ROBERT S. MUELLER, III
United States Attorney
Northern District of California

Assistant United States Attorney
450 Golden Gate Ave., Box 36055
San Francisco, CA. 94102
(415) 436-7200

IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA, Plaintiff,

v.

FRANKLIN W. BISHOP, an individual doing business as Minidiscnow.com, Defendant.

CASE NO.

CONSENT DECREE AND ORDER FOR INJUNCTIVE AND OTHER RELIEF

WHEREAS plaintiff, the United States of America, has commenced this action by filing the Complaint herein; defendant has waived service of the Summons and Complaint; the parties have been represented by the attorneys whose names appear hereafter; and the parties have agreed to settlement of this action upon the following terms and conditions, without adjudication of any issue of fact or law and without defendant admitting liability for any of the matters alleged in the Complaint;

THEREFORE, on the joint motion of plaintiff and defendant, it is hereby ORDERED, ADJUDGED, and DECREED as follows:

1. This Court has jurisdiction of the subject matter and of the parties.

2. The Complaint states a claim upon which relief may be granted against the defendant under Sections 5(a)(1), 5(m)(1)(A), 13(b), 16(a) and 19 of the Federal Trade Commission Act, 15 U.S.C. 45(a)(1), 45(m)(1)(A), 53(b), 56(a) and 57b.

DEFINITION

For the purposes of this Consent Decree, the term "Mail Order Rule" means the Federal Trade Commission's Trade Regulation Rule Concerning Mail or Telephone Order Merchandise, 16 C.F.R. Part 435, or as the Rule may hereafter be amended.

CONSUMER REDRESS

1. Defendant Franklin W. Bishop, his successors and assigns, shall, within fifteen (15) business days after service of this Order, compile from regularly kept business records of the defendant a list containing, for each buyer who has ordered and paid for but not received shipment of any item of merchandise by the date of service of this Order, his or her name, last known address, and the total purchase price paid for all items of merchandise ordered, including, all charges for applicable taxes. Defendant shall, within thirty (30) calendar days after service of this Order, reimburse each buyer on this list.

INJUNCTION

2, Defendant, his successors and assigns, and his agents, servants, employees and attorneys, and all persons in active concert or participation with any one or more of them who receive actual notice of this Consent Decree by personal service or otherwise, are hereby enjoined from violating, directly or through any corporation, subsidiary, division or other device, any provision of the Mail Order Rule, including but not limited to:

a. Soliciting orders for the sale of telephone or mail order merchandise unless they have a reasonable basis to expect that they could ship such merchandise within the time stated in the solicitation or, if no time is stated clearly and conspicuously in the solicitation, within thirty (30) days after receipt of a properly completed order, as required by 16 C.F.R.  435.1(a)(1);
 
b. Providing to the buyer a revised shipping date unless they have a reasonable basis for making such representation, as required by 16 C.F.R.  435.1(a)(2);
 
c. Failing 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 order and receive a prompt refund, as required by 16 C.F.R.  435.1(b)(1); and
 
d. Failing to deem an order canceled and make a prompt refund to buyers who are entitled to such refunds under the Rule, as required by 16 C.F.R.  435.1(c).

3. In the event the Mail Order Rule is hereafter amended or modified, defendant's compliance with that Rule as so amended or modified shall not be deemed a violation of this injunction. A copy of the Mail Order Rule is attached hereto as "Appendix A" and incorporated herein as if fully set forth verbatim.

COMPLIANCE

4. Defendant shall, within thirty (30) days of the entry of this Consent Decree, provide a copy of this Consent Decree, the Mail Order Rule, and the Statement of Basis and Purpose for that Rule to each of his agents, servants, employees and attorneys, secure from each such person a signed statement acknowledging receipt of a copy of this Consent Decree, and shall, within ten (10) days of complying with this paragraph, file an affidavit with the Regional Director, Western Region, Federal Trade Commission, 901 Market Street, San Francisco, CA 94103, setting forth the fact and manner of his compliance, including the name and title of each person to whom a copy of the Consent Decree has been provided.

