STIPULATED CONSENT DECREE AND FINAL JUDGMENT
[ECF No. 27]
JENNIFER A. DORSEY, District Judge.
Plaintiff, the United States of America, brought this action against Patricia Kern; Advanced Allocation System, Inc.; Distribution Reporting Center, Inc.; Global Data Funding, Inc.; Marketing Image Direct, Inc.; Montgomery Marketing, Inc. LLC.; North American Disbursement Agency, Inc.; Pacific Allocation Systems, Inc.; Special Money Managers, Inc.; Al American Awards, Inc.; Golden Products Service, Inc.; Edgar Del Rio; NSD Products, Inc.; Sea O'Connor; Epifanio Castro; New Generation Graphics, Inc.; Andrea Burrow; Stephen Fennell; and Neptune Data Services, Inc., by filing a complaint pursuant to the Fraud Injunction Statute, 18 U.S.C. § 1345. This Court granted the United States' ex parte application for a temporary restraining order on February 20, 2018, finding that (1) the United States could likely succeed in defendants are violating or are about to violate 18 U.S.C. §§ 1341 and 1349 by executing a scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent representations with the intent to defraud using the U.S. Mail; (2) the equities weigh in favor of an injunction; and (3) an injunction is in the public's interest. Finding good cause to do so, on March 2, 2018, the Court extended the temporary restraining order until April 24, 2018.
Plaintiff and defendant Stephen Fennell and Neptune Data Services, Inc. (hereinafter the "Settling Defendants") stipulate to entry of this Consent Decree and Final Judgment ("Consent Decree") to resolve all matters in dispute in this action between them. IT IS HEREBY ADJUDGED, ORDERED, AND DECREED as follows:
FINDINGS
1. This Court has jurisdiction over this matter and the parties.
2. The Complaint charges that defendants violated are violating, or are about to violate 18 U .S.C. §§ 1341 and 1349 by executing schemes and artifices to defraud or for obtaining money or property my means of false or fraudulent representations with the intent to defraud, and, in so doing, use the United States Mail.
3. Settling Defendants neither admit nor deny any allegations in the Complaint, except as specifically stated in this Order. Only for purposes of this action, Settling Defendants admit the facts necessary to establish jurisdiction.
DEFINITIONS
1. "Caging Services" refers to opening mail; entering or inputting data about such mail into a database or forwarding such data; handling, forwarding, or depositing payments received in such mail, including currency, bank checks, certified checks, money orders, or credit card charge authorizations; or handling or forwarding any such mail;
2. "Covered Materials" refers to any materials that contain advertisements, solicitations, promotions, and/or any other materials:
a. that represent, directly or indirectly, expressly or impliedly that the recipient has won, will win, or will receive cash, awards, or prizes;
b. that represent, directly or indirectly, expressly or impliedly that the recipient will receive delivery of cash, awards, or other prizes in return for payment of a fee;
c. that offer for sale information regarding sweepstakes or lotteries;
d. that represent, directly or indirectly, expressly or impliedly, that the recipient of the solicitation was specifically selected to receive the mailing based on a reason other than the fact that the recipient's name appears on a mailing list;
e. that offer for a fee the following items or services:
i. Wealth-Building Programs, meaning instructions, reports, or programs which provide purportedly guaranteed results or methods for making money or an item purportedly guaranteed to provide the user with luck or wealth;
ii. Psychics, meaning persons (actual or fictitious) that are presented in mailed solicitations or other solicitations to consumers as having psychic, clairvoyant, or other such similar special abilities; or
f. that contain any other false or misleading representations.
3. "Customer List(s)" refers to any compilation including personal information—such as the name, address, telephone number, email address, social security number, other identifying information, or data that enables access to a person's account (including a credit card, bank account, or other financial account—that was compiled in whole or in part from individuals who have responded to any Covered Materials.
4. "Fee" refers to a payment of any kind, including but not limited to: processing fees, service fees, expediting fees, purchase fees, nominal fees, symbolic payments, gifts and gratuities.
5. "Payment Processing Services" refers to handling credit card transactions, debit card transactions, Automated Clearing House (ACH) transactions, check transactions, money orders, travelers check transactions, or cash transactions.
PROHIBITED ACTIVITIES
I. Pursuant to 18 U.S.C. § 1345 and the inherent power of this Court, Settling Defendants, their agents, officers, employees, and successors and all other persons and entities i active concert or participation with them are permanently enjoined from:
A. committing mail fraud as defined by 18 U.S.C. §§ 1341 and 1349;
B. using the United States mail, or causing others to use the United States mail, to distribute any Covered Materials;
c. printing, or causing others to print, any Covered Materials that will be distributed through the United States mail;
D. receiving, handling, opening, or forwarding any correspondence transmitted through the United States mail that responds, by sending payment or otherwise, t any Covered Materials;
E. disclosing, using, benefitting from, selling, offering for sale, leasing, renting, brokering or licensing any Customer Lists;
F. disclosing, using, benefitting from, selling, offering for sale, leasing, renting, brokering or licensing any lists compiled from or consisting in whole or in part o United States residents where such lists will be used to address any Covered Materials;
G. compiling Customer Lists;
H. performing, or causing others to perform, Caging Services on correspondence transmitted through the United States mail in response to any Covered Materials;
I. performing, or causing others to perform, Payment Processing Services for payments received from U.S. residents in response to any Covered Materials; or
J. acting as a consultant (whether paid or unpaid) for any person engaged in any of the conduct described in Subparagraph I(A)-(1), above.
