Federal Trade Commission v. Affordable Media, LLC
case brief summary
179 F.3d 1228 (1999)
CASE FACTS
Defendants-appellants formed a limited liability company to serve as the primary telemarketer of media units. The group was unable to sell enough products to return the promised yields to the media-unit investors, but the group was able to take the later investors' investments to pay the promised yields to earlier investors, which was a classic Ponzi scheme. Plaintiff-appellee filed a complaint, charging appellants and others with violations of the Federal Trade Commission Act and the Telemarketing Sales Rule for their participation in a scheme to telemarket fraudulent investments to consumers. A preliminary injunction was entered against appellants, which required appellants to repatriate any assets held for their benefit outside of the United States. Appellants refused to comply with the order and the lower court held them in civil contempt of court.
DISCUSSION
CONCLUSION
The court of appeals affirmed the lower court's decision that found defendants-appellants in civil contempt of court when they failed to comply with a preliminary injunction. The court found that there was no clear error in the lower court's finding that appellants remained in control of their trust and could repatriate the trust assets and therefore the only action the lower court could have taken was to hold appellants in contempt.
Suggested Study Aids For Wills, Trusts & Estate Law
179 F.3d 1228 (1999)
CASE SYNOPSIS
Defendants-appellants
challenged a decision of the United States District Court for the
District of Nevada that found appellants in civil contempt of court
after they failed to comply with a preliminary injunction when they
refused to return their illicit proceeds. An action was brought
against appellants by plaintiff-appellee to recover as much money as
possible for defrauded investors in appellants' telemarketing scheme.CASE FACTS
Defendants-appellants formed a limited liability company to serve as the primary telemarketer of media units. The group was unable to sell enough products to return the promised yields to the media-unit investors, but the group was able to take the later investors' investments to pay the promised yields to earlier investors, which was a classic Ponzi scheme. Plaintiff-appellee filed a complaint, charging appellants and others with violations of the Federal Trade Commission Act and the Telemarketing Sales Rule for their participation in a scheme to telemarket fraudulent investments to consumers. A preliminary injunction was entered against appellants, which required appellants to repatriate any assets held for their benefit outside of the United States. Appellants refused to comply with the order and the lower court held them in civil contempt of court.
DISCUSSION
- The appellate court affirmed the lower court's decision.
- The court found that because there was no clear error in the lower court's finding that appellants remained in control of their trust and could repatriate the trust assets, the lower court did not abuse its discretion in holding them in contempt.
CONCLUSION
The court of appeals affirmed the lower court's decision that found defendants-appellants in civil contempt of court when they failed to comply with a preliminary injunction. The court found that there was no clear error in the lower court's finding that appellants remained in control of their trust and could repatriate the trust assets and therefore the only action the lower court could have taken was to hold appellants in contempt.
Suggested Study Aids For Wills, Trusts & Estate Law
No comments:
Post a Comment