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UNITED STATES DISTRICT COURT
v. MODEL 1, INC., a Virginia corporation, Civil Action No. COMPLAINT FOR PERMANENT
INJUNCTION Plaintiff, the Federal Trade Commission ("FTC" or "the Commission"), by its undersigned attorneys, alleges as follows: 1. The Commission brings this action under Section 13(b) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. § 53(b), to secure preliminary and permanent injunctive relief, rescission of contracts, restitution, disgorgement, and other equitable relief for defendants' deceptive acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).JURISDICTION AND VENUE 2. This Court has subject matter jurisdiction over this matter pursuant to 28 U.S.C. §§ 1331, 1337(a) and 1345 and 15 U.S.C. §§ 45(a) and 53(b).3. Venue in the United States District Court for the Eastern District of Virginia is proper under 28 U.S.C. § 1391(b) and (c), and 15 U.S.C. § 53(b). PLAINTIFF 4. Plaintiff, the Federal Trade Commission, is an independent agency of the United States Government created by statute. 15 U.S.C. §§ 41 et seq. The Commission is charged, inter alia, with enforcement of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), which prohibits unfair or deceptive acts or practices in or affecting commerce. The Commission is authorized to initiate federal district court proceedings, by its own attorneys, to enjoin violations of the FTC Act in order to secure such equitable relief as may be appropriate in each case. 15 U.S.C. § 53(b).DEFENDANTS 5. Defendant Model 1, Inc. ("Model 1") is a Virginia corporation. Its principal place of business is 8150 Leesburg Pike, Tysons Corner, Virginia, 22101. Model 1 transacts business within the Eastern District of Virginia. Model 1 advertises and promotes its services to consumers in Virginia, Maryland and the District of Columbia. Model 1 was incorporated in June 1998.6. Defendant Creative Talent Management, Inc. ("Creative") is a Virginia corporation, formerly named Creative Artists, Inc., and Erickson Talent Management, Inc. Its principal place of business is 8501-1 Tyco Road, Vienna, Virginia 22182. Creative transacts business within the Eastern District of Virginia. Creative advertises and promotes its services to consumers in Virginia, Maryland and the District of Columbia. Since June 1998, when Model 1 was incorporated, Creative has referred potential customers to Model 1. 7. Defendant The Erickson Agency, Inc. ("Erickson Agency") is a Virginia corporation. Its principal place of business is 1491 Chain Bridge Road, McLean, Virginia, 22101. Erickson Agency transacts business within the Eastern District of Virginia. Erickson Agency is represented as the primary job placement resource for Creative or Model 1 graduates. 8. The foregoing defendant corporations, Model 1, Creative and Erickson Agency (hereinafter called "Model 1"), operate a common enterprise to induce consumers to purchase their talent management services. 9. Defendant Jason Hoffman is the president of Model 1. He also is a Supervisor of Creative. In connection with the matters alleged herein, he transacts business in the Eastern District of Virginia. Individually or in concert with others, he has formulated, directed, controlled or participated in the acts and practices of the corporate defendants, including the acts and practices set forth in this complaint. 10. Defendant Ralph Edward Bell is the president of Creative. He is the husband or former husband of defendant Patricia Erickson, the president of Erickson Agency. In connection with the matters alleged herein, he transacts business in the Eastern District of Virginia. Individually or in concert with others, he has formulated, directed, controlled or participated in the acts and practices of the corporate defendants, including the acts and practices set forth in this complaint. 11. Defendant Patricia Erickson is the founder and president of Erickson Agency and the founder and former president of Creative. She is the wife or former wife of defendant Ralph Edward Bell, president of Creative. In connection with the matters alleged herein, she transacts business in the Eastern District of Virginia. Individually or in concert with others, she has formulated, directed, controlled or participated in the acts and practices of the corporate defendants, including the acts and practices set forth in this complaint. COMMERCE 12. At all times relevant to this complaint, the defendants have maintained a substantial course of trade in the advertising, promotion, offering for sale and sale of talent management services for aspiring models or actors in or affecting commerce, as "commerce" is defined in Section 4 of the FTC Act, 15 U.S.C. § 44.DEFENDANTS' BUSINESS ACTIVITIES 13. Defendants purport to provide talent management services including "jobs, job placement, industry training, photography and agency placement." Defendants represent that they are highly selective in scouting, screening and reviewing consumers for marketability as models and actors. Defendants' talent scouts