BUSINESS OPERATIONS
II. Settling Defendants represent to the Court that, as the time of entry of this Consent Decree, they are not engaging in any activities relating to the creation, rental, sale, distribution, use, or maintenance of any lists of containing personal information, including Customer Lists. Settling Defendants shall not engage in such activities for ten ( 10) years from the entry of this Consent Decree.
RETENTION OF CUSTOMER LISTS AND COVERED MATERIALS
III. Within seven (7) days of entry of this Consent Decree, the Settling Defendants ar ordered to provide to Settling Defendants' legal counsel all copies of (I) any Customer Lists and (2) any Covered Materials that are currently in their possession, custody or control. Settling Defendants shall also provide a copy of such Customer Lists and Covered Materials to counsel of record for the United States in this matter and shall not retain in their possession or control any copies of such Customer Lists or Covered Materials. Within seven (7) days of entry of this Consent Decree, Settling Defendants shall also direct any third parties that are in custody of Settling Defendants' Customer Lists and Covered Materials, excluding Settling Defendants' legal counsel, to provide all copies of such materials to counsel of record for the United States in this matter and not to retain any copies of such materials in the third party's possession, custody or control, provided however that these third parties may also provide a copy of such Customer Lists and Covered Materials to their own retained counsel. Within fourteen (14) days of entry o this Consent Decree, Settling Defendants shall provide counsel of record for the United States a certification in the form attached here as Exhibit A, sworn under penalty of perjury before a loca notary, detailing what materials, if any, were provided to Settling Defendants' legal counsel and to counsel of record for the United States in this matter, and certifying that Settling Defendants no longer have in their possession any such materials.
NOTICE TO THIRD PARTIES
IV. Within five (5) days of entry of this Consent Decree, Settling Defendants shall provide copies of this Consent Decree to all direct mailers, graphic designers/artists, list brokers, printer/distributors, mailing houses, caging services, and/or payment processors with which they reasonably have determined they done business at any time with respect to any Covered Materials distributed through the United States mail. Within seven (7) days of entry of this Consent Decree, Settling Defendants shall provide proof of such notice to the Court and the United States, including the name and addresses of the entities and/or individuals to whom the notice was sent, how the notice was sent, when the notice was sent, and a copy of the notice.
OWNERSHIP OF MAIL
v. Settling Defendants disclaim any ownership interest in mail responsive to any Covered Materials. The United States Postal Inspection Service is authorized to open any and al United States Mail that was detained pursuant to any order of this Court and any mail responsive to Covered Materials in its possession, custody, or control. The United States Postal Inspection Service shall return any currency, bearer instruments (including but not limited to money orders and travelers checks), and any personal effects that can be positively identified with its sender contained in any mail opened pursuant to this paragraph. This return shall include a letter notifying the sender of the disposition of this matter, attached here as Exhibit B. The United States Postal Inspection Service is authorized to destroy any and all remaining detained mail (including but not limited to envelopes, order forms, correspondence, personal checks, and payment card information (PCI)).
ORDER ACKNOWLEDGEMENT
VI. Within five (5) days after entry of this Consent Decree, the Settling Defendants are ordered to submit to the United States' counsel of record in this action a written acknowledgement of this Consent Decree sworn under penalty of perjury.
SIGNATORIES, INTEGRATION, MODIFICATION, & WAIVER
VII. The undersigned parties and counsel each represent that he, she or it is fully authorized to enter into the terms and conditions of this Consent Decree and to execute and legally bind to this document the party which he, she, or it represents.
VIII. This Consent Decree constitutes the final, complete, and exclusive agreement and understanding among the Parties with respect to the settlement embodied in the Consent Decree and supersedes all prior agreements and understandings, whether oral or written, concerning the settlement embodied herein (other than deliverables that are subsequently submitted and approved pursuant to this Decree). The parties acknowledge that there are no representations, agreements, or understandings relating to the settlement other than those expressly contained in this Consent Decree. This Consent Decree may be signed by the parties and counsel in counterparts, each of which constitutes an original and all of which constitute one of the same Consent Decree. Signatures delivered by facsimile transmission, or as .pdf attachments to emails, shall constitute acceptable, binding signatures for purposes of this Consent Decree.
IX. The Consent Decree shall not be modified except in writing by Plaintiff and the Settling Defendants and approved by the Court.
X. Settling Defendants agree: (1) to waive all rights to appeal or otherwise challeng or contest the validity of this Consent Decree; (2) to waive, release, and remit any and all claims, either directly or indirectly against the United States and its agencies, employees, representatives and agents, including but not limited to the Department of Justice, the United States Postal Inspection Service, and their employees, with respect to this action.
XL Plaintiff and the Settling Defendants agree to bear their own costs and attorneys' fees in this action.
FINALITY AND RETENTION OF JURISDICTION
XII. This Court retains jurisdiction of this action for the purposes of enforcing or modifying this Consent Decree and for the purpose of granting such additional relief as may be necessary or appropriate.
XIII. This Consent Decree shall constitute a final judgment and order in this action as to Settling Defendant.
IT IS SO ORDERED.
Exhibit A
Exhibit B
