130–31. The FTC’s summary judgment brief, Dkt. 135 at p. 19, 

quoted the passage as “Is it guaranteed that we will stay safe [from COVID-19]?” 

when it discussed the exchange. But the district court was interpreting not the 

FTC’s pleading, but the certified translation. See 1-ER-11 (Op. 10) (quoting Dkt. 

144, the translation). As for the pleading, appellants identify no error in supplying 

the obvious context of an excerpted quotation in brackets. See Blue Book R. 

5.2 (a). 

 Ultimately, this entire issue is largely pointless because appellants touted 

Basic Immune IGG as a COVID preventative multiple times in English-language 

videos. One video shows Nguyen responding to a question about “the best 

preventative measure to take now” by stating about the product, “in case you get 

infected with the virus, then your body will be able to fight back and destroy all the 

Coronavirus that is entering your body.” 3-ER-212; 2-SER-415–18 (¶¶ 299-305). 

In another one, Nguyen claimed Basic Immune IGG was a “prevention” for 

COVID-19, and suggested that it had been clinically tested and had a “patent” 

from the FDA. 3-ER-218, 220; 2-SER-418–20 (¶¶ 306-07). In light of those 

uncontested statements, it is clear that even if the dispute over the Vietnamese 
51 

broadcast had merit, it is not genuine because it would not “preclude the entry of 

summary judgment.” Anderson, 477 U.S. at 248-49. 

IV. APPELLANTS’ “FORCE MAJEURE” DEFENSE HAS NO MERIT. 

Finally, in a last-ditch effort to evade responsibility for their misconduct, 

appellants argue that the district court erred in finding them liable despite the 

“unprecedented global pandemic that was unforeseen to anyone.” Br. 51. By their 

account, appellants were innocent victims of events in a “tumultuous time” over 

which they “had no control.” Br. 52-53. Rather than being held responsible for 

exploiting consumer fears by selling merchandise under false pretenses, appellants 

contend, they should be applauded for “their heroic effort” working long hours 

during the pandemic. Br. 53. 

This account twists the facts beyond recognition and in any event provides 

no defense to appellants’ violations. The law required appellants to have a 

reasonable basis for their shipping time claims at the time they made them. The 

district court found that appellants had no factual basis to claim, among other 

deceptive statements, that they had sanitizer “in stock” that would “ship[] today” 

(or within a few days). 1-ER-4–5, 8–10 (Op. 3-4, 7-9). They did not have sufficient 

inventory on hand when they disseminated ads making those claims to hundreds of 

thousands of consumers, inducing millions in sanitizer sales. 1-ER-5, 14 (Op. 4, 

13). And they made the claims despite “known supply chain obstacles and a 
52 

dwindling or nonexistent inventory.” 1-ER-5 (Op. 4). Indeed, the court found 

appellants “were well aware of the global supply chain disruptions that hindered 

[their] ability to restock their inventory” and yet “continued to solicit orders.” 1-

ER-15 (Op. 14). And when Google and Facebook cut off their accounts for 

violating the platforms’ policies, appellants circumvented those suspensions by 

advertising on the same sites through different accounts. 1-ER-16 (Op. 15); 1-SER4, 5–6, 200–03; 2-SER-351–52 (¶ 189-90), 488–90 (¶¶ 436-39). This was not a 

situation where a seller had every reason to believe it could ship products promptly 

but was caught unawares by an intervening disruption. 

Moreover, appellants’ MITOR violations extended beyond the unfounded 

shipping time claims. Appellants also violated MITOR’s shipping delay 

notification and prompt refund requirements. Appellants’ made-up “force majeure” 

defense has no bearing on those violations. Even if appellants did have reason to 

believe they could ship their products in the promised time frames, there is no 

excuse for failing to issue the required notifications to purchasers, or failing to 

issue prompt refunds when asked. 

At base, appellants are profiteers, not victims. The district court properly 

declined to allow them to shift blame to circumstances they purposefully seized 

upon for their own financial gain – at great cost to consumers. 
53 

CONCLUSION 

The judgment of the district court should be affirmed. 

 Respectfully submitted,

ANISHA S. DASGUPTA

General Counsel 

JOEL MARCUS

Deputy General Counsel 

September 28, 2022 /s/ Mariel Goetz 

MARIEL GOETZ

Attorney 

FEDERAL TRADE COMMISSION

600 Pennsylvania Avenue, N.W. 

Washington, D.C. 20580 

 Of Counsel:

DOUGLAS V. WOLFE

KATHERINE E. JOHNSON

CHRISTOPHER ERICKSON

 Attorneys 

FEDERAL TRADE COMMISSION

Washington, D.C. 20580 
UNITED STATES COURT OF APPEALS 

FOR THE NINTH CIRCUIT

Form 8. Certificate of Compliance for Briefs

Instructions for this form: http://www.ca9.uscourts.gov/forms/form08instructions.pdf

9th Cir. Case Number(s) 22-55446

I am the attorney or self-represented party. 