5. For a period of five (5) years from the date of entry of this Consent Decree, defendant, his successors and assigns, shall maintain and make available to the Federal Trade Commission, within seven (7) days of the date of receipt of a written request, business records demonstrating compliance with the terms and provisions of this Consent Decree.

6. Defendant shall, for a period of ten (10) years from the date of entry of this Consent Decree, notify the Regional Director, Western Region, Federal Trade Commission, 901 Market Street, San Francisco, CA 94103, within thirty (30) days of each affiliation with a new business or employment whose activities include the mail or telephone order sale of merchandise, or of his affiliation with a new business or employment in which his own duties and responsibilities involve the mail or telephone order sale of merchandise.

7. One hundred eighty (180) days after entry of this Order, defendant shall provide a written report to the Federal Trade Commission, sworn to under penalty of perjury, setting forth in detail the manner and form in which the defendant has complied and is complying with this Order. This report shall include but not be limited to:

a. a specimen copy of each delay option notice used for purposes of complying with any provision of the Mail Order Rule, and a statement setting forth in detail the procedures in place for providing such notices;
 
b. a specimen copy of each advertisement containing a shipping representation;
 
c. a statement setting forth in detail defendant's procedures for providing prompt refunds pursuant to the Mail Order Rule; and
 
d. a statement setting forth in detail the basis for claiming that defendant will by able to ship merchandise:
 
i. within the time stated in any advertisement;
 
ii. within thirty (30) days, where no time is stated clearly and conspicuously in any advertisement.
 
e. a statement setting forth in detail the manner and form in which defendant has satisfied all redress obligations required by this Order, including, but not limited to, a copy of the list compiled pursuant to Paragraph 1 of this Order, and the amount of redress paid to each consumer on this list.

Defendant shall mail this written notification to: the Regional Director, Western Region, Federal Trade Commission, 901 Market Street, San Francisco, CA 94103.

8. Defendant is hereby required, in accordance with 31 U.S.C.  7701, to furnish to the Federal Trade Commission his taxpayer identifying number (social security number or employer identification number), which shall be used for purposes of collecting and reporting on any delinquent amount arising out of his relationship with the government.

CONTINUING JURISDICTION

9. This Court shall retain jurisdiction of this matter for the purposes of enabling any of the parties to this Consent Decree to apply to the Court at any time for such further orders or directives as may be necessary or appropriate for the interpretation or modification of this Consent Decree, for the enforcement of compliance therewith, or for the punishment of violations thereof.

JUDGMENT IS THEREFORE ENTERED in favor of plaintiff and against defendant, pursuant to all the terms and conditions recited above.

Dated this ___ day of _____, 20__.

UNITED STATES DISTRICT JUDGE

The parties, by their respective counsel, hereby consent to the terms and conditions of the Consent Decree as set forth above and consent to the entry thereof. Defendant waives any rights that may arise under the Equal Access to Justice Act, 28 U.S.C. 2412, concerning the investigation and prosecution of this action.

FOR THE UNITED STATES OF AMERICA:

DAVID W. OGDEN
Acting Assistant Attorney General
Civil Division
U.S. Department of Justice

ROBERT S. MUELLER, III
United States Attorney
Northern District of California

Assistant United States Attorney
450 Golden Gate Ave., Box 36055
San Francisco 94102
(415) 436-7200

EUGENE THIROLF
Director
Office of Consumer Litigation

_________________________________


Attorney
Office of Consumer Litigation
Civil Division
U.S. Department of Justice
Washington, D.C. 20530

FOR THE FEDERAL TRADE COMMISSION:

_________________________________
JEFFREY KLURFELD
Regional Director
Western Region
Federal Trade Commission

_________________________________
LINDA K. BADGER
MATTHEW D. GOLD
Attorneys
Western Region
Federal Trade Commission
901 Market Street, Suite 570
San Francisco, CA 94103
(202) 356-5266

FOR THE DEFENDANT:

___________________________________
FRANKLIN W. BISHOP