Court Opinion

ID: 3060711
Source: CourtListenerOpinion
Date Created: 2015-10-14 00:42:31.532082+00
Date Added: 2024-06-11T09:55:51.776502
License: Public Domain

[DO NOT PUBLISH]

                 IN THE UNITED STATES COURT OF APPEALS

                           FOR THE ELEVENTH CIRCUIT
                                                                            FILED
                              ________________________             U.S. COURT OF APPEALS
                                                                     ELEVENTH CIRCUIT
                              Nos. 10-10715 and 10-12901                 APRIL 25, 2011
                              ________________________                    JOHN LEY
                                                                           CLERK
                     D. C. Docket No. 8:09-cv-02309-SDM-TBM

FEDERAL TRADE COMMISSION,

                                                          Plaintiff-Appellee,

                                           versus

RICHARD A. BISHOP,
individually and as a member
of Optimum Business Solutions, LLC,

                                                  Defendant-Appellant.
                              ________________________

                     Appeals from the United States District Court
                          for the Middle District of Florida
                            ________________________
                                   (April 25, 2011)

Before DUBINA, Chief Judge, HILL, Circuit Judge, and GOLDBERG,* Judge.

GOLDBERG, Judge:

       *
         Honorable Richard W. Goldberg, United States Court of International Trade Judge,
sitting by designation.
                                  I. DISCUSSION

A. Preliminary Injunction

      This court reviews the granting of a preliminary injunction for abuse of

discretion. Commodity Futures Trading Comm’n v. Wilshire Inv. Mgmt. Corp.,

531 F.3d 1339, 1343 (11th Cir. 2008). Section 13(b) of the Federal Trade

Commission Act (“FTCA”) allows courts to grant injunctions against defendants

in an action brought by the Federal Trade Commission (“FTC”) provided there is a

“proper showing that, weighing the equities and considering the Commission’s

likelihood of ultimate success, [granting the injunction] would be in the public

interest . . . .” 15 U.S.C. § 53(b) (2009).

      The district court did not abuse its discretion by adopting the Magistrate

Judge’s findings and concluding that the FTC had demonstrated a “substantial

likelihood of success on the merits” and that the equities involved support the

preliminary injunction. Klay v. United Healthgroup, Inc., 376 F.3d 1092, 1097

(11th Cir. 2004). The district court order granting the preliminary injunction is

affirmed.

B. Scope of Asset Freeze

      This court reviews an asset freeze for abuse of discretion. Commodity

Futures Trading Comm’n v. Levy, 541 F.3d 1102, 1110 (11th Cir. 2008). Bishop

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claims the district court abused its discretion by granting a preliminary injunction

that froze all of his assets,1 other than an allowance for personal expenses,

inconsistent with principles of equity.

       The FTCA’s grant of authority to issue an injunction carries the full range

of equitable remedies, among which is the power to grant restitution.2 Wilshire,

531 F.3d at 1344 (quoting Fed. Trade Comm’n v. Gem Merch. Corp., 87 F.3d 466,

468-69 (11th Cir. 1996)). Restitution is an equitable remedy designed to cure

unjust enrichment of the defendant. Id. at 1345 (citation omitted). Specifically,

restitution and disgorgement deprive the defendant of his ill-gotten gains; these

equitable remedies do not take into consideration the plaintiff’s losses. Id.

(citation omitted). The “burden for showing the amount of assets subject to

disgorgement (and, therefore available for freeze) is light: ‘a reasonable

approximation of a defendant’s ill-gotten gains [is required] . . . Exactitude is not a

requirement.’” Sec. & Exch. Comm’n v. ETS Payphones, Inc., 408 F.3d 727, 735

(11th Cir. 2005) (quoting Sec. & Exch. Comm’n v. Calvo, 378 F.3d 1211, 1217

(11th Cir. 2004)).

       1
         All of the defendant’s assets that existed on November 13, 2009 were frozen, including
assets obtained prior to the activities alleged and assets held jointly with his wife, but excluding
$9,500 per month for living expenses.
       2
        Here, the FTC seeks equitable relief, as evident from the FTC’s own complaint. (R. 1 at
13–15, ¶ 45 & Prayer for Relief).

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      The district court abused its discretion by imposing too broad of an asset

freeze without making any reasonable approximation of Defendant-Appellant’s ill-

gotten gains. Therefore, we remand this case to the district court to determine

whether the asset freeze corresponds with a reasonable approximation of Bishop’s

unjust enrichment, in accordance with equitable principles.

C. Modification of Asset Freeze

      Defendant-Appellant’s appeal from the denial of his motion to modify the

terms of the preliminary injunction is moot in light of our decision to vacate and

remand the asset freeze.

                                II. CONCLUSION

      The granting of the preliminary injunction is affirmed, the asset freeze is

vacated and remanded, and the appeal of the denial of the motion to modify the

preliminary injunction is dismissed as moot.

AFFIRMED in part, VACATED and REMANDED in part, and DISMISSED

in part.

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