This brief contains 12,147 words, excluding the items exempted 

by Fed. R. App. P. 32(f). The brief’s type size and typeface comply with Fed. R. 

App. P. 32(a)(5) and (6). 

I certify that this brief (select only one):

complies with the word limit of Cir. R. 32-1.

is a cross-appeal brief and complies with the word limit of Cir. R. 28.1-1.

is an amicus brief and complies with the word limit of Fed. R. App. P. 

29(a)(5), Cir. R. 29-2(c)(2), or Cir. R. 29-2(c)(3).

is for a death penalty case and complies with the word limit of Cir. R. 32-4.

complies with the longer length limit permitted by Cir. R. 32-2(b) because 

(select only one):

it is a joint brief submitted by separately represented parties; 

a party or parties are filing a single brief in response to multiple briefs; or

a party or parties are filing a single brief in response to a longer joint brief.

complies with the length limit designated by court order dated .

is accompanied by a motion to file a longer brief pursuant to Cir. R. 32-2(a).

Signature s/Mariel Goetz Date 9/28/2022

(use “s/[typed name]” to sign electronically-filed documents)

Feedback or questions about this form? Email us at forms@ca9.uscourts.gov

Form 8 Rev. 12/01/2018
STATUTORY ADDENDUM 
TABLE OF CONTENTS 

Federal Trade Commission Act 

Section 5, 15 U.S.C. § 45(a)(1)...........................................................A1 

Section 12, 15 U.S.C. § 52(a) .............................................................A2 

Section 19, 15 U.S.C. § 57b...............................................................A3 

Unordered Merchandise Statute 

39 U.S.C. § 3009............................................................................A5 

39 U.S.C. § 3009(b) ........................................................................A5 

Mail, Internet, or Telephone Order Merchandise Rule 

16 C.F.R. § 435.1(e)........................................................................A5 

16 C.F.R. § 435.2(a)(1) ...................................................................A5 

16 C.F.R. § 435.2(b)(1)....................................................................A6 

16 C.F.R. § 435.2(c)........................................................................A9 
A1 

United States Code, 2019 Edition 

Title 15 - COMMERCE AND TRADE 

CHAPTER 2 - FEDERAL TRADE COMMISSION; PROMOTION OF EXPORT 

TRADE AND PREVENTION OF UNFAIR METHODS OF COMPETITION 

SUBCHAPTER I - FEDERAL TRADE COMMISSION 

§45. Unfair methods of competition unlawful; prevention by Commission 

(a) Declaration of unlawfulness; power to prohibit unfair practices; 

inapplicability to foreign trade 

(1) Unfair methods of competition in or affecting commerce, and unfair or 

deceptive acts or practices in or affecting commerce, are hereby declared unlawful. 

(2) The Commission is hereby empowered and directed to prevent persons, 

partnerships, or corporations, except banks, savings and loan institutions described 

in section 57a(f)(3) of this title, Federal credit unions described in section 57a(f)(4) 

of this title, common carriers subject to the Acts to regulate commerce, air carriers 

and foreign air carriers subject to part A of subtitle VII of title 49, and persons, 

partnerships, or corporations insofar as they are subject to the Packers and 

Stockyards Act, 1921, as amended [7 U.S.C. 181 et seq.], except as provided in 

section 406(b) of said Act [7 U.S.C. 227(b)], from using unfair methods of 

competition in or affecting commerce and unfair or 

deceptive acts or practices in or affecting commerce. 

* * * 

 
A2 

§ 52. Dissemination of false advertisements 

(a) Unlawfulness. It shall be unlawful for any person, partnership, or corporation 

to disseminate, or cause to be disseminated, any false advertisement— 

(1) By United States mails, or in or having an effect upon commerce, by any 

means, for the purpose of inducing, or which is likely to induce, directly or 

indirectly the purchase of foods, drugs, devices, services, or cosmetics; or 

(2) By any means, for the purpose of inducing, or which is likely to induce, 

directly or indirectly, the purchase in or having an effect upon commerce of food, 

drugs, devices, services, or cosmetics. 

