FTC v. Leisure Time Marketing, Inc., et al - Stipulated Final Order as to Khalilian

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION

Case No. 6:00 -Civ-1057-ORL-19B

FEDERAL TRADE COMMISSION, ) Plaintiff,

LEISURE TIME MARKETING, INC., a Florida Corporation;
DISCOVERY RENTAL, INC., d/b/a Discovery Rentals, Inc., a Florida Corporation;
MARLIN SWANSON;
BRITT SHENKMAN;
EDWARD M. SEBASTIAN; and
FEREIDOUN "FRED" KHALILIAN; Defendants.

STIPULATED FINAL ORDER OF PERMANENT INJUNCTION AGAINST FEREIDOUN "FRED" KHALILIAN

Plaintiff, the Federal Trade Commission ("FTC" or "Commission"), having filed its Complaint for a permanent injunction and other relief in this matter, pursuant to Sections 13(b) and 19 of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. §§ 53(b) and 57, and Section 4(a) of the Telemarketing and Consumer Fraud and Abuse Prevention Act, 15 U.S.C. § 6103(a), moved for an ex parte temporary restraining order pursuant to Rule 65 of the Federal Rules of Civil Procedure (Fed. R. Civ. P. 65), and for other equitable relief, including appointment of a temporary receiver, an asset freeze and an order to show cause why a preliminary injunction should not issue. The Court granted the Commission's motion except as to the appointment of a receiver on August 14, 2000. Defendant Fereidoun "Fred" Khalilian and Plaintiff Federal Trade Commission, through their counsel, then stipulated and consented to the terms, conditions, and findings of a stipulated preliminary injunction order without the need of a hearing.

Defendant Fereidoun "Fred" Khalilian, together with Plaintiff Federal Trade Commission, through their counsel, have now agreed to the entry of this Stipulated Final Order of Permanent Injunction ("Final Order") by this Court in order to resolve all matters in dispute against him in this action.

Being fully advised in the premises and acting upon the joint motion of the parties, the Commission and Fereidoun "Fred" Khalilian, to enter into this Final Order,

IT IS HEREBY ORDERED, ADJUDGED, AND DECREED as follows:

1. This Court has jurisdiction of the subject matter of this case and the parties hereto;
: 2. The Complaint states a claim upon which relief may be granted against the Defendant under Section 5, 13(b), and 19 of the FTC Act, 15 U.S.C. §§ 45, 53(b), and 57(b); and the Telemarketing and Consumer Fraud and Abuse Prevention Act, 15 U.S.C. § 6103(a);
: 3. Venue in this district is proper under 28 U.S.C. §1391 (b) and (c), and 15 U.S.C. § 53(b);
: 4. The acts and practices of the Defendant are and were in or affecting commerce, as "commerce" is defined in Section 4 of the FTC Act, 15 U.S.C. § 44;
: 5. Entry of this Final Order is in the public interest;
: 6. Defendant has 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 Order, and further waives and releases the Commission, its employees, agents and representatives, from any claims arising from this action;
: 7. Except as provided in Section VI(F) of this Final Order, this Final Order does not constitute evidence of or an admission by Defendant of any liability or wrongful conduct, including that he has engaged in violation of either the FTC Act, the Telemarketing and Consumer Fraud and Abuse Prevention Act, or the Telemarketing Sales Rule or of any wrongful conduct alleged in the Complaint; and; 8. Except as may be provided for herein, this Order shall supercede all prior Orders by this Court in this case.

DEFINITIONS

For purposes of this Final Order, the following definitions shall apply:

1. "Plaintiff" or "Commission" or "FTC" means the Federal Trade Commission.

2. "Defendant" means Defendant Fereidoun "Fred" Khalilian.

3. "Assets" means all real and personal property of Defendant, or held for the benefit of Defendant, including but not limited to, "goods," "instruments," "equipment," "fixtures," "general intangibles," "inventory," "checks," or "notes," (as these terms are defined in the Uniform Commercial Code), lines of credit and all cash, wherever located.

4. "Substantial assistance or support" means knowingly providing any of the following goods or services to any person or entity engaged in telemarketing:

a. Performing customer service functions for an entity engaged in telemarketing including, but not limited to, receiving or responding to consumer complaints;

b. Formulating or providing, or arranging for the formulation or provision of any telephone sales script or any other marketing material for an entity engaged in telemarketing;

c. Providing names of, or assisting in the generation of, potential customers for any entity engaged in telemarketing; or

d. Performing marketing services of any kind for any entity engaged in telemarketing.

