United States District Court, M.D. Florida, Orlando Division
REPORT AND RECOMMENDATION
C. IRICK, UNITED STATES MAGISTRATE JUDGE.
cause comes before the Court for consideration without oral
argument on the following motion:
MOTION: RECEIVER'S AMENDED MOTION TO APPROVE
SETTLEMENT WITH MATTHEW LLOYD MCPHEE AND RELATED ENTITIES
FILED: September 6, 2019
THEREON it is RECOMMENDED
that the motion be GRANTED.
4, 2018, the Federal Trade Commission (the FTC), brought this
action against several Defendants - including MOBE Ltd. and
its related entities (collectively, MOBE), Matthew Lloyd
McPhee, and others - for alleged violations of Section 5(a)
of the Federal Trade Commission Act, 15 U.S.C. § 45(a).
Doc. 1 (the Complaint). In the Complaint, the FTC alleged, in
sum, that Defendants operated a fraudulent internet business
education program called “My Online Business Education,
” or the “MOBE” program, through which
Defendants claimed they would reveal a “simple 21-step
system that will show consumers how to quickly and easily
start their own online business and make substantial
income.” Doc. 1 at 2. The FTC further alleged that
contrary to Defendants' representations, “the vast
majority of consumers who join the MOBE program and purchase
. . . costly MOBE memberships lose money.” Id.
at 3. According to the FTC, Defendants defrauded thousands of
consumers who collectively paid Defendants over $125, 000,
000.00 based on misrepresentations by Defendants concerning
the MOBE program. Id. at 3-4.
with the filing of the Complaint, the FTC also moved -
pursuant to Federal Rule of Civil Procedure 65(b) - for a
temporary restraining order, asset freeze, other equitable
relief, and an order to show cause why a preliminary
injunction should not issue against Defendants. Doc. 3. At
the same time, the FTC made an application for a temporary
receiver. Doc. 6. The next day, the Court granted the
FTC's motions, issued a temporary restraining order, and
appointed Mark J. Benet as temporary receiver (the Receiver).
Doc. 13 (the TRO).
other things, the TRO (i) enjoined the Defendants from
violating Section 5(a) of the FTC Act, (ii) enjoined the
Defendants from transferring, liquidating or otherwise
encumbering or disposing of any of their assets, and (iii)
appointed the Receiver as the temporary receiver of the
"Receivership Entities." The TRO has been converted
into a series of agreed preliminary injunctions, containing
essentially the same terms as were contained in the TRO.
See Doc. 94 (stipulated preliminary injunction
pertaining to Russell W. Whitney); Doc. 95 (stipulated
preliminary injunction pertaining to Susan Zanghi); Doc. 107
(stipulated preliminary injunction pertaining to McPhee and
the MOBE Defendants).
the Order Approving Revised Stipulated Preliminary Injunction
(Doc. 107, the Preliminary Injunction), the Court directed
the Receiver to accomplish the following:
B. Take exclusive custody, control, and possession of all
Assets and Documents of, or in the possession, custody, or
under the control of, any Receivership Entity, wherever
C. Conserve, hold, manage, and prevent the loss of all Assets
of the Receivership Entities, and perform all acts necessary
or advisable to preserve the value of those Assets. The
Receiver shall assume control over the income and profits
therefrom and all sums of money now or hereafter due or owing
to the Receivership Entities. The Receiver shall have full
power to sue for, collect, and receive, all Assets of the
Receivership Entities and of other persons or entities whose
interests are now under the direction, possession, custody,
or control of, the Receivership Entities. Provided, however,
that the Receiver shall not attempt to collect any amount
from a consumer if the Receiver believes the consumer's
debt to the Receivership Entities has resulted from the
deceptive acts or practices or other violations of law
alleged in the Complaint in this matter, without prior Court
approval. . . .
* * *
L. Institute, compromise, adjust, appear in, intervene in,
defend, dispose of, or otherwise become party to any legal
action in state, federal or foreign courts or arbitration
proceedings as the Receiver deems necessary and advisable to
preserve or recover the Assets of the Receivership Entities,
or to carry out the Receiver's mandate under this Order,