| WILLIAM E. KOVACIC General Counsel GUY G. WARD JOHN D. JACOBS (CA Bar #134154) Attorneys for Plaintiff IN THE UNITED STATES DISTRICT COURT FEDERAL TRADE COMMISSION, Plaintiff, v. INTERNATIONAL TRADER, a Nevada corporation, doing business as PREMIER BUSINESS SOLUTIONS and AMERICAN DATA SYSTEMS, and BRUCE ANUGWOM, individually, and doing business as PREMIER BUSINESS SOLUTIONS, AMERICAN DATA SYSTEMS, and INTERNATIONAL TRADER, and as an officer and director of INTERNATIONAL TRADER, a Nevada corporation, Defendants. Case No. Plaintiff, the Federal Trade Commission ("FTC" or "Commission"), for its complaint alleges: 1. The FTC brings this action under Sections 5(a) and 13(b) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. §§ 45(a) and 53(b), to obtain permanent injunctive relief, rescission or reformation of contracts, restitution, disgorgement, and other equitable relief for defendants' deceptive acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. §45(a). JURISDICTION AND VENUE 2. Subject matter jurisdiction is conferred upon this Court by 15 U.S.C. §§ 45(a), 53(b), and 28 U.S.C. §§ 1331, 1337(a), and 1345. 3. Venue in the Central District of California is proper under 15 U.S.C. § 53(b) and 28 U.S.C. §§ 1391(b) and (c). PLAINTIFF 4. Plaintiff Federal Trade Commission is an independent agency of the United States Government created by statute. 15 U.S.C. §§ 41 et seq. The Commission enforces Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), which prohibits unfair or deceptive acts or practices in or affecting commerce. The Commission may initiate federal district court proceedings by its own attorneys to enjoin violations of the FTC Act and to secure such equitable relief as may be appropriate in each case, including restitution for injured consumers. 15 U.S.C. § 53(b). DEFENDANTS 5. Defendant International Trader, a Nevada corporation, with its principal place of business at 10680 West Pico Boulevard, #280, Los Angeles, California 90064, promotes and sells work-at-home medical billing employment opportunities. International Trader also does business as Premier Business Solutions and American Data Systems. International Trader transacts or has transacted business in the Central District of California. 6. Defendant Bruce Anugwom is an officer and director of International Trader. Anugwom also does business as Premier Business Solutions, American Data Systems, and International Trader, to promote and sell work-at-home medical billing employment opportunities. Anugwom's principal place of business is located at 10680 West Pico Boulevard, #280, Los Angeles, California 90064. Anugwom resides and transacts business in the Central District of California. 7. Defendants International Trader and Bruce Anugwom have functioned as a common business enterprise and have derived mutual benefit from their relationship. Defendants have used the same and/or similar promotional materials and sales tactics to promote and sell their work-at-home medical billing employment opportunities. COMMERCE 8. At all times relevant to this complaint, defendants have maintained a substantial course of business in the offering for sale and sale of medical billing employment opportunities, in or affecting commerce, as "commerce" is defined in Section 4 of the FTC Act, 15 U.S.C. § 44. DEFENDANTS' BUSINESS PRACTICES 9. Since at least 1998, defendants have offered and sold work-at-home medical billing employment opportunities to consumers throughout the United States. Defendants have promoted their medical billing employment opportunities to prospective purchasers in a variety of media, including classified advertisements in newspapers and on the Internet. 10. In their advertisements, defendants offer medical billing jobs that will pay "up to $35/hour," thereby making representations about the earnings potential of the work-at-home medical billing employment opportunity. Defendants' advertisements urge consumers to call defendants' toll-free telephone number to learn more about the opportunity. 11. For example, defendants' classified advertisements typically state:
12. Consumers who call defendants' toll-free telephone number are ultimately connected to defendants, or their employees or agents, who represent to consumers that in exchange for a payment of $189, consumers will receive everything they need to get started in medical billing, including: (1) contact information for physicians who are in need of outside medical billing work; (2) the computer software necessary to do electronic claims processing for physicians; and (3) training and technical support. 