Case 3:06-cv- VPC Document 82 Filed 10/03/2007€¦ · Case 3:06-cv-00578-HDM-VPC Document 82 Filed...
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Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 1 of 24
UNTED STATES DISTRICT COURT . DISTRICT OF NEVADA
Federal Trade Commssion
Plaiti 3:06-CV-00578-HDM-VPC
ORDER ERG Ventues, LLC, et aI.
Defendats.
, "
Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 2 of 24
STIPULATED FINAL ORDER FOR PERMNT INJUCTION MONETARY JUGMENT AS TO DEFENDANTS ERG VENTURS, LLC,
ELLIOTT S. CAMRON. ROBERT A. DAVIDSON. II. AN GARY E. HIL or the "Commssion ), fied its
complaint agait defendants ERG Ventues, ILC and d//a ERG Ventues, LLC2, Media
5 Motor, Joysticksavers.com, and Privateinublic.com; Ellott S. Cameron, individually and d//a
6 ERG Ventues ILC2 Media Motor, Joysticksavers.com, and Privateinublic.com; Robert A.
Plainti the Federal Trade Commssion FTC"
Davidson, II individualy and d//a ERG Ventues , ILC2 , Media Motor, J oysticksavers.com,
and Privateinublic.com; Garr E. Hill individually and d//a ERG Ventues , LLC2, Media
9 Motor, Joysticksavers.com, and Privateinublic.com; and Timothy P. Taylor, individualy and
10 d//a Team Taylor Made for injUnctive and other equitable relief in ths matter pursuant to
Sections 5 and 13(b) of the Federal Trade Commssion Act ("FTC Act"), 15 US.C. 9 45(a),
12 53(b), on October 31 , 2006. . The Cour ordered an ex parte Temporar Restraing Order
13 November 1 , 2006, and a Preliar Injunction was entered on November 29, 2006. The
14 Commission and defendants ERG Ventues, LLC, Ellott S. Cameron, Robert A. Davidson, il
15 and Gar E. Hill, hereby stipulate to the entr of, and request the CoUr to enter, ths Stipulated
16 Final Order for Permanent Injunction and Monetar Judgment as to defendants ERG Ventues
17 LLC, Ellott S. Cameron, Robert A. Davidson, il, and Gan E. Hi ("Order ), to resolve all
18 matters of dispute between them in ths action.
IT IS THEREFORE STIPULATED, AGREED, AN ORDERED as follows:
Ths Cour has jursdiction over the subject matter of ths case, and it has
jurisllction of all pares hereto pursuant to 15 US.C. 99 45(a), 53(b), and 28
C. 99 1331 , 1337(a) and 1345;
Venue is proper as to all partes in the Distrct of Nevada pursuant to 15 U.
C. 99 1391(b) and (c); 9 53(b) and 28 U.
. The activities alleged in the amended complaint are in or affectig "commerce" as
that term is defied in Section 4 of the FTC Act, 15 U.S.C. 9 44;
The facts that the FTC has stated in its amended complait, if tre, would state a
claim upon which relief may be granted under Sections 5(a) and 13(b) of the FTC
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Act, 15 U.S.C. g~ 45(a) and 53(b);
ERG Ventues, LLC, Elliott S. Cameron, Robert A. Davidson, II and GarrE.
Hi have entered into ths Order freely and without coercion, and they
acknowledge that they haye read the provisions of ths Order and are prepared
abide hy them;
The undersigned, individually and by and though their counsel, as applicable
have agreed that the entr of ths Order resolves all matters of dispute between
them arsing from the amended complaint in this action, up to the date of entr of
. this Order. Ths Order, however, shall have no preclusive effect as to any action
brought by any other state or federal law enforcement agency;
ERG Ventues, LLC, Ellott S. Cameron, Robert A. Davidson, IT and Gar
Hi waive al rights to seek appellate review or otherse challenge or contest the
validity of ths Order and waive and release any clain they may have against the
Commssion, its employees, representatives, or agents;
ERG Ventues, LLC, Ellott S. Cameron, Robert A. Davidson, n, and Gar
Hi agree that ths Order does not entitle them to seek or to obtai attorneys ' fees
as a prevailig par under the Equal Access to Justice Act, 28 US.C. 92412, as
amended by Pub. L. 104-121 , 110 Stat. 847 , 863-64 (1996), and they fuher
waive any rights to attorneys ' fees that may arise under said provision oflaw;
Ths Order is remedial in natue and no porton of any payments paid herein shall
be deemed or constred as payment of a fie, damages, penalty, or puntive
assessment; and
10. Entr of this Order is in the public interest.
ORDER
DEFINTIONS
For the pUIpose of this Order, the following defitions shall apply:
Defendants" means, individually, collectively or in any combination: ERG Ventues
LLC d//a ERG Ventues , LLC2, Giant Ventues, LLC, Media Motor, IMGiant
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Joysticksavers.com, PrivateInublic.com, Megalocast.com, and Popuppers.com; Ellott S.