5. Vacation travel package" means any product or service that purports to provide transportation, accommodations, or amenities usable during travel. This definition specifically includes, but is not limited to: travel planning services; booking and reservation services; and certificates, vouchers, coupons, reservation forms or other documents that purport to be full or partial payment, or redeemable, for transportation or accommodations, car rental, tours, sports or other activities, meals, drinks, or entrance to special events or locations.

6. "Telemarketing" shall mean any business activity (including, but not limited to, initiating or receiving telephones calls, managing others who initiate or receive telephone calls, operating an enterprise that initiates or receives telephone calls, or otherwise participating as an officer, director, employee or independent contractor in an enterprise that initiates or receives telephone calls) that involves attempts to induce consumers to purchase any item, good, service, partnership interest, trust interest, or beneficial interest, or to enter a contest for a prize, by means of telephone sales presentations, either exclusively or in conjunction with the use of other forms of telemarketing. Provided, however, that the term "telemarketing" shall not include transactions that are not completed until after a face-to-face contact between the seller or solicitor and the consumers solicited.

ORDER

BAN

IT IS THEREFORE ORDERED that Defendant Fereidoun "Fred" Khalilian, and his officers, agents, directors, employees, salespersons, independent contractors, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and all other persons in active concert or participation with him who receive actual notice of this Final Order by personal service or otherwise, whether acting directly or through any trust, corporation, subsidiary, division or other device, is hereby permanently restrained and enjoined from telemarketing any vacation travel package or providing substantial assistance or support to others engaged in such activities.

PROHIBITED BUSINESS ACTIVITIES

II.

IT IS FURTHER ORDERED that Defendant Fereidoun "Fred" Khalilian, and his officers, agents, directors, employees, salespersons, independent contractors, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and all other persons in active concert or participation with him who receive actual notice of this Final Order by personal service or otherwise, whether acting directly or through any trust, corporation, subsidiary, division or other device, is hereby permanently restrained and enjoined from making expressly or by implication, any false or misleading representation or omission of any material fact in connection with the advertising, marketing, offering for sale or sale of any goods or services, including, but not limited to:

A. Making any misrepresentation that consumers will receive free goods or services;

B. Making any misrepresentation that the price quoted to a consumer in the sales solicitation is the total cost to purchase, receive or use the goods or services; and

C. Failing to disclose in a clear and conspicuous manner the conditions and restrictions to purchase, receive or use the goods or services.

III.

IT IS FURTHER ORDERED that, Defendant, Fereidoun "Fred" Khalilian and his officers, agents, directors, employees, salespersons, independent contractors, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and all other persons in active concert or participation with him who receive actual notice of this Final Order by personal service or otherwise, whether acting directly or through any trust, corporation, subsidiary, division or other device, in connection with the advertising, marketing, offering for sale or sale of any goods or services, is 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:

A. Misrepresenting, directly or by implication, any material restrictions, limitations, or conditions to purchase, receive, or use goods or services, including but not limited to that there are no restrictions, limitations or conditions to purchase or use free goods or services in violation of Section 310.3(a)(2)(ii) of the Telemarketing Sales Rule, 16 C.F.R. § 310.3(a)(2)(ii);
: B. Failing to disclose, in a clear and conspicuous manner before consumers pay for goods or services, the total costs to purchase, receive, or use the goods or services, in violation of Section 310.3(a)(1)(i) of the Telemarketing Sales Rule, 16 C.F.R. § 310.3(a)(1)(i);
: C. Failing to disclose, in a clear and conspicuous manner before consumers pay for goods or services, all material restrictions, limitations or conditions to purchase, receive, or use the goods or services, in violation of Section 310.3(a)(1)(ii) of the Telemarketing Sales Rule, 16 C.F.R. § 310.3(a)(1)(ii) including, but not limited to, that consumers are expected or required to attend sales presentations and the approximate length of such presentations; and
: D. Failing to disclose, in a clear and conspicuous manner before consumers pay for goods or services, that Defendant has a policy of not making refunds, cancellations, exchanges, or repurchases in violation of Section 310.3(a)(1)(iii) of the Telemarketing Sales Rule, 16 C.F.R. § 310.3(a)(1)(iii).

IV.

