IN THE UNITED STATES DISTRICT COURT FOR FEDERAL TRADE COMMISSION, Plaintiff, v. INDEPENDENT TRAVEL AGENCIES OF AMERICA, INC., a corporation; TRAVEL INDUSTRY COUNCIL, INC. a corporation; and DAVID EUGENE MUELLER, individually and as an officer of the corporation, Defendants. CIVIL ACTION CONSENT DECREE Plaintiff, the Federal Trade Commission ("Commission"), has commenced this action by filing its Complaint. The Commission and defendant David E. Mueller ("Mueller" or "the individual defendant"), represented by the attorneys listed below, have agreed to settlement of this action upon the following terms and conditions, without adjudication of any issue of fact or law, and without the individual defendant admitting liability for the offenses alleged in the Complaint. The Court, being fully advised in the premises and action upon the joint motion of the plaintiff and the individual defendant, ORDERS AND DECREES THAT: I. JURISDICTION AND VENUE A. This Court has jurisdiction over the subject matter and the parties to this case. The Complaint states a claim upon which relief may be granted against the defendants under Sections 5(a) and 13(b) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. §§ 45(a) and 53(b). B. Venue in this district is proper under 28 U.S.C. §§ 1391(b) and (c) and 15 U.S.C. § 53(b). II. DEFINITIONS For purposes of this Consent Decree, the following definitions shall apply: A. "Business opportunity" shall mean any written or oral business arrangement, however denominated, whether or not covered by the Federal Trade Commission's Trade Regulation Rule Concerning Franchising and Business Opportunity Ventures (the "Franchise Rule"), 16 C.F.R. § 436, and which consists of the payment of any consideration for (1) the right to offer, sell, or distribute goods, commodities, or services (whether or not identified by a trademark, service mark, trade name, or other commercial symbol) and/or (2) more than nominal assistance to any person or entity in connection with or incident to the establishment, maintenance, or operation of a new business or the entry by an existing business into a new line or type of business. B. "Franchise" shall mean a franchise as defined in the Franchise Rule at 16 C.F.R. § 436.2(a). III. INJUNCTION IT IS HEREBY ORDERED that: A. Defendant Mueller and any companies controlled by defendant Mueller, their successors and assigns, and their officers, 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, in connection with the marketing, promotion, sale or offering for sale of any franchise or any business opportunity, are permanently restrained and enjoined from:
B. Defendant Mueller and any companies controlled by defendant Mueller, their successors and assigns, and their officers, 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 ever violating, directly or through any corporation, subsidiary, division or other device, any provision of the Franchise Rule, 16 C.F.R. § 436, or as the Rule may hereinafter be amended. A copy of this Rule is attached hereto as Appendix A and incorporated herein as if fully set forth verbatim. C. Defendant Mueller and any companies controlled by defendant Mueller, their successors and assigns, and their officers, agents, servants, employees and attorneys, and all other persons or entities 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 permanently enjoined from selling, renting, leasing, transferring, or otherwise disclosing the name, address, telephone number, credit card number, bank account number or other identifying information of any person who paid any money to any defendant, at any time prior to entry of this Consent Decree, for information or assistance regarding opening and/or operating a travel agency; provided, however, that defendants may disclose such identifying information to a law enforcement agency or as required by court order. D. Defendant Mueller is permanently enjoined from engaging or participating, whether directly, in concert with others, or through any business entity or other device, in the marketing, promotion, sale or offering for sale of any franchise or any business opportunity relating to, regarding, or involving the travel industry. IV. ADMINISTRATION ASSISTANCE A. Nothing contained in this Consent Decree shall be construed as preventing the Commission from participating in any distribution of assets that may occur as a result of the Chapter 7 proceeding captioned In Re Travel Industry Council, Inc., Ch. 7 Case No. 94-24852 (Bankr. S.D.Fl.), pursuant to the applicable provisions of the Bankruptcy Code, 11 U.S.C. 1 et seq., and the Commission's Proof of Claim filed with the Bankruptcy Court in the above- captioned action on April 4, 1995, in the amount of $11,250,000. The individual defendant will not contest the validity or amount of the Commission's Proof of Claim, a copy of which is attached as Appendix B. B. Each party to this Consent Decree hereby agrees to bear its own costs and attorney fees incurred in connection with this action; provided, however, in the event the Commission initiates proceedings to enforce the provisions of this Consent Decree and provided further the Court determines that the individual defendant has violated any term or provision of this Consent Decree, defendant Mueller shall pay the costs and attorneys fees incurred by the Commission in connection with proceedings to enforce this Consent Decree. C. Defendant Mueller further agrees that the facts as alleged in the Complaint filed in this matter on February 13, 1995, shall be taken as true in any subsequent litigation filed by the Commission to enforce its rights pursuant to this Consent Decree, including but not limited to a nondischargeability complaint in any subsequent related bankruptcy proceeding. D. Defendant Mueller shall aid and assist the Commission or its designated agent, without compensation and in any manner reasonably requested in writing by Commission staff, in the administration of this Consent Decree. Such aid and assistance may include but is not limited to:
E. IT IS FURTHER ORDERED that, within three (3) business days after the date of entry of this Consent Decree, the individual defendant shall submit to the Commission a truthful sworn statement, in the form shown on Appendix C to this Consent Decree, that shall reaffirm and attest to the truthfulness, accuracy, and completeness of the financial statements that were executed by the individual defendant on March 18 and 29, 1996. The Commission's agreement to this Consent Decree is expressly premised upon the truthfulness, accuracy and completeness of the defendants’ financial condition as represented in the financial statements referenced above, which contain material information upon which the Commission relied in negotiating and agreeing to the terms of the Consent Decree. If, upon motion by the Commission, this Court finds that the individual defendant failed to file the sworn statement required by this Paragraph, or filed financial statements that failed to disclose any material asset, or materially misrepresented the value of any asset, or made any other material misrepresentation in or omission from the financial statements, the Commission may request that the judgment herein be reopened for the purpose of modifying the amount and/or the terms of the Decree with respect to redress; provided, however, that in all other respects this judgment shall remain in full force and effect unless otherwise ordered by the Court; and, provided further, that proceedings instituted under this Paragraph are 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 Consent Decree. For the purpose of this paragraph, the individual defendant waives the right to contest any of the allegations of the complaint. V. REPORTING REQUIREMENTS IT IS FURTHERED ORDERED that: A. For a period of five (5) years from the date of this Consent Decree, the individual defendant shall maintain, preserve and make available for examination and copying by a duly authorized representative of the Commission, upon reasonable notice, during normal business hours, any books, accounts, written materials or other records reasonably necessary to assess the individual defendant's compliance with this Consent Decree. B. For a period of five (5) years from the date of this Consent Decree, the individual defendant shall notify the Commission in writing of each new affiliation with a business or employment, including self-employment, within seven (7) calendar days of such affiliation or employment. Each such notice shall include defendant Mueller's current business address and a statement of the nature of the business affiliation or employment that defines his duties and responsibilities in connection with such business affiliation or employment. In the event of any material change in the foregoing information within the said five-year period, defendant Mueller shall notify the Commission in writing within ten (10) calendar days of the change. C. Defendant Mueller authorizes the Commission to verify all information provided on the financial disclosure form with all appropriate third parties, including but not limited to financial institutions. D. Within ninety (90) days after the entry of this Consent Decree, the individual defendant shall file with the Commission a report stating the fact and manner of his compliance with this Consent Decree. E. All written notices that the individual defendant is required to provide to the Commission shall be mailed to:
VI. COMPLIANCE WITH OTHER STATE OR FEDERAL LAWS IT IS FURTHER ORDERED, that nothing herein shall relieve the individual defendant of any obligations respecting contracts required by the law of the state in which the contract is made or federal law. VII. CONTINUING JURISDICTION The 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 imposition of punishment or other sanctions for violations thereof. JUDGMENT IS THEREFORE ENTERED in favor of plaintiff, the Federal Trade Commission, and against defendant, David E. Mueller, under the terms and conditions set forth herein, each party to bear its own costs and attorney's fees.
___________________ The parties, by their respective Counsel, hereby consent to the terms and conditions of the judgment as set forth above and consent to the entry hereof.
_____________________ APPENDIX A [FRANCHISE RULE] APPENDIX B [PROOF OF CLAIM] APPENDIX C IN THE UNITED STATES DISTRICT COURT FOR FEDERAL TRADE COMMISSION, Plaintiff, v. INDEPENDENT TRAVEL AGENCIES OF AMERICA, INC., a corporation; TRAVEL INDUSTRY COUNCIL, INC. a corporation; and DAVID EUGENE MUELLER, individually and as an officer of the corporation, Defendants. CIVIL ACTION CONSENT DECREE DECLARATION OF DAVID EUGENE MUELLER I, David Eugene Mueller, hereby state that the information contained in the financial statements and related papers provided to the Federal Trade Commission on March 18 and 29, 1996 was true, accurate and complete at such time. A copy of the aforementioned financial statements and related papers is attached hereto as Appendix C-1. I declare under penalty of perjury that the foregoing is true and correct. Executed on ____________________ _______________________ APPENDIX C-1 [FINANCIAL DISCLOSURE OF INDIVIDUAL DEBTOR FORMS] |