UNITED STATES DISTRICT COURT
Plaintiff, the Federal Trade Commission ("Commission" or "FTC"), filed a complaint for a permanent injunction and other relief, including restitution to consumers, pursuant to Section 13(b) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. § 53(b), alleging that defendants have violated Section 5(a) of the FTC Act and the FTC's Trade Regulation Rule entitled "Disclosure Requirements and Prohibitions Concerning Franchising and Business Opportunity Ventures ("the Franchise Rule"), 16 C.F.R. Part 436. Defendants, Touchnet, Inc. ("Touchnet"), Touchtone Telecommunications & Advertising, Inc. ("Touchtone"), Eric Carino, and Malissa Carino, and plaintiff, by and through its counsel, have agreed to entry of this Stipulated Final Order and Judgment ("Order"), without trial or adjudication of any issue of law and fact.
NOW THEREFORE, plaintiff and defendants having requested the Court to enter this Order, it is ORDERED, ADJUDGED, AND DECREED as follows:
A. This Court has jurisdiction over the subject matter of this action and the parties hereto;
B. The complaint states a claim upon which relief may be granted against defendants under Sections 5(a) and 13(b) of the FTC Act, 15 U.S.C. §§ 45(a) and 53(b);
C. Defendants have waived all rights to seek judicial review or otherwise to challenge or contest the validity of this Order;
D. This Order does not constitute and shall not be interpreted to constitute either an admission by defendants or a finding by the Court that defendants have engaged in violations of the FTC Act or the Franchise Rule; and
E. Entry of this Order is in the public interest.
For purposes of this Order, the following definitions shall apply:
IT IS THEREFORE ORDERED that defendants are hereby permanently restrained and enjoined from engaging, participating, or assisting in any manner or in any capacity whatsoever in the advertising, marketing, promoting, offering for sale or selling of any business opportunity, franchise or business venture, whether directly or indirectly, in concert with others, or through any intermediary, business entity or device.
IT IS FURTHER ORDERED that defendants, in connection with the advertising, marketing, promoting, offering for sale or selling of any goods and services, are hereby permanently restrained and enjoined from making, or assisting in the making, either orally or in writing, expressly or by implication, any false or misleading statements or representations of fact to any person about the following:
IT IS FURTHER ORDERED that defendants shall:
IT IS FURTHER ORDERED that defendants, within three (3) business days from the date this Order is entered, shall submit to the Commission sworn statements, in the form shown in Attachment C to this Order, that reaffirm and attest to the truthfulness, accuracy, and completeness of the defendants' financial statements that were executed on February 12, 1998 (designated the "Financial Statements"). The Commission's agreement to this Order 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 this Order. If, upon motion by the Commission, this Court finds that any defendant failed to file the sworn statement required by this Paragraph, or filed a Financial Statement that failed to disclose any material asset, materially misrepresented the value of any asset, or made any other material misrepresentation in or omission from the Financial Statement, the judgment herein shall be reopened for the purpose of determining an appropriate amount for that defendant to pay as redress; provided, however, that in all other respects, this Order shall remain in full force and effect unless otherwise ordered by this Court.
IT IS FURTHER ORDERED that defendants, for a period of five (5) years from the date this Order is entered, and upon reasonable written notice from the Commission, shall permit duly authorized representatives of the Commission, without restraint or interference from defendants:
The Commission may otherwise monitor defendants' compliance with this Order by all lawful means available including, but not limited to, the use of investigators posing as consumers, potential investors, suppliers, and other entities.
IT IS FURTHER ORDERED that, for a period of five (5) years from the date this Order is entered:
IT IS FURTHER ORDERED that defendants, within 180 days from the date this Order is entered, shall file with the Commission a written report setting forth in detail the manner and form in which they have complied with this Order.
IT IS FURTHER ORDERED that all notices and reports of defendants required by this Order shall be made to the following address:
IT IS FURTHER ORDERED that this Court shall retain jurisdiction of this matter for all purposes.
SO ORDERED, this day of , 1998.
The Honorable Barbara Rothstein
The parties hereby stipulate and agree to the terms and conditions set forth above and consent to entry of this Stipulated Final Order and Judgment. Defendants waive any rights that may arise under the Equal Access to Justice Act, 28 U.S.C. § 2412, amended by Pub. L. 104-121, 110 Stat. 847, 863-64 (1996).
FOR PLAINTIFF FEDERAL TRADE COMMISSION:
Joe Lipinsky, WSBA #25446
FOR THE DEFENDANTS:
By: Eric Carino, President
TOUCHTONE TELECOMMUNICATIONS &
By: Eric Carino, President
Our records indicate that you purchased a [pay-per-call 900 number, prepaid telephone card or Internet consulting] business opportunity with our company between January 1, 1995, and [date -- 10 days after Order is entered].
Pursuant to an agreement we reached with the Federal Trade Commission settling allegations that we misrepresented the business opportunity, franchise or business venture we sold, we have agreed to cease collection efforts on any monies you owe and may owe us for the purchase of the [pay-per-call 900 number, prepaid telephone card or Internet consulting] business opportunity.
Therefore, you are no longer contractually obligated to pay us any more money under your contract.