IT IS FURTHER ORDERED that, Defendant Fereidoun "Fred" Khalilian and his officers, agents, directors, employees, salespersons, independent contractors, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and all other persons in active concert or participation with them who receive actual notice of this Final Order by personal service or otherwise, whether acting directly or through any trust, corporation, subsidiary, division or other device, in connection with the advertising, marketing, offering for sale or sale of any goods or services, is hereby permanently restrained and enjoined from providing substantial assistance or support to any seller or telemarketer, as those terms are defined at 16 C.F.R. § 310.2 (r) and (t) of the Telemarketing Sales Rule, when Defendant knows or consciously avoids knowing that the seller or telemarketer is engaged in any act or practice in violation of the FTC Act or the Telemarketing Sales Rule.

TRANSFER OF FROZEN ASSETS FOR CONSUMER REDRESS

IT IS FURTHER ORDERED that all funds subject to freeze by this Courts' Orders dated August 14, 2000, and August 28, 2000, located in the following accounts, shall be released and transferred to the Commission:

Bank of America:

account 003710789796 (approximate balance, $96,588.55); and

Bank of America:

account 003660670301 (approximate balance $43,808.92).

In addition, the following funds, shall be released and transferred to the Commission:

Bank of America:

trust account of Cove & Associates, P.A. 003660283509 ($45,000.00).

The funds shall be paid to the Commission and shall be used to effect restitution pursuant to Section VI below.

CONSUMER REDRESS

VI.

IT IS FURTHER ORDERED that Defendant shall make restitution as follows:

A. Within three (3) days of entry of this Final Order, Defendant shall pay to the Commission the sum of One Hundred, Eighty-Five Thousand, Three Hundred and Ninety Seven Dollars and forty-seven cents ($185,397.47) for equitable monetary relief, including but not limited to, consumer redress. The payment shall be made by wire transfers from the accounts listed in Section V above to the account of the Federal Trade Commission and shall constitute the "Redress Payment."
: B. The Redress Payment shall be deposited into a redress fund, administered by the Commission, to be used for equitable relief, including but not limited to consumer redress and any attendant expenses for the administration of any redress fund. The Commission, in its sole discretion, may use a designated agent to administer the redress fund.
: C. If the Commission determines, in its sole discretion, that redress to purchasers is wholly or partially impracticable, any funds not so used shall be deposited into the United States Treasury and treated as disgorgement. Defendant shall have no right to contest any decision or action of the FTC or its agent concerning the disbursement or disposition of any funds paid pursuant to this Final Order.
: D. The Redress Payment is intended to be compensatory in nature and no portion thereof shall be deemed a payment of any fine, penalty forfeiture or punitive assessment.
: E. Defendant agrees that the facts as alleged in the Complaint filed in this matter shall be taken as true in any subsequent litigation filed by the Commission to enforce its rights pursuant to this Final Order, including but not limited to a nondischargeability complaint in any subsequent bankruptcy proceeding. Defendant is hereby required, in accordance with 31 U.S.C. § 7701, to furnish to the Commission Defendant's taxpayer identification 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 the Defendant's relationship with the government.

BOND

VII.

IT IS FURTHER ORDERED that Defendant shall obtain a performance bond in the principal sum of Five Hundred Thousand Dollars ($500,000.00) before engaging in the telemarketing of any good or service, directly, indirectly, or in concert with others, or through intermediaries, business entities or other devices. The terms and conditions of the bond requirement are as follows:

A. The performance bond shall be an insurance agreement pledging surety for financial loss issued by a surety company that is admitted to do business in each State in which the bonded Defendant does business and that holds a Federal Certificate of Authority As Acceptable Surety on a Federal Bond and Reinsuring.
: B. The performance bond shall cite this Final Order as the subject matter of the bond and shall provide surety thereunder against financial loss resulting from whole or partial failure of performance due, in whole or in part, to any violation of Section 5 of the FTC Act, 15 U.S.C. § 45, the Telemarketing Sales Rule, 16 C.F.R. Part 310, or the provisions of this Final Order. Such performance bond shall be executed in favor of both (1) the Federal Trade Commission for the benefit of any person injured as a result of any false or misleading representation of material fact made by the bonded Defendant while engaged in telemarketing any goods or services, and (2) any consumer so injured.
: C. The bond shall be deemed continuous and remain in full force and effect as long as the bonded Defendant continues to engage or participate in the telemarketing of any good or service and for at least five (5) years after the Defendant has ceased to engage or participate in the advertising, marketing, promotion, offering for sale, or sale of such good or service.
: D. The bond required by this Section is in addition to, and not in lieu of, any other bond required by Federal, State, or local law.
: E. The bonded Defendant shall provide a copy of the bond required by this Section to the Regional Director of the Commission's Southeast Region at the address specified in Section XIII at least ten (10) days before commencing telemarketing.
: F. The Commission may execute against the performance bond to the extent provided in Section V(B) above, if it demonstrates to this Court, by a preponderance of the evidence, that after the effective date of this Final Order, the bonded Defendant, while engaging or participating in the advertising, marketing, promotion, offering for sale or sale of goods or services, made any false or misleading representation of material fact, expressly or by implication, prohibited by Section 5 of the FTC Act, the Telemarketing Sales Rule, or the provisions of this Final Order.
: G. The Defendant shall not disclose the existence of any performance bond required by this Section to any consumer, or other purchaser or prospective purchaser of any good or service without also disclosing clearly and prominently, at the same time, "AS REQUIRED BY ORDER OF THE U.S. DISTRICT COURT IN SETTLEMENT OF CHARGES OF FALSE AND MISLEADING REPRESENTATIONS IN THE PROMOTION AND SALE OF CERTAIN GOODS AND SERVICES."