Cameron d//a ERG Ventues, LLC2, Giant Ventues, LLC, Media Motor, IMGiant
Joysticks avers. com, PrivateInublic.com, Megalocast.com, and Popuppers.com
individually and as an offcer of ERG Ventues, LLC and Giant Ventues, LLC; Robert
A. Davidson, II d//a ERG Ventues, LLC2, Giant Ventues, LLC, Media Motor
IMGiant, Joysticksavers.com, PrivateInublic.com, Megalocast.com, and
Popuppers.com, individually and as an offcer of ERG Ventues, LLC and Giant
Ventues, LLC; and Garr E. Hil d//a ERG Ventues ILC2 Giant Ventues, ILC
Media Motor, IMGiant, Joysticksavers.com, PrivateInublic.com, Megalocast.com, and
Popuppers.com, individually and as an offcer of ERG Ventues, LLC and Giant
Ventues, LLC; as well as their successors and assign/3.
Individual Defendant(s)" means Ellott S. Cameron d//a ERG Ventues, LLC2, Giant
Ventues, LLC, Media Motor, IMGiant, Joysticksavers.com, PrivateInublic.com
Megalocast.com, and Popuppers.com; RobertA. Davidson, n d//a ERG Ventues
LLC2, Giant Ventues, LLC, Media Motor, IMGiant, Joysticks avers. com,
PrivateInublic.com, Megalocast.com, and Popuppers.com; and Gar E. Hi d//a ERG
Ventues, LLC2, Giant Ventues, LLC , Media Motor, IMGiant, Joysticksavers.com,
PrivateInublic.com, Megalocast.com, and Popuppers.com.
Corporate Defendant(s)" mean ERG Ventues, LLC d//a ERG Ventues, LLC2
Giant Ventues, LLC, Media Motor, IMGiant, Joysticksavers.com, PrivateInublic.
Megalocast.com, and Popuppers.com, as well as their successors and assigns.
Assets" means any legal or equitable interest in, right to , or clai to, any real, personal
or intellectual propert of any of the Corporate Defendants or Individual Defendants, or
held for the benefit of any Corporate Defendants or Individual Defendants, wherever
located, includig, but not lited to, chattel, goods, instruents, equipment, fixtues
general intangibles, effects, leaseholds, contracts, mail or other deliveries, shares of stock
inventory, checks, notes, accounts, credits, receivables (as those terms are defied in the
Uniform Commercial Code), cash, and trsts, includig but not limted to any other trt - 4
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held for the benefit of any Corporate Defendant or Individual Defendant, or any of the
Individual Defendants ' mior children , or spouses. .
Document" is synonymous in meang and equal in scope to the usage of the term in
the Federal Rules of Civil Procedure 34(a), and includes wrting, drawigs, graphs
chars, Internet sites, Web pages, Web sites, electronically-stored inormation, includig
e-mail and instant messages, photographs , audio and video 'recordigs, contracts
accounting data, advertisements (includig, but not lited to , advertsements placed on
the World Wide Web), FTP Logs, Server Access Logs, USENET N ewsgroup postings
Web pages , books, wrtten or prited records, handwritten notes, telephone logs,
telephone scripts, receipt books, ledgers, personal and business canceled checks and
11' check registers, bank statements, appointment books, computer records, and other data
stored in any medium from which inormation can be obtained and translated. A draft or
non-identical copy is a separate document withi the meang of the term.
Affate Program(s)" mean an arangement under which any of the Defendants payor
offer to pay another ("the afliate ) to maret, adverise, distibute, download or install
softare or other goods or services on behalf of any of the Defendants, with the afliate
. 17 being paid based on performance measures, such as the number of softare installations
or downoads.
Softare" means any fie, program, application, content, code or set of instrctions that
controls, diects, orassists In the operation of a computer and/or intrcts a computer as
to what tasks to perform.