13. Defendants also make representations about the earnings potential of the medical billing employment opportunity without giving consumers access to the information they need to evaluate the claims. For example, defendants claim that consumers will be paid weekly, at a rate of $3 to $5 per claim, and will make between $15 and $45 an hour. Accordingly, the minimum income defendants promise consumers is about $30,000 per year. 14. When consumers receive defendants' medical billing package, it includes a CD and a small booklet. The CD contains medical billing software and a list containing contact information for physicians allegedly in need of medical billing assistance. The booklet explains how to run the CD on a computer. 15. When consumers attempt to contact the physicians on the list provided by defendants, the consumers find that the contact information is inaccurate and/or that the physicians neither want nor need medical billing services. 16. When consumers call defendants to complain or to ask for assistance, they often cannot reach a live representative. Consumers may be given the opportunity to leave their names and numbers, but defendants rarely return the consumers' calls. 17. Few, if any, consumers who purchase defendants' medical billing employment opportunity earn, or will earn, any income. 18. In the initial sales call, defendants also represent to consumers that defendants' medical billing employment opportunity comes with a 90-day money back guarantee. However, when consumers receive defendants' package, they learn that defendants' written refund policy requires: that consumers can return defendants' materials only after keeping them for at least 90 days, but no longer than 120 days; that all returns must be accompanied by a "return authorization number," which consumers can only obtain by calling the defendants; and that a shipping and handling charge and a 10 percent restocking fee will be deducted from the refund. Even when consumers have complied with these conditions, defendants have refused to provide refunds. VIOLATIONS OF SECTION 5 OF THE FTC ACT 19. Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), prohibits unfair or deceptive acts and practices in or affecting commerce. COUNT I 20. In numerous instances, in the course of offering for sale and selling medical billing employment opportunities, defendants or their employees or agents have represented, expressly or by implication, that defendants will furnish the names and addresses of physicians who are likely to use the consumers to process their medical claims. 21. In truth and in fact, in numerous instances, defendants do not furnish the names and addresses of physicians who are likely to use the consumers to process their medical claims. 22. Therefore, defendants' representations as set forth in Paragraph 20 are false and misleading and constitute deceptive acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a). COUNT II 23. In numerous instances, in the course of offering for sale and selling medical billing employment opportunities, defendants or their employees or agents have represented, expressly or by implication, that consumers who purchase defendants' medical billing employment opportunity will earn a specific level of earnings, such as $15 to $45 per hour. 24. In truth and in fact, few, if any, consumers who purchase defendants' medical billing employment opportunity earn, or will earn, the specific level of earnings represented by defendants. 25. Therefore, defendants' representations as set forth in Paragraph 23 are false and misleading and constitute deceptive acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a). COUNT III 26. In numerous instances, in the course of offering for sale and sale of medical billing employment opportunities, defendants or their employees or agents have represented, expressly or by implication, that consumers can readily obtain refunds upon request. 27. In truth and in fact, in numerous instances, consumers cannot readily obtain refunds upon request. 28. Therefore, defendants' representations as set forth in Paragraph 26 are false and misleading and constitute deceptive acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a). CONSUMER INJURY 29. Consumers in many areas of the United States have suffered substantial monetary loss as a result of defendants' unlawful acts or practices. Absent injunctive relief by this Court, defendants are likely to continue to injure consumers and harm the public interest. THIS COURT'S POWER TO GRANT RELIEF 30. 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. 31. This Court, in the exercise of its equitable jurisdiction, may award other ancillary relief to remedy injury caused by defendants' law violations. PRAYER FOR RELIEF WHEREFORE, plaintiff the Federal Trade Commission, pursuant to Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), and the Court's own equitable powers, requests that the Court:
Respectfully Submitted, WILLIAM E. KOVACIC Dated:_________________ ___________________________ JOHN D. JACOBS (CA Bar #134154) |