RIGHT TO REOPEN

VIII.

IT IS FURTHER ORDERED that the Defendant shall, within three (3) business days after the date of entry of this Final Order, submit to the Commission a truthful sworn statement in the form shown in Attachment A to this Final Order, that shall reaffirm and attest to the truthfulness, accuracy, and completeness of the financial statements that the Defendant provided to the Commission. The Commission's agreement to, and the Court's approval of, this Final Order are expressly premised upon the truthfulness, accuracy, and completeness of these financial statements. If the Court finds that the Defendant failed to disclose any material asset, materially misrepresented the value of any asset, or made any other material misrepresentation or omission in the above-referenced financial statements, the Court shall enter a judgment against the Defendant, in favor of the Commission, in the amount of $11.6 million, and the entire amount of the judgment shall become immediately due and payable.

MONITORING COMPLIANCE OF SALES PERSONNEL

IX.

IT IS FURTHER ORDERED that in connection with any business operated by Defendant, or where Defendant is the majority owner of the business or directly or indirectly manages or controls the business and where the business is engaged in telemarketing any goods and services, Defendant is hereby permanently restrained and enjoined from:

A. Failing to take reasonable steps to monitor and ensure that all employees and independent contractors engaged in sales or other customer service functions comply with this Final Order. Such steps shall include adequate monitoring of sales presentations or other communications with customers, and also shall include, at a minimum, the following: ( 1) listening to the oral representations made by persons engaged in sales or other customer service functions; (2) establishing a procedure for receiving and responding to consumer complaints; and (3) ascertaining the number and nature of consumer complaints regarding transactions in which each employee or independent contractor is involved; provided that this Section does not authorize or require the Defendant to take any steps that violate any federal, state, or local laws;
: B. Failing promptly to investigate fully any consumer complaint received by any business to which this Section applies; and
: C. Failing to take adequate corrective action with respect to any employee or independent contractor who, as determined by the Defendant, is not complying with this Final Order. Corrective action may include training, disciplining, and/or terminating such employee or independent contractor.

ACKNOWLEDGMENT OF RECEIPT OF ORDER BY DEFENDANT

IT IS FURTHER ORDERED that within five (5) business days after receipt by the Defendant of this Final Order as entered by the Court, the Defendant shall submit to the Commission a truthful sworn statement, in the form shown on Attachment "B" that shall acknowledge receipt of this Final Order.

DISTRIBUTION OF ORDER BY DEFENDANT

XI.

IT IS FURTHER ORDERED that for a period of five (5) years from the date of entry of this Final Order, the Defendant shall:

A. Provide a copy of this Final Order to, and obtain a signed and dated acknowledgment of receipt of same from, each officer, director, each individual serving in a management capacity, all personnel involved in responding to complaints or inquiries, and all sales personnel, whether designated as employees, consultants, independent contractors or otherwise, immediately upon employing or retaining any such persons, for any business where Defendant engages in, or is the majority owner of the business or directly or indirectly manages or controls a business which is engaged in telemarketing any goods or services; and

B. Maintain for a period of three (3) years after creation, and upon reasonable notice, make available to representatives of the Commission, the original signed and dated acknowledgment of the receipt of copies of this Order, as required herein.

RECORD KEEPING PROVISIONS

XII.

