UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
FEDERAL TRADE COMMISSION,
STATE OF ILLINOIS,
COMMONWEALTH OF KENTUCKY, and
STATE OF NORTH CAROLINA,
Plaintiffs,
v.
FORTUNE HI-TECH MARKETING, INC.,
A Kentucky corporation,
FHTM, INC., a Kentucky corporation
ALAN CLARK HOLDINGS, LLC, a Kentucky corporation,
FHTM CANADA, INC., a Canadian corporation,
FORTUNE NETWORK MARKETING (UK) LIMITED,
An United Kingdom Private Limited Company
PAUL C. ORBERSON, and
THOMAS A. MILLS,
Defendants.
13cv578
Judge John W. Darrah
Magistrate Arlander Keys
RECEIVED
JAN 24 2013
THOMAS G. BRUTON
CLERK, U.S. DISTRICT COURT
COMPLAINT FOR PERMANENT INJUNCTION AND OTHER EQUITABLE RELIEF
Plaintiffs, the Federal Trade Commission (“FTC”), the State of Illinois, the Commonwealth of Kentucky, and the State of North Carolina, for their Complaint, allege:
1. Plaintiff FTC brings this action under Section 13(b) of the Federal Trade
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Commission Act (“FTC Act”) 15 U.S.C. § 53 (b), to obtain temporary, preliminary, and permanent injunctive relief, rescission or reformation of contracts, restitution, the refund of monies paid, disgorgement of ill-gotten monies, and other equitable relief for Defendants’ acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).
2. The State of Illinois brings this action under Section 7(a) of the Illinois Consumer Fraud Act, 815 ILCS 505/7(a), to obtain a preliminary or permanent injuction, restitution, and civil penalties against Defendants for engaging in deceptive acts or practices in violation of the Illinois Consumer Fraud Act, 815 ILCS 505/1 et seq.
3. The Commonwealth of Kentucky, by and through Jack Conway, Attorney General of Kentucky, brings this action pursuant to the Kentucky Consumer Protection Act, K.R.S. 367.010 et seq., and under the Kentucky Pyramid Sales Act, K.R.S. 367.832 et seq., to obtain a permanent injunction, preliminary relief, consumer restitution, damages, civil penalties, and reimbursement of its costs, expenses and attorney’s fees against Defendants for their violations of the Kentucky Consumer Protection Act and provisions of the Kentucky Pyramid Sales Act.
4. The State of North Carolina, by and through its Attorney General, Roy Cooper, brings this action for violations of the North Carolina Pyramid and Chain Schemes Statute, N.C. Gen. Stat. § 14-291.2, and the North Carolina Unfair and Deceptive Practices Act, N.C. Gen. Stat § 75-1.1, et seq., to obtain temporarty and permanent injunctive relief, restitution for consumers, civil penalties, and attorneys’ fees pursuant to N.C. Gen. Stat. §§ 14-291.2, 75-1.1, 75-14, 75-15.1, 75-15.2, and 75-16.1.
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JURISDICTION AND VENUE
5. This Court has subject matter jurisdiction over the FTC’s claims pursuant to 28 U.S.C. §§ 1331, 1337(a), and 1345, and 15 U.S.C. §§ 45(a) and 53(b).
6. This Court has supplemental jurisdiction over the claims fo Plaintiffs State of Illinois, Commonwealth of Kentucky, and State of North Carolina, pursuant to 28 U.S.C. § 1367.
7. Venue is proper in this district under and 28 U.S.C. § 1391(b), (c), and (d), and 15 U.S.C. § 53(b).
PLAINTIFFS
8. Plaintiff, the FTC, is an independent agency of the United States Government created by statute. 15 U.S.C. §§ 41-58. The FTC enforces Section 5(a) of the FTC Act, 15 U.S.CC. § 45(a), which prohibits unfair or deceptive acts or practices in or affecting commerce.
9. The FTC is authorized to 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 rescission or reformation of contracts, restitution, the refund of monies paid, and the disgorgement of ill-gotten monies. 15 U.S.C. §§ 53(b) and 56(a)(2)(A).
