Source: https://www.ftc.gov/sites/default/files/documents/cases/1998/08/final_or.010.htm
Timestamp: 2019-06-18 07:07:51
Document Index: 150780527

Matched Legal Cases: ['art 310', 'art 310', 'art 310', 'art 310', 'art 308', 'art 436']

WHEREAS, plaintiff, Federal Trade Commission ("FTC" or "Commission"), filed this action under Sections 5(a), 13(b) and 19 of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. �� 45(a), 53(b) and 57b, on June 20, 1997;
WHEREAS, the FTC and defendants Sweet Song Corporation, Tsavorite Sword Corporation, Ron Hudson, Inc., and Hari Jiwan Singh Khalsa a/k/a Stephen Jon Oxenhandler and a/k/a Bob Thomas ("settling defendants") have agreed to entry of this Stipulated Final Judgment and Order for Permanent Injunction and Other Equitable Relief ("Order") and stipulate to the Courts findings below;
This Court has jurisdiction over the Commissions claim pursuant to 28 U.S.C. �� 1331, 1337(a) and 1345, and 15 U.S.C. �� 45(a), 53(b), 57b(a), 6102(c) and 6105. This Court has jurisdiction over the parties.
This is an action instituted by the FTC under Sections 5(a), 13(b) and 19 of the FTC Act, 15 U.S.C. �� 45(a), 53(b) and 57b. The Complaint seeks both permanent injunctive relief and consumer redress for alleged deceptive practices by defendants in connection with the offering for sale and sale of gemstones as investments in violation of Section 5(a) of the FTC Act, 15 U.S.C. � 45(a) and of the Telemarketing Sales Rule, 16 C.F.R. Part 310, promulgated August 23, 1995.
Plaintiff Commission has the authority to seek the relief it requests, and the Court has the authority to grant it under Sections 13(b) and 19 of the FTC Act, 15 U.S.C. �� 53(b) and 57b.
The activities of the settling defendants are in or affecting commerce, as the term is defined in Section 4 of the FTC Act, 15 U.S.C. � 44.
F. Falsely representing, expressly or by implication, any other fact material to a consumers decision to purchase gemstones, coins, bullion or any other investment opportunity;
G. Violating or assisting others in violating any provision of the Commissions Telemarketing Sales Rule, 16 C.F.R. Part 310, as amended from time to time (current version attached as Appendix B), including but not limited to misrepresenting, directly or by implication, "[a]ny material aspect of an investment opportunity." 16 C.F.R. � 310.3(a)(2)(vi).
B. This bond shall be conditioned upon compliance with Section 5(a) of the FTC Act, 15 U.S.C. � 45(a), the Telemarketing Sales Rule, 16 C.F.R. Part 310, and with the provisions of this Order. The bond shall be continuous and remain in full force and effect as long as settling defendant Hari Jiwan Singh Khalsa continues to engage in telemarketing or assists others engaged in telemarketing, and for at least three (3) years after settling defendant Hari Jiwan Singh Khalsa has ceased to engage in such activities.
C. The bond shall cite this Order as the basis of the bond, and shall provide surety thereunder to consumers against financial loss resulting from any violation of Section 5(a) of the FTC Act, 15 U.S.C. � 45(a), the Telemarketing Sales Rule, 16 C.F.R. Part 310, or the provisions of this Order.
V. IT IS FURTHER ORDERED that, to facilitate the Commissions monitoring of settling defendant Hari Jiwan Singh Khalsas compliance with this Order, settling defendant Hari Jiwan Singh Khalsa shall:
(2) To interview or depose the directors, officers, and employees, including all personnel involved in responding to consumer complaints or inquiries, and all sales personnel, whether designated as employees, consultants, independent contractors, free-lancers or otherwise, of any business to which subsection E(1) of this Section V applies, concerning matters relating to compliance with the terms of this Order. The person interviewed or deposed may have counsel present. Provided that, the Commission may otherwise monitor the settling defendants compliance with this Order by all lawful means available, including the use of compulsory process, seeking production of documents, or the taking of depositions, and the use of investigators posing as consumers or suppliers.