approach prospective consumers in public places and represent that they have been selected to interview with Model 1 because they have special characteristics or the "look" that significantly increases their prospects for finding work as a model or actor. Defendants' talent scouts tell consumers that they need to attend an interview at Model 1 to obtain modeling or acting assignments. Defendants' talent scouts give consumers a promotional brochure that contains the following representations:14. When consumers attend an interview at Model 1, a person, who is identified as a Vice President of Talent Management, informs the consumer that he will recommend the consumer for talent management services but that a committee of industry experts will make the final selection. The Vice President also tells the consumer that, as a prerequisite for agency representation, the consumer must take modeling and acting training from Model 1. Defendants represent that their modeling and acting workshops have a limited enrollment and that only ten percent of consumers interviewed are accepted for this training. Defendants further represent that consumers must pay a deposit for the workshops which is fully refundable if the consumer is not accepted by defendants' review committee. 15. Defendants represent to consumers that they are likely to obtain substantial paid employment as models or actors if they are selected for Model 1 talent management services. Defendants tell consumers that they have numerous well-known client businesses, organizations and entertainment entities, such as The Hecht Company, Marlo Furniture, the American Association of University Women and Bell Atlantic, who hire models and actors defendants manage for paid employment. Defendants also claim to have provided casting services on numerous film productions, including, but not limited to, True Lies and Dave. 16. Defendants claim to derive their income primarily by retaining a portion of the money paid by their clients to models and actors defendants represent. Consumers are told "the way we get paid here is percentages." Model 1 tells consumers that, after they complete the training workshops, they will be represented by the Erickson Agency or another reputable agency responsible for obtaining lucrative modeling and acting job assignments for Model 1 models and actors. By these representations, defendants induce consumers to purchase expensive talent management services sold by Model 1. VIOLATIONS OF SECTION FIVE OF THE FTC ACT COUNT I 17. Defendants represent, expressly or by implication, that their talent management services are highly selective in scouting, screening and reviewing consumers for marketability as models or actors.18. In truth and in fact, defendants' talent management services are not selective in scouting, screening and reviewing consumers for marketability as models or actors. 19. Therefore, defendants' representations, as set forth in paragraph 17 above, are false and deceptive, in violation of Section 5 of the FTC Act, 15 U.S.C. § 45. COUNT II 20. Defendants represent, expressly or by implication, that consumers selected for talent management services are likely to obtain substantial paid employment as models or actors through defendants' efforts.21. In truth and in fact, consumers selected for talent management services are unlikely to obtain substantial paid employment as models or actors through defendants' efforts. 22. Therefore, defendants' representations, as set forth in paragraph 20 above, are false and deceptive, in violation of Section 5 of the FTC Act, 15 U.S.C. § 45. COUNT III 23. Defendants represent, expressly or by implication, that Model 1's principal source of income is commissions on the fees paid by its clients to Model 1 models and actors.24. In truth and in fact, defendants' principal source of income is not client-paid commissions but fees paid by consumers for their talent management services, including modeling and acting training. 25. Therefore, defendants' representations, as set forth in paragraph 23 above, are false and deceptive, in violation of Section 5 of the FTC Act, 15 U.S.C. § 45. CONSUMER INJURY 26. Defendants' violations of Section 5 of the FTC Act, as set forth above, have caused and continue to cause substantial injury to consumers. Absent injunctive relief by this Court, defendants are likely to continue to injure consumers and harm the public interest.THIS COURT'S POWER TO GRANT RELIEF 27. Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), empowers this Court to issue a permanent injunction and to grant other ancillary relief, including consumer redress, disgorgement and restitution, to prevent and remedy violations of any provision of the law enforced by the FTCPRAYER FOR RELIEF WHEREFORE, plaintiff requests that this Court, as authorized by Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), and pursuant to its own equitable powers:
DATED: DEBRA VALENTINE CONNIE WAGNER DATED: _____________________ ____________________________
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