IN THE UNITED STATES DISTRICT COURT FEDERAL TRADE COMMISSION, Plaintiff, v. ONE OR MORE UNKNOWN PARTIES DECEIVING CONSUMERS INTO CALLING AN INTERNATIONAL AUDIOTEXT SERVICE ACCESSED THROUGH TELEPHONE NUMBER (767) 445-1775, Defendant(s). Civil Action No. COMPLAINT FOR PERMANENT INJUNCTION AND OTHER
EQUITABLE RELIEF Plaintiff, the Federal Trade Commission ("FTC" or "the Commission"), for its complaint alleges as follows: NATURE OF THIS ACTION 1. This is an action by the Federal Trade Commission, pursuant to its statutory authority, to enjoin a widespread deceptive trade practice and to obtain redress for injured consumers or to compel disgorgement of ill gotten gains. The identity of the defendant or defendants is not yet known because the defendant(s) use sophisticated means to hide their identities. Defendant(s) are involved in some aspect of the international audiotext business. Accordingly, defendant(s) profit every time a person calls an international number in which they have a proprietary interest. Defendant(s) have profited from systematically deceiving consumers into calling one such number in which they have a proprietary interest, (767) 445-1775. JURISDICTION AND VENUE 2. This Court has 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 Western District of North Carolina 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, inter alia, enforces Section 5(a) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. § 45(a), which prohibits unfair or deceptive acts or practices in or affecting commerce. The Commission has the authority 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), 56(a)(2). 5. The Commission brings this action under Section 13(b) of the 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 defendant(s)' deceptive and unfair acts and practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a). DEFENDANT(S) 6. The defendant(s) are one or more individuals or entities whose identities and addresses are unknown to the Commission at this time. The defendant(s) transact business in the Western District of North Carolina. COMMERCE 7. At all times relevant to this complaint, defendant(s) have maintained a substantial course of trade, advertising, offering for sale and selling information via both the Internet and international telephone lines, in or affecting commerce as "commerce" is defined in Section 4 of the FTC Act, 15 U.S.C. § 44. DEFENDANT(S)' COURSE OF BUSINESS 8. The defendant(s) are involved in the international audiotext business, i.e, providing information or entertainment over the telephone to consumers who dial an international telephone number. Through a complex set of agreements among numerous parties (including domestic and foreign telephone companies, their agents, resellers of international telephone services, and other intermediaries), all participants in the international audiotext business profit from the volume of calls to specified international telephone numbers. Consumers are billed international long distance rates for the international audiotext telephone calls. The domestic and foreign telephone companies yield to the participants in the international audiotext business portions of the revenues generated by those calls in return for the increased traffic which the audiotext business brings to their telephone systems. In this case, the defendant(s) are the currently unknown participant(s) in the international audiotext business, who are the perpetrators of a scheme (hereinafter defendant(s) shall be referred to as "UNKNOWN PERPETRATORS"), which lasted from at least October 1998 to March 1999, that deceived consumers into calling one particular adult entertainment service connected to telephone number (767) 445-1775 ("Telephone Number"). 9. The Telephone Number connects to the Caribbean island nation of Dominica. It is not known whether UNKNOWN PERPETRATOR(S) reside in Dominica, the United States, another country, or some combination thereof. Defendant(s) send out unsolicited e-mail inducing consumers to call the Telephone Number using, among others, the following e-mail addresses: EZRide1978@aol.com, GHawth7781@aol.com, RDRD6669BCC@aol.com, BPACN@aol.com, RTCT5@aol.com, DDCNG341@aol.com, Jnabliss@aol.com, JVaca14728@aol.com, I82ND7761@aol.com, Afis432225@aol.com, LCJTJ@aol.com, CChapa@aol.com, Davidatp@aol.com, TMJTBogit@aol.com, DM4165@aol.com, DMP6757@aol.com, Mochoney@aol.com, LisaM98501@aol.com, Dmw1109@aol.com, JSDJHI@aol.com, Mariacary1@aol.com, BLkapple@aol.com, BIGNOISE31@aol.com, KCSuga@aol.com, BTHURE38@aol.com, Smp67@aol.com, BeachB6689@aol.com, Ravin70@aol.com, TMspwa@aol.com, and Sn4963@aol.com. In numerous instances, consumers are unable to reply to these addresses because the addresses have been forged. 10. Consumers who call the Telephone Number are unlikely to be aware that it is an international number located in Dominica since they can dial it directly without entering a country code. When called, the Telephone Number does not provide the caller with any preamble or cost disclosure stating the amount of the charge, or that the call is an international call, which can exceed at least $1.50 per minute. American telephone carriers, pursuant to international agreements, bill consumers for the call and forward the funds collected to the Dominica telephone company, Cable & Wireless (Dominica), Ltd. ("CWD"). After deducting a portion of the revenues from the funds collected by the American telephone carriers, CWD remits the balance of the funds received from the American telephone carriers to those involved in the audiotext business, including, either directly or through some intermediary, defendant(s) UNKNOWN PERPETRATOR(S). 11. Due to time lags between billing, collection and remission of payments, it typically takes a minimum of 60 days from when a consumer calls the Telephone Number until defendant(s) UNKNOWN PERPETRATOR(S) receive payment for the calls to the Telephone Number. 12. From at least October 1998 through late March 1999, defendant(s) UNKNOWN PERPETRATOR(S) sent or caused to be sent, unsolicited commercial e-mail messages ("UCE"), also known as "bulk e-mail" and "junk e-mail," to consumers over the Internet. 13. In several slightly different variations, the UCE state that the recipient's order for unspecified merchandise has been processed and that a sum of money (usually around $300) will be charged to the recipient's credit card account within the next few days. The UCE provides a "transaction" or "reference" number for the alleged order and advises the recipient to call the Telephone Number if he or she has any questions. 14. Consumers are unable to reply to UCE via return e-mail, so they must call the Telephone Number if they want to question or dispute the supposed pending charge to their credit card. 15. When a consumer dials the Telephone Number, he or she quickly discovers that the Telephone Number is not any type of billing center. Rather, dialing the Telephone Number connects the consumer to an adult entertainment audiotext service with a sexual content. Consumers calling the Telephone Number in an attempt to question or dispute the charge, receive a charge on their telephone bills for the international audiotext telephone call to Dominica. VIOLATIONS OF THE FTC ACT COUNT I 16. In numerous instances, in the course of inducing consumers to call an international audiotext entertainment service, defendant(s) represent or represented, expressly or by implication that:
17. In truth and in fact:
18. Therefore, defendant(s)' representations, as set forth above, are false and misleading and constitute deceptive acts or practices in violation of Section 5 of the FTC Act, 15 U.S.C. § 45. CONSUMER INJURY 19. Consumers in many areas of the United States, including the State of North Carolina, have suffered monetary loss as a result of defendant(s)' unlawful acts or practices. Absent injunctive relief by this Court, defendant(s) are likely to continue to injure consumers and harm the public interest. By granting the requested injunctive relief, the Court can dam the defendant(s)' revenue stream by preventing American telephone carriers from remitting the funds they collect for calls to the Telephone Number offshore to CWD and, ultimately, defendant(s) UNKNOWN PERPETRATOR(S). THIS COURT'S POWER TO GRANT RELIEF 20. 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 FTC. 21. This Court, in the exercise of its equitable jurisdiction, may award other ancillary relief to remedy injury caused by defendant(s)' law violations. PRAYER FOR RELIEF WHEREFORE, plaintiff, the Federal Trade Commission, 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:
Date: Respectfully Submitted, ______________________ |