(i) By signing this agreement, Sat Bachan Kaur Khalsa acknowledges that she is contractually bound to carry out her obligations under this Section VI, and she further acknowledges that the Commissions agreement to settle this lawsuit with her husband, settling defendant Hari Jiwan Singh Khalsa, is adequate consideration for the promises she makes herein.
G. Subsection F, of this Section VI, shall not be deemed a waiver of the Commissions right to seek an order to show cause why settling defendant Hari Jiwan Singh Khalsa should not be held in contempt for failure to comply with the Order.
H. The facts as alleged in the Complaint shall be taken as admitted and true for the sole purpose of any subsequent litigation to collect amounts due pursuant to this Order, including but not limited to any subsequent bankruptcy proceeding. In this subsequent litigation, settling defendants agree to waive their right to assert affirmative defenses. This waiver does not constitute a waiver of settling defendant Hari Jiwan Singh Khalsas rights, if any, under the Fifth Amendment to the United States Constitution or similar provisions in state constitutions or statutes.
VII. IT IS FURTHER ORDERED that the Commission's agreement to this Order is expressly premised upon the material truthfulness, accuracy, and completeness of settling defendant Hari Jiwan Singh Khalsas financial condition as represented in the financial information previously submitted to the Commission on July 21, 1997, July 28, 1997, January 6, 1998, and as amended by letter dated April 6, 1998, which constitute material information relied upon by the Commission in negotiating and agreeing to this Order. If, upon motion by the Commission, this Court finds that settling defendant Hari Jiwan Singh Khalsa failed to disclose any material asset, materially misrepresented the value of any asset, or made any other material misrepresentation or material omission, the Commission may request that this Order be reopened for the limited purpose of allowing the Commission to modify his monetary liability; provided however, that in all other respects this Order shall remain in full force and effect unless otherwise ordered by the Court; and, provided further, that proceedings instituted under this provision by the Commission shall be in addition to and not in lieu of any other civil or criminal remedies as may be provided by law, including any other proceedings the Commission may initiate to enforce this Order. Settling defendant Hair Jiwan Singh Khalsa waives any and all rights to contest any of the allegations in the Commission's Complaint in this matter in any subsequent proceeding conducted under this Section VII.
IX. IT IS FURTHER ORDERED that this Order supersedes the Preliminary Injunction, with asset freeze, entered in this matter on July 10, 1997, as modified by this Court on October 22, 1997, to the extent specified in this Order. The freeze of the settling defendant Hari Jiwan Singh Khalsas assets shall be lifted upon execution of the listing agreement referenced in Section VI.B(2) and the sworn affidavit referenced in Section VII and upon written acknowledgment by counsel for the Commission of receipt of the listing agreement and sworn statement.
X. IT IS FURTHER ORDERED that each party to this stipulated Order hereby agrees to bear its own costs and attorneys fees incurred in connection with this action.
XI. IT IS FURTHER ORDERED that the settling defendants waive all rights to seek judicial review or otherwise challenge or contest the validity of this Order. The settling defendants waive any claims they had or may have under the Equal Access to Justice Act, 28 U.S.C. � 2412, concerning the prosecution of this action to the date of entry of this Order.
Hari Jiwan Singh Khalsa _____________________________
(1) Before a customer pays(1) for goods or services offered, failing to disclose, in a clear and conspicuous manner, the following material information:
(i) The total costs to purchase, receive, or use, and the quantity of, any goods or services that are the subject of the sales offer;(2)
(b) Assisting and facilitating. It is a deceptive telemarketing act or practice and a violation of this Rule for a person to provide substantial assistance or support to any seller or telemarketer when that person knows or consciously avoids knowing that the seller or telemarketer is engaged in any act or practice that violates �� 310.3(a) or (c), or � 310.4 of this Rule.
(i) It has established and implemented written procedures to comply with � 310.4(b)(1)(ii);
(ii) It has trained its personnel in the procedures established pursuant to � 310.4(b)(2)(i);
(iii) The seller, or the telemarketer acting on behalf of the seller, has maintained and recorded lists of persons who may not be contacted, in compliance with � 310.4(b)(1)(ii); and
(3) The name and last known address of each customer, the goods or services purchased, the date such goods or services were shipped or provided, and the amount paid by the customer for the goods or services;(3)
(b) A seller or telemarketer may keep the records required by � 310.5(a) in any form, and in the manner, format, or place as they keep such records in the ordinary course of business. Failure to keep all records required by � 310.5(a) shall be a violation of this Rule.