10. Plaintiff State of Illinois is one of the fifty sovereign states of the United States. Lisa Madigan is the duly elected and qualified Attorney General acting for Plaintiff State of Illinois, and brings this action for and on behalf of the People of the State of Illinois, pursuant to the provisions of the Consumer Fraud and Deceptive Business Practices Act, 815 ILCS §§ 505/1 et seq., and her common law authority as Attorney General to represent the People of the State of Illinois.
11. Plaintiff Commonwealth of Kentucky is one of the fifty sovereign states of the United States. Jack Conway is the duly elected and qualified Attorney General acting for
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Plaintiff Commonwealth of Kentucky, and brings this action under the Kentucky Consumer Protection Act, K.R.S. 367.010 et seq. and the Kentucky Pyramid Sales Act, K.R.S. 367.832 et seq.
12. Plaintiff State of North Carolina is one of the fifty sovereign states of the United States. Roy Cooper is the duly elected and qualifies Attorney General acting for Plaintiff State of North Carolina and brings this action pursuant to authority granted under Chapters 75 and 114 of the North Carolina General Statutes for violations of the North Carolina Pyramid and Chain Schemes Statute, N.C. Gen. Stat. § 14-291.2, and the North Carolina Unfair and Deceptive Trade Practices Act, N.C. Gen. Stat. § 75-1.1 et seq.
DEFENDANTS
13. Defendant Fortune Hi-Tech Marketing, Inc., is a Kentucky corporation with its principal place of business at 880 Corporate Dr., Suite 300, Lexington, Kentucky 40503. Fortune Hi-Tech Marketing, Inc., transacts or has transacted business in this district and throughout the United States.
14. Defentand FHTM, Inc., is a Kentucky corporation with its principal place of business at 880 Corporate Dr., Suite 300, Lexington, Kentucky 40503. FHTM, Inc., transacts or has transacted business in this district and throughout the United States.
15. Defendant Alan Clark Holdings, LLC, is a Kentucky limited liability company with its principal place fo business at 20 Gose Pike, Danville, Kentucky 40422. Alan Clark Holdings, LLC transacts or has transacted business in this district and throughout the United States.
16. Defendant FHTM Canada, Inc., is a Canadian corporation that has its registered office in Ottawa, Ontario, but its principal place of business at 880 Corporate Dr., Suites 200 and
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300, Lexington, Kentucky 40503. FHTM Canada, Inc., transacts or has transacted business in this district and throughout the United States.
17. Defendant Fortune Network Marketing (UK) Limited, is a United Kingdom Private Limited Company that has its registered office in Berkshire, United Kingdom, but its principal place of business at 880 Corporate Dr., Suites 200 and 300, Lexington, Kentucky 40503. Fortune Network Marketing (UK) Limited transacts or has transacted business in this district and throughout the United States.
18. Defendant Paul Orberson is the President and Director of Fortune Hi-Tech Marketing, Inc. and FHTM, Inc., a Member of Alan Clark Holdings, Inc., and a Director of FHTM Canada, Inc. At all times material to this Compaint, acting alone or in concert with others, he has formulated, directed, controlled, had the authority to control, or participated in the acts and practices of the corporate Defendants, including the acts and practices set forth in this Complaint. Defendant Orberson, in connection with the matters alleged herein, transacts or has transacted business in this district and throughout the United States.
19. Defendant Thomas A. Mills is the Chief Executive Officer of Fortune Hi-Tech Marketing, Inc., the Vice President and Director of FHTM, Inc, a Member of Alan Clark Holdings, Inc., a Director of FHTM Canada, Inc., and Director and Chief Executive Officer of Fortune Network Marketing (UK) Limited. At all times material to this Complaint, acting alone or in concert with others, he has formulated, directed, controlled, had the authority to control, or participated in the acts and practices of the corporate Defendants, including the acts and practices set forth in this Complaint. Defendant Mills, in connection with the matters alleged herein, transacts or has transacted business in this district and throughout the United States.
20. Defendants Fortune Hi-Tech Marketing, Inc., FHTM, Inc., Alan Clark Holdings,
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