CONDUCT PROHIITIONS
IT IS THEREFORE ORDERED that the Defendants, as well as their offcers, agents
servants, employees and those persons in active concert or paricipation with them who receive
actual notice of ths Order by personal service or otherwise, are permanently restraied and
enjoined from, prior to instalg any Softare diectly or indirectly on consumers ' computers:
1) failig to clearly and conspicuously disclose the name and fuction of all such Softare (the
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Requied Disclosure ); and 2) failg to provide, imediately after the Required Disclosure is
made, a clearly and conspicuously disclosed option to prevent the installation of all such
Softare, which, when exercised by the consumer, prevents the installation of all such Softare.
ll.
IT IS FURTHER ORDERED that the Defendants , as well as their offcers, agents
servants, employees and those persons in active concert or parcipation with them who receive
actual notice of ths Order by personal service or otherwise, are permanently restraied and
enjoined from, diectly or indiectly, publishig, dissemiatig, distrbutig, intallg, or
downoading any Softare that interferes with a consumer s computer use, includig but not
lited to Softare that:
tracks consumers ' Internet activity or collects other personal inormation;
changes consumers ' preferred Internet homepage settgs; inerts a new adversing toolbar onto consumers ' Internet browsers;
generates numerous "pop up" advertsements on consumers ' computer screens
even when consumers ' Internet browsers are closed;
adds advertising icons to the computer s desktop;
tampers with, disables, or otherwise alters the performance of other programs
includig anti-spyware and anti-vis programs;
alters Internet browser securty settgs , includig the list of safe or trsted
websites; or
installs other adversing Softare on consumers ' computers.
ID.
IT IS FURTHR ORDERED that, in connection with distrbutig or advertising,
promotig, marketing, offerig for sale or license, or sellg or licensing, any product or service
the Defendants, as well as their offcers, agents, servants, employees and those persons in active
concert or parcipation with them who receive actual notice of ths Order by personal servce or
otherwse, are permanently restrained and enjoined from makg, or assisting others in malcig,
diectly or indirectly, expressly or by implication, any material false or misleading representation.
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MONETARY JUGMENT
IV.
IT IS FUTHR ORDERED that:
Judgment in the.amount of $3 596 757 (three millon, five hundred niety-six
thousand, seven hundred fift-seven dollars) is hereby enteredjointly and
severally agaist the Defendants.
Ths judgment shall be suspended, except as follows:
With five (5) days afer the date of entr of ths Order, Defendants shall:
1) pay $82 000 (eighty-two thousand dollarg) from the frozen accounts
listed in Attachment A to the United States Internal Revenue Servce
IR"), as provided in sub-paragraph 3 below; and 2) pay the remaing
balance of all accoUnts listed in Attachment A (approxiately $208 000)
to the Commssion py wire transfer in accord with diections provided by
the Commssion.
Defendat Gar E. Hill agrees to assign all right, title and interest in his
share of the Wilam A. Hi and Haret A. Hill Famly Trust ("
Famiy Trust") to the Commssion, as follows:
Except as provided in sub-section iii below, Defendant Hi hereby
diects the Trustee of the Hil Famy Trust ("Hill Trustee ) to pay
directly to the Commssion all distributions, payments or assets to
which Defendant Hi is entitled under the Hi Family Trust by
utilizing the wire instrctions to be provided by the Commssion to
the Hill Trustee, or by such other method as prescribed by the
Commssion;
11. Should the Hi Trustee fail to pay Defendant Hil' s share of the
Hill Famly Trust to the Commssion in a timely maner
Defendant Hill shall, at his own expense, commence and prosecute
a suit against the Hi Trustee in the appropriate court to compel
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the Hin Trustee to pay Defendat Hill' s share of the Hill Famly
Trust to the Commssion;
ll. If Defendant Hi complies with sub-subsections i and ii above
the Commssion shall not object to Defendant Hi rece vig and
retaing items that the Hi Trustee has determed to be of lited intrsic value or marketabilty, provided that such items appear on
the Willam A. & HaIet A. Hill Famiy Trust Personal Propert
Inventory dated December 31 , 2005. This language shall not
requie or otherw e impact the Hill Trustee s discretion, as
provided in the Trut, to detere whether Defendant Hill is
entitled to any or all of these items.