(c) The seller and the telemarketer calling on behalf of the seller may, by written agreement, allocate responsibility between themselves for the recordkeeping required by this Section. When a seller and telemarketer have entered into such an agreement, the terms of that agreement shall govern, and the seller or telemarketer, as the case may be, need not keep records that duplicate those of the other. If the agreement is unclear as to who must maintain any required record(s), or if no such agreement exists, the seller shall be responsible for complying with �� 310.5(a)(1)-(3) and (5); the telemarketer shall be responsible for complying with � 310.5(a)(4).
(a) The sale of pay-per-call services subject to the Commission's "Trade Regulation Rule Pursuant to the Telephone Disclosure and Dispute Resolution Act of 1992," 16 CFR Part 308;
(b) The sale of franchises subject to the Commission's Rule entitled "Disclosure Requirements and Prohibitions Concerning Franchising and Business Opportunity Ventures," 16 CFR Part 436;
(c) Telephone calls in which the sale of goods or services is not completed, and payment or authorization of payment is not required, until after a face-to-face sales presentation by the seller;
(d) Telephone calls initiated by a customer that are not the result of any solicitation by a seller or telemarketer;
(e) Telephone calls initiated by a customer in response to an advertisement through any media, other than direct mail solicitations; provided, however, that this exemption does not apply to calls initiated by a customer in response to an advertisement relating to investment opportunities, goods or services described in �� 310.4(a)(2) or (3), or advertisements that guarantee or represent a high likelihood of success in obtaining or arranging for extensions of credit, if payment of a fee is required in advance of obtaining the extension of credit;
(f) Telephone calls initiated by a customer in response to a direct mail solicitation that clearly, conspicuously, and truthfully discloses all material information listed in � 310.3(a)(1) of this Rule for any item offered in the direct mail solicitation; provided, however, that this exemption does not apply to calls initiated by a customer in response to a direct mail solicitation relating to prize promotions, investment opportunities, goods or services described in �� 310.4(a)(2) or (3), or direct mail solicitations that guarantee or represent a high likelihood of success in obtaining or arranging for extensions of credit, if payment of a fee is required in advance of obtaining the extension of credit; and
(g) Telephone calls between a telemarketer and any business, except calls involving the retail sale of nondurable office or cleaning supplies; provided, however, that � 310.5 of this Rule shall not apply to sellers or telemarketers of nondurable office or cleaning supplies.
(a) Any attorney general or other officer of a State authorized by the State to bring an action under the Telemarketing and Consumer Fraud and Abuse Prevention Act, and any private person who brings an action under that Act, shall serve written notice of its action on the Commission, if feasible, prior to its initiating an action under this Rule. The notice shall be sent to the Office of the Director, Bureau of Consumer Protection, Federal Trade Commission, Washington, D.C. 20580, and shall include a copy of the State's or private person's complaint and any other pleadings to be filed with the court. If prior notice is not feasible, the State or private person shall serve the Commission with the required notice immediately upon instituting its action.
(1)When a seller or telemarketer uses, or directs a customer to use, a courier to transport payment, the seller or telemarketer must make the disclosures required by � 310.3(a)(1) before sending a courier to pick up payment or authorization for payment, or directing a customer to have a courier pick up payment or authorization for payment.
(2) For offers of consumer credit products subject to the Truth in Lending Act, 15 U.S.C. 1601 et seq., and Regulation Z, 12 CFR 226, compliance with the disclosure requirements under the Truth in Lending Act, and Regulation Z, shall constitute compliance with � 310.3(a)(1)(i) of this Rule.
(3)For offers of consumer credit products subject to the Truth in Lending Act, 15 U.S.C. 1601 et seq., and Regulation Z, 12 CFR 226, compliance with the recordkeeping requirements under the Truth in Lending Act, and Regulation Z, shall constitute compliance with � 310.5(a)(3) of this Rule.