IT IS FURTHER ORDERED that, for a period of five (5) years from the date of entry of this Final Order, Defendant, in connection with any business operated by him or where he owns or is the majority owner of the business or directly or indirectly manages or controls a business which engages in telemarketing any goods or services, is hereby restrained and enjoined from failing to create, and from failing to retain for a period of five (5) years following the date of such creation, unless otherwise specified:

A. Books, records, and accounts that, in reasonable detail, accurately and fairly reflect the cost of goods and services sold, revenues generated, and the disbursement of such revenues;

B. Records accurately reflecting the name, address, and telephone number of each person employed in any capacity by such business, including as an independent contractor; that person's job title or position; the date upon which the person commenced work; and the date and reason for the person's termination, if applicable. The business subject to this Section shall retain such records for any terminated employee for a period of two (2) years following the date of termination;

C. Records containing the names, addresses, phone numbers, dollar amounts paid, quantity of items or services purchased, and description of items or services purchased, for all consumers to whom such business has sold, invoiced, or shipped any goods or services;

D. Records that reflect, for every consumer complaint or refund request, whether received directly or indirectly or through any third party:

1. The consumer's name, address, telephone number, and the dollar amount paid by the consumer;

2. The written complaint or refund request, if any, and the date of the complaint or refund request;

3. The basis of the complaint, including the name of any salesperson complained against, and the nature and result of any investigation conducted concerning any complaint;

4. Each response and the date of the response;

5. Any final resolution and the date of the final resolution; and

6. In the event of a denial of a refund request, the reason for the denial; and

E. Copies of all sales scripts, training materials, advertisements, or other marketing materials utilized; provided that copies of all sales scripts, training materials, advertisements, or other marketing materials utilized shall be retained for three (3) years after the last date of dissemination of any such materials.

COMPLIANCE REPORTING BY DEFENDANT

XIII.

IT IS FURTHER ORDERED that, in order that compliance with the provisions of this Final Order may be monitored:

A. For a period of five (5) years from the date of entry of this Final Order, the Defendant, to the extent applicable, shall notify the Commission of the following:

1. Any change in Defendant's residence, mailing address, and telephone number within ten (10) days of the date of such change;

2. Any changes in Defendant's employment status (including self-employment) within ten (10) days of such change. Such notice shall include the name and address of each business that Defendant is affiliated with or employed by, a statement of the nature of the business, and a statement of Defendant's duties and responsibilities in connection with the business or employment; and

3. Any proposed change in the structure of any business entity owned or controlled by the Defendant, such as creation, incorporation, dissolution, assignment, sale, merger, creation or dissolution of subsidiaries, proposed filing of a bankruptcy petition, change in the corporate name or address, or any other change that may affect compliance obligations arising our of this Final Order, thirty (30) days prior to the effective date of any proposed change provided, however, that, with respect to any proposed change in the corporation about which Defendant learns less than thirty (30) days prior to the date such action is to take place, Defendant shall notify the Commission as soon as is practicable after learning of such proposed change;

B. One hundred eighty (180) days after the date of entry of this Final Order, the Defendant shall provide a written report to the 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 Final Order. This report shall include, but not be limited to, the following:

1. The Defendant's then current residence address and telephone number;

2. The Defendant's then current employment, business address and telephone numbers, a description of the business activities of such employer, and Defendant's title and responsibilities for each employer;

3. A copy of each acknowledgment of receipt of this Final Order obtained by the Defendant pursuant to Section X;

4. A statement describing the manner in which Defendant has complied and is complying with this Final Order; and

5. A statement indicating whether any performance bond has been obtained by the Defendant pursuant to Section VII, and attaching a copy of such bond so obtained;

C. Upon written request by a representative of the Commission, Defendant shall submit additional written reports (under oath, if requested) and produce documents on fifteen (15) days notice with respect to any conduct subject to this Final Order;

D. For the purposes of this Final Order, Defendant shall, unless otherwise directed by the Commission's authorized representatives, mail all written notifications to the Commission to:

Regional Director

Southeast Region

Federal Trade Commission

Suite 5M35, 60 Forsyth Street, S.W.

Atlanta, Georgia 30303-2322

Re: FTC v. Leisure Time Marketing, Inc.

E. For the purposes of this Section, "employment" includes the performance of services as an employee, consultant, or independent contractor; and "employers" include any individual or entity for whom Defendant performs services as an employee, consultant, or independent contractor; and

F. For purposes of the compliance reporting required by this Section, the Commission is authorized to communicate directly with Defendant.

PLAINTIFF'S AUTHORITY TO MONITOR COMPLIANCE

XIV.