Withi five (5) days afer the date of entr of this Order, the IDdividual
Defendants shall pay the followig totals to the IRS from the frozen
accounts listed in ,Attachment A in order to wholly or parally satisfy
15. their 2006 federal tax liabilty:
Ellott S. Cameron: $29 712 (twenty-nie thousand, seven
17. hundred and twelve dollar)
Robert A. Davidson: $32 054 (th-two thousand, fi-four
dollars)
GaE. Hill: $20;234 (twenty thousand, two hundred and thty
four dollas)
With fieen (15) days of the tax payments, each Individual Defendant
shall provide wrtten proof to the Commssion of the payments, includig
copies of cancelled checks and as-fied copies of their 2006 federal tax
retus. Any portion of the Defendants ' federal tax liability not satisfied
by the payments made pursuant to ths sub-paragraph shall be the sole
responsibilty of the Defendants, and shall not be paid from fuds due
the Commssion pursuant to sub-paragrphs B(I) and B(2) of ths
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Paragraph. In the event the 2006 federal tax liabilty of any of the
Defendants is less than the totals set fort in ths sub-paragraph, the
Defendants shall pay the difference to the Commssion.
Defendants agree that they wil not, whether acting directly or though
any corporation, parership, subsidiar, division, trade name, device, or
other entity, submit to any federal or state tax authority any retu
amended retu, or other offcial document that takes a deduction for, or
seeks a tax refud or other favorable tax treatment for, any payments by
. one or more of the Defendants pursuant to Paragraph IV of ths Order.
Defendants futher agre they wi not seek a credit or refud of any kid for federal taxes or penalties paid for tax year 2006. However, if the
Defendants otherwse obtai a credit or refud of any federal taxes or
penalties paid for tax year 2006 the Defendants shall promptly pay the
Commssion the amount of such credit or refud, together with any
interest the Defendants have eared in connection with any such credit or
refud.
All fuds paid to the FTC pursuant to the Order shall be deposited into an
account admstered by the CoITssion or its agent to be used for equitable
relief, includig but not lited to consumer redress, and any attendant expenses
for the admstration of such equitable relief. In the event that diect redress to
consers is wholly or partialy impracticable or fuds remai after redress is
completed, the Commssion may apply any remaig fuds for such other
equitable relief (includig consumer inormation remedies) as it determes to
reasonably related to the Defendants ' practices alleged in the amended
complait. Any fuds not used for such equtable relief shall be deposited to the
United States Treasur as disgorgement. The Defendants shall have no right to
chalenge the Commssion s choice of remedies under ths Paragraph. The
Defendants shall have no right to contest tJe maner of distrbution chosen by
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the Commssion.
The Defendants reliquish all domion, control and title to the fuds paid
into the account established pursuant to this Order. The Defendants shall make
no claim to or demand for the retu of fuds, directly or indiectly, though
counselor otherwse; and in the event of banptcy of any such defendant, the
Defendants acknowledge that the fuds are not par of the debtor s estate, nor
does the estate have any claim or interest therein.
e Commssion s agreement to ths Order is expressly premised upon the
trthlness, accuacy and completeness of the Defendants' sworn fiancial
statements and supportg documents submitted to the Commssion, as well as all
subsequent addenda thereto, all of which the Defendants stipulate are trthl
accurate, and complete. The Defendants and the Commsion stipulate that these
fiancial disclosures provide the basis for the assets listed in Attachment A to
this Order and include material inormation upon which the Commssion relied in
15: gotiatig and agreeing to ths Order. The Defendants and the Comms ion
stipulate that the Commssion has relied on the trthess, accuracy, and
completeness of these fiancial disclosures in agreeing to the terms of ths Order
and that the Commssion would not have entered into ths Order but for the
trthlness, accuracy, and completeness of these fiancial disclosures.
, upon motion by the Commssion, ths Cour fids that the Defendants
have failed to disclose any material asset or materially misstated the value of any
asset in the fiancial statement or related documents described above, or have
made any other material misstatement or omission in the fiancial statements or
related documents described above, then ths Order shall be reopened and
suspension of the judgment shall be lifted for the purose of requig payment
monetar relief in the amount of the judgment set fort in sub-paragraph A of ths
Paragraph, less the sum of any amounts paid to the Commssi"on pursuant to
sub-paragraph B of ths Paragraph. Provided, however that in all other respects
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ths Order shall remai in full force and effect, uness otherwise ordered by the
Cour.
Upon such reinstatement of the monetar judgement, the Cour shall make an
express determation that the monetar judgment shall be imediately due and
payable. The Commssion shall be entitled to interest on the judgment, computed
from the day of entr of this Order, at the rate prescribed by 18 US.C. g 1961 , as
amended. The Commssion shall be perittd to execute on the judgment
imediately after the suspension is lifted and engage in discovery in aid of
execution.
The Defendants agree that the facts as aleged in :the amended complaint fied in
ths action shall be taken as tre for the purose of a nondischargeability
complaint in any banptcy proceedig.
Proceedigs instituted imder ths Paragraph ar in addition to, and not in lieu of
any other civil or criminal remedies that may be provided by law, includig any
other proceedigs the Commssion may intiate to enforce ths Order.
LIFTING OF ASSET FREZE
IT IS FUTHER ORDERED that the fteeze against the assets of the Defendants
19 pursuant to Paragraph il otthe Preliar Injunction Order entered by ths Cour on November
29, 2006 ("Preliar Injunction ), shal be lied for the sole purose of tranferrg fuds
pursuant to Paragraph IV of ths Order, and shall be dissolved upon tranfer of all such fuds.
COMPLIACE MOMTORIG
VI.
IT IS FURTHER ORDE D that, for puroses of monitorig and investigatig
compliance with any provision of this Order
With ten (10) days of receipt of wrtten notice from a representative of the
Commssion, Ellott S. Cameron, Robert A. Davidson, n, Gar E. Hi and ERG
Ventues, LLC, each shall submit additional wrtten reports, sworn to under
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penalty of perjur; produce documents for inspection and copyig; appear for
deposition; and/or provide entr during normal business hour to any business
location in such defendant' s possession or diect or indiect control to inspect the
" business operation;
In addition, the Co:ission is authorized to monitor compliance with ths Order
by all other lawfu mean, including but not lited to the following:
obtaing discovery from any person, without fuer leave of cour, using
the procedures prescribed by Fed. R. Civ. P. 30 , and 45"
posing as consumers and suppliers to Defendants, Defendants ' employees
or any other entity managed or controlled in whole or in part by Elliott S.
Cameron, Robert A. Davidson, II GaIT E. Hill or ERG Ventues, LLC
without the necessity of identifcation or prior notice; and
Defendants shall permt representatives of the Commssion to intervew any
employer, consultant, independent contractor, representative, agent, or employee
who has agieed to such an intervew, relatig in any way to any conduct subject to
ths Order. The person interviewed may have coUnel present.
that nothig in ths Order shall lit the Commssion s lawfl use of
compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 U.S.C. 9949, 57b- , to
19 obtai any docume:Qtar material, tangible things, testiony, or inormation relevant to unair or
deceptive acts or practices in or affecting commerce (with the meang of 15
Provided, however,
C.
45 (a)(I)).
MONITORIG BY DEFENDANTS
VI.
IT IS FURTHR ORDERED that, for a period of eight (8) years from the date of entr
25 'of this Order, the Individual and Corporate Defendants, and their offcers , agents , diectors
employees, salespersons, independent contractors, subsidiares , affliates, successors , assign,
and al other persons in active concert or parcipation with any of them who receive actual notice
of this Order by personal service or otherwse, in connection with the advertsing, promotion
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marke ing, offerg for sale, sale, or provision of any goods or services on or though the Interet
t4e Wodd Wide Web , or any web page or web site, are hereby permanently restr ined and
. enjoined from failig to:
Obtai contact inormation from any partcipant in any Afliate Program. In the
. case pf a natual person, Defendants shall 0 btair the parcipant' fit and last
name, physical address, countr, telephone number, and e-mail address. In the
case of other business entities, Defendants shall obtain the fist and last name
physical address, countr, telephone number, and e-mail address for the natual
. person who owns , manages, or controls the paricipant.
Prior to any such prospective partcipant' s acceptance into any Afliate Progrm,
(1) provide each such person a copy of ths Order; (2) obtai from each such
person a signed and dated statement acknowledgig receipt of this Order and
expressly agreeing to comply with ths Order; and (3) clearly and promiently
disclose that engaging in acts or practices prohibited by this Order wil result
15 . immediate termation of the affliate and forfeitue of al monies received or
owed;
Establish, implement, and maintain an Internet-based mechanism, includig, but
not lited to, e-mail that enables: (1) consumers to report complaints to
Defendants regardig the practices of any affliate program parcipant; (2)
Defendats to associate, correctly, each such complait with the affliate that is
the subject of the complaint; and (3) Defendants to receive and respond to such
complaints, whether received diectly or indirectly, in a tiely maner.
Defendants shall clearly and promiently disclose the existence of such reporting
mechansm on their websites;
Promptly and completely investigate any complaits received through Paragraph
VI(C) or any other source to determe whether any such participant is engagig
in acts or practices prohibited by ths Order; and
Termate, imediately, any paricipant in any Afliate Program that Defendants
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reasonably conclude has engaged in or is engagig in acts or practices prohibited
by ths Order and cease payments to any such person.
vided, however, that ths Paragraph does not authorize or requie Defendants to take
. any action that violates any federal, state, or local law.
COMPLIACE REPORTING BY DEFENDANTS
VI. IT IS FURTHER ORDERED that, in order that compliance with the provisio:p of this
Order may be monitored:
For a period of five (5) years from the date of entr of ths Order
Ellott S. Cameron, Robert A. Davidson, II and Gan . Hi, shall noti the Commssion o the followig:
Any changes in residence, mailig addresses, and telephone
numbers of any Individual Defendant with ten (10) days of the date of such change;
Any changes in employment status (includig self-employment), of
any Individual Defendat and any change in the ownership of the
Individual Defendant in any business entity, with ten (10) days of
the date of such change. Such notice shal include the name and
address of each business that the Individual Defendant is affliated
with, employed by, creates or forms, or performs services for; a
statement of the natue of the business; and a statement of the
Individual Defendant' s duties and responsibilties in connection
with the business or employment; and
il. Any changes in the Individual Defendant' s name or use of any
aliases or fictitious names; and
Defendants ERG Ventues , ILC, Ellott S. Cameron, Robert A. Davidson, II and
Gar E. Hill shall noti the Commssion of any changes in corporate strctue of
ERG Ventues, LLC or any business entity that an Individual Defendat directly
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, or indiectly controls, or has an ownership interest in, that may affect compliance,
obligations arsing under ths Order, includig but not lited to a dissolution
assignent, sale, merger, or other action that would result in the emergence ofa
successor entity; the creation or dissolution of a subsidiar, parent, or afliate that
engages in any acts or practices subj ect to ths Order; the fig of banptcy petition; or a change in the corporate nae. or address, at least thi (30) days
prior to such change provided that, with respect to any proposed change in the
corporation about which the defendant(s) leam less than thty (30) days prior to
the date such action is to take place, defendant(s) shall notifY the Commssion as
soon as is practicable after obtaig such knowledge.
One hundred eighty (180) days after the date of entr of ths Order, defendants
ERG Ventues, LLC, Ellott S. Cameron, Robert A. Davidson, II and Gar Hi each shall provide a wrtten report to the FTC, sworn to under penalty of
perjur, setting fort in detai the maner and form in which they have complied
and are complyig with ths Order. This report shal include, but not be lited to:
For each Individual Defendat:
The then-curent residence address, mailg addresses, and
telephone numbers ofthe Individual Defendat;
The then-curent employment an business addresses and
telephone numbers of the Individual Defendant, a description of
the business activities of each such employer or business, and the
title and responsibilties of the Individual Defendant for each such
employer or business; and
Any other changes required to be reported under sub-paragraph A
of ths Paragraph.
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For all the Defendants:
A copy of each acknowledgment of receipt of ths Order obta
by each defendant pursuant to Paragraphs vn, X and XI of this
Order; and
Any other changes requied to be reported under sub-paragraph A
of ths Paragraph.
With ten (10) days of a request by the Commssion, each of the Defendants shall
complete, sign, date and submit to the IRS , along with the requisite IRS fee, IRS
, Form 4506 diectig that certfied copies of the Defendant' s federal tax retus and any amep.ded retus for tax years 2006 and 2007 be sent to the Commssion
at the address in sub-paragraph E.
For the puroses of ths Order, Defendants shall, uness otherwise directed by the
Commssion s authoried representatives, mail all wrtten notications to the
Commssion to:
Associate Director, Division of Enforcement Federal Trade Commssion 600 Pennylvana Avenue, NW Washigton, DC 20580 Re: FTC v. ERG Ventues. LLC. eta!. Civil Action No. 3:06-00578
For puroses of the compliance reportg and monitorig requied by ths Order
the Commssion is authorized to communcate diectly with the Defendants.
RECORD KEEPING PROVISIONS
IX.
22- IT IS FURTHER ORDERED that, for a period of eight (8) years from the date of entr
of ths Order, defendats ERG Ventues ILC Ellott S. Cameron, Robert A. Davidson, II and
Garr E. Hi, for any business that such defendant diectly or indiectly controls, or in which
such defendant has a majority ownership interest, which is diectly or indiectly engaged in the
business of advertsing, promotig, marketig, offerig for sale or license, or sellg or licensing
any product or service via the Interet, and their agents, ernployees, offcers, corporations
successors, and assigns , and those persons in active concert or paricipation with them who
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Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 17 of 24
receive actual notice of ths Order by personal servce or otherwise, are hereby restraied and
enjoined from faig to create and retai the following records:
. Accountig records that reflect the cost of goods or services sold, revenues
generated, and the disbursement of such revenues;
Personnel records accurately reflecting: the name, address, and telephone number
of each person employed in any capacity by such business, includig 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 tennation, if
applicable;
Customer files contaig the names, address , phone numbers , dollar amounts
paid, quantity of items or servces purchased, and description of items or services
purchased, to the extent such inormation is obtained in the ordiar course of
business;
Records reflectig contact inormation and a detaied payment history for all
persons and entities engaged in the marketig, distrbutig, or intallg of
Softare at the diection of, or for the benefit of, the Defendats.
Complaits and refud requests (whether received diectly, indiectly or though
arythid par) and any responses to those complaints or requests;
Copies of all advertsements or other marketing materials, includig but not
lited to web sites, instant messages, e-mail messages, Internet "pop up
advertsements, and Internet baner advertisements; and
All records and documents necessar to demonstrate fu compliance with each
provision of ths Order, includig but not lited to , copies of acknowledgments
of receipt of ths Order equied by Paragraphs vn, X, and XI and all reports
submitted to the FTC pursuant to Paragraphs vm and IX of ths Order.
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Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 18 of 24
DISTRIUTION OF ORDER BY DEFENDANTS
IT IS FUTHER ORDERED that, for a period of five (5) years from the date of entr
of ths Order, the Defendants shall deliver copies of the Order as diected below:
Corporate Defendants: Defendant ERG Ventues, LLC must deliver a copy of
ths Order to all of its pricipals, offcers, diectors, and managers as well as its
employees, agents, affliates, sub-affliates, and representatives who engage in
conduct related to the subject matter of ths Order. For curent personnel, delivery
shall be with five (5) days of service of ths Order upon such defendants. For
new personnel, delivery shall occu prior to the new personnel assug their
responsibilities.
. B. Individual Defendant as Control Person: For any business that defendat Ellott
S. Cameron, Robert A. Davidson, n, or Gar E. Hill directly or indiectly control
or in which such Individual Defendat has a majority ownership interest, the
Individual Defendant must deliver a copy of ths Order to all pricipals, offcers
diectors, and managers of that business. The Individual Defendat must also
deliver copies of ths Order to all employees, agents, affliates, sub-affliates, and
representatives of that business who engage in conduct related to the subj ect
matter of this Order. For curent personnel, delivery shall be made with five (5) days ' of serice of ths Order upon such defendants. For new personnel, delivery
shall occu prior to the new personnel assumg their responsibilities.
Individual Defendant as Employee or Non-Control Person: For any business
which an Individual Defendant is not a controllg person of the business but
otherwise engages in conduct that is related to the subject matter of ths Order, the
Individual Defendant must deliver a copy of this Order to all pricipals and
managers of such business before engagig in such conduct.
Defendants ERG Ventues , LLC, Ellott S. Cameron, Robert A. Davidson, II and
Gar E. Hi must secure a signed and dated statement aclmowledgig receipt of
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..
Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 19 of 24
the Order, withi th (30) days of delivery, from all persons receivig a copy of
the Order pursuant to this Paragraph.
ACKNOWLEDGMENT OF RECEIPT OF ORDER BY DEFENDANTS
XI.
IT IS FURTHR ORDERED that each of the Defendants, within five (5) business days
of receipt of this Order as entered by the Cour, must submit to the Commssion a trthl sworn
statement acknowledging receipt of ths Order.
RETENTION OF JUSDICTION
XI. IT IS FURTHR ORDERED that this Cour shall retain jurisdiction of this matter for
puroses of constrction, modification, and enforcement of this Order.
SeptemberSO ORDERED, this day of , 2007, at Reno
14 Nevada.
The Honorable Howard D. McKibben United States District JudgeDistrct of Nevada, Reno
Stipulated and agreed to by:
Dated: r ('7/07o" Defendat
Dated: Robert A. Davidson, II Defendant
Dated:Gar E. Hil, Defendant
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.'
Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 20 of 24
the Order, within thirt (30) days of delivery, from all persons receiving a copy of
the Order pursuant to this Paragraph.
ACKNOWLEDGMENT OF RECEIPT OF ORDER BY DEFENDANTS
XI.
IT IS FURTHER ORDERED that each of the Defendants, within five (5) business days
of receipt of this Order as entered by the Court, must submit to the Commission a truthful swam
statement acknowledging receipt of this Order.
RETENTION OF JURISDICTION
XII.
IT IS FURTHER ORDERED that this Cour shall retain jurisdiction of this matter for
purposes of constrction, modification, and enforcement of this Order.
SO ORDERED, this day of , 2007 , at Reno
Nevada.
The Honorable Howard D. McKibben United States District Judge District of Nevada, Reno
Stipulated and agreed to by:
Dated:
Dated: (/ild/u/
Dated: Garry E. Hil, Defendant
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Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 21 of 24
the Order, within thirt (30) days of delivery, from all persons receiving a copy of
the Order pursuant to this Paragraph.
ACKNOWLEDGMENT OF RECEIPT OF ORDER BY DEFENDANTS
XI.
IT IS FURmER ORDERED that each of the Defendants, within five (5) business days
of receipt of this Order as entered by the Cour, must submit to the Commission a trthful sworn
statement acknowledging receipt of this Order.
RETENTION OF JURISDICTION
XII.
IT IS FURmER ORDERED that this Cour shall retain jursdiction of this matter for
puroses of constrction, modification, and enforcement of this Order.
SO ORDERED, this day of , 2007 , at Reno
14 Nevada.
The Honorable Howard D. McKibben United States District JudgeDistrct of Nevada, Reno
Stipulated and agreed to by:
Dated:20 Elliott S. Cameron, Defendant
Dated: Robert A. Davidson, II, Defendant
Dated: (iJ /rt7'1
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Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 22 of 24
Dated:
Dated: Dennis Kennedy Leah Martin Kimberly McGhee Bailey Merrll Attorneys for Defendants ERG Ventues , LLC Robert A. Davidson, II, and Gar E. Hil 8691 W. Sahara Ave. , Suite 200 Las Vegas, NY 89117-8820
10 (702) 562-8820
Dated: Ethan Arenson
13 Colleen B. Robbins Attorneys for Plaintiff
14 Federal Trade Commission 600 Pennsylvania Avenue, NW
, DC 2058015 Washington(202) 326-2204; (202) 326-2548
Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 23 of 24
Dated:. as CE
ERG Ventures, LLC, Defendant ar4 '
5 , '-Dated; Cf
I/oe: IS. cnne y /0 7 Leah Martin Kimberly McGhee Bailey Mcail Attorneys for Defendants ERG Ven.tures, LLC,Robert A. Davidso II, and Garr E. Hil
9 8691, W. Sahara Ave., Suite 200 Las Vegas, NV 89117-8820
10 (702) 562-8820
1/'J7/Dated:t an enson 13 Colleen:8- Robbins
Attorneys for Plaintiff14 Federal Trade Commssion
600 Pennsylvania A venue, NW15 Washington, DC 20580
(202) 326 2204; (202) 326-2548
Case 3:06-cv-00578-HDM-VPC Document 82 Filed 10/03/2007 Page 24. of 24
ATTACHMNT A
Defendants ' Bank Accounts Frozen Pursuant To The Asset Freeze
Bank Name/Source
Bancorp South.
Bancorp South
Bancorp South
Bancorp South
Fidelity Investments
Regions Banc
Regions Banc
Chase
Pacifc Premier Ban Wells Fargo Ban
Wells Fargo Ban
Pentagon Federal Credit Union
SCE Federal Credit Union
US Ban NA
Account Description
Checkig
Savings
Windows Media Solutions Checkig
Certficate of Deposit
Roth
Regions Free Checkig
Regions Free Checkig
Commercial Checkig
Checkig Account
Checkig Account
Savings Account
Regular Share Account
Power Checkig
Checkig Account
N anie of Account Holder Robert Davidson, II
Robert Davidson, II
Robert Davidson, n
Robert DavidSon, n
. Robert Davidson, n
Robert Davidson, II
Robert Davidson, n
ERG Ventues, LLC
Gar Hill Gar Hill
Garr
Gar Hi
Ellott Cameron
Ellott Cameron