(b) Unfair or deceptive act or practice. The dissemination or the causing to be 

disseminated of any false advertisement within the provisions of subsection (a) of 

this section shall be an unfair or deceptive act or practice in or affecting commerce 

within the meaning of section 5 [15 USCS § 45].
A3 

§57b. Civil actions for violations of rules and cease and desist orders 

respecting unfair or deceptive acts or practices 

(a) Suits by Commission against persons, partnerships, or corporations; 

jurisdiction; relief for dishonest or fraudulent acts 

(1) If any person, partnership, or corporation violates any rule under this 

subchapter respecting unfair or deceptive acts or practices (other than an 

interpretive rule, or a rule violation of which the Commission has provided 

is not an unfair or deceptive act or practice in violation of section 45(a) of 

this title), then the Commission may commence a civil action against such 

person, partnership, or corporation for relief under subsection (b) in a 

United States district court or in any court of competent jurisdiction of a 

State. 

(2) If any person, partnership, or corporation engages in any unfair or deceptive 

act or practice (within the meaning of section 45(a)(1) of this title) with 

respect to which the Commission has issued a final cease and desist order 

which is applicable to such person, partnership, or corporation, then the 

Commission may commence a civil action against such person, partnership, 

or corporation in a United States district court or in any court of competent 

jurisdiction of a State. If the Commission satisfies the court that the act or 

practice to which the cease and desist order relates is one which a 

reasonable man would have known under the circumstances was dishonest 

or fraudulent, the court may grant relief under subsection (b). 

(b) Nature of relief available 

The court in an action under subsection (a) shall have jurisdiction to grant such 

relief as the court finds necessary to redress injury to consumers or other persons, 

partnerships, and corporations resulting from the rule violation or the unfair or 

deceptive act or practice, as the case may be. Such relief may include, but shall not 

be limited to, rescission or reformation of contracts, the refund of money or return 

of property, the payment of damages, and public notification respecting the rule 

violation or the unfair or deceptive act or practice, as the case may be; except that 

nothing in this subsection is intended to authorize the imposition of any exemplary 

or punitive damages. 

* * * 
A4 

39 USCS § 3009 

United States Code, 2019 Edition 

TITLE 39. POSTAL SERVICE (§§ 101 — 5605) 

Part IV. Mail Matter (Chs. 30 — 37) 

CHAPTER 30. Nonmailable Matter (§§ 3001 — 3018) 

§ 3009. Mailing of unordered merchandise 

(a) Except for (1) free samples clearly and conspicuously marked as such, and (2) 

merchandise mailed by a charitable organization soliciting contributions, the 

mailing of unordered merchandise or of communications prohibited by subsection 

(c) of this section constitutes an unfair method of competition and an unfair trade 

practice in violation of section 45(a)(1) of title 15. 

(b) Any merchandise mailed in violation of subsection (a) of this section, or within 

the exceptions contained therein, may be treated as a gift by the recipient, who 

shall have the right to retain, use, discard, or dispose of it in any manner he sees fit 

without any obligation whatsoever to the sender. All such merchandise shall have 

attached to it a clear and conspicuous statement informing the recipient that he may 

treat the merchandise as a gift to him and has the right to retain, use, discard, or 

dispose of it in any manner he sees fit without any obligation whatsoever to the 

sender. 

(c) No mailer of any merchandise mailed in violation of subsection (a) of this 

section, or within the exceptions contained therein, shall mail to any recipient of 

such merchandise a bill for such merchandise or any dunning communications. 

(d) For the purposes of this section, “unordered merchandise” means merchandise 

mailed without the prior expressed request or consent of the recipient. 

 
A5 

Code of Federal Regulations (2020) 

16 CFR 435.1 

Title 16 – Commercial Practices 

Part 435 — Mail, Internet, or Telephone Order Merchandise 

§ 435.1 Definitions. 

For purposes of this part: 

(a) Mail, Internet, or telephone order sales shall mean sales in which the buyer has 

ordered merchandise from the seller by mail, via the Internet, or by telephone, 

regardless of the method of payment or the method used to solicit the order. 

* * * 

(e) Shipment shall mean the act by which the merchandise is physically placed in 

the possession of the carrier. 

* * * 

§ 435.2 Mail, Internet, or telephone order sales. 

In connection with mail, Internet, or telephone order sales in or affecting 

commerce, as “commerce” is defined in the Federal Trade Commission Act, it 

constitutes an unfair method of competition, and an unfair or deceptive act or 

practice for a seller: 

(a) 

(1) To solicit any order for the sale of merchandise to be ordered by the buyer 

through the mail, via the Internet, or by telephone unless, at the time of the 

solicitation, the seller has a reasonable basis to expect that it will be able to ship 

any ordered merchandise to the buyer: 

(i) Within that time clearly and conspicuously stated in any such solicitation; or 

(ii) If no time is clearly and conspicuously stated, within thirty (30) days after 

receipt of a properly completed order from the buyer. Provided, however, where, at 

the time the merchandise is ordered the buyer applies to the seller for credit to pay 

for the merchandise in whole or in part, the seller shall have fifty (50) days, rather 

than thirty (30) days, to perform the actions required in this paragraph (a)(1)(ii). 
A6 

(2) To provide any buyer with any revised shipping date, as provided in paragraph 

(b) of this section, unless, at the time any such revised shipping date is provided, 

the seller has a reasonable basis for making such representation regarding a 

definite revised shipping date. 

(3) To inform any buyer that it is unable to make any representation regarding the 

length of any delay unless: 

(i) The seller has a reasonable basis for so informing the buyer; and 

(ii) The seller informs the buyer of the reason or reasons for the delay. 

(4) In any action brought by the Federal Trade Commission, alleging a violation of 

this part, the failure of a respondent-seller to have records or other documentary 

proof establishing its use of systems and procedures which assure the shipment of 

merchandise in the ordinary course of business within any applicable time set forth 

in this part will create a rebuttable presumption that the seller lacked a reasonable 

basis for any expectation of shipment within said applicable time. 

(b) 

(1) Where a seller is unable to ship merchandise within the applicable time set 

forth in paragraph (a)(1) of this section, to fail to offer to the buyer, clearly and 

conspicuously and without prior demand, an option either to consent to a delay in 

shipping or to cancel the buyer s order and receive a prompt refund. Said offer 

shall be made within a reasonable time after the seller first becomes aware of its 

inability to ship within the applicable time set forth in paragraph (a)(1) of this 

section, but in no event later than said applicable time. 

(i) Any offer to the buyer of such an option shall fully inform the buyer regarding 

the buyer’s right to cancel the order and to obtain a prompt refund and shall 

provide a definite revised shipping date, but where the seller lacks a reasonable 

basis for providing a definite revised shipping date the notice shall inform the 

buyer that the seller is unable to make any representation regarding the length of 

the delay. 

(ii) Where the seller has provided a definite revised shipping date which is thirty 

(30) days or less later than the applicable time set forth in paragraph (a)(1) of this 

section, the offer of said option shall expressly inform the buyer that, unless the 

seller receives, prior to shipment and prior to the expiration of the definite revised 

shipping date, a response from the buyer rejecting the delay and cancelling the 
A7 

order, the buyer will be deemed to have consented to a delayed shipment on or 

before the definite revised shipping date. 

(iii) Where the seller has provided a definite revised shipping date which is more 

than thirty (30) days later than the applicable time set forth in paragraph (a)(1) of 

this section or where the seller is unable to provide a definite revised shipping date 

and therefore informs the buyer that it is unable to make any representation 

regarding the length of the delay, the offer of said option shall also expressly 

inform the buyer that the buyer’s order will automatically be deemed to have been 

cancelled unless: 

(A) The seller has shipped the merchandise within thirty (30) days of the 

applicable time set forth in paragraph (a)(1) of this section, and has received no 

cancellation prior to shipment; or 

(B) The seller has received from the buyer within thirty (30) days of said 

applicable time, a response specifically consenting to said shipping delay. Where 

the seller informs the buyer that it is unable to make any representation regarding 

the length of the delay, the buyer shall be expressly informed that, should the buyer 

consent to an indefinite delay, the buyer will have a continuing right to cancel the 

buyer’s order at any time after the applicable time set forth in paragraph (a)(1) of 

this section by so notifying the seller prior to actual shipment. 

(iv) Nothing in this paragraph shall prohibit a seller who furnishes a definite 

revised shipping date pursuant to paragraph (b)(1)(i) of this section, from 

requesting, simultaneously with or at any time subsequent to the offer of an option 

pursuant to paragraph (b)(1) of this section, the buyer’s express consent to a further 

unanticipated delay beyond the definite revised shipping date in the form of a 

response from the buyer specifically consenting to said further delay. Provided, 

however, that where the seller solicits consent to an unanticipated indefinite delay 

the solicitation shall expressly inform the buyer that, should the buyer so consent 

to an indefinite delay, the buyer shall have a continuing right to cancel the buyer’s 

order at any time after the definite revised shipping date by so notifying the seller 

prior to actual shipment. 

(2) Where a seller is unable to ship merchandise on or before the definite revised 

shipping date provided under paragraph (b)(1)(i) of this section and consented to 

by the buyer pursuant to paragraph (b)(1)(ii) or (iii) of this section, to fail to offer 

to the buyer, clearly and conspicuously and without prior demand, a renewed 

option either to consent to a further delay or to cancel the order and to receive a 
A8 

prompt refund. Said offer shall be made within a reasonable time after the seller 

first becomes aware of its inability to ship before the said definite revised date, but 

in no event later than the expiration of the definite revised shipping date. Provided, 

however, that where the seller previously has obtained the buyer’s express consent 

to an unanticipated delay until a specific date beyond the definite revised shipping 

date, pursuant to paragraph (b)(1)(iv) of this section or to a further delay until a 

specific date beyond the definite revised shipping date pursuant to paragraph (b)(2) 

of this section, that date to which the buyer has expressly consented shall 

supersede the definite revised shipping date for purposes of paragraph (b)(2) of this 

section. 

(i) Any offer to the buyer of said renewed option shall provide the buyer with a 

new definite revised shipping date, but where the seller lacks a reasonable basis for 

providing a new definite revised shipping date, the notice shall inform the buyer 

that the seller is unable to make any representation regarding the length of the 

further delay. 

(ii) The offer of a renewed option shall expressly inform the buyer that, unless the 

seller receives, prior to the expiration of the old definite revised shipping date or 

any date superseding the old definite revised shipping date, notification from the 

buyer specifically consenting to the further delay, the buyer will be deemed to have 

rejected any further delay, and to have cancelled the order if the seller is in fact 

unable to ship prior to the expiration of the old definite revised shipping date or 

any date superseding the old definite revised shipping date. Provided, however, 

that where the seller offers the buyer the option to consent to an indefinite delay 

the offer shall expressly inform the buyer that, should the buyer so consent to an 

indefinite delay, the buyer shall have a continuing right to cancel the buyer’s order 

at any time after the old definite revised shipping date or any date superseding the 

old definite revised shipping date. 

(iii) Paragraph (b)(2) of this section shall not apply to any situation where a seller, 

pursuant to the provisions of paragraph (b)(1)(iv) of this section, has previously 

obtained consent from the buyer to an indefinite extension beyond the first revised 

shipping date. 

(3) Wherever a buyer has the right to exercise any option under this part or to 

cancel an order by so notifying the seller prior to shipment, to fail to furnish the 

buyer with adequate means, at the seller’s expense, to exercise such option or to 

notify the seller regarding cancellation. 
A9 

(4) Nothing in paragraph (b) of this section shall prevent a seller, where it is unable 

to make shipment within the time set forth in paragraph (a)(1) of this section or 

within a delay period consented to by the buyer, from deciding to consider the 

order cancelled and providing the buyer with notice of said decision within a 

reasonable time after it becomes aware of said inability to ship, together with a 

prompt refund. 

(c) 

To fail to deem an order cancelled and to make a prompt refund to the buyer 

whenever: 

(1) The seller receives, prior to the time of shipment, notification from the buyer 

cancelling the order pursuant to any option, renewed option or continuing option 

under this part; 

(2) The seller has, pursuant to paragraph (b)(1)(iii) of this section, provided the 

buyer with a definite revised shipping date which is more than thirty (30) days later 

than the applicable time set forth in paragraph (a)(1) of this section or has notified 

the buyer that it is unable to make any representation regarding the length of the 

delay and the seller: 

(i) Has not shipped the merchandise within thirty (30) days of the applicable time 

set forth in paragraph (a)(1) of this section, and 

(ii) Has not received the buyer’s express consent to said shipping delay within said 

thirty (30) days; 

(3) The seller is unable to ship within the applicable time set forth in paragraph 

(b)(2) of this section, and has not received, within the said applicable time, the 

buyer’s consent to any further delay; 

(4) The seller has notified the buyer of its inability to make shipment and has 

indicated its decision not to ship the merchandise; 

(5) The seller fails to offer the option prescribed in paragraph (b)(1) of this section 

and has not shipped the merchandise within the applicable time set forth in 

paragraph (a)(1) of this section. 
A10 

(d) 

In any action brought by the Federal Trade Commission, alleging a violation of 

this part, the failure of a respondent-seller to have records or other documentary 

proof establishing its use of systems and procedures which assure compliance, in 

the ordinary course of business, with any requirement of paragraph (b) or (c) of 

this section will create a rebuttable presumption that the seller failed to comply 

with said requirement.