IT IS FURTHER ORDERED that the Commission is authorized to monitor Defendant's compliance with this Final Order by all lawful means, including, but not limited to, the following:

A. To obtain discovery, without further leave of court, from any person in the manner provided by Chapter V of the Federal Rules of Civil Procedure, Fed. R. Civ. P. 26-37, including the use of compulsory process pursuant to Rule 45, Fed. R. Civ. P. 45, for the purpose of monitoring and investigating Defendant's compliance with any provision of this Final Order;

B. To use representatives posing as consumers and suppliers to Defendant, Defendant's employees, or any other entity managed or controlled in whole or in part by Defendant, without the necessity of identification or prior notice; and

C. Nothing in this Final Order shall limit the Commission's lawful use of compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 U.S.C. §§ 49 and 57b-1, to investigate whether Defendant has violated any provision of this Final Order or Section 5 of the FTC Act, 15 U.S.C.§ 45.

ACCESS TO BUSINESS PREMISES

XV.

IT IS FURTHER ORDERED that, for a period of five (5) years from the date of entry of this Final Order, for the purposes of further determining compliance with this Final Order, Defendant shall permit representatives of the Commission:

A. To access, during business hours, any office or facility storing documents of any business operated by Defendant or where Defendant is the majority owner of the business or directly or indirectly manages or controls any part of the business and the business is engaged in telemarketing any goods or services. In providing such access, Defendant shall permit representatives of the Commission to inspect and copy all documents relevant to any matter contained in this Final Order; and shall permit Commission representatives to remove documents relevant to any matter contained in this Final Order for a period not to exceed five (5) business days so that the documents may be inspected, inventoried, and copied; and

B. To interview officers, directors, and employees, including all personnel involved in responding to consumer complaints or inquiries, and all sales personnel, whether designated as employees, consultants, agents, independent contractors or otherwise, of any business to which Subsection A of this Section applies, concerning matters relating to compliance with the terms of this Final Order. The person interviewed may have counsel present. Provided that, upon application of the Commission and for good cause shown, the Court may enter an ex parte order granting immediate access to Defendant's business premises for the purposes of inspecting and copying all documents relevant to any matter contained in this Final Order.

PROHIBITION AGAINST DISCLOSING CUSTOMER IDENTIFICATION INFORMATION

XVI.

IT IS FURTHER ORDERED that Defendant and his officers, agents, directors, employees, salespersons, independent contractors, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and all other persons in active concert or participation with him who receive actual notice of this Final Order by personal service or otherwise, whether acting directly or through any trust, corporation, subsidiary, division or other device, are permanently restrained and enjoined from selling, renting, leasing, transferring, or otherwise disclosing the name, address, telephone number, credit card number, bank account number, e-mail address, or other identifying information of any person who directly or indirectly paid any money to any defendant named in this matter in connection with the advertising, marketing, offering for sale or sale of any vacation travel package by means of telemarketing -at any time prior to entry of this Final Order. Provided however, that Defendant may disclose such identifying information to a law enforcement agency or as required by law, regulation, or court order.

ATTORNEYS' FEES

XVII.

IT IS FURTHER ORDERED that each party to this Final Order hereby agrees to bear its own costs and attorney's fees incurred in connection with this action.

CONTINUING JURISDICTION

XVIII.

IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for all purposes.

SO ORDERED, this _____day of ___________________, 2001, at __________.

__________________________________
Hon. Patricia C. Fawsett
United States District Judge

The parties agree and stipulate to entry of the foregoing Order as a Stipulated Permanent Injunction in this action.

FOR PLAINTIFF FEDERAL TRADE COMMISSION

Dated:

______________________________
Valerie M. Verduce
GA Bar 727066
Federal Trade Commission

______________________________
Barbara E. Bolton
MA Bar 553036
Federal Trade Commission

Trial Attorneys for Plaintiff

Federal Trade Commission

60 Forsyth Street, S.W., Suite 5M35

Atlanta, GA 30303

(404) 656-1390 (voice)

(404) 656-1379 (fax)

FOR DEFENDANT FEREIDOUN "FRED" KHALILIAN

Dated:

____________________________
Fereidoun "Fred" Khalilian
Defendant

Dated:

____________________________
Andrew N. Cove
FL Bar 562122
Cove & Associates

Trial Attorney for Defendant

Fereidoun "Fred" Khalilian

225 S. 21^st Avenue

Hollywood, Florida 33020