UNITED STATES DISTRICT COURT
STIPULATED FINAL JUDGMENT AND ORDER FOR PERMANENT INJUNCTION AS TO DEFENDANTS SURECHEK SYSTEMS, INC. and DOUGLAS S. DERICKSON Plaintiffs, Federal Trade Commission ("FTC" or "Commission"), and the State of Arkansas have filed a complaint pursuant to Sections 13(b) and 19 of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. §§ 53 (b) and 57b, and Section 6(b) of the Telemarketing and Consumer Fraud and Abuse Prevention Act, 15 U.S.C. § 6105(b), charging the defendants in this action with violations of Section 5 of the FTC Act, 15 U.S.C. § 45, and with violations of the FTC's Telemarketing Sales Rule, 16 C.F.R. Part 310. The plaintiffs, by and through their counsel, and defendants, SureCheK Systems, Inc. and Douglas S. Derickson have agreed to the entry of this Stipulated Final Judgment and Order for Permanent Injunction ("Final Judgment") by this Court in order to resolve all matters in dispute in this action involving defendants SureCheK Systems, Inc. and Derickson. Except as noted in the "Findings" (Section II - Paragraphs 4 - 13 set out below), the plaintiffs and defendants SureCheK Systems, Inc. and Derickson have consented to the entry of this final judgment without trial or adjudication of any issue of law or fact herein. Being fully advised in the premises and acting upon the joint motion of the parties, SureCheK Systems, Inc., Derickson, the Commission, and the State of Arkansas, to enter this Final Judgment, IT IS HEREBY ORDERED, ADJUDGED AND DECREED AS FOLLOWS: I. DEFINITIONS For purposes of this Final Judgment, the following definitions shall apply: 1. "Telemarketing" shall mean a plan, program, or campaign which is conducted to induce the purchase of goods or services by use of one or more telephones and which involves more than one interstate telephone call. 2. "Material" means likely to affect a person's choice of, or conduct regarding, goods or services. 3. "Final Judgment" means this Stipulated Final Judgment and Order for Permanent Injunction. II. FINDINGS 4. This Court has jurisdiction of the subject matter of this action and of defendants SureCheK Systems, Inc. and Derickson; 5. The Complaint states a claim upon which relief may be granted against defendants SureCheK Systems, Inc. and Derickson under Sections 5, 13(b) and 19(a) of the FTC Act, 15 U.S.C. §§ 45, 53(b) and 57b, and under Section 6(b) of the Telemarketing and Consumer Fraud and Abuse Prevention Act, 15 U.S.C. § 6105(b); 6. Venue in this district is proper under 28 U.S.C. § 1391(b) and (c), and 15 U.S.C. § 53(b); 7. Entry of this Final Judgment is in the public interest; 8. The acts and practices of defendants were in or affecting commerce, as "commerce" is defined in Section 4 of the FTC Act, 15 U.S.C. § 44; 9. Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), empowers this Court to grant injunctive and other ancillary relief, including consumer redress, disgorgement, and restitution, to prevent and remedy any violations of any provision of law enforced by the Commission; 10. Section 19 of the FTC Act, 15 U.S.C. § 57b, authorizes this Court to grant such relief as the Court finds necessary to redress injury to consumers or other persons resulting from defendants' violations of the Telemarketing Sales Rule, including the rescission or reformation of contracts, and the refund of money; 11. Section 4(a) of the Telemarketing Act, 15 U.S.C. § 6103(a), authorizes the Court to grant to the State of Arkansas, on behalf of its residents, injunctive and other equitable relief, including damages, restitution, other compensation, and such further and other relief the Court deems appropriate; 12. This Court, in the exercise of its equitable jurisdiction, may award other ancillary relief to remedy injury caused by the defendants' law violations; and 13. Defendants have waived all claims under the Equal Access to Justice Act, 28 U.S.C. § 2412, and all rights to seek judicial review or otherwise challenge or contest the validity of this Final Judgment. III. ORDER - INJUNCTION 14. IT IS THEREFORE ORDERED that defendants SureCheK Systems, Inc. and Derickson, in connection with the advertising, offering for sale, sale, or distribution of any good or service, are hereby permanently restrained and enjoined from:
15. IT IS FURTHER ORDERED that defendants SureCheK Systems, Inc. and Derickson are hereby permanently restrained and enjoined from violating any provision of the Telemarketing Sales Rule, 16 C.F.R. Part 310, including but not limited to:
16. IT IS FURTHER ORDERED that defendants SureCheK Systems, Inc. and Derickson are hereby permanently restrained and enjoined from providing to any person, except agents of the Commission or other law enforcement authorities, the name, address, telephone number, Social Security number or credit card or bank account number of any person who engaged in a telemarketing transaction with any of the defendants named in this action. 17. IT IS FURTHER ORDERED that for a period of five (5) years, commencing with the date of entry of this Final Judgment, defendants SureCheK Systems, Inc. and Derickson and their assigns, agents, servants, and employees, and those persons in active concert or participation with any of them who receive actual notice of this Final Judgment by personal service or otherwise, whether acting directly or through any corporation, subsidiary, division, trust, investment, or other device, are hereby restrained and enjoined from creating, operating or controlling any business entity, including any partnership, limited partnership, joint venture, sold proprietorship, or corporation, without first providing the plaintiffs with a written statement disclosing (1) the name of the business entity, (2) the address and telephone number of the business entity, (3) the names of the business entity's officers, directors, principals, managers and employees, and (4) a detailed description of the business entity's proposed activities. IV. ORDER - COMPLIANCE 18. IT IS FURTHER ORDERED that, in order to facilitate the monitoring of compliance with the provisions of this Permanent Injunction, defendant Derickson shall, for a period of five (5) years commencing with the date of entry of this Final Judgment:
19. IT IS FURTHER ORDERED that, in order to facilitate the monitoring of compliance with the provisions of this Permanent Injunction, defendants SureCheK Systems, Inc. and Derickson shall, for a period of five (5) years commencing with the date of entry of this Final Judgment:
20. IT IS FURTHER ORDERED that the plaintiffs' agreement to this Final Judgment is expressly premised upon the truthfulness, accuracy, and completeness of defendants' financial condition as represented to counsel for the Commission in the financial statements provided by defendants to counsel for plaintiffs on July 28, 1997, and in the sworn deposition testimony given by defendant Derickson on September 18, 1997, which contain material information upon which the plaintiffs relied in negotiating and agreeing to the amount and/or terms of the redress payment stated in the Final Judgment. If, upon motion by the Commission or the State of Arkansas, this Court finds that defendants SureCheK Systems, Inc. or Derickson 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 or in the deposition of defendant Derickson taken by the Commission, the Final Judgment herein shall be reopened for the purpose of modifying the amount and/or terms of the redress payment; provided, however, that in all other respects this Final 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 or the State of Arkansas may initiate to enforce this Final Judgment. Defendants SureCheK Systems, Inc. and Derickson further authorize the Commission and the State of Arkansas to verify all information provided in the financial statements with all appropriate third parties, including but not limited to financial institutions. 21. IT IS FURTHER ORDERED that all notices required of defendant Derickson by this Final Judgment shall be mailed to the following address:
V. ORDER - EQUITABLE MONETARY RELIEF 22. IT IS FURTHER ORDERED that:
VI. ORDER - SUBSEQUENT PROCEEDINGS 23. IT IS FURTHER ORDERED that defendants SureCheK Systems, Inc. and Derickson agree that the facts as alleged in the Complaint filed with this Final Judgment shall be taken as true in any subsequent litigation filed by the Federal Trade Commission or the State of Arkansas to enforce their rights pursuant to this Final Judgment, including but not limited to a nondischargeability complaint in any subsequent bankruptcy proceeding. 24. IT IS FURTHER ORDERED that each party to this Final Judgment hereby agrees to bear its own costs and attorneys' fees incurred in connection with this action; provided, however, in the event the Federal Trade Commission or the State of Arkansas initiate proceedings to enforce the provisions of this Final Judgment, and provided further, that the Court determines that the defendants SureCheK Systems, Inc. or Derickson violated any terms or provisions of this Final Judgment, the defendants shall pay the costs and attorneys' fees incurred by the Federal Trade Commission or the State of Arkansas in connection with proceedings to enforce this Final Judgment. 25. IT IS FURTHER ORDERED that this action and the relief awarded herein is in addition to and not in lieu of other remedies as may be provided by law including both civil and criminal remedies. Nothing in this final order shall be construed as a waiver of private rights, causes of action, or remedies that any person may have against defendants SureCheK Systems, Inc. and Derickson with respect to the business practices addressed by this Final Judgment. 26. IT IS FURTHER ORDERED that this Court shall retain jurisdiction of this matter for all purposes, including but not limited to the enforcement of compliance with the Final Judgment, or the punishment of violations thereof. SO ORDERED, this _________ day of ___________________, 1998. The parties hereby stipulate and agree to the terms and conditions set forth above and consent to entry of this Final Judgment. For Plaintiffs the Federal Trade Commission and the State of Arkansas Dated: __________ ____________________________________ Dated: __________ ____________________________________ For Defendants SureCheK Systems, Inc. and Douglas S. Derickson ___________________________________ Dated: __________